O.P(DRT) No.306 of 2023

1 O.P(DRT) No.306 of 2023 ## **`IN THE HIGH COURT OF KERALA AT ERNAKULAM`** ## **`PRESENT`** ## **`THE HONOURABLE MR.JUSTICE C.S.DIAS`** ``` FRIDAY, THE 11[TH] DAY OF AUGUST 2023 / 20TH SRAVANA, 1945 ``` ``` OP (DRT) NO. 306 OF 2023 ``` **`AGAINST THE ORDER/JUDGMENT`** in IA No.3474/2022 in **`SA 90/2022 OF DEBT RECOVERY`** ``` TRIBUNAL- 2, ERNAKULAM ``` ## **`PETITIONER/S:`** ``` M/S. THE KERALA PLANTATIONS D.NO.48/2654B, SREEVALSAM BUILDING, GROUND FLOOR, RSAC RING ROAD, KANIAMPUZHA, NEAR MOBILITY HUB VYTTILA, ERNAKULAM - 682 019, REPRESENTED BY ITS MANAGING PARTNER MR. SURENDRAN THARAYIL, PIN - 682019 ``` ``` BY ADVS. AMAL GEORGE MANU GEORGE KURUVILLA ``` ## **`RESPONDENT/S:`** ``` 1THE SOUTH INDIAN BANK LTD, KOLENCHERY BRANCH, DOOR NO. 460 C WARD NO.4, JJ ARCADE, NH 49 STREET, KOLENCHERY, ERNAKULAM DT. 682311, REPRESENTED BY ITS BRANCH MANAGER, PIN - 682311 2AUTHORISED OFFICER, SOUTH INDIAN BANK LTD REGIONAL OFFICE, ERNAKULAM, SOUTH INDIAN BANK BUILDING, INFOPARK ROAD, KAKKANAD, RAJAGIRI VALLEY, PIN 682039, 3MEENA KUMARI R,W/O BALACHANDRA KURUP, JAYASANKAR, KUREEPUZHA, SAKTHIKULANGARA, KOLLAM. PIN 691003, 4THE DEBTS RECOVERY TRIBUNAL II, ERNAKULAM 1ST FLOOR, KERALA STATE HOUSING BOARD BUILDING, PANAMPALLY NAGAR, ERNAKULAM - 682036, REPRESENTED BY ITS REGISTRAR, BY ADV SUNIL SHANKER ``` ``` THIS OP (DEBT RECOVERY TRIBUNAL) HAVING COME UP FOR ADMISSION ON 11.08.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ``` 2 O.P(DRT) No.306 of 2023 ## **C.S.DIAS, J.** ## **================== O.P(DRT) No.306 of 2023 ================== Dated this the 11[th] August, 2023** ## **JUDGMENT** The original petition is filed assailing Ext P16 order passed by the Debts Recovery Tribunal-II, Ernakulam (in short 'Tribunal') in IA No.3474/2022 in SA No.90/2022 declining to stay the recovery proceedings initiated against the secured asset. 2. The brief relevant facts for the determination of the original petition are: (i) The petitioner is a firm engaged in export of spices. The first respondent – Bank had sanctioned credit facilities to the tune of Rs.760/- lakh, which was later enhanced from time to time. (ii) Due to the Covid-19 pandemic, the petitioner's business got seriously affected. Although the petitioner requested the first respondent to renew the credit facility, the same was not considered. Instead, the second respondent issued Ext.P1 notice under Section 3 O.P(DRT) No.306 of 2023 13(2) of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act (in short, ‘Act’). (iii) As the classification of the petitioner's loan accounts as 'Non Performing Asset' (NPA) is per se illegal, the petitioner filed S.A No.90/2022 before the Tribunal. The application was resisted by the respondents 1 and 2 through their reply statement. (iv) To prove the actual state of affairs, the petitioner filed Ext P5 application to appoint an Advocate Commissioner to conduct a local inspection. The said application was also resisted by the respondents through Ext P6 counter affidavit. (v) The petitioner had produced several documents to prove that the secured assets are agricultural properties. The respondents 1 and 2 filed Exts P7 and P7A declarations to prove that the borrower and the guarantors of the loan had signed the declarations. 4 O.P(DRT) No.306 of 2023 (vi) While going through the declarations signed by Meenakumari.R - one of the mortgagors, it was found that her signature was forged. (vii) In the above background, the petitioner had filed I.A No.1094/2023 (Ext.P11), to send the forged declaration of Meenakumari for expert opinion. (viii) The Tribunal took a strange view, by holding that, as Meenakumari.R had not disputed her signature, the question of whether the declaration is forged can be considered along with determination of the Securitization Application. Subsequently, the petitioner filed IA 1406/2023, to review the order passed in Ext P11 application. The said application was also rejected. (ix) Then, the petitioner filed OP(DRT) No.234/2023 before this Court. By Ext P15 judgment, this Court had directed the Tribunal to consider the dispute raised by the petitioner at the appropriate stage and at the discretion of the Tribunal. (x) Immediately after passing of Ext P15 judgment, the petitioner filed an application for impleading Meenakumari.R as an additional third defendant. The application is not considered till date. Instead, 5 O.P(DRT) No.306 of 2023 the Tribunal, by Ext P16 order, has rejected IA No.3474/2022 filed to stay the recovery proceedings. (xi) Ext P16 is patently erroneous and illegal. Hence, the original petition. 3. Heard; Sri.George Thomas, the learned Senior Counsel appearing for the petitioner and Sri.Sunil Shankar, the learned Standing Counsel appearing for respondents 1 and 2. Notice to respondents 3 and 4 is dispensed with. 4. The question is whether there is any illegality in Ext P16 order ? 5. Challenging the recovery proceedings initiated by the respondents 1 and 2 , the petitioner has filed S.A No.90/2022 before the Tribunal under Sec.17 of the Act. Along with the Securitization Application, the petitioner had filed IA No.3474/2022, to stay the recovery proceedings. 6. During the pendency of the Securitization Application, the petitioner had sought to send the declaration allegedly executed by one of the guarantors for expert opinion. The Tribunal dismissed the said application. Challenging the order, the petitioner filed OP(DRT) 6 O.P(DRT) No.306 of 2023 No.234/2023, which was disposed of by this Court, by Ext P15 ## judgment, holding thus: “11. On an analysis of the findings of the Tribunal in Exts P16 and P21orders, it undoubtedly establishes that the Tribunal has only deferred the question regarding the genuineness of Exts.P10 and P10A declarations, purportedly signed by Meenakumari.R, with the determination of the securitisation application. The Tribunal has in unequivocal terms held that it would consider the said question at the time of consideration of S.A. 12. In addition to the above, I also find sufficient force in the contention of Sri.Sunil Shanker that, if Meenakumari.R has a case that her signatures are forged on Exts.P10 and P10A, it is for her to come forward and put up such a plea. Nonetheless, I am of the view that the petitioner can always raise the said contention, so far as when recovery proceedings are initiated against the properties covered by the alleged forged declarations, but subject to the condition that Meenakumari establishing and proving that she has not executed the declarations as sworn by her in Ext.P13 affidavit. If the petitioner can shift the initial onus of proof and prima facie prove its case on the said point then Tribunal would be at liberty to exercise its powers under Section 73 of the Indian Evidence Act, 1872 and compare the signatures on Exts.P10, P10A and P12. If the Tribunal is convinced and satisfied of the case putforth by the petitioner, then the Tribunal may, in its discretion, refer the disputed document for expert opinion. 13. It is to be remembered that the expert opinion is one of the weakest forms of evidence, which is only to be accepted with due care and circumspection. 14. It is trite; that the supervisory powers of this Court is not to correct every error of fact or even a legal flaw. The power under Article 227 of the Constitution of India is to be exercised sparingly and only in appropriate cases, to keep the 7 O.P(DRT) No.306 of 2023 Courts/Tribunals within their bounds of its authority and avoid miscarriage of justice. 15. As already observed, since the Tribunal has only deferred the decision to consider the question as to whether Exts.P10 and P10A declarations are forged or not, I do not find any error or illegality in the in the impugned orders warranting interference by this Court under Article 227 of the Constitution of India. Resultantly, the original petition is disposed of, directing the Tribunal to consider the dispute raised by the petitioner regarding the signatures of Meenakumari.R on Exts.P10 and P10A declarations, at the appropriate stage and at the discretion of the Tribunal.” 7. Subsequent to the passing of Ext P15 judgment, the petitioner moved IA No.3474/2022, to stay the recovery proceedings. 8. The Tribunal, after appreciating the rival pleadings, by Ext P16 order had held that the petitioner has not made out a prima facie case to stay the recovery proceedings during the pendency of the securitisation application. 9. By Ext P16 order, the Tribunal has rejected the petitioner’s application for an interim relief, pending disposal of the securitisation application. 10. Sec.18 of the Act specifically provides that any person aggrieved by any order of the Tribunal passed under Sec.17 of the Act 8 O.P(DRT) No.306 of 2023 has a remedy of appeal before the Appellate Tribunal within thirty days from the date of receipt of an order. 11. Sri.George Thomas placed reliance on the decision of the Hon’ble Supreme Court in **Axis Bank vs. SBS Organics (P) Ltd and another** [(2016) 12 SCC 18] and contended that an appeal under Sec.18 of the Act will lie only against the final order passed under Sec.17 of the Act. 12. The above submission was countered by Sri.Sunil Shankar, who placed reliance on **Mardia Chemicals Ltd and others vs. Union of India** [(2004) 4 SCC 311] and submitted that an appeal under Sec.18 of the Act will lie against any order passed by the Tribunal under Sec.17 of the Act. 13. The legal position regarding maintainability of an appeal against any order passed under Sec.17 of the Act (whether interlocutory or final) is no longer res-integra in the light of the Division Bench decision of this Court in **Varghese A.P vs. Chief Manager, Vijaya Bank and others** [2019 (5) KHC 685] . 14. In **Waryam Singh and another vs. Amarnath and another** [AIR 1954 SC 215], **Shalini Shyam Shetty and another vs.** 9 O.P(DRT) No.306 of 2023 **Rajendra Shankar Patil** [ (2010) 8 SCC 329], **M/s.Garment Craft vs. Prakash Chand Goel** [(2022) 4 SCC 181] and a host of other judicial precedents the Hon’ble Supreme Court has delineated the powers of the High Courts under Article 227 of the Constitution of India. It is well settled that the said power is to be exercised only to keep the Courts of District Judiciary/ Tribunals within their bounds of authority and to see that they do their duty as expected of them in a legal manner. The power is restricted to the cases of serious dereliction of duty and flagrant violation of fundamental principles of law and justice, where if this Court does not interfere, a grave injustice will remain uncorrected. But, this does not mean that the said power is to be exercised indiscriminately, that too interfere with discretionary orders. 15. The Hon’ble Supreme Court in **South Indian Bank Ltd vs. Naveen Mathew Philip (2023 LiveLaw (SC) 320),** after adverting to a myriad of earlier judicial pronouncements rendered under the Act, has categorically declared that High Courts shall not, unless in extra ordinary circumstances, interfere with proceedings initiated under the Securitisation and Reconstruction of Financial Assets and Enforcement 10 O.P(DRT) No.306 of 2023 of Security Interest Act, 2002, in writ proceedings under Article 226 of the Constitution of India. 16. In the light of the alternative statutory remedy available to the petitioner, I am not inclined to entertain the original petition and interfere with Ext P16 order the of by exercising power superintendence of this Court under Article 227 of the Constitution of India. Resultantly, the original petition is dismissed without prejudice to the right of the petitioner to work out its remedies, in accordance with law. **sd/-** **C.S.DIAS, JUDGE** sks/11.8.2023 11 O.P(DRT) No.306 of 2023 ## **`APPENDIX OF OP (DRT) 306/2023`** ``` PETITIONER EXHIBITS Exhibit P1TRUE PHOTOCOPY OF THE DEMAND NOTICE DATED 10/08/2021 U/S 13(2) OF THE SARFAESI ACT Exhibit P2TRUE PHOTOCOPY OF THE DETAILED OBJECTIONS SUBMITTED BY THE MANAGING PARTNER OF THE PETITIONER DATED 8.10.2021 Exhibit P3TRUE PHOTOCOPY OF THE REPLY DATED 26.10.2021 SENT BY THE 2ND RESPONDENT Exhibit P4TRUE PHOTOCOPY OF THE POSSESSION NOTICE DATED 01.01.2022 ISSUED BY THE 2ND RESPONDENT ALONG WITH THE TYPED COPY Exhibit P5TRUE PHOTOCOPY OF THE IA 48 OF 2023 IN SA 90 OF 2022 DATED 05/01/2023 FILED BEFORE DRT 2 ERNAKULAM Exhibit P6TRUE PHOTOCOPY OF THE COUNTER AFFIDAVIT FILED IN IA 48 OF 2023 IN SA 90 OF 2022 DATED 10/01/2023 Exhibit P7TRUE PHOTOCOPY OF THE DECLARATION SAID TO HAVE BEEN MADE BY MRS. MEENAKUMARI R DATED 12.03.2018 Exhibit P7ATRUE PHOTOCOPY OF THE DECLARATION SAID TO HAVE BEEN MADE BY MRS. MEENAKUMARI R DATED 13.03.2018 Exhibit P8TRUE PHOTOCOPY OF THE SANCTION LETTER DATED 13.11.2017 Exhibit P9TRUE PHOTOCOPY OF THE ADMITTED AND FORGED SIGNATURES OF MRS. MEENAKUMARI R Exhibit P10TRUE PHOTOCOPY OF THE AFFIDAVIT FILED BY MRS. MEENAKUMARI R. DATED 04/04/2023 SWORN BEFORE THE NOTARY Exhibit P11TRUE PHOTOCOPY OF THE IA 1094 OF 2023 IN SA 90 OF 2022 DATED 23/03/2023 FILED BY ``` 12 ## O.P(DRT) No.306 of 2023 ``` PETITIONER BEFORE DRT 2 ERNAKULAM ``` ``` Exhibit P12TRUE PHOTOCOPY OF THE COUNTER AFFIDAVIT FILED IN IA 1094 OF 2023 IN SA 90 OF 2022 DATED 31/03/2023 ``` ``` Exhibit P13TRUE PHOTOCOPY OF THE PROCEEDINGS IN SA 90 OF 2022 DATED 11/04/2023 DOWNLOADED FROM THE OFFICIAL WEBSITE OF DEBTS RECOVERY TRIBUNAL ``` ``` Exhibit P14TRUE PHOTOCOPY OF THE ORDER PASSED BY HON'BLE DRT DISMISSING THE REVIEW PETITIONS DATED 19/05/2023 ``` ``` Exhibit P15TRUE PHOTOCOPY OF THE IA 2097 OF 2023 IN SA 90 OF 2022 DATED 21.06.2023 FILED BEFORE DRT 2 ERNAKULAM ``` ``` Exhibit P16TRUE PHOTOCOPY OF THE ORDER PASSED BY HON'BLE DRT 2 ERNAKULAM IN IA 3474 OF 2022 IN SA 90 OF 2022 DATED 17/07/2023 ```