Sebastian Durom v. Authorised Officer, State Bank of India and Rani Thomas

# **`IN THE HIGH COURT OF KERALA AT ERNAKULAM`** ## **`PRESENT`** ## **`THE HONOURABLE MRS. JUSTICE ANU SIVARAMAN`** ``` THURSDAY, THE 8[TH] DAY OF JUNE 2023 / 18TH JYAISHTA, 1945 ``` ## **`WP(C) NO. 1882 OF 2016`** ## **`PETITIONER:`** ``` SEBASTIAN DUROM S/O.JOSEPH DUROM, CHULLICKAL HOUSE 16/1342, KOCHUPALLY ROAD, THOPPUMPADY, COCHIN - 5, ERNAKULAM DISTRICT. BY ADVS. R.GOPAN SHAJIN S.HAMEED ``` ## **`RESPONDENTS:`** ``` 1AUTHORISED OFFICER, SBI STATE BANK OF INDIA, 7TH FLOOR, VENKARATHU TOWERS, PALARIVATTOM, ERNAKULAM DISTRICT. 2RANI THOMAS, OLASSAYIL MK RAGHAVAN ROAD, KOOVAPPADAM, KOCHI - 682 002. BY ADVS. SMT.S.AMBILY SRI.BIJU JOSEPH SRI.BIJU JOSEPH SRI.K.K.CHANDRAN PILLAI SR. SRI.ROBIN THOMAS PHILIP ``` ``` THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 08.06.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ``` ``` WP(C) NO. 1882 OF 2016 ``` ``` 2 ``` ## **JUDGMENT** Dated this the 8[th] day of June, 2023 This writ petition is filed seeking the following reliefs:- - (i) Issue a writ of certiorari or other appropriate writ - direction or order quashing Exhibit P6. - (ii) Issue writ of mandamus to consider the request - letter Exhibit P7. (iii) Permit the petitioner to remit the balance amount of Rs 57,000,00/ (fifty seven lakhs only) and direct the bank to issue the sale certificate in favour of the petitioner, 2. Heard the learned counsel for the petitioner and the learned Senior Counsel appearing for the respondent. 3. It is submitted by the learned counsel for the petitioner that the petitioner had participated in an auction conducted in respect of property having 8.122 cents in Sy No.500/1 and 500/2 of Rameswaram Village, Kochi Taluk. The property was a secured asset and was brought to sale under the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. It is stated that the petitioner had paid an amount of Rs.7,60,000/- which is 10% of the total amount as earnest money for participating in the E auction. It ``` WP(C) NO. 1882 OF 2016 ``` ``` 3 ``` is stated that on confirmation of the auction the petitioner had an remitted an amount of Rs.11,50,000/- including the transfer charges on 19/12/2015, thereafter, the petitioner was unable to remit the balance 75% of the amount before 2/1/2016. It is stated that the petitioner received Ext.P6 letter dated 2/1/2016 stating that since the balance amount had not been paid within 15 days the further time granted from 18/12/2015, the entire amount of Rs.19,10,000/- paid by him stood forfeited in terms of the Rules. The learned counsel for the petitioner submits that the action taken by the bank in forfeiting the entire amount was completely untenable. The petitioner had thereafter submitted Ext.P7 representation which was also rejected. 4. The learned Senior Counsel appearing for the respondents submits that the provisions of the Rules make it abundantly clear that the balance amount has to be remitted by the auction purchaser within 15 days. It is submitted that the petitioner had remitted 25% of the amount but the balance amount of purchase price payable should have been paid on or before the 15[th] day of confirmation of the sale of the immovable property or such extended period as may be agreed upon, in writing, in any case ``` WP(C) NO. 1882 OF 2016 ``` ``` 4 ``` not exceeding 3 months. It is submitted that the petitioner had admittedly not paid the amount within 15 days or the extended time or even within the 3 months as provided in Rule 9(4) of the Security Interest (Enforcement) Rules, 2002. It is therefore submitted that there is no merit in the writ petition. It is further submitted that the proper remedy available to the petitioner was to have approach the Debt Recovery Tribunal with an application under Section 17(1) and that in case such a course of action is adopted, all the factual aspects of the matter can be considered. 5. The learned counsel for the petitioner places reliance on decisions of several High Courts stating that the remedy under Section 17(1) of the Securitisation (SARFAESI) Act is available only to a person who is aggrieved by any of the measures taken under Sub Section (4) of Section 13 by the secured creditor or his authorised officer and that since the petitioner is the auction purchaser he cannot be said to be a person aggrieved by the measures taken under Section 13(4) and he would not have right to approach the Debt Recovery Tribunal under Section 17. However, I notice that the Apex court in Agarwal Tracom Pvt.Ltd v. Punjab National Bank and others [2017 KHC 6808] has ``` WP(C) NO. 1882 OF 2016 ``` ``` 5 ``` considered the provisions of the Act and the Rules, specifically Rule 9(4) and (5) thereof and has held that the provision in Rule 9(5) of the Security Interest (Enforcement) Rules, 2002 to forfeit the deposit made by the auction purchaser in case the auction purchaser commits any default in paying installment of sale money to the secured creditor is a part of the measures specified in Section 13(4). It is therefore held that the expression “any of the measures” referred to in 13(4) taken by secured creditor or his authorized Officer in Section 17(1) would include all actions taken by the secured creditor under the Rules which relate to the measures specified in Section 13(4). It was held that the Writ Court and the Appellate Court was justified in dismissing the appellant’s writ petition on the ground of availability of alternative statutory remedy of filing an application under Section 17(1) of SARFAESI Act before the concerned tribunal to challenge the action of the Bank in forfeiting the deposit under Rule 9(5) of the Act, 2002. 6. The learned counsel for the petitioner would then contend that it was on account of the prevailing position, that an auction purchaser could not approach the Tribunal under Section 17(1) that the petitioner had approached this Court filing the instant writ ``` WP(C) NO. 1882 OF 2016 ``` ``` 6 ``` petition. It is submitted that in case the petitioner is being non suited on the ground of availability of an alternative remedy at this stage in the proceedings, the petitioner may at least be permitted to approach Debt Recovery Tribunal by enlarging the time available for the same. 7. Having considered the contentions advanced, I am of the opinion that the proper remedy available to the petitioner was to have approached the Debt Recovery Tribunal as against the order forfeiting the advance paid by him. In view of the fact that this Writ Petition had been admitted and had been pending before this Court from February, 2016 onwards, I am of the opinion that the petitioner is to be given a breathing time to approach the Tribunal and to raise his contentions in a properly constituted application under Section 17(1). In the above view of the matter, leaving open the contentions of the petitioner and granting him the liberty to approach the Tribunal with an application under Section 17(1), this Writ Petition is closed. In case the petitioner approaches the Tribunal within one month from today, the delay in filing the application shall be condoned by the Tribunal. In view of the fact that, the petitioner ``` WP(C) NO. 1882 OF 2016 ``` ``` 7 ``` submits that the matter has been pending since long the Tribunal shall endeavor to consider and pass final orders in the matter without undue delay. Sd/- **ANU SIVARAMAN JUDGE** ska ``` WP(C) NO. 1882 OF 2016 ``` ``` 8 ``` ## **`APPENDIX OF WP(C) 1882/2016`** ``` PETITIONER EXHIBITS EXHIBIT P1TRUE COPY OF SALE NOTICE DATED 11.11.2015. EXHIBIT P2TRUE COPY OF PAYMENT OF EARNEST AMOUNT 7,60,000/- DATED 11.12.2015 EXHIBIT P3A TRUE COPY OF THE NOTICE ISSUED BY RESPONDENT DATED 18.12.2015. EXHIBIT P4A TRUE COPY OF PROOF OF PAYMENT OF BALANCE AMOUNT 11,50,000/- DATED 19.12.2015. EXHIBIT P5A TRUE COPY OF LOAN SANCTION LETTER FROM INDUS IND BANK DATED 21.12.2015. EXHIBIT P6A TRUE COPY OF LETTER FROM RESPONDENT DATED 02.01.2016. EXHIBIT P7A TRUE COPY OF REPRESENTATION LETTER BY RESPONDENT DATED 06.01.2016. Exhibit P8A TRUE COPY OF THE RE AUCTION NOTICE AFFIXED DATED NIL. ```