On 2.9.2016, while entertaining the writ petiton, this court directed for issuance of notice to opposite party nos. 1 to 5 and 8 and directed for listing of the matter today.
Today, learned counsel for the petitioner has filed today the affidavit of service, which is taken on record.
Sri Imran Khan, Advocate has filed power on behalf of opposite party no. 1 whereas Sri Nitesh Kumar Tripathi has filed fresh Vakalatnama on behalf of opposite party no. 2.
Heard Sri Prashant Kumar, learned counsel for the petitioners, Sri Imran Khan, learned counsel for the opposite party no. 1, Sri Nitesh Kumar Tripathi & Sri Avdhesh Shukla for the UCO Bank, Sri N.K. Seth, learned Senior Advocate assisted by Sri Sachin Garg and Sri Alok Saran holding brief of Sri Akhilesh Kalra.
In the instant writ petition, petitioners have assailed the order dated 08.08.2016 passed by Debts Recovery Tribunal, Lucknow in the Securitization Application No. 157 of 2015 whereby the Tribunal has allowed the preliminary objection raised by the respondent no.6 (auction-purchaser) regarding maintainability of Securitization Application and rejected the same as not maintainable.
From the impugned judgment, it comes out that on the application under Section 17 of the Act moved by the petitioner before the Debts Recovery Tribunal, respondent no.6 [auction-purchaser] moved an application dated 29.5.2015 about the maintainability of Securitization Application. The Tribunal has observed that the learned Counsel for the petitioners/applicants have not filed any rejoinder in reply to prelimiary objection. However, they orally objected to the preliminary objection and it was urged during oral arguments that the Securitization Application under Section 17 of the SARFASI Act, 2002 is maintainable. However, Sri N.K. Seth, learned counsel for the Auction-Purchaser (opposite party no.6) has submitted that no rejoinder to the preliminary objection was ever served, and, therefore, he is unable to say anything about filing of the rejoinder to the preliminary objection as alleged by the petitioners before the learned Tribunal.
At the out set, Sri N.K.Seth has raised a preliminary objection with regard to the maintainability of the present writ petition on the ground that petitioners have remedy of filing appeal before the Appellate Tribunal under Section 18 of the Act and submitted that the writ petition is liable to be dismissed on the ground of availability of alternative remedy.
To strengthen the aforesaid arguments, learned counsel has placed reliance upon the judgment of this Court reported in Umang Gyanchandani Vs. Debts Recovery Tribunal Lucknow and others,[2015 (33) LCD 1986], Union Bank of India Vs. Satyavati Tandon,(2010) 8 SCC 110, Kanhaiya Lal Sachdev Vs. State of Maharastra (2011) 2 SCC 782 and General Manager Sidheshwara Cooperative Bank Vs. Iqbal and others (2013) 10 SCC 83.
In reply to the aforesaid preliminary objection, Sri Prashant Kumar, learned counsel for the petitioners while fairly admitting that there is a provision of filing appeal against the order dated 08.08.2016 passed under Section 17 of the Act before the Appellate Tribunal in view of the provisions of Section 18 of the Act but vehemently contended that learned Tribunal has committed manifest error by not appreciating the rejoinder submitted by the petitioners to the preliminary objections of Auction Purchaser (opposite party no. 6) and has wrongly relied upon the findings of Debts Recovery Tribunal given in Transfer Application no. 128 of 2002 and observed that the issue cannot be adjudicated in the Securitization Application as the same is barred by the principle of res-judicata overlooking the fact that the order of Debts Recovery Tribunal passed on the transfer application no. 128 of 2002, is presently pending before this Court at Allahabad and, therefore, the present writ petition is maintainable.
It has been urged that with regard to making counter claim in respect of alleged gold bars securitieis, the judgment passed bythe Tribunal dated 2.6.2008 in Transferred Application No. 128 of 2002 and the order passed by the DRAT, Allahabad in Appeal No. R-991 of 2008 and Appeal No. R-992 of 2008 on 8.12.2011 have been challenged before this Court at Allahabad in Writ Petition No. 60932 of 2011 on 08.12.2011, which is still pending. Therefore, there is no question of drawing any inference on the judgments passed by the DRT, Lucknow and DRAT,Allahabad.
I have examined the submissions advanced by learned counsel for the parties and gone through the record.
The order under challenge has been passed by the Debts Recovery Tribunal on the application moved under-Section 17 of the Act whereby petitioners challenge the steps/procedure adopted by the Securitizing Company under the provisions of Section 13(4) of the Act as well as notice alongwith counter-claim for compensation against the loss and damages claimed under Section 19 of the Act.
To examine the issue regarding maintainability of the instant writ petition, it would be apt to reproduce Section 18 of the SARFAESI Act, 2002 which provides filing of appeal to the Appellate Tribunal. Said section reads as under:-
"18. Appeal to Appellate Tribunal : (1) Any person aggrieved, by any order made by the Debts Recovery Tribunal under section 17, may prefer an appeal alongwith such fee, as may be prescribed to the Appellate Tribunal within thirty days from the date of receipt of the order of Debts Recovery Tribunal:
[Provided that different fees may be prescribed for filing an appeal by the borrower or by the person other than the borrower:] [Provided further that no appeal shall be entertained unless the borrower has deposited with the Appellate Tribunal fifty per cent. of the amount of Debts due from him, as claimed by the secured creditors or determined by the Debts Recovery Tribunal, whichever is less:
Provided also that the Appellate Tribunal may, for the reasons to be recorded in writing, reduce the amount to not less than twenty-five per cent. of Debts referred to in the second proviso.] (2) Save as otherwise provided in this Act, the Appellate Tribunal shall, as far as may be, dispose of the appeal in accordance with the provisions of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (51 of 1993) and rules made thereunder.
Now, I would like to deal the objections raised by the respondents Counsel regarding non-exhaustion of alternative remedy by the petitioners. In this context, it may be observed that the existence of alternative remedy is not an absolute bar, is a legal proposition, which has been propounded by the Apex Court and this Court in series of cases. It would be useful to refer some of the decisions rendered by the Apex Court on this issue.
In Thansingh Nathmal v. Superintendent of Taxes; [AIR 1964 SC 1419], the Apex Court adverted to the rule of self-imposed restraint that writ petition will not be entertained if an effective remedy is available to the aggrieved person and observed:
"The High Court does not therefore act as a court of appeal against the decision of a court or tribunal, to correct errors of fact, and does not by assuming jurisdiction under Article 226 trench upon an alternative remedy provided by statute for obtaining relief. Where it is open to the aggrieved Petitioner to move another tribunal, or even itself in another jurisdiction for obtaining redress in the manner provided by a statute, the High Court normally will not permit by entertaining a petition under Article 226 of the Constitution the machinery created under the statute to be bypassed, and will leave the party applying to it to seek resort to the machinery so set up."
In Titaghur Paper Mills Company Ltd. v. Suite of Orissa (1983) 2 SCC 433 the Apex Court while examining the question of availability of alternative remedy observed as under:
"It is now well recognised that where a right or liability is created by a statute which gives a special remedy for enforcing it, the remedy provided by that statute only must be availed of.
In Mafatlal Industries Ltd. v. Union of India; (1997) 5 SCC 536, it has been observed by the Apex Court that:
"So far as the jurisdiction of the High Court under Article 226 or for that matter, the jurisdiction of this Court under Article 32 is concerned, it is obvious that the provisions of the Act cannot bar and curtail these remedies. It is, however, equally obvious that while exercising the power under Article 226/Article 32, the Court would certainly take note of the legislative intent manifested in the provisions of the Act and would exercise their jurisdiction consistent with the provisions of the enactment.
In the case of L. Chandra Kumar Vs. Union of India and others, reported in AIR 1997 SC 1125, a seven Judges Constitution Bench of Hon'ble Supreme Court held as under:-
"Though judicial review in the basic feature of the Constitution, the vesting of power of judicial review in an alternative institutional mechanism, after taking it away from the High Courts, would not do violence to the basic structure so long as it was ensured that the alternative mechanism was an effective and real substitute for the High Court."
In the case of Karnataka Chemical Industries and others vs. Union of India and others (2000) 10 SCC 12, it was held that:
"When there is no challenge to the validity of any statutory provision, we see no reason as to why a writ petition should have been filed by passing the alternative remedy which is provided under the statute. On the short ground, we dismiss this appeal, vacate the interim orders, direct the payment of the balance amount of duty alongwith interest @ 15% per annum with yearly rests. It will be open to the appellant to avail of such statutory remedy as may be available to it. If an appeal is filed within four weeks from today, the Department will take a lenient view in condoning the delay."
In the case of Central Coalfields Ltd. vs. State of Jharkhand and others (2005) 7 SCC, 492, it has been held that :
"If there is statutory alternative remedy available to a person under an statute itself, in that case the writ petition should not be entertained under Article 226 of the Constitution of India and the petitioner is directed to avail the alternative statutory remedy."
Recently, the Hon'ble Supreme Court in Civil Appeal No. 10706 of 2011 (Nivedita Sharma Versus Cellular Operators Assn. Of India and others) decided on 07.12.2011, considered the question of alternative remedy/exhaustion of remedies and has held that Articles 226/227 are not available if an efficacious alternative remedy is available to aggrieved person. The relevant paragraphs of the aforesaid judgment reads as under:-
"We have considered the respective arguments/ submissions. There cannot be any dispute that the power of the High Courts to issue directions, orders or writs including writs in the nature of habeas corpus, certiorari, mandamus, quo warranto and prohibition under Article 226 of the Constitution is a basic feature of the Constitution and cannot be curtailed by parliamentary legislation L. Chandra Kumar v. Union of India; (1997) 3 SCC 261. However, it is one thing to say that in exercise of the power vested in it under Article 226 of the Constitution, the High Court can entertain a writ petition against any order passed by or action taken by the State and/or its agency / instrumentality or any public authority or order passed by a quasi-judicial body/authority, and it is an altogether different thing to say that each and every petition filed under Article 226 of the Constitution must be entertained by the High Court as a matter of course ignoring the fact that the aggrieved person has an effective alternative remedy. Rather, it is settled law that when a statutory forum is created by law for redressal of grievances, a writ petition should not be entertained ignoring the statutory dispensation.
Thus, by a series of decisions it has been settled that the remedy of writ is an absolutely discretionary remedy and the High Court has always the discretion to refuse to grant any writ, if it is satisfied that the aggrieved party can have an adequate or suitable relief elsewhere. The Court, in extraordinary circumstances, may exercise the power, if it comes to the conclusion that there has been a breach of principles of natural justice or procedure required for decision has not been adopted.
In United Bank of India Vs. Satyawati Tondon and others; (2010)8 SCC 110 the Apex Court while dealing with the issue whether the alternative statutory remedy available under the Act can be bypassed and jurisdiction under Article 226 of the Constitution could be invoked, observed in paragraph 55 as under:-
" 55. It is a matter of serious concern that despite repeated pronouncement of this Court, the High Courts continue to ignore the availability of statutory remedies under the DRT Act and the SARFAESI Act and exercise jurisdiction under Article 226 for passing orders which have serious adverse impact on the right of banks and other financial institutions to recover their dues. We hope and trust that in future the High Courts will exercise their discretion in such matters with great caution, care and circumspection.
The law as propounded hereinabove has been reiterated again in the case of Kanhaiyalal Lalchand Sachdev and others Vs. State of Maharashtra and others, (2011) 2 SCC 782 wherein the Hon'ble Supreme Court on the question of alternative remedy/exhaustion of remedies held that Articles 226/227 are not available, if an efficacious alternative remedy is available to aggrieved person. Relevant paragraphs 23 and 24 of said judgment read as under:
"23. In our opinion, therefore, the High Court rightly dismissed the petition on the ground that an efficacious remedy was available to the appellants under Section 17 of the Act. It is well settled that ordinarily relief under Articles 226/227 of the Constitution of India is not available if any efficacious alternative remedy is available to any aggrieved person. (See Sadhana Lodh Vs. National Insurance Co. Ltd., Surya Dev Rai Vs. Ram Chander Rai and SBI Vs. Allied Chemical Laboratories).
24. In City and Industrial Development Corpn. Vs. Dosu Aardeshir Bhiwandiwala, (2009) 1 SCC 168, this Court had observed that: (SCC p. 175, para 30) "30. The Court while exercising its jurisdiction under Article 226 is duty bound to consider whether:
(a) adjudication of the writ petition involves any complex and disputed questions of facts and whether they can be satisfactorily resolved;
(b) the petition reveals all material facts;
(c) the petitioner has any alternative or effective remedy for the resolution of the dispute;
(d) the person invoking the jurisdiction is guilty of unexplained delay and laches;
(e) ex facie barred by any laws of limitation;
(f) grant of relief is against public policy or barred by any valid law; and host of other factors."
It may be noted that when an alternative and equally efficacious remedy is open to a litigant, he should be required to pursue that remedy and not to invoke the extra ordinary jurisdiction of the High Court to issue a prerogative writ as the writ jurisdiction is meant for doing justice between the parties where it cannot be done in any other forum.
In the instant case, petitioners have rushed directly to this Court and have by-passed the statutory alternative remedy, which is not permissible in view of the aforesaid settled position.
In view of the above, the writ petition is dismissed on the ground of availability of alternative statutory remedy. It is made open to the petitioners to raise the pleas before the appellate court which have been raised before this Court or make an application for recall/review, if so advised.
At this stage, Sri Prashant Kumar, learned counsel for the petitioners submits that the limitation of filing the appeal against the impugned order under Section 18 of the Act is expiring today, therefore, he may be permitted to present the same before the appellate Forum within a week.
Appreciating the request of learned counsel for the petitioners, it is provided that if any appeal is filed within seven days from the date of issue of certified copy of this order, the said appeal will be considered and decided by the Appellate Authority on merits and shall not be rejected/dismissed on the ground of limitation.
Order Date :- 7.9.2016 kkv/