# **`IN THE HIGH COURT OF KERALA AT ERNAKULAM`**
## **`PRESENT`**
## **`THE HONOURABLE MR.JUSTICE N.NAGARESH`**
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TUESDAY, THE 28[TH] DAY OF MAY 2024 / 7TH JYAISHTA, 1946
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WP(C) NO. 7779 OF 2024
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OA NO.460 OF 2022 OF DEBT RECOVERY TRIBUNAL, ERNAKULAM
PETITIONER/DEFENDANT:
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RAJAGOPAL V.
AGED 54 YEARS, S/O. VISWANATHA VELAR S.
NO.8/470, KUPPAYANCHALLA, K.K.POST,
THEKKEDESAM VILLAGE, CHITTUR TALUK,
PIN – 678 101.
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BY ADVS.
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REJI GEORGE
ANUPAMA JOHNY
SAISANKAR.S
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## **`RESPONDENT/APPLICANT:`**
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1STATE BANK OF INDIA
ASSET RECOVERY AND MANAGEMENT BRANCH, 40/947,
1ST FLOOR R.S. BUILDING,
OPP. MAHARAJAS COLLEGE GROUND, M.G.ROAD,
ERNAKULAM, REPRESENTED BY ITS CHIEF MANAGER,
PIN – 682 011.
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2THE AUTHORIZED OFFICER
STATE BANK OF INDIA,
ASSET RECOVERY AND MANAGEMENT BRANCH, 40/947,
1ST FLOOR R.S. BUILDING,
OPP. MAHARAJAS COLLEGE GROUND, M.G.ROAD,
ERNAKULAM, PIN – 682 011.
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BY ADV
TOM K.THOMAS
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THIS WRIT PETITION (CIVIL) HAVING COME UP FOR
ADMISSION ON 28.05.2024, THE COURT ON THE SAME DAY
DELIVERED THE FOLLOWING:
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## **JUDGMENT**
Dated this the 28[th] day of May, 2024
The petitioner, who has availed financial assistance from the State Bank of India and who is facing coercive proceedings under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, has filed this writ petition invoking Article 226 of the
Constitution of India seeking the following reliefs:
i. To set aside Ext.P11 possession notice issued by the second Respondent and Ext.P13 order issued by the Chief Judicial Magistrate’s Court, Palakkad in M.C.No.3/2024.
ii. To dispense with the filing of the translation of the documents in vernacular language.
iii. To pass such other order or direction as is found just and proper to the facts and circumstances of the case.
2. It is evident from the pleadings that the petitioner
has approached this Court challenging Ext.P11 Possession Notice and Ext.P13 order issued by the Chief Judicial Magistrate Court, Palakkad, which are impugned orders passed under Sections 17 and 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of
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Security Interest Act, 2002. The petitioner has therefore an effective remedy before the Debts Recovery Tribunal.
3. Counsel appearing for the petitioner would urge that the property proceeded against by the Bank is being an agricultural property, it cannot be a secured asset. If it is not a secured asset, then the petitioner is at liberty to approach this Court under Article 226 of the Constitution of India or any other court. The petitioner cannot be forced to approach the Debts Recovery Tribunal itself.
4. The Counsel for the petitioner relied on the Division Bench judgment of this Court in _**Elsamma and Others v. Kaduthuruthy Urban Co-operative Bank Limited and Others [2018 (5) KHC 701],**_ wherein this Court held as follows:
_7.It was inter alia contended that Sub-sections (2) and (3) of Section 17 of the SARFAESI Act provide sufficient safeguards for restoration of possession of property which is not a secured asset. Section 17(2) enables the Debts Recovery Tribunal to consider as to whether the measures taken by the secured creditor for enforcement of security are proper. Section 17(3) which follows Section 17(2) empowers the Debts Recovery Tribunal to declare the measures taken as invalid and restore possession. Both Sections 17(3) and 17(2) of the SARFAESI Act are confined to the measures taken by the 'secured creditor' and in relation to the 'secured_
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_asset'. We do not think that the above statutory provisions can be called in aid when property which is allegedly not a secured asset is to be taken possession of. The parties need be relegated to Section 17 of the SARFAESI Act only if it is found that the acts complained of are in relation to a property which is a secured asset._
_xxxx xxxx xxxx_
_13.To sum up:_
_(i) The jurisdiction of the Civil Court is not barred if the plea is that the plaint schedule property is not the secured asset in respect of which a security interest is created. (ii) The Civil Court shall decline jurisdiction if it is found in the midst of adjudication that the disputed property is in fact the secured asset over which security interest is created._
_(iii) Any person aggrieved can also move the Debts Recovery Tribunal under Section 17 seeking clarification about the measures taken under Section 13(4) of the SARFAESI Act._
_(iv) The decision in KHDFC Bank Ltd.'s case (supra) is approved and does not militate against Jagdish Singh's case (supra) wherein the property is admittedly a secured asset._
5. Standing Counsel entered appearance on behalf of
the respondents and resisted the writ petition filing a counter affidavit. In the counter affidavit, the respondents submitted that the question as to the nature of the secured asset cannot be adjudicated before this Court under Article 226 of the Constitution of India, in view of the fact that disputed facts are involved. The documents produced by the petitioner in support of his contention that the property in question is an agricultural
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property cannot be relied on by this Court to hold that the property of the petitioner is an agricultural land. Moreover, two items of property are proceeded under the provisions of the SARFAESI Act. The documents produced by the applicant shows that only an extend of 2.5 Ares of land is utilised for agricultural purpose. From the description of the property No.2 it could be seen that the said property is a house site, wherein the residential building of the petitioner is situated.
6. The notice under 13(2) of the SARFAESI Act was issued to the petitioner as early as on 03.06.2022. The petitioner received the above notice. However, no reply/objection was given by the petitioner, whereby accepting that the property described therein are liable to be proceeded under the provisions of the SARFAESI Act. Once the notice of demand is served, the mandate of the Act, as evident from Section 13(3) A, is the availability of an opportunity to the borrower to raise any objection against the notice Issued. This statutory notice enables the borrower to raise an objection to any of the ground available to him. In this case, admittedly no
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objection was raised by the borrower or guarantor in respect of the secured asset specifically scheduled in the notice issued under Sec. 13(2) of the Act. The petitioner did not avail the opportunity available to object. Hence, he cannot now turn around and question the proceedings initiated by the bank on the ground that the property proceeded against is liable to be exempted under Sec.31 (1) of the SARFAESI Act.
7. Heard the learned Counsel for the petitioner and the learned Standing Counsel for the respondents.
8. The argument of the petitioner, in short, is that the property proceeded against by the Bank is agricultural property and therefore, it is exempted from the proceedings, under Section 31(i) of the SARFAESI Act, 2002. The proceedings initiated by the Bank are therefore highly illegal and arbitrary. As the agricultural property of the petitioner cannot be a secured asset, if the Bank or anyone else tries to take possession of the said property, the petitioner can approach other Civil Courts than the Debts Recovery Tribunal.
9. Assuming that the petitioner’s contention based on the Division Bench judgment in _**Elsamma and**_
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_**Others** (Supra)_ is correct, even then a writ petition under Article 226 of the Constitution of India is not maintainable, as the dispute involved becomes a dispute of civil nature between the petitioner and the Bank.
10. In such circumstances, the petitioner may have to approach the Civil Court / Debts Recovery Tribunal, as the petitioner is advised.
With the above observation, the writ petition is disposed of.
Sd/-
**N. NAGARESH**
**JUDGE**
AMR
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## **`APPENDIX OF WP(C) 7779/2024`**
## **`PETITIONER’S EXHIBITS`**
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Exhibit P1
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A TRUE COPY OF PARTITION DEED
NO.1653/1961 DATED 11.12.1961 OF CHITTUR
SUB REGISTRY.
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- **`Exhibit P1(a) A TRUE COPY OF PURCHASE CERTIFICATE NO.457/1971 DATED 27.10.1971 ISSUED BY THE LAND TRIBUNAL, CHITTUR.`**
- **`Exhibit P2 A TRUE COPY OF PADDY RECEIPT SHEET DATED 03.04.2008 ISSUED BY THE KERALA STATE CIVIL SUPPLIES CORPORATION LTD.`**
- **`Exhibit P2(a) A TRUE COPY OF PADDY RECEIPT SHEET DATED 29.10.2009 ISSUED BY THE KERALA STATE CIVIL SUPPLIES CORPORATION LTD.`**
- **`Exhibit P2(b) A TRUE COPY OF PADDY RECEIPT SHEET DATED 06.05.2022 ISSUED BY THE KERALA STATE CIVIL SUPPLIES CORPORATION LTD.`**
- **`Exhibit P2(c) A TRUE COPY OF PADDY RECEIPT SHEET DATED 16.05.2023 ISSUED BY THE KERALA STATE CIVIL SUPPLIES CORPORATION LTD.`**
- **`Exhibit P3 A TRUE COPY OF O.A.NO.460/2022, WITHOUT ITS ANNEXURES, FILED BY THE FIRST RESPONDENT BEFORE THE DEBTS RECOVERY TRIBUNAL - I, ERNAKULAM.`**
- **`Exhibit P4 A TRUE COPY OF THE LETTER OF SANCTION DATED 01.07.2010 OF THE AGRI CASH CREDIT FACILITY OF RS.1,00,000/- PRODUCED AS ANNEXURE-A1 ALONG WITH EXT.P3 MEMORANDUM OF ORIGINAL APPLICATION.`**
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Exhibit P5A TRUE COPY OF THE AGREEMENT FOR
HYPOTHECATION DATED 07.07.2010 PRODUCED
AS ANNEXURE-A2 ALONG WITH EXT.P3
MEMORANDUM OF ORIGINAL APPLICATION.
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Exhibit P6
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A TRUE COPY OF THE LETTER OF ARRANGEMENT
DATED 18.08.2016 PRODUCED AS ANNEXURE-A3
ALONG WITH EXT.P3 MEMORANDUM OF ORIGINAL
APPLICATION.
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Exhibit P7A TRUE COPY OF THE HYPOTHECATION
AGREEMENT DATED 18.08.2016 PRODUCED AS
ANNEXURE-A4 ALONG WITH EXT.P3 MEMORANDUM
OF ORIGINAL APPLICATION.
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- **`Exhibit P8 A TRUE COPY OF CERTIFICATE NO.77/2023 DATED 25.09.2023 ISSUED BY THE VILLAGE OFFICER, THEKKEDESAM.`**
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Exhibit P9A TRUE COPY OF CERTIFICATE NO. NIL DT.
21.09.2023 ISSUED BY THE AGRICULTURAL
OFFICER, KRISHI BHAVAN, NALLEPPILLI,
PALAKKAD.
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- **`Exhibit P10 TWO PHOTOGRAPHS OF THE MORTGAGED PROPERTY OWNED BY THE PETITIONER'S FATHER.`**
- **`Exhibit P11 A TRUE COPY OF THE POSSESSION NOTICE DT.15.09.2023 ISSUED BY THE FIRST RESPONDENT TO THE PETITIONER`**
- **`Exhibit P12 A TRUE COPY OF THE NOTICE DT.09.02.2024 ISSUED TO THE PETITIONER BY THE ADVOCATE COMMISSIONER IN M.C.NO.3/2024 ON THE FILE OF THE CHIEF JUDICIAL MAGISTRATE'S COURT, PALAKKAD.`**
- **`Exhibit P13 A TRUE COPY OF THE ORDER DATED 08.01.2024 PASSED BY THE CHIEF JUDICIAL MAGISTRATE'S COURT, PALAKKAD IN M.C.NO.3/2024.`**
## **`RESPONDENTS’ EXHIBITS`**
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Exhibit R1(a)TRUE COPY OF THE NOTICE UNDER SEC.13(2)
OF THE SARFAESI ACT DATED 03.06.2022
ISSUED TO THE PETITIONER
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