High Court of KeralaSingle Judge2021-09-06Writ petition disposed; petitioner allowed to a...

Aljo Joseph v. Dhanalakshmi Bank Ltd. and Ors.

Case / Petition Number:WP(C) No.11003/2021

Case Details & Bench

Court: High Court of Kerala
Hon'ble Judges: P. V. Kunhikrishnan
Judgment Date: 2021-09-06
Court Decision / Holding: Writ petition disposed: interim order dated 19.05.2021 to continue for 30 days; petitioner may file an appeal under Section 61 of the IBC within 30 days; if filed within 30 days, the appeal will be treated as timely and proceed as per law; all other contentions left open.
Final Disposition: Writ petition disposed; petitioner allowed to approach appellate authority under Section 61 of IBC; interim stay extended for 30 days; other contentions left open; if appeal filed within 30 days it will be treated as timely.

Parties to the Case

Appellants / Petitioners

Aljo Joseph

Respondents

Dhanalakshmi Bank Ltd.
National Company Law Tribunal, Kochi
Jasin Jose

Legal Representation & Advocates

Counsels for Petitioners

• P.B. Krishnan
• V. K. Peer Mohamad Khan
• Girish Kumar VC

Counsels for Respondents

• C. K. Karunakaran (SC) for Dhanalakshmi Bank
• P. Vijay Kumar, ASG of India
• Mohan Jacob George
• M. Jithesh Menon
• P. V. Parvathy
• Reena Thomas
• Nigi George

Case Synopsis & Summary

This writ petition challenges Ext. P6, an order of the National Company Law Tribunal (NCLT), Kochi, in IBA/41/KOB/2020. Petitioner Aljo Joseph contends the NCLT order is without jurisdiction and seeks certiorari, mandamus and other relief. The High Court frames the core issue as the maintainability of a writ under Article 226 when a statutory remedy exists under the Insolvency and Bankruptcy Code, 2016 (IBC), specifically Section 61. It notes the settled principle, relied upon by several decisions, that a writ against NCLT orders need not be entertained where a statutory remedy exists, though interference is possible in exceptional cases. The record reveals that Rs. 1.6 crore was received during settlement discussions (OTS), with the bank alleging readiness to withdraw the petition; the petitioner claims legal difficulties in withdrawal. An impleading petition by the State Bank of India was dismissed as unnecessary. The Court, while acknowledging bonafides, disposes of the petition by allowing the petitioner to file an appeal under Section 61 of the IBC within 30 days and directs that the interim stay granted on 19.05.2021 continue for 30 days. If the appeal is filed within 30 days, it will be treated as timely; all other contentions are left open. The petition is therefore disposed with directions to pursue the statutory remedy rather than quash the NCLT order on a writ.

Provisions of Law Cited

Insolvency and Bankruptcy Code, 2016 – Section 61Insolvency and Bankruptcy Code, 2016 – Section 7Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interests Act, Sec. 13(2)Constitution of India, Article 226

Legal Doctrines & Maxims

Writ jurisdiction under Article 226 should not be exercised where there exists a statutory remedy (existence of adequate alternate remedy).
Existence of an adequate statutory remedy (IBC Sec. 61) before filing a writ against NCLT orders.

Submissions & Arguments

Contentions of Appellants / Petitioners

The applicant contends Ext. P6 is without jurisdiction and seeks certiorari and mandamus, along with other relief. The main challenge is to the NCLT order, with the petitioner arguing that there is no jurisdiction to pass Ext. P6 and that a remedy exists under Section 61 of the IBC. The petitioner asserts bonafides and seeks to preserve rights, contending that the writ petition deserves consideration notwithstanding the statutory remedy, or at least the stay should be continued until a decision on appeal.

Contentions of Respondents

Respondents submit that the amount settled (approximately Rs. 1.6 crore) has been received and there is a move to withdraw the writ petition; an impleading petition was dismissed as unnecessary. They urge that the writ petition should give way to appellate remedy under Section 61 of the IBC, and that the stay order was issued on grounds of settlement discussions. They emphasize the bank’s readiness to proceed with the settlement and withdrawal from the writ petition.

Cited Precedents (4)

Case Name	Citation	Treatment	Explanation
Embassy Property Developments Private Limited v. State of Karnataka and others	(2020) 13 SCC 308	Positive	Cited to support the principle that writ petitions against NCLT orders are not entertained when a statutory remedy (IBC) exists.
Sesh Nath Singh and Another v. Baidyabati Sheoraphuli Co-operative Bank Ltd. And Another	2021 SCC Online SC 244	Positive	Cited to reinforce the settled approach against entertaining writs where an IBC remedy is available.
Sulochana Gupta and Another v. RBG Enterprises Private Ltd.	2020 SCC Online Ker 4153	Positive	Cited as authority for the same proposition in the Kerala High Court context.
W.P.(C) No.8257/2021 (Judgment dated 02.07.2021)	W.P.(C) No.8257/2021	Positive	Cited as a recent corroborative High Court decision supporting the same principle.

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Extracted Judgment Text

Exact text extracted from official judgment records.

# **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MR. JUSTICE P.V.KUNHIKRISHNAN MONDAY, THE 6[TH] DAY OF SEPTEMBER 2021 / 15TH BHADRA, 1943** **WP(C) NO. 11003 OF 2021** ## **PETITIONER:** ALJO JOSEPH AGED 44 YEARS S/O. P.K.JOSEPH, PUTHUPPARA HOUSE, KIDANGOOR P.O., ANGAMALY-683572. BY ADVS. P.B.KRISHNAN V.K.PEERMOHAMED KHAN GIRISH KUMAR V.C ## **RESPONDENTS:** 1 DHANALAKSHMI BANK LTD. REPRESENTED BY ITS BRANCH MANAGER, ANGAMALY BRANCH, DHANALAKSHMI BUILDING, NAICKANAL, THRISSUR-680001. 2 THE NATIONAL COMPANY LAW TRIBUNAL, COMPANY LAW BHAVAN, KAKKANAD, KOCHI-682030. 3 JASIN JOSE, 5D, SKYLINE RIVERSCAPE, THOTTUMUGHAM, ALUVA, KERALA683101. BY ADVS. SRI.C.K.KARUNAKARAN,SC,DHANALAKSHMI BANK SHRI.P.VIJAYAKUMAR, ASG OF INDIA MOHAN JACOB GEORGE - R3 M.JITHESH MENON P.V.PARVATHY (P-41) REENA THOMAS NIGI GEORGE THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 06.09.2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) NO.11003/2021 2 ## **P.V.KUNHIKRISHNAN, J** **--------------------------------------** **W.P.(C)No.11003 of 2021 -------------------------------------Dated this the 6[th] day of September 2021** ## **JUDGMENT** ## **The above Writ petition is filed with** ## **following prayers:** _“a) issue a writ of certiorari or other appropriate writs, directions or orders calling for the records leading up to Exhibit P6 and quash the same._ _b) issue a writ of mandamus or other appropriate writs, directions or orders restraining the 3[rd] respondent from proceedings further with Exhibit P6;_ _c) grant such other reliefs as this Honourable Court may deem fit, just and proper in the circumstances of the case._ _d) award cost of these proceedings.”_ **2. The main prayer in this writ petition is** **a challenge against Ext.P6 order passed by the National Company Law Tribunal(NCLT), Kochi** **Bench, Kerala. Admittedly Ext.P6 can be challenged by filing an appeal under Section 61 of the Insolvency and Bankruptcy Code, 2016. Eventhough the learned counsel for the** WP(C) NO.11003/2021 3 **petitioner submitted that Ext.P6 is passed without jurisdiction and raised several other contentions, according to me, the same need not be considered at this stage. It is settled by several decisions of this Court and the Apex Court that, the writ petition need not be entertained against orders of NCLT, when there is a statutory remedy available as per the Insolvency and Bankruptcy Code, 2016.** _**(See the judgment in Embassy Property Developments Private Limited v. State of Karnataka and others [(2020)13 SCC 308], Sesh Nath Singh and Another - v. Baidyabati Sheoraphuli Co operative Bank Ltd. And Another [2021 SCC Online SC 244], Sulochana Gupta and Another v. RBG Enterproses Private Ltd.[2020 SCC Online Ker 4153] and the judgment dated 02.07.2021 in W.P.(C)No.8257/2021)**_ **. Of course, in certain circumstances the writ court can interfere. But in the facts and circumstances of this case, I think this writ petition under Article 226 of the Constitution** WP(C) NO.11003/2021 4 **of India need not be entertained. All the contentions of the petitioner in this writ petition are left open. They can file an appeal before the appellate authority as per Section 61 of the Insolvency and Bankruptcy Code, 2016 and raise all the contentions raised in this writ petition. Since, the writ petition is pending before this Court from 03.05.2021 and there is an interim order passed by this Court on 19.05.2021, which is in force even now, I think a breathing time can be given to the petitioner to file an appeal before the appellate authority.** **3. This Court actually stayed Ext.P6 order based on a submission from the 1[st] respondent. The order of stay passed by this Court on 19.05.2021 is extracted hereunder:** _“The learned counsel for the petitioner has made available a letter dated 19.05.2021 of the 1[st] respondent addressed to the Managing Director of M/s.Orma Marble Palace (P) Ltd, of which petitioner is a Director informing that the bank has received a sum of_ WP(C) NO.11003/2021 5 _Rs.1,60,00,000/- (One Crore Sixty Lakhs Only) towards the loan settlement and that the final OTS is under consideration._ _In view of these developments, there shall be a stay of further proceedings pursuant to Ext.P6 for a period of two months.”_ ## **4. The learned counsel for the 1[st]** **respondent submitted that the amount is already received and the bank already approached the Tribunal for withdrawing the writ petition. The learned counsel for the petitioner submitted that there is some legal difficulties in withdrawing the petition.** **5. An impleading petition is filed by the State Bank of India as I.A.No.1/2021 raising several contentions. I think that impleading petition need not be considered at this stage. If there is any grievance to the State Bank of India, they can approach the Tribunal in accordance to law. According to me, the impleading petition need not be considered and therefore, I.A.No.1/2021 is dismissed.** WP(C) NO.11003/2021 6 **6. Since this writ petition was filed within 30 days from the date of receipt of the impugned order in this case and since an interim order also passed by this Court, I think the appellate authority can accept the appeal without a delay condonation petition, if the same is filed within 30 days. I am passing such an order because the petitioner was pursuing this writ petition with bonafides. Therefore, I think this writ petition can be disposed allowing the petitioner to approach the appellate authority.** **Hence, this writ petition is disposed in the following manner:** **i) The interim order dated 19.05.2021 which is in force even now will continue for a period of 30 days from today.** **ii) The petitioner is free to file an appeal against Ext.P6 order before the appellate authority as per Section 61 of the Insolvency and Bankruptcy Code, 2016 in the meanwhile.** WP(C) NO.11003/2021 **==> picture [8 x 9] intentionally omitted <==** **iii) If an appeal is filed by the petitioner within 30 days from today, the appellate authority will treat it as an appeal within time and consider the same in accordance to law.** **iv) All other contentions raised by the petitioner in this writ petition are left open.** **Sd/P.V.KUNHIKRISHNAN JUDGE** **DM** WP(C) NO.11003/2021 8 ## **APPENDIX OF WP(C) 11003/2021** PETITIONER'S EXHIBITS EXHIBIT P1 TRUE COPY OF THE DEMAND NOTICE DATED 8.1.2018 ISSUED BY THE 1ST RESPONDENT UNDER SECTION 13(2) OF THE SECURITISATION ACT. EXHIBIT P2 TRUE COPY OF THE APPLICATION IN IBA/41/KOB/2020 FILED BY THE 1ST RESPONDENT UNDER SECTION 7 OF IBC BEFORE THE 2ND RESPONDENT. EXHIBIT P3 TRUE COPY OF THE COUNTER AFFIDAVIT FILED BY THE PETITIONER TO EXHIBIT P2 APPLICATION. - EXHIBIT P4 TRUE COPY OF THE REJOINDER FILED BY THE 1ST RESPONDENT. EXHIBIT P5 TRUE COPY OF THE REQUEST FOR ONE TIME SETTLEMENT SUBMITTED BY THE PETITIONER DATED 5.2.2021 OFFERING TO PAY AN AMOUNT OF RS.140.00 LAKHS PAYABLE FINALLY BEFORE THE 31ST OF MARCH 2021. EXHIBIT P6 TRUE COPY OF THE ORDER DATED 9.4.2021 IN IBA/41/KOB/2020. EXHIBIT P7 TRUE COPY OF THE NOTICE DATED 21.4.2021 ISSUED BY THE 3RD RESPONDENT. RESPONDENT EXHIBITS EXHIBIT R4(A) TRUE COPY OF THE CLAIM SUBMITTED BY THE BANK DATED 16/04/2021. //TRUE COPY// PA TO JUDGE