Indian Bank v. P. Sasi Proprieter, M/S P.S. Printers; Debts Recovery Tribunal-II

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MR. JUSTICE DEVAN RAMACHANDRAN** **FRIDAY ,THE 23RD DAY OF NOVEMBER 2018 / 2ND AGRAHAYANA, 1940** ## **OP (DRT).No. 108 of 2018** **AGAINST THE ORDER/JUDGMENT IN OTHERS 296/2018 of DEBT RECOVERY TRIBUNAL, ERNAKULAM** ## **PETITIONER/S:** **1 THE CHIEF MANAGER & AUTHORIZED OFFICER, INDIAN BANK ZONAL OFFICE, THIRUVANANTHAPURAM - 695 001.** **2 THE MANAGER INDIAN BANK, PARASSALA BRANCH,THIRUVANANTHAPURAM - 695 502. 3 INDIAN BANK HEAD OFFICE, 254-260, AVVAI SHANMUGAM SALAI,ROYAPETTAH, CHENNAI, TAMILNADU - 600 014,REPRESENTED BY ITS CHAIRMAN & MANAGING DIRECTOR. BY ADV. SRI.S.EASWARAN, SC, INDIAN BANK** ## **RESPONDENT/S:** **1 P.SASI PROPRIETOR, M/S. P.S. PRINTERS,THYKOOTAM PUTHEN VEEDU, PLAMOOTTIKADA P.O., NEYYATTINKARA TALUK, THIRUVANANTHAPURAM,NOW RESIDING AT GURFUKRIPA, POST OFFICE JUNCTION,PARASSALA, NEYYATTINKARA, THIRUVANANTHAPURAM - 695 001.** **2 THE DEBTS RECOVERY TRIBUNAL- II REPRESENTED BY ITS REGISTRAR,K.S.H.B. BUILDING, PANAMPILLY NAGAR,ERNAKULAM, KOCHI - 682 036.** **BY ADVS. SRI.JAISHANKAR V.NAIR, CGC SRI.A.D.SHAJAN S.SINDHU** **THIS OP (DEBT RECOVERY TRIBUNAL) HAVING BEEN FINALLY HEARD ON 23.11.2018, THE COURT ON THE SAME DAY PASSED THE FOLLOWING:** **OP (DRT).No. 108 of 2018** 2 ## **JUDGMENT** This petition has been filed by the Indian Bank challenging an order issued by the Debt Recovery Tribunal (herein after DRT for short) Eranakulam, a copy of which is on record as Ext.P10, where under a Securitisation Application (herein after SA for short) filed by the 1st respondent has been found to be maintainable. The petitioner bank contents with great amount of force that Ext.P10 order is completely in error since the first respondent has chosen to challenge certain steps initiated by the Bank under the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest Act ('the SARFAESI Act' for brevity), much beyond 45 days after such steps were taken and therefore that the Securitisation Application (SA) is barred by Limitation. 2. I have heard Sri. Easwaran, the learned Standing Counsel for the Bank and Smt. S. Sindhu, the learned counsel for the respondents in this O.P who submits with great fervor, but unfortunately in a cause that appears to be hopeless as far as her clients are concerned. **OP (DRT).No. 108 of 2018** 3 3. The most essential facts that will require my attention for resolution of the issues in this case is that the property in question was mortgaged by the 1st respondent in favor of the Indian Bank while availing of certain financial facilities; and that when the account became irregular, the Bank issued a statutory notice under Section 13(2) of the Act on 09/07/2015 and thereafter a further notice Sec. 13(4) on 30/10/2015. 4. The petitioner appears to have challenged these actions of the Bank by filing WP(C) No. 8236 of 2016 before this court which was disposed of through a judgment, dated 03/03/2016, imposing certain conditions for regularisation of the loan; but which is stated not to have been complied with by the 1st respondent. Notwithstanding this, it transpires that the 1st respondent filed another Writ Petition. W.P.(C).No. 22009 of 2017, which was also, however, dismissed through a judgment, dated 17/07/2017, on the ground that the 1st respondent had not complied with the earlier directions, which compelled the petitioner to file Writ Appeal No. 1946 of 2017, against it, which was disposed of by a learned Divison Bench through a judgment dated 26/09/2017, directing the 1st respondent to pay Rs. 4 lakhs on or before 27/09/2017, another 6 lakhs on or before **OP (DRT).No. 108 of 2018** 4 31/12/2017 and the balance thereafter on or before 31/03/2018. 5. Pertinently, even within the period granted by this court in Writ Appeal No. 1946 of 2017, the petitioner appears to have challenged the sale notice issued by the Bank on 07/08/2017, as also the notice issued prior to taking possession of the secured asset issued on 30/10/2015 by filing SA No.203 of 2017 before the DRT, Eranakulam. This SA was however dismissed through Ext.P2 order. 6. The above being so, since the 1st respondent had not complied with the directions in Writ Appeal No. 1946 of 2017, the bank issued another sale notice on 17/02/2018 notifying sale of the secured asset on 21/03/2018. The first respondent challenged this action by filing WP(C) No. 9698 of 2018 which was however, dismissed by this court on 21/03/2018 directing the 1st respondent to invoke alternative remedy under the Statute. This did not stop the petitioner from again filing a Writ Petition, numbered as W.P.No. 13225 of 2018 on 10/04/2018, challenging the sale notice as well as the sale which has taken place by then, but which was withdrawn, with the permission to approach the DRT, on 15/05/2018. The first respondent thereafter appears to have filed SA No. 296 of 2018 on **OP (DRT).No. 108 of 2018** 5 23/05/2018, however, challenging only the sale proclamation dated 17/02/2018 and the possession notice dated 30/10/2015, but incredulously without challenging the sale of the secured asset which was, concededly, conducted on 21/03/2018. 7. The pleadings would show that the Registry of the DRT initially refused to number S.A.No. 296 of 2018 on the ground that, since what was challenged therein was a sale proclamation dated 17/02/2018 and the possesion notice dated 30/10/2015, the SA filed on 23/05/2018 is far beyond the 45 days limitation provided under the Act. However, on an appeal filed by the first respondent before the DRT against this objection, it appears that the DRT directed the Registry to put the Bank on notice, since they had already filed a Caveat by then and then proceeded to hear this objection by treating the Securitisation Application as an unnumbered one and consequently to issue Ext.P10 order, which is impugned herein. 8. Even though the afore narration would encompass various facts, the issue before me is only whether SA No. 296 of 18 which was filed admittedly on 23/05/2018, challenging the sale proclamation dated 17/02/2018 and the 13(4) notice dated 30/10/2015, can be found to be maintainable, going by Section **OP (DRT).No. 108 of 2018** 6 17(1) of the SARFAESI Act, which irrefragably provides that an aggrieved person will have to file an application before the DRT within a period of 45 days from the date on which an impugned step is taken by the Bank/Financial Institution. 9. I notice from Ext. P10 that the manner in which the DRT has found SA 296 of 2018 to be maintainable is because the bank had, on 05/04/2018, issued Ext.P9 letter to the 1[st] respondent informing him that the sale of the secured asset has taken place on 21/03/2018 and that the said sale is scheduled to be confirmed on 21/04/2018. The date of this letter was taken by the DRT to be the commencement of limitation period and it is on such basis that the DRT has overruled the objection of its Registry, thus finding the SA as being maintainable. 10. The question thus before me is whether it was proper on the DRT to have accepted the date in Ext.P9 to reckon the period of limitation or whether it has erred in doing so. 11. The most pertinent factual factor in this situation is the conceded position that the 1[st] respondent has filed SA. No. 296 of 2018 not against the sale, which was conducted on 21/03/2018, but only against the sale proclamation dated 17/02/2018. Had the 1[st] respondent challenged the sale which **OP (DRT).No. 108 of 2018** 7 were held on 21/03/2018, then perhaps Ext.P9 letter could have been pressed into service by the 1[st] respondent to show that he had information of the sale only on that date. However, ineffably, the 1[st] respondent has not chosen to challenge the sale but only the sale proclamation dated 17/02/2018. Since the measure taken by the Bank, which has now been challenged by the 1[st] respondent is not the sale but the sale proclamation, obviously, the period of limitation will have to be reckoned from the date of that measure and not from the date of a subsequent unchallenged measure taken by the Bank, therefore, it is only if the sale had been challenged by the 1[st] respondent, could the DRT had been justified in adopting the date in Ext.P9 for the purpose of computation of limitation, since Ext.P9 only informs the factum of the sale to the 1[st] respondent, further intimating him that the sale will be confirmed on 21/04/2018. 12. Smt. S. Sindhu, very strenuously contended before me that since the sale has not been confirmed and since Ext.P9 only says that the sale will be confirmed on 21/04/2018, the sequence of measures taken by the Bank, starting from the sale, proclamation up to the sale should be construed to be a composite one and therefore, that the date in Ext.P9 becomes **OP (DRT).No. 108 of 2018** 8 relevant. I am afraid that going by the judgments of this court in **Roshan Narayanan v. Central Bank of India [2017(4) KLT 1172] and Sidheek v. Federal Bank [2018(1) KLT 172,** these contentions cannot gather legal favour, because the 1[st] respondent would obtain the locus to challenge each measure taken by the bank and because limitation, with respect to the remedies relating to each of the measures, will have to be reckoned from the date on which that particular measure was taken by the Bank. 13. Obviously, therefore, since the respondent is only challenging the sale proclamation issued on 17/02/2018, but not the sale which happened on 21/03/2018, the period of limitation ought to have been reckoned by the DRT only with respect to the date on which that measure was taken, namely, 17/02/2018. The submissions of Smt. S.Sindhu that Ext. P9 will have to be reckoned as a valid factor with respect to the challenge in the SA against the sale proclamation cannot, consequently, be found to be tenable. To reiterate and as I have said above, it is only if the sale have been challenged by the 1[st] respondent, could he have obtained the locus to assert that Ext.P9, which is a letter informing him of the sale, could have been taken note of **OP (DRT).No. 108 of 2018** 9 purpose of computation of limitation. In the afore circumstances, I cannot find favor with the impugned order issued by the DRT and I resultantly, allow this writ petition, vacating the said order and leaving the parties to their respective remedies in law if any available. This Writ Petition is thus ordered. **Sd/-** Dxy **DEVAN RAMACHANDRAN JUDGE** **OP (DRT).No. 108 of 2018** 10 ## **APPENDIX** ## **PETITIONER'S/S EXHIBITS:** **EXHIBIT P1. COPY OF S.A.NO.203 OF 2017 FILED BY THE 1ST RESPONDENT BEFORE DRT** - **EXHIBIT P2. COPY OF THE ORDER DATED 6.11.2017 IN S.A.NO.203 OF 2017** - **EXHIBIT P3. COPY OF THE JUDGMENT DATED 17.7.2017 IN W.P.(C)NO.22009 OF 2017** **EXHIBIT P4. COPY OF THE JUDGMENT DATED 21.3.2018 IN W.P.NO.9698 OF 2018** - **EXHIBIT P5. COPY OF THE WRIT PETITION, W.P.NO.9698 OF 2018** - **EXHIBIT P6. COPY OF THE WRIT PETITION, W.P. NO.13225 OF 2018 FILED BY THE 1ST RESPONDENT** - **EXHIBIT P6 (A). COPY OF THE AND THE INTERLOCUTORY APPLICATION FILED BY THE 1ST RESPONDENT IN W.P.NO.13225 OF 2018** **EXHIBIT P7. COPY OF THE JUDGMENT DATED 15.5.2018 IN W.P.NO.13255 OF 2018** - **EXHIBIT P8. COPY OF THE SECURITIZATION APPLICATION FILED BY THE 1ST RESPONDENT BEFORE DRT - II, ERNAKULAM** - **EXHIBIT P9. COPY OF THE LETTER DATED 5.4.2017 (ANNEXURE A16) FIELD IN SA BY THE 1ST RESPONDENT** **EXHIBIT P10. COPY OF THE PROCEEDINGS DATED 5.7.2018 OF THE 2ND RESPONDENT**