M/S.Venkatrayar Sago Factory v. Idbi Bank Limited

IN THE HIGH COURT OF JUDICATURE AT MADRAS

DATED : 20.03.2024 CORAM :

THE HON'BLE MR.SANJAY V.GANGAPURWALA , CHIEF JUSTICE AND THE HON'BLE MR.JUSTICE D.BHARATHA CHAKRAVARTHY C.R.P.(PD).No.4497 of 2023

1. M/s. Venkatrayar Sago Factory, S.F.No.272/4A, Velampalayam road, Kakkaveri, Rasipuram taluk, Namakkal District - 637 408.

2. M/s. K.Venkatraman & Co., 1/169, K.K.Thottam, Velampalayam road, Kakkaveri, Rasipuram taluk, Namakkal District - 637 408.

3. V.Dinesh Kumar

4. K.Vengataraman .. Petitioners

Versus

1. IDBI Bank Limited, Rep. by its Deputy General Manager, Pradusha Bollepallai

2. D.Gayathri

3. V.Prabhavathi .. Respondents Prayer : Civil Revision Petition filed under Article 227 of the Constitution of India to strike off proceedings in Criminal M.P.No.1145 of 2022 on the file of the learned Chief Judicial Magistrate, Namakkal filed by the 1/6

respondent under Sections 14(1) & (2) of Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. For Petitioner : Mr.N.Suresh For Respondents : Mr.Shivakumar for M/s.Shivakumar and Suresh, for R1

ORDER

(Order of the Court is made by the Hon'ble Chief Justice) Heard Mr.N.Suresh, learned Counsel for the petitioner and Mr.Shivakumar, learned Counsel for the first respondent.

2. The petitioner is challenging the proceedings initiated by the respondent Bank under Section 14 of the SARFAESI Act, 2002 (hereinafter referred to as 'the Act').

3. The learned Counsel for the petitioner submits that the respondent Bank admitted that 14.77 acres out of 33 acres of the land, mortgaged by the petitioner, is an agricultural land. The provisions of the Act do not apply to an agricultural land and as such, the proceedings initiated under Section 14 of the Act in respect of an agricultural land are illegal and not maintainable. The learned Counsel, to buttress his submissions, relies upon the reply given 2/6

by the authorised officer under Section 13(3A) of the Act, so also the possession notice issued under Rule 8(1) of the Security Interest (Enforcement) Rules, 2002 and the interim orders passed by the Debts Recovery Tribunal, Madurai.

4. Per contra, the learned Counsel for the respondent Bank submits that the respondent Bank is taking possession of the assets such as the factory building and other appurtenances over the land mortgaged. The application under Section 14 of the Act is filed for possession of the land mortgaged wherein the factory premises are also situated along with other appurtenances.

5. There cannot be any dispute with the proposition that agricultural lands are exempted from the operation of the Act in view of the Section 31(i) of the said Act.

6. Whether the factory building exists on the land, for which, the application under Section 14 of the Act is filed or there are some other appurtenances on the said land, will have to be considered by the authority / 3/6

learned Chief Judicial Magistrate with whom the application under Section 14 of the Act is filed and pending.

7. According to the respondent Bank, an amount of Rs.142 crores is due and payable by the petitioner. We are not inclined to exercise our writ jurisdiction under Article 226 of the Constitution of India in view of the disputed questions of fact involved in the matter. The location of the property, the appurtenances over the property mortgaged all will have to be considered by the learned Chief Judicial Magistrate, Namakkal.

8. In the light of that, the learned Chief Judicial Magistrate, Namakkal may consider all the relevant aspects of the matter while deciding the application under Section 14 of the Act. This Civil Revision Petition is dismissed. There shall be no order as to costs. Consequently, C.M.P.No.27030 of 2023 is closed.

(S.V.G., CJ.) (D.B.C., J.) 20.03.2024 Index : yes/no Speaking order/Non-speaking order : yes/no grs 4/6

To The Deputy General Manager, IDBI Bank Limited, No.111, Ground Floor, K.T.Towers, 4 roads, Omalur Main Road, Salem - 636 007.

THE HON'BLE CHIEF JUSTICE AND D.BHARATHA CHAKRAVARTHY, J.

grs C.R.P.(PD).No.4497 of 2023 5/6

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