State Bank of India v. Circle Inspector of Police, Angamaly Police Station and others

## **`IN THE HIGH COURT OF KERALA AT ERNAKULAM`** ## **`PRESENT`** ## **`THE HONOURABLE MR.JUSTICE N.NAGARESH`** ``` THURSDAY, THE 6[TH] DAY OF JUNE 2024 / 16TH JYAISHTA, 1946 WP(C) NO. 14875 OF 2024 ``` ## **`PETITIONER:`** ``` STATE BANK OF INDIA,REPRESENTED BY ITS AUTHORIZED OFFICER, AGED 56 YEARS STRESSED ASSETS RECOVERY BRANCH-I, 7TH FLOOR, VANKARATH TOWERS ,PALARIVATTOM BYPASS JUNCTION, ERNAKULAM DISTRICT PIN DULY REPRESENTED BY ITS AUTHORIZED OFFICER MRS. SOBHANA BALAKRISHNAN , D/O. E K BALAKRISHNAN, PIN – 682024 ``` ``` BY ADV SMT.S.LAKSHMY ``` ## **`RESPONDENTS:`** - **`1 CIRCLE INSPECTOR OF POLICE , ANGAMALY POLICE STATION ERNAKULAM DISTRICT, PIN – 680308`** - **`2 BABU MP., AGED 55 YEARS MOONJELI HOUSE, CHURCH NAGAR, ANGAMALY, ERNAKULAM DISTRICT, PIN – 683572`** - **`3 MOLLY BABU , AGED 50 YEARS MOONJELI HOUSE, CHURCH NAGAR, ANGAMALY, ERNAKULAM DISTRICT, PIN – 683572`** - **`4 M/S BENZER STEELS PVT LTD. , MOONJELI HOUSE, CHURCH NAGAR, ANGAMALY, ERNAKULAM DISTRICT, PIN- 683572 DULY REPRESENTED BY ITS MANAGING DIRECTOR - BABU M P , MOONJELI HOUSE, CHURCH NAGAR, ANGAMALY, ERNAKULAM DISTRICT, PIN – 683572`** 2 W.P. (C) No.14875 of 2024 ``` 5MR. BINO BABU , S/O MR. M.P. BABU AMOONJELI HOUSE, CHURCH NAGAR, ANGAMALY, ERNAKULAM DISTRICT, PIN – 683572 ``` ``` BY ADVS. SRI.BIJU ANTONY ALOOR K.P.PRASANTH(K/000536/2017) HASEEB HASSAN.M(K/796/2023) KRISHNASANKAR D.(K/726/2022) ASOKAN K.V.(K/000373/2023) REBIN VINCENT GRALAN(K/000473/2015) ``` ``` THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 06.06.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ``` W.P. (C) No.14875 of 2024 3 ## **N. NAGARESH, J.** **---------------------------W.P. (C) No.14875 of 2024** **--------------------------------------------------** _**Dated this the 6[th] day of June, 2024**_ ## **JUDGMENT** The petitioner is a secured creditor. The 4[th] respondent, which is a Private Limited Company, approached the Angamaly Branch of erstwhile State Bank of Travancore for credit facilities Cash Credit Hypothecation of Rs.50,00,000/-. The petitioner granted the said credit facilities on 04.02.2015 to the 4[th] respondent. The 2[nd] and 3rd respondents, stood as guarantors to the said transaction. 2. The 4[th] respondent further approached the Angamaly Branch of the petitioner for enhancement of credit facilities on various dates, which was granted by the petitioner. The 2[nd] respondent substituted the security and created equitable mortgage of the properties covered by Deed No.538/2015, SRO Angamaly. The 2[nd] respondent further ## W.P. (C) No.14875 of 2024 4 confirmed the creation of equitable mortgage by executing Memorandum of Deposit of Title Deeds in favour of the petitioner. 3. The loan account of the 4[th] respondent was irregular and hence, was classified as Non-performing Asset. The petitioner proceeded against the secured assets under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 and the Security Interest (Enforcement) Rules, 2002. 4. The 2[nd] and 3[rd] respondents approached the Debts Recovery Tribunal-I, Ernakulam against the proceedings initiated by the petitioner under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 and the Security Interest (Enforcement) Rules, 2002 by filing SA No.307/2022. The said SA is pending consideration before the Debts Recovery Tribunal-I, Ernakulam. ## W.P. (C) No.14875 of 2024 5 5. The 2[nd] respondent approached this Court challenging the proceedings initiated by the petitioner under the SARFAESI Act, 2002 by way of W.P.(C) No.21927/2023. The 2[nd] respondent sought the permission of this Court to withdraw the same and this Court permitted the 2[nd] respondent to withdraw the writ petition. 6. The petitioner approached the Chief Judicial Magistrate’s Court, Ernakulam by filing MC No.1122/2022 to take physical possession of the secured asset. Respondents 2 and 3 further approached the Debts Recovery Tribunal-I, Ernakulam challenging the measures initiated by the petitioner under Section 14 of the SARFAESI Act, 2002. The Debts Recovery Tribunal-I, Ernakulam has dismissed I.A. No.3480/2023 in SA No.307/2022. 7. Respondents 2 and 3 then approached this Court by filing OP(DRT) No.533 of 2023 challenging the dismissal of I.A. No.3480/2023 in SA No.307/2022, Debts Recovery Tribunal-I, Ernakulam. Respondents 2 and 3 sought leave of W.P. (C) No.14875 of 2024 6 this Court to withdraw the OP(DRT) and the OP(DRT) was withdrawn granting liberty to approach this Court, if situation so warrants. 8. Physical possession of the secured asset was taken over by the Bank on 05.12.2023. Respondents 2 and 3 along with respondents 5 and 6 trespassed into the secured asset and the petitioner preferred a complaint before the 1[st] respondent for offences punishable under Sections 441, 443 and 445 of the Indian Penal Code, 1860. The 1[st] respondent removed respondents 2 and 3 and respondents 5 and 6 from the secured asset. The petitioner put the secured asset to sale on 15.03.2024. 9. Counsel entered appearance on behalf of respondents 2 and 3 and resisted the writ petition. The counsel submitted that there is no trespass as alleged by the petitioner. The petitioner-Bank is not entitled for the reliefs sought for in the writ petition. The writ petition is liable to be dismissed, contended respondents 3 and 4. 7 W.P. (C) No.14875 of 2024 10. Heard. 11. It is not in dispute that the physical possession of the secured assets was taken over by the petitioner-Bank on 05.12.2023 on the basis of Section 14 order passed by the Chief Judicial Magistrate’s Court concerned. The grievance of the petitioner is that respondents 2 and 3 along with respondents 5 and 6 trespassed into the secured asset. 12. The petitioner filed a complaint before the Police. The 1[st] respondent removed respondents 2, 3, 5 and 6 from the secured asset. However, the respondents again trespassed into the property on 04.04.2024. It is in such circumstances that the petitioner is before this Court. 13. It is also to be noted that respondents 2 and 3 had approached this Court filing W.P.(C) No.10528/2024 and sought to command the Bank not to proceed further with Ext.P5 order of the Debts Recovery Tribunal. The said writ petition was dismissed by the judgment dated 20.05.2024. ## W.P. (C) No.14875 of 2024 8 14. The impact of taking over possession of a property through the assistance of a Court Commissioner under Section 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, came up for consideration before this Court in _**Kumaran A. A v. Superintendent of Police, Thrissur and others** [2022 (3) KLT 672]_ . This Court held that the purport of the Act is to divest the owner of a property in the enforcement of security interest and initiate measures to wipe off the liability by resorting to measures including sale. If measures taken for dispossession and consequent sale are inter meddled by persons like respondents 4 and 5, it would result in a mockery of the rule of law. The Will of the people reflected through the legislation will be seriously infringed, if the Court remains a mute spectator. 15. In the instant case, the borrowers had broken the locks and forcibly repossessed the secured asset which had by then become the property of the petitioner. The W.P. (C) No.14875 of 2024 9 dispossession of respondents 4 and 5 under Section 14 of the Act cannot be interfered with or infringed upon by any person after taking law into their own hands. When such illegal actions are taken, rule of law requires this Court to issue directions to the police force of the State to forcefully remove such trespassers. 16. In the present case, it is not in dispute that pursuant to the orders of the Chief Judicial Magistrate's Court under Section 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, the Advocate Commissioner has taken possession of the Secured Assets mortgaged by the 2[nd] respondent, on 05.12.2023. The said proceedings are not under challenge before any competent Court. In such circumstances, any continued possession by respondents 2, 3 or 4 can only be treated as trespass into the property. In the facts and circumstances of the case, the writ petition is disposed of commanding the 1[st] respondent to take 10 W.P. (C) No.14875 of 2024 immediate action on Ext.P13 and cause such steps to remove respondents 2 to 5 from the property. Sd/- **N. NAGARESH JUDGE** STB W.P. (C) No.14875 of 2024 11 ## **`APPENDIX OF WP(C) 14875/2024`** ## **`PETITIONER EXHIBITS`** ``` Exhibit P1TRUE COPY OF THE SANCTION LETTER DATED 04.02.2015 ``` ``` ExhibitP P2TRUE COPY OF THE SALE DEED NO. 538 OF 2015 DATED 18.02.2015, SRO ANGAMALY IN FAVOUR OF THE SECOND RE- SPONDENT Exhibit P3TRUE COPY OF THE MEMORANDUM OF DEPOSIT OF TITLE DEEDS DATED 16.03.2017 ``` - **`Exhibit P4 TRUE COPY OF THE NOTICE ISSUED UNDER SECTION 13(2) OF THE SE- CURITIZATION AND RECONSTRUCTION OF FINANCIAL ASSETS AND EN- FORCEMENT OF SECURITY INTEREST ACT, 2002 ISSUED ON THE SEC- OND TO FOURTH RESPONDENTS`** - **`Exhibit P5 TRUE COPY OF THE JUDGMENT IN WP(C) NO. 21927/2023 DATED 7.08.2023`** - **`Exhibit P6 TRUE COPY OF THE REPORT OF THE ADVOCATE COMMISSIONER ALONG WITH THE PHOTOGRAPHS EVIDENCING THE POSSESSION OF THE SECURED ASSET`** - **`Exhibit p7 TRUE COPY OF THE JUDGMENT IN OP (DRT) NO. 533/2023 DATED 2/2/2024`** - **`Exhibit p 8 TRUE COPY OF THE PRIVATE COMPLAINT DATED 21.12.2023 AND THE RECEIPT ISSUED BY STATION HOUSE OFFICER, ANGAMALY`** - **`Exhibit p9 TRUE COPY OF THE SALE NOTICE DATED 29.01.2024`** - **`Exhibit P10 RUE COPY OF THE WRIT PETITION NO. 10528/2024 FILED BY THE SECOND TO FOURTH RE- SPONDENTS I`** - **`Exhibit P11 TRUE COPY OF THE COUNTER AFFIDAVIT FILED BY THE PETITIONER IN WRIT PETITION NO. 10528/2024`** - **`Exhibit P12 TRUE COPY OF THE COMPLAINT BY EMAIL COMMUNICA- TION CAUSED TO THE FIRST RESPONDENT BY THE PETITIONER`** - **`ExhibitP 13 TRUE COPY OF THE COMPLAINT DATED 5.4.2024 AND THE RECEIPT ISSUED BY THE`** 12 W.P. (C) No.14875 of 2024 ``` FIRST RESPONDENT Exhibit P14THE PHOTOGRAPHS EVI- DENCING THE TRESPASS BY THE THIRD, FIFTH AND SIXTH RESPONDENTS ```