S. Jayasree v. Repco Home Finance Ltd.

# **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE THE CHIEF JUSTICE MR.S.MANIKUMAR** **&** **THE HONOURABLE MR. JUSTICE SHAJI P.CHALY** **FRIDAY, THE 12TH DAY OF JUNE 2020 / 22ND JYAISHTA, 1942** **WA.No.740 OF 2020** **AGAINST THE ORDER/JUDGMENT IN WP(C) 33232/2019(D) OF HIGH COURT OF KERALA** ## **APPELLANT/PETITIONER IN W.P.(C):** **S.JAYASREE AGED 51 YEARS W/O. SREEKUMAR, RESIDING AT SREEPADHAM, PERUMPAIKADU VILLAGE, NATTASSERY, S.H MOUNT (P.O) KOTTAYAM, KERALA, PIN 686 006** **BY ADVS. SRI.M.V.THAMBAN SRI.R.REJI SMT.THARA THAMBAN SRI.B.BIPIN SMT.RENI JAMES** ## **RESPONDENTS:** **1 REPCO HOME FINANCE LTD. REPRESENTED BY ITS MANAGING DIRECTOR, REPCO TOWER, NO. 33, NORTH USMAN ROAD, T. NAGAR, CHENNAI - 600 017 2 THE AUTHORIZED OFFICER, REPCO TOWER, NO. 33, NORTH USMAN ROAD, T. NAGAR, CHENNAI - 600 017 3 THE MANAGER, REPCO HOME FINANCE LTD, 1ST FLOOR, MARWA SQUARE, WEST NADA, THIRUNAKKARA, KOTTAYAM, PIN - 686 001** ## **SRI.P.PAULOCHAN ANTONY, STANDING COUNSEL SC FOR RESPONDENTS** **THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 12.06.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** WA.No.740 OF 2020 2 ## **J U D G M E N T** ## **S.MANIKUMAR,CJ** Instant writ appeal is filed against the judgment dated 23[rd] January, 2020 in W.P.(C) No.33232 of 2019. The said judgment is extracted below: “ ## **J U D G M E N T** The prayers in the above writ petition civil are as follows: 1. Issue a writ of certiorari or any other appropriate writ, order or direction, calling for the records leading upto to Ext.P5 and quash Ext.P5. 2. Issue a writ of mandamus or any other appropriate writ, order or direction, against the respondent to regularize the loan account referred in Ext.P5 notice and direct the respondents to grant breathing time to the petitioner to wipe out the defaulted monthly installment amounts. 2. Heard Sri. M.V Thamban, learned counsel appearing for the petitioner and Sri. P. Poulochan Antony, learned counsel appearing for the respondent (Repco Home Finance Ltd). 3. Sri. P. Poulochan Antony, learned counsel appearing for the respondent Repco Home Finance Ltd, would submit on the basis of instructions that the overdues to be cleared by the petitioner as on 21/01/2020 for regularization of loan account comes to around Rs.4,00,155/- and that the respondent Home Finance Company is prepared to give the petitioner one last opportunity to clear such WA.No.740 OF 2020 3 overdues for regularizing the loan account, provided the petitioner proves his bonafides by remitting an amount of not less than Rs.50,000/on or before 10/02/2020 and in case if the petitioner complies with the said condition, then the respondent Home Finance Company will give the petitioner further time to clear the balance overdues in 6 equal monthly installments. 4. Sri. M.V Thamban, learned counsel appearing for the petitioner submits that the petitioner's husband is suffering from serious cancer ailments as can be seen from Ext.P1 discharge summary issued by the Department of Oncology of the Pushpagiri Medical College Hospital, Thiruvalla and that the installments may be upto 10. It is also pointed out by the petitioner's counsel that the petitioner has already complied with the conditional interim order passed by this Court on 06/12/2019 by remitting an amount of Rs.50,000/- within the time deadline. Due to the persuasion made by this Court, respondent Home Finance Company does not appear to have very serious objection to the said suggestion made by this Court that the installments could be 10, taking into account the fact that the petitioner's husband is suffering from serious cancer ailments as can be seen from Ext.P1 discharge summary issued by the Medical College Hospital concerned. 4. Accordingly the following directions and orders are passed. (i) The competent official of the respondent Home Finance shall immediately furnish a comprehensive and authenticated statement of accounts pertaining to the loan transaction in question showing the precise details thereof and the total dues to be cleared by the borrower as on the date of issuance of the said statement. (ii) The petitioner will immediately pay an amount of not less than Rs.50,000/- to the respondent Home Finance Ltd on or before 15/02/2020. In case if the petitioner complies with the said condition to pay the said amount of Rs.50,000/- on or before WA.No.740 OF 2020 4 15/02/2020, then the respondent Bank will give further time to the petitioner to clear the balance overdues in 10 equal monthly installments, and each of such installment shall be payable on or before the last day of the month concerned starting from the month of March 2020 onwards. Until then, the respondent Bank may keep in abeyance, further steps pursuant to the impugned proceedings. However this is subject to the condition that petitioner shall also pay all the applicable charges and interest thereon and also should clear the regular EMI's in time. (iii) On the other hand, if the petitioner does not comply with any of the conditions or defaults with any one of the said instalments, then the respondent Home Finance will be at liberty to proceed with further steps pursuant to the impugned proceedings from the stage where it has stopped. With these observations and directions, the above Writ Petition (Civil) stands finally disposed of.” 2. Mr.M.V.Thamban, learned counsel for appellant, made submissions on the grounds raised in the appeal and sought for interference with the impugned judgment dated 23.1.2020. 3. We are not inclined to interfere with the same, for the reason that, time and again the Hon'ble Supreme Court has held that a writ against the proceedings under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, is not maintainable, when there is an alternative efficacious remedy provided under the said Act. WA.No.740 OF 2020 5 4. Reliance can be made on a decision of the Honourable Supreme Court in **Authorised Officer, State Bank of Travancore and another v. Mathew K.C.** reported in (2018) 3 SCC 85. Relevant portions quoted by the learned counsel read as under: “15. It is the solemn duty of the Court to apply the correct law without waiting for an objection to be raised by a party, especially when the law stands well settled. Any departure, if permissible, has to be for reasons discussed, of the case falling under a defined exception, duly discussed after noticing the relevant law. In financial matters grant of ex-parte interim orders can have a deleterious effect and it is not sufficient to say that the aggrieved has the remedy to move for vacating the interim order. Loans by financial institutions are granted from public money generated at the tax payers expense. Such loan does not become the property of the person taking the loan, but retains its character of public money given in a fiduciary capacity as entrustment by the public. Timely repayment also ensures liquidity to facilitate loan to another in need, by circulation of the money and cannot be permitted to be blocked by frivolous litigation by those who can afford the luxury of the same. The caution required, as expressed in Satyawati Tandon (supra), has also not been kept in mind before passing the impugned interim order:- “46. It must be remembered that stay of an action initiated by the State and/or its agencies/instrumentalities for recovery of taxes, cess, fees, etc. seriously impedes execution of projects of public importance and disables them from discharging their constitutional and legal obligations towards the citizens. In cases relating to recovery of the dues of banks, financial WA.No.740 OF 2020 6 institutions and secured creditors, stay granted by the High Court would have serious adverse impact on the financial health of such bodies/institutions, which (sic will) ultimately prove detrimental to the economy of the nation. Therefore, the High Court should be extremely careful and circumspect in exercising its discretion to grant stay in such matters. Of course, if the petitioner is able to show that its case falls within any of the exceptions carved out in Baburam Prakash Chandra Maheshwari v. Antarim Zila Parishad, Whirlpool Corpn. v. Registrar of Trade Marks and Harbanslal Sahnia v. Indian Oil Corpn. Ltd. and some other judgments, then the High Court may, after considering all the relevant parameters and public interest, pass an appropriate interim order.” 16. The writ petition ought not to have been entertained and the interim order granted for the mere asking without assigning special reasons, and that too without even granting opportunity to the Appellant to contest the maintainability of the writ petition and failure to notice the subsequent developments in the interregnum. The opinion of the Division Bench that the counter affidavit having subsequently been filed, stay/modification could be sought of the interim order cannot be considered sufficient justification to have declined interference. 17. The writ petition ought not to have been entertained and the interim order granted for the mere asking without assigning special reasons, and that too without even granting opportunity to the Appellant to contest the maintainability of the writ petition and failure to notice the subsequent developments in the interregnum. The opinion of the Division Bench that the counter affidavit having subsequently been filed, stay/modification could be sought of the interim order cannot be considered sufficient justification to have declined WA.No.740 OF 2020 7 interference. 18. We cannot help but disapprove the approach of the High Court for reasons already noticed in Dwarikesh Sugar Industries Ltd. vs. Prem Heavy Engineering Works (P) Ltd. and Another, 1997 (6) SCC 450, observing :- “32. When a position, in law, is well settled as a result of judicial pronouncement of this Court, it would amount to judicial impropriety to say the least, for the subordinate courts including the High Courts to ignore the settled decisions and then to pass a judicial order which is clearly contrary to the settled legal position. Such judicial adventurism cannot be permitted and we strongly deprecate the tendency of the subordinate courts in not applying the settled principles and in passing whimsical orders which necessarily has the effect of granting wrongful and unwarranted relief to one of the parties. It is time that this tendency stops.” ## 4. In **United Bank of India v. Satyawati Tondon and others** [(2010) 8 SCC 110], upon detailed consideration of the statutory scheme under the SARFAESI Act, 2002, availability of a remedy to the aggrieved under Section 17 before the Tribunal and the appellate remedy under Section 18 before the Appellate Tribunal, object and purpose of the legislation, Hon'ble Apex Court observed that a writ petition ought not to be entertained in view of the availability of an alternative statutory remedy, “43. Unfortunately, the High Court overlooked the settled law that the High Court will ordinarily not entertain a petition under Article 226 of the Constitution if an effective remedy is available to the aggrieved person and that this rule applies with greater rigour in matters WA.No.740 OF 2020 8 involving recovery of taxes, cess, fees, other types of public money and the dues of banks and other financial institutions. In our view, while dealing with the petitions involving challenge to the action taken for recovery of the public dues, etc. the High Court must keep in mind that the legislations enacted by Parliament and State Legislatures for recovery of such dues are a code unto themselves inasmuch as they not only contain comprehensive procedure for recovery of the dues but also envisage constitution of quasi-judicial bodies for redressal of the grievance of any aggrieved person. Therefore, in all such cases, the High Court must insist that before availing remedy under Article 226 of the Constitution, a person must exhaust the remedies available under the relevant statute. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55. It is a matter of serious concern that despite repeated pronouncement of this Court, the High Courts continue to ignore the availability of statutory remedies under the DRT Act and the SARFAESI Act and exercise jurisdiction under Article 226 for passing orders which have serious adverse impact on the right of banks and other financial institutions to recover their dues. We hope and trust that in future the High Courts will exercise their discretion in such matters with greater caution, care and circumspection.” ## 5. In **Civil Appeal Nos.10243-10250 of 2018 [ICICI Bank Ltd.** **v. Umakanta Mohapatra and Others]** , by order dated 5.10.2018, the Hon'ble Apex Court reaffirmed the legal position that High Court has no jurisdiction to entertain writ petitions under Article 226 of the Constitution of India, relating to matters coming under the purview of SARFAESI Act, 2002, where a statutory remedy is available by filing an application under WA.No.740 OF 2020 9 Section 17 of the said Act. In the light of the above discussion and decisions, the instant appeal is dismissed. **Sd/-** **S.MANIKUMAR CHIEF JUSTICE** smv **Sd/SHAJI P.CHALY JUDGE**