M/S Datsun India And Anr vs Debts Recovery Tribunal Iii And Anr on 16 February, 2024

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Punjab-Haryana High Court

M/S Datsun India And Anr vs Debts Recovery Tribunal Iii And Anr on 16 February, 2024

Author: Lisa Gill

Bench: Lisa Gill


CWP No.3443 of 2024 (O&M). -1-


CWP No.3443 of 2024 (O&M)
Date of Decision: 16.02.2024

sesees Petitioner(s)


.... Respondent(s)


Present: Mr. Manuj Nagrath, Advocate

for petitioners.
36 2% 2 24

1. Prayer in this writ petition is for quashing order dated 19.12.2023

(Annexure P-11), passed by learned Debt Recovery Tribunal-III, Chandigarh,
(for short DRT-III), whereby SA No.197 of 2023 has been dismissed.

2. Learned counsel for petitioners submits that petitioner no.1 is a
firm engaged in the business of sale and purchase of staple pins and petitioner
no.2 is its proprietor. Petitioners availed of cash credit facility from Allahabad
Bank by mortgaging three residential properties. There was financial
indiscipline, for reasons as may be, pursuant to which proceedings under
Securitization and Reconstruction of Financial Assets and Enforcement of
Security Interest Act, 2002 (hereinafter referred to as SARFAESI Act) were
initiated against petitioners. Notice dated 01.07.2016 was issued under
Section 13(2) of SARFAESI Act seeking recovery of an amount of

Rs.3,69,834,36.88/. Objections are stated to have been filed but to no avail. It

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CWP No.3443 of 2024 (O&M). -2-

is contended that notice dated 04.12.2019 was issued by Tehsildar-cum-
Executive Magistrate, Ludhiana, for compliance of order dated 19.06.2017,
passed by learned Additional District Magistrate, Ludhiana, despite the fact
that said order under Section 14 of SARFAESI Act was never passed in
favour of respondent no.2 — reconstruction company i.e. ASREC(India) Ltd.
CWP-3896-2020 was filed by petitioners, which was ultimately dismissed as
infructuous on 19.05.2022 as matter was settled between parties.

3. However, subsequently on fresh cause of action which
purportedly arose, petitioners filed CWP-24824-2021 before this Court
challenging subsequent measures undertaken by respondent–reconstruction
company under SARFAESI Act. It was also pleaded therein that petitioners’
proposal for One Time Settlement was not considered. Interim order was
passed in said writ petition to the effect that in case a sum of Rs.1 crore is
deposited by petitioners with the respondent-reconstruction company in a no
lien account within two weeks, sale which was proposed to be held on
11.03.2022, would proceed but not be confirmed and in default of payment,
said order shall stand vacated. Subsequently, it was noted in order dated
23.02.2023 in CM-3389-CWP-2023 in CWP-24824-2021 that learned counsel
upon instructions from Mr. Rajesh Sharma, authorized representative of M/s.
Datsun India undertook that a draft of Rs.1.32 crores in favour of creditor
would be furnished on the adjourned date. Needful was not done and further
time was sought for deposit of said amount. Ultimately, CWP-24824-2021
was disposed of on 24.04.2023 with liberty to petitioners to approach the
Tribunal as and when cause of action arose under Section 17(3) of SARFAESI

Act. It was observed that alternate and efficacious remedy was available to

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CWP No.3443 of 2024 (O&M). -3-

petitioners before learned Tribunal. SA No.291 of 2017 filed by petitioners
stood dismissed and CWP-3896-2020 dismissed in view of settlement. No
ground for continuance of said proceedings was found Relevant part of order

dated 24.04.2023 reads as under:-

“4. A perusal of the paper-book would also go on to
show that SA No.291 of 2017 filed by the petitioners before
the Tribunal challenging the SARFAESIT notices was
dismissed on 03.04.2017 and the said order was
unsuccessfully challenged before this Court. It also
transpires that CWP No.38956 of 2020 was filed which
was dismissed on 19.05.2022 on the ground that the matter
had been settled between the parties.

5. It has also been averred in the written statement that
SA has not been revived and the physical possession of the
property was with the Bank, but the petitioners tried to
forcibly break the locks. A perusal of the paperbook further
goes on to show that notice under Section 13 (4) of the
2002 Act (for short ‘2002 Act’) has been issued on
15.10.2016 (Annexure P-5) and apparently in pursuance of
the same the securitization application had been filed by
the petitioners. The outstandings are huge and the
recovery of public money has been held up. Even otherwise
in spite of an undertaking given the petitioners have not
complied with the same and it also amounts to contempt of
this Court, but this Court does not wish to go into the said

6. Resultantly, keeping in view the fact that there is an
alternate and efficacious remedy available before the
Tribunal, which was availed, we are of the considered
opinion that no further purpose would be served by
keeping the matter pending since the petitioners are not
willing to deposit the amount as undertaken. Accordingly,

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CWP No.3443 of 2024 (O&M). -4-

the present writ petition is disposed of with the liberty to
the petitioners to approach the Tribunal, as and when
cause of action arises, under section 17 (3) of the 2002
Act, in view of the law laid down in SLP No. 22021-22022
of 2022, M/s. South India Bank Ltd. and others vs. Naveen
Mathew Philip and another decided on 17.04.2023.”

4. It is submitted that petitioners subsequently filed SA No.197 of
2023 in August, 2023. Said SA was dismissed vide impugned order dated
19.12.2023. Review application was filed by petitioners on 11.01.2024 but
the same, it is submitted had not been listed for hearing whereas auction
notice dated 25.01.2024 (Annexure P-13) has been issued. Petitioners have
also approached learned DRT-III, Chandigarh for preponement of hearing of
Review Application but the same is yet to be listed. Copy of application is
attached with the writ petition as Annexure P-14.

5. Learned counsel for petitioners vehemently argued that dismissal
of SA No.197 of 2023 by learned DRT merely on the ground of delay is illegal
and arbitrary. It has wrongly been held by learned DRT-III, Chandigarh that
Section 5 of Limitation Act, 1963 has no application to proceedings before
learned DRT and that it has no jurisdiction to condone delay of filing SA by

invoking Section 5 of Limitation Act.

6. We heard learned counsel for petitioners at length and have gone
through the file with his assistance. However, we do not find any ground

whatsoever to interfere in this writ petition.

7. Admittedly, order dated 19.12.2023, passed by learned DRT-III,

Chandigarh is an appealable order. Petitioners have filed an application

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CWP No.3443 of 2024 (O&M). 5-

seeking review of said order, which is pending. In the given factual matrix,
we do not find any ground to interfere for examining validity of order dated
19.12.2023, passed by learned DRT-III, Chandigarh. Clear cut and specific
remedies in this regard are duly provided under the SARFAESI Act itself.
Interference by this Court in exercise of jurisdiction under Article 226 of the
Constitution of India is not called for. Gainful reference in this regard can be
made to Union Bank of India v. Satyawati Tandon and others, 2010(8) SCC
110, Varimadugu Obi Reddy v. B. Sreenivasulu and others, 2023(1) R.C.R.
(Civil) 34, M/s South Indian Bank Ltd. and others v. Naveen Mathew Philip
and another, 2023(2) RCR (Civil) 771. Petitioners on various occasions have
been approaching this Court for challenging proceedings under SARFAESI
Act as narrated in the foregoing paras. Relevant portion of order dated
24.04.2023 in CWP-24824-2021 is reflective of the conduct of petitioners. As
of now admittedly review application filed by petitioners is pending before
learned DRT. In the given factual matrix, we do not find any ground
whatsoever to interfere at this stage for examining the validity of impugned
order dated 19.12.2023, passed by learned DRT or to stay auction notice dated
25.01.2024 (Annexure P-13). We find no occasion for starting parallel

8. We further do not find any merit in the averment in the writ
petition that review application filed by petitioners is deliberately not being
listed before respondent no.1. This averment is not substantiated by any
material on record or even at the time of arguments before us. It is open to
petitioners to make necessary mention before learned DRT-III, Chandigarh for

listing of application for review. In case such mention is made, we are

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CWP No.3443 of 2024 (O&M). -6-
sanguine that same shall be considered by learned DRT-III, Chandigarh, in
accordance with law.

9. Writ petition is accordingly disposed of with liberty to petitioners
to pursue the proceedings already initiated by them in accordance with law. It
is clarified that there is no expression of opinion on the merits of matter and

any reference to the facts is for decision of this writ petition only.


Whether speaking/reasoned: Yes/No
Whether reportable: Yes/No


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