Rajan and others v. Union of India and others
Case Details & Bench
- Court
- High Court of Kerala
- Hon'ble Judges
- N. Nagareesh
- Judgment Date
- 2024-01-10
- Court Decision / Holding
- The writ petition is dismissed. The petitioners are granted liberty to approach the Debts Recovery Tribunal. If they move to the DRT, the Tribunal shall consider the pendency of this writ petition before the Court for the purpose of condoning any delay in entertaining applications, if any.
- Final Disposition
- Writ petition dismissed; liberty to approach Debts Recovery Tribunal (DRT) with consideration of pendency/delay by the tribunal.
Parties to the Case
Appellants / Petitioners
- RAJAN
- LEELAMMA
- THANKAMMA
- VALSALA KUMARI KS
Respondents
- THE UNION OF INDIA
- RESERVE BANK OF INDIA
- THE SOUTH INDIAN BANK
- AUTHORISED OFFICER, SOUTH INDIAN BANK
- M.S. PRASAD S/O MADATHILPARAMBIL SIVARAMAN NAIR
- M/S FOTTON PAINTS PVT. LTD.
Legal Representation & Advocates
Counsels for Petitioners
- • Thareeq Anver K.
- • K. Salma Jennath
- • P.K. Vinod Kumar
- • Arun Chand
Counsels for Respondents
- • Sunil Shanker
- • George Zachariah Eruthickel
- • Vidya Gangadharan
- • Hareesh Anandan
- • Sandhra S
- • Sri S. Manu
Case Synopsis & Summary
This Kerala High Court writ petition, filed as WP(C) No.31244/2023, challenges an ongoing Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 proceeding initiated by a bank against a building owned by the fifth respondent. The petitioners are long-standing tenants (over 40 years) residing in the disputed property, which the owner mortgaged to the third respondent bank to secure a loan; the bank now seeks to realize the debt by taking possession. The petitioners contend they were unaware of the mortgage and argue that the tenant’s rights are superior to the mortgagee’s during securitization proceedings, asserting that eviction and dispossession without due process would violate fundamental rights. They criticize the bank’s authorised officer as lacking authority to exercise powers beyond the secured creditor’s remit, and they challenge the suggestion that tenants must bear liability for the borrower's defaults. The case cites Vishal N. Kalsaria v. Bank of India and others to emphasize that tenancy, once created, requires due process and cannot be terminated arbitrarily. The court notes amendments in 2016 introducing Section 17(4A), which grants tenants a direct remedy before the Debts Recovery Tribunal (DRT) as a preferred forum, rendering a writ petition under Article 226 not maintainable. Ultimately, the court dismisses the writ but grants tenants the liberty to approach the DRT, with the DRT to consider any pending writ-petition-related delay issues.
Provisions of Law Cited
Legal Doctrines & Maxims
- Due process of law
- Right of mortgagee is subject to the right of the tenants
Submissions & Arguments
Contentions of Appellants / Petitioners
The petitioners contend that the 5th respondent mortgaged the property after roughly four decades of tenancy, so the mortgagee’s rights must acknowledge and respect the tenants’ occupancy and remaining livelihoods. They argue the Authorized Officer lacks authority to exceed the secured creditor’s powers, especially given the tenants’ long-standing status and lack of alternate housing. They emphasize that tenancy constitutes a protected interest and that eviction without due process contravenes constitutional guarantees, citing Vishal N. Kalsaria v. Bank of India and others to support the requirement of due process for eviction after tenancy is created. They also challenge differential filing fees for tenants and assert that tenants who occupied tenanted property before lending should not bear borrower-default liabilities. They invoke statutory amendments enabling tenant access to the DRT under Section 17(4A).
Contentions of Respondents
The respondents assert that the remedy lies with the Debts Recovery Tribunal under the 2016 amendment and that the writ petition under Article 226 is not maintainable. They maintain that the bank’s mortgage and security rights authorize it to proceed with recovery and that tenancy does not automatically bar such actions, urging the tribunal to decide matters of tenancy and possession within the framework of securitization proceedings. They argue that the petitioners’ eviction claims must be evaluated by the DRT, and that condoning any delay can be considered within the tribunal’s proceedings.
Cited Precedents (1)
| Case Name | Citation | Treatment | Explanation |
|---|---|---|---|
| Vishal N. Kalsaria v. Bank of India and others | [(2016) 3 SCC 762] | Mentioned Only | Cited to support the principle of due process in tenancy matters; the court does not rely on it to overrule or distinguish a contrary position. |
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