whether the civil Court has no jurisdiction for eviction of a tenant by landlord as the SARFAESI proceedings were initiated by the bank aganist the landlord ? - No The appellants herein/the tenants are neither the guarantors nor any person inducted into the possession of the secured asset/suit schedule property by way of a lease after notice under Section 13 (2) was given and default committed. Admittedly they have been inducted into the possession of the plaint schedule property on 01.11.2011 by virtue of an oral lease and they have committed default of payment of rent with effect from 01.12.2012 and the creditor bank took symbolic possession of the secured asset/plaint schedule property of the borrower/landlord on 18.09.2015 under the provisions of SARFAESI Act which was not injucted by the Courts below. The present case which was dealt by the Courts below is totally falls outside the purview of the proceedings of the SARFAESI Act and the Judgments and decrees of the Courts below do not hit or inject the Debt Recovery Tribunal or any other Appellate Tribunal to function under the provisions of SARFAESI Act with reference to the very same plaint schedule property which is a secured asset mortgaged by the borrower/the landlord/the respondent herein. There is no conflict of orders passed by the Courts below with the orders that may be passed under SARFAESI Act and RDBI Act 1993.
whether the civil Court has no jurisdiction for eviction of a tenant by landlord as the SARFAESI proceedings were initiated by the bank aganist the landlord ? - No
The appellants herein/the tenants are neither the guarantors nor any person inducted into the possession of the secured asset/suit schedule property by way of a lease after notice under Section 13 (2) was given and default committed. Admittedly they have been inducted into the possession of the plaint schedule property on 01.11.2011 by virtue of an oral lease and they have committed default of payment of rent with effect from 01.12.2012 and the creditor bank took symbolic possession of the secured asset/plaint schedule property of the borrower/landlord on 18.09.2015 under the provisions of SARFAESI Act which was not injucted by the Courts below.
The present case which was dealt by the Courts below is totally falls outside the purview of the proceedings of the SARFAESI Act and the Judgments and decrees of the Courts below do not hit or inject the Debt Recovery Tribunal or any other Appellate Tribunal to function under the provisions of SARFAESI Act with reference to the very same plaint schedule property which is a secured asset mortgaged by the borrower/the landlord/the respondent herein. There is no conflict of orders passed by the Courts below with the orders that may be passed under SARFAESI Act and RDBI Act 1993.
IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI
HON’BLE SRI JUSTICE B.KRISHNA MOHAN
SECOND APPEAL No.28 OF 2021
Between:
Barigala Kotesh, S/o. Peturu & another
… APPELLANTS
AND
Bandaru Yedukondalu, S/o. Venkateswarlu
... RESPONDENT
DATE OF JUDGMENT PRONOUNCED : 12.02.2021
SUBMITTED FOR APPROVAL
HONOURABLE SRI JUSTICE B. KRISHNA MOHAN
1. Whether Reporters of Local Newspapers
may be allowed to see the order? Yes/No
2. Whether the copy of order may be
marked to Law Reporters/Journals? Yes/No
3. Whether His Lordship wish to see the
fair copy of the order? Yes/No
_________________________
JUSTICE B. KRISHNA MOHAN
2 BKMJ
Sa No.28 of 2021
*IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI
*HONOURABLE SRI JUSTICE B. KRISHNA MOHAN
+ SECOND APPEAL No.28 OF 2021
% Dated : 12.02.2021
Between:
# Barigala Kotesh, S/o. Peturu & another
… APPELLANTS
AND
$ Bandaru Yedukondalu
... RESPONDENT
! Counsel for appellants : Mr. G. Rama Chandra Reddy
^Counsel for Respondent : Mr. Phani Teja Cheruvu
<GIST :
>HEAD NOTE:
? Cases referred:
1 Dt.11.09.2019 in Criminal Appeal Nos.1371 of 2019
2 Dt. 27.08.2020 in Civil Appeal Nos.2843-2844 of 2010
3 Dt. 21-01-2021 in SPECIAL LEAVE PETITION (C) Nos.15870 of 2020
4 Dt.06-05-2016 in CIVIL APPEAL Nos.4083-4084 of 2016
5 Dt. 25-11-2014 in CIVIL APPEAL No.10589 OF 2014
6 Dt. 17-07-2017 in CIVIL APPEAL No.9151 of 2017
7 Dt. 27-01-2021 in CIVIL APPEAL No.6744 of 2013
8 Dt.18.01.2016 in Civil Appeal No.167 of 2007
3 BKMJ
Sa No.28 of 2021
HON’BLE SRI JUSTICE B.KRISHNA MOHAN
SECOND APPEAL No.28 OF 2021
JUDGMENT:
This second appeal is filed against the Judgment and decree in
A.S.No.82 of 2020 on the file of the V Additional District Judge,
Guntur, FAC III Additional District Judge, Guntur, dated 21.12.2020
confirming the Judgment and decree in O.S.No.122 of 2016 on the file
of the Senior Civil Judge, Mangalagiri, dated 05.05.2020 ordering the
eviction of the appellants herein/tenants to deliver the vacant
possession of the plaint schedule property to the respondent
herein/landlord and comply with the other reliefs granted by the
Courts below.
2. The appellants herein are the appellants in the first appeal and
the defendants in the suit. The respondent herein is the respondent
in the first appeal and the plaintiff in the suit.
3. Heard the learned counsel for the appellants and the learned
counsel for the respondent.
4. The plaintiff initiated an action in O.S.No.122 of 2016 on the
file of the Senior Civil Judge, Mangalagiri against the defendants for
eviction and delivery of the vacant possession of the plaint schedule
property, for the payment of arrears of Rs.4,25,700/- and damages
for use and occupation unauthorisedly from 01.03.2016 to 31.05.2016
4 BKMJ
Sa No.28 of 2021
at the rate of Rs.20,000/- per month with interest at the rate of 24%
per annum from the date of suit till the date of realisation and costs.
5. The plaintiff contends that he is the absolute owner of the
plaint schedule property, the defendants herein took the said
property/apartment/flat on 01.11.2011 for a monthly rent of
Rs.8,000/- under an oral lease and the rent was enhanced to
Rs.12,900/- per month with effect from 01.12.2012, in-spite of
enjoying the possession of the said property as tenants, the
defendants have committed default in payment of monthly rent with
effect from 01.12.2012, due to which the plaintiff became a defaulter
before the creditor bank of ICICI Bank, in those circumstances he filed
a case in RCC No.4 of 2013 before the Rent Controller, Mangalagiri for
eviction against the 1st defendant and the same was allowed and the
appeal preferred by the 1st defendant/tenant in RCA was allowed
setting aside the order in RCC on the point of jurisdiction, as such the
defendants continued as tenants in the schedule premises without
paying any rents with effect from December, 2012 and that apart the
defendants filed a suit in O.S.No.291 of 2015 on the file of the
Principal Junior Civil Judge, Mangalagiri for permanent injunction
against the landlord/plaintiff herein which is being contested by the
plaintiff herein. Subsequently the plaintiff got issued a statutory
notice, dated 03.02.2016 to the defendants terminating the lease of
the schedule property/apartment by the end of the month of
February, 2016 calling upon them to vacate the plaint schedule
property within 15 days from the date of receipt of the said notice by
5 BKMJ
Sa No.28 of 2021
paying the arrears of rent since December, 2012 till the date of
vacation of the premises at the rate of Rs.12,900/- per month and
payment of damages for the unauthorised occupation at the rate of
Rs.20,000/- per month till the premises is vacated. Since the
defendants did not comply with the said demand notice, the plaintiff
was constrained to file the suit for eviction, for damages and recovery
of arrears of rent since December, 2012 to till the date of eviction.
6. Then, the defendants filed a written statement denying the
averments and contentions of the plaintiff contending further that the
plaintiff purchased the plaint schedule property/the apartment under
a valid registered sale deed obtaining loan from ICICI Bank, Bandar
Road Branch, Vijaywada, became a defaulter in payment of loan
installments and as such the plaintiff intended to sell the said
property, then one Mr. Barigala Suresh, purchased the said property
for an amount of Rs.18 lakhs by paying an advance amount of
Rs.5 lakhs under an agreement of sale dated 13.10.2011, the said
purchaser is none other than the brother of the 1st defendant, the
plaintiff delivered the possession of the suit schedule property and
the brother of the 1st defendant/the purchaser has let out the said
property to the 1st defendant and as such, they have been in
possession and enjoyment of the same on a rent of Rs.5,000/- per
month and the 2nd defendant filed a complaint in crime No.159 of
2015, dated 29.06.2015 against the plaintiff and others under Sections
323, 427, 506, 509 r/w 34 of IPC, Section 3-1-1, 3-1-X SC, ST POA Act
which is pending before the Mangalagiri Town police station.
6 BKMJ
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7. Basing upon the above said rival averments and contentions, the
trail Court framed the issues as follows :-
(1) Whether the plaintiff has got title over the
plaint schedule property or not ?
(2) Whether the defendants are tenants of plaintiff
with regard to the plaint schedule property or
not ?
(3) Whether the defendants committed wilful
default in payment of rent for the plaint
schedule property or not ?
(4) Whether the defendants are liable to pay the
damages as prayed by the plaintiff or not ?
(5) Whether the plaintiff is entitled for the eviction
as sought for or not ?
(6) To what relief ?
8. During the course of trial on behalf of the plaintiff, PWs.1 and 2
were examined and Exs.A1 to A13 were marked. On behalf of the
defendants, DW1 was examined and no document was marked.
9. The plaintiff in his deposition besides relying upon the
averments of the plaint further stated that he became the chronic
defaulter in repayment of loan due to non payment of rents by the
defendants and as such the ICICI bank took symbolic possession of the
plaint schedule property under SARFAESI Act on 18.09.2015 and the
bank is trying to auction the same for realisation of their debt. In
furtherance of the same, the bank has also filed O.A No.716 of 2016
before the Debt Recovery Tribunal, Visakhapatnam which is pending
for trial.
7 BKMJ
Sa No.28 of 2021
10. After considering the evidence on record, the trial Court gave a
finding that there is no proof to show that the plaint schedule
property belongs to the said Barigala Suresh as contended by the
defendants and they miserably failed in proving the said
contention/transaction and the defendants have committed default in
payment of rent and they are due for arrears of payment of rent and
damages along with the vacation of the premises. Ultimately the suit
is decreed with costs vide it’s judgment dated 05.05.2020 directing
the defendants to vacate and deliver the plaint schedule property, to
pay the arrears of rent of Rs.4,25,700/-, to pay damages of
Rs.20,000/- per month from 01.03.2016 to 31.05.2016 for an
unauthorized occupation of the premises from the date of the suit till
the date of realization and deliver the vacant possession to the
plaintiff with interest thereupon at the rate of 6% per annum from the
date of suit till the date of realisation.
11. Aggrieved by the same, the defendants therein/tenants
preferred an appeal in A.S.No.82 of 2020 on the file of the III
Additional District Judge, Guntur. While considering the same, the
lower appellate Court framed the following points :
1. Whether there is a landlord and tenant
relationship existed between the plaintiff and
defendants ?
2. Whether the defendants committed wilful
default in payment of rents for the plaint
schedule property ?
3. Whether the plaintiff is entitled for eviction of
defendants as prayed for ?
8 BKMJ
Sa No.28 of 2021
4. Whether this appellate Court finds any reasons
to interfere with the findings on the trial Court?
5. To what relief ?
12. It has observed that the appellants therein/the tenants raised
an additional plea that the civil Court has no jurisdiction as the
SARFAESI proceedings were initiated by the bank and the bank has
also filed O.A.No.716 of 2016 against their landlord/the respondent
therein and service of summons was also marked as Ex.A13 before the
trial Court. While considering the case on merits, the lower appellate
Court gave a finding that in case of any grievance for the appellants
as tenants they can approach the Debt Recovery Tribunal under the
relevant provisions of the SARFAESI Act and with regard to the
findings of the trial Court, the same was confirmed, dismissing the
appeal vide it’s Judgment, dated 21.12.2020. Against the said
confirming Judgments and decrees the appellants herein/the tenants
filed the Second Appeal before this Court by framing a ground as
“substantial question of law” to the effect that “the jurisdiction of
the civil Court is barred and the proceedings under SARFAESI Act are
alone available to proceed against the appellants herein/the tenants
and the respondent herein/the landlord cannot continue the eviction
proceedings against them and as such the Judgments of the Courts
below are liable to be set aside on the ground of lack of jurisdiction.”
13. To substantiate the same, the learned counsel for the
appellants refers to the following Sections of law under the provisions
9 BKMJ
Sa No.28 of 2021
of Securitisation and Reconstruction of Financial Assets and
Enforcement of Security Interest Act, 2002.
Section 13 :
13. Enforcement of security interest.—(1)
Notwithstanding anything contained in section 69 or
section 69A of the Transfer of Property Act, 1882 (4 of
1882), any security interest created in favour of any
secured creditor may be enforced, without the
intervention of the court or tribunal, by such creditor in
accordance with the provisions of this Act.
(2) Where any borrower, who is under a liability to a
secured creditor under a security agreement, makes any
default in repayment of secured debt or any installment
thereof, and his account in respect of such debt is
classified by the secured creditor as non-performing
asset, then, the secured creditor may require the
borrower by notice in writing to discharge in full his
liabilities to the secured creditor within sixty days from
the date of notice failing which the secured creditor
shall be entitled to exercise all or any of the rights
under sub-section (4).
1[Provided that—
(i) - - -
(ii) - - -
(4) In case the borrower fails to discharge his liability in
full within the period specified in sub-section (2), the
secured creditor may take recourse to one or more of the
following measures to recover his secured debt,
namely:—
(a) take possession of the secured assets of the borrower
including the right to transfer by way of lease,
assignment or sale for realising the secured asset;
[(b) - - -
(c) - - -
(d) require at any time by notice in writing, any person
who has acquired any of the secured assets from the
10 BKMJ
Sa No.28 of 2021
borrower and from whom any money is due or may
become due to the borrower, to pay the secured
creditor, so much of the money as is sufficient to pay the
secured debt.
(5) Any payment made by any person referred to in
clause (d) of sub-section (4)to the secured creditor shall
give such person a valid discharge as if he has made
payment to the borrower.
17. 1[Application against measures to recover secured
debts].—(1) Any person (including borrower), aggrieved
by any of the measures referred to in sub-section (4) of
section 13 taken by the secured creditor or his
authorised officer under this Chapter,2
[may make an
application along with such fee, as may be prescribed,]to
the Debts Recovery Tribunal having jurisdiction in the
matter within forty-five days from the date on which
such measures had been taken:
1
[(2) The Debts Recovery Tribunal shall consider whether
any of the measures referred to in sub-section (4) of
section 13 taken by the secured creditor for enforcement
of security are in accordance with the provisions of this
Act and the rules made thereunder.
2
[(3) If, the Debts Recovery Tribunal, after examining the
facts and circumstances of the case and evidence
produced by the parties, comes to the conclusion that
any of the measures referred to in sub-section (4) of
section 13, taken by the secured creditor are not in
accordance with the provisions of this Act and the rules
made thereunder, and require restoration of the
management or restoration of possession, of the secured
assets to the borrower or other aggrieved person, it may,
by order,—
(a) declare the recourse to any one or more measures
referred to in sub-section (4) of section 13 taken by
the secured creditor as invalid; and
11 BKMJ
Sa No.28 of 2021
(b) restore the possession of secured assets or
management of secured assets to the borrower or
such other aggrieved person, who has made an
application under sub-section (1), as the case may be;
and
(c) pass such other direction as it may consider
appropriate and necessary in relation to any of the
recourse taken by the secured creditor under subsection (4) of section 13.]
(4) If, the Debts Recovery Tribunal declares the recourse
taken by a secured creditor under sub-section (4) of
section 13, is in accordance with the provisions of this
Act and the rules made thereunder, then,
notwithstanding anything contained in any other law for
the time being in force, the secured creditor shall be
entitled to take recourse to one or more of the measures
specified under sub-section (4) of section 13 to recover
his secured debt.
1
[(4A) Where—
(i) any person, in an application under sub-section (1),
claims any tenancy or leasehold rights upon the secured
asset, the Debt Recovery Tribunal, after examining the
facts of the case and evidence produced by the parties in
relation to such claims shall, for the purposes of
enforcement of security interest, have the jurisdiction to
examine whether lease or tenancy,—
(a) has expired or stood determined; or
(b) is contrary to section 65A of the Transfer of
Property Act, 1882(4 of 1882); or
(c) is contrary to terms of mortgage; or
(d) is created after the issuance of notice of default
and demand by the Bank under sub-section (2) of
section 13 of the Act; and
(ii) the Debt Recovery Tribunal is satisfied that tenancy
right or leasehold rights claimed in secured asset falls
under the sub-clause (a) or sub-clause (b) or sub-clause
(c) or sub-clause (d) of clause (i), then notwithstanding
12 BKMJ
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anything to the contrary contained in any other law for
the time being in force, the Debt Recovery Tribunal may
pass such order as it deems fit in accordance with the
provisions of this Act.]
(5) Any application made under sub-section (1) shall be
dealt with by the Debts Recovery Tribunal as
expeditiously as possible and disposed of within sixty
days from the date of such application:
Provided that - - -
34. Civil court not to have jurisdiction.—No civil court
shall have jurisdiction to entertain any suit or
proceeding in respect of any matter which a Debts
Recovery Tribunal or the Appellate Tribunal is
empowered by or under this Act to determine and no
injunction shall be granted by any court or other
authority in respect of any action taken or to be taken in
pursuance of any power conferred by or under this Act or
under the Recovery of Debts Due to Banks and Financial
Institutions Act, 1993 (51 of 1993).
35. The provisions of this Act to override other laws.—
The provisions of this Act shall have effect,
notwithstanding anything inconsistent therewith
contained in any other law for the time being in force or
any instrument having effect by virtue of any such law.
37. Application of other laws not barred.—The
provisions of this Act or the rules made thereunder shall
be in addition to, and not in derogation of, the
Companies Act, 1956 (1 of 1956), the Securities Contracts
(Regulation) Act, 1956(42 of 1956), the Securities and
Exchange Board of India Act, 1992 (15 of 1992), the
Recovery of Debts Due to Banks and Financial Institutions
Act, 1993 (51 of 1993) or any other law for the time
being in force.
13 BKMJ
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14. Per contra the learned counsel for the respondent refers to
some of the decisions of the Hon’ble Supreme Court of India and the
Hon’ble High Court – Jodhpur as follows :
01. Criminal Appeal Nos.1371 of 2019, Dt.11.09.20191
on the file of
Hon’ble THE SUPREME COURT OF INDIA, held in para No.20 of Page 14 as.,
“While Section 13 (13) of SARFAESI prohibits a
borrower from leasing out any of the secured assets
after receipt of a notice under Section 13 (2) without
the prior written consent of the secured creditor”.
02. Civil Appeal Nos.2843-2844 of 2010, Dt. 27.08.20202
on the file of
Hon’ble THE SUPREME COURT OF INDIA, held in para No.25 of Page 11 as.,
“25. A second appeal, or for that matter, any appeal
is not a matter of right. The right of appeal is
conferred by statute. A second appeal only lies on a
substantial question of law. If statute confers a
limited right of appeal, the Court cannot expand the
scope of the appeal. It was not open to the
Respondent-Plaintiff to re-agitate facts or to call
upon the High Court to reanalyze or re-appreciate
evidence in a Second Appeal.”
03. SPECIAL LEAVE PETITION (C) Nos.15870 of 20203
, Dt. 21-01-2021 on
the file of Hon’ble THE SUPREME COURT OF INDIA, held in para No.18 OF
Page 6 as.,
“18. The Court must interpret a statute in a manner
which is just, reasonable and sensible. If the
grammatical construction leads to some absurdity or
some repugnancy or inconsistency with the legislative
intent, as may be deducted by reading the provisions
of the statute as a whole, the grammatical
construction may be departed from to avoid anomally,
1 Dt.11.09.2019 in Criminal Appeal Nos.1371 of 2019
2 Dt. 27.08.2020 in Civil Appeal Nos.2843-2844 of 2010
3 Dt. 21-01-2021 in SPECIAL LEAVE PETITION (C) Nos.15870 of 2020
14 BKMJ
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absurdity or inconsistency. To quote Venkatarama
Aiyar, J. In Tirath Singh v. Bachittar Singh. AIR 1955
SC 830 (at 833), “where the language of a statute, in
its ordinary meaning and grammatical construction,
leads to a manifest contradiction of the apparent
purpose of the enactment, or to some inconvenience
or absurdity, hardship or injustice, presumably not
intended, a construction may be put upon it which
modifies the meaning of the words, and even the
structure of the sentence.” This view has been
reiterated by this Court.”
04. CIVIL APPEAL Nos.4083-4084 of 2016, Dt.06-05-20164
on the file of
Hon’ble THE SUPREME COURT OF INDIA, held as in Para No.14 as.,
“The issues of facts once finally determined will
however, stare at the parties and bind them on
account of earlier judgments or for any other good
reason where equitable principles of estoppel are
attracted.”
05. CIVIL APPEAL No.10589 OF 2014, Dt. 25-11-20145
on the file of
Hon’ble THE SUPREME COURT OF INDIA, held in para No.13 as.,
“13. In the present case, we find this statement of law
would apply on all fours. The judgment of the Trail
Court has been decided issue wise, on the merits,
after hearing both parties. The suit has finally been
decreed. Consequently this judgment cannot be
reversed purely on technical grounds unless there is a
failure of justice, which we have seen, is nobody’s
case.”
06. CIVIL APPEAL No.9151 of 2017, Dt. 17-07-20176
on the file of Hon’ble
THE SUPREME COURT OF INDIA, held in Para No.48 as.,
“48)We sincerely feel that the eviction matters should
be given priority in their disposal at all stages of
4 Dt.06-05-2016 in CIVIL APPEAL Nos.4083-4084 of 2016
5 Dt. 25-11-2014 in CIVIL APPEAL No.10589 OF 2014
6 Dt. 17-07-2017 in CIVIL APPEAL No.9151 of 2017
15 BKMJ
Sa No.28 of 2021
litigation and especially where the eviction is claimed
on the ground of bona fide need of the landlord. We
hope and trust that due attention would be paid by all
courts to ensure speedy disposal of eviction cases.”
07. CIVIL APPEAL No.6744 of 2013, Dt. 27-01-2021 7on the file of Hon’ble
THE SUPREME COURT OF INDIA, held in Para No.8 as.,
“The first appeal is a valuable right, and, at that
stage, all questions of fact and law decided by the
trial court are open for re-consideration. The
judgment of the appellate court must, therefore,
reflect conscious application of mind and must record
the court’s findings, supported by reasons for its
decision in respect of all the issues, along with the
contentions put forth and pressed by the parties.”
08. In Civil Appeal No.167 of 2007, Dt.18.01.20168
on the file of Hon’ble
THE SUPREME COURT OF INDIA, held in para Nos.22, 23, 24, as.,
“22) That apart, we find that the appellants were
able to prove their ownership through their
predecessor-in-title on the strength of sale deed
(Ex.P.6/7) of the suit premises whereas the
respondents failed to prove their defence. Indeed, the
burden being on them, it was necessary for the
respondents to prove that the sale in favour of the
appellants’ predecessor-in-title of suit premises was a
transaction of mortgage and not an outright sale.
Since the respondents did not adduce any
documentary or oral evidence to prove their defence,
the first appellate Court was justified in allowing the
eviction petition. In our view, the evidence adduced
by the appellants to prove their title over the suit
premises was sufficient to maintain eviction petition
against the respondents and it was, therefore, rightly
accepted by the first appellate Court.
7 Dt. 27-01-2021 in CIVIL APPEAL No.6744 of 2013
8 Dt.18.01.2016 in Civil Appeal No.167 of 2007
16 BKMJ
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23) As observed supra, the first appellate Court
having recorded categorical findings that the
relationship of landlord-tenant was proved and
secondly, the respondents had committed a wilful
default in payment of monthly rent and its arrears
from 01.06.1987, these findings were binding on the
High Court while deciding the revision petition. It was
more so when these findings did not suffer with any
jurisdictional error which alone would have entitled
the High Court to interfere.
24) Learned counsel for the respondents lastly argued
that there was an encroachment made by the
appellants on the suit premises and document (Ex-P-6)
was inadmissible in evidence, hence the eviction
petition was liable to be dismissed on these two
grounds also. These submissions, in our considered
view, deserve to be rejected at their threshold
because the same were not raised in the written
statement filed by the respondents before the Rent
Controller and nor were urged at any stage of the
proceedings. We cannot, therefore, allow such factual
submissions to be raised for the first time in this
appeal.”
09. The Hon’ble Rajasthan High Court – Jodhpur in I.C.I.C.I. Bank
Limited Vs. Krishna Kumar & Others on 27 April, 2018 held as.,
“Before incorporation of sub-section (4-A) and
substitution of sub-section (3) in Section 17 of the
SARFAESI Act as above, there was no remedy
available to a tenant who was being dispossessed
(25 of 25) [CW-16965/2017] under the SARFAESI Act
and hence, it was in those circumstances that the
judgment in the case of Vishal N. Kalsaria (supra)
was passed. The amended Act and incorporation of
sub-section (4-A) in Section 17 of the SARFAESI Act as
well as sub-section (3) of Section 17 of the SARFAESI
Act sufficiently empowered the tenant to challenge
17 BKMJ
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the proceedings qua his dispossession as a lessee or
a tenant, in case, action is being initiated against
him for dispossession under the SARFAESI Act.”
15. As stated supra, Section 13 (1) of the SARFAESI Act, 2002 speaks
about the power of a secured creditor to enforce any security interest
without interference of the Court or Tribunal.
Section 13 (2) of the said Act speaks about the power of the
secured creditor to issue notice calling upon to discharge the full
liability of the borrower within 60 days in case of default and
declaration of the account as non-performing asset.
Section 13 (4) (a) empowers the creditor to recover the secured
debt by taking possession of the secured assets of the borrower
including the right of transfer by way of lease, assignment of sale
etc., in the case of default and violation of Section 13 (2).
Section 13 (4) (d) empowers the secured creditor to issue a
notice to any person who acquired the security asset to pay money to
the creditor to satisfy the secured debt of the borrower. As per
Section 13 (5) any payment made by such a person as per Section 13
(4) (d) to the secured creditor is a valid discharge.
As stated supra, Section 17 (1) enables to file an application by
any person (including the borrower) to question the measures taken
by the secured creditor under Section 13 (4) within 45 days from the
date of such measures taken.
18 BKMJ
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Under Section 17 (4A) the Debt Recovery Tribunal would go into
the issues and examine the facts of the case with reference to the
situations enshrined in sub clause (a) to (d) of Section 17 (4A) (i)
provided either any tenant or lessee files an application under Section
17 (1).
Section 34 bars the jurisdiction of Civil Court to entertain any
suit or proceedings in respect of the matters having jurisdiction of the
Debt Recovery Tribunal or the Appellate Tribunal under the provisions
of SARFAESI Act, 2002 and the RDBI Act, 1993 and no injunction can
be granted for the action taken under the said Acts.
16. It is to be carefully seen that all the above said provisions of the
SARFAESI Act do not come to the rescue of the appellants/tenants
herein as none of the situations and circumstances are applicable to
the facts and circumstances of the present case. The appellants
herein/the tenants are neither the guarantors nor any person
inducted into the possession of the secured asset/suit schedule
property by way of a lease after notice under Section 13 (2) was given
and default committed. Admittedly they have been inducted into the
possession of the plaint schedule property on 01.11.2011 by virtue of
an oral lease and they have committed default of payment of rent
with effect from 01.12.2012 and the creditor bank took symbolic
possession of the secured asset/plaint schedule property of the
borrower/landlord on 18.09.2015 under the provisions of SARFAESI Act
which was not injucted by the Courts below. At least it is not the
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Sa No.28 of 2021
case of the appellants/the tenants that they have made an
application under Section 17 (1) seeking shelter under sub Clause (4A)
of Section 17 of the SARFAESI Act. Obviously they could not do so,
because they are not inducted into the suit schedule property
subsequent to the notice issued under Section 13 (2) and symbolic
possession taken under Section 13 (4). Hence they can’t be termed as
any person or tenant under the provisions of SARFAESI Act.
17. The present case which was dealt by the Courts below is totally
falls outside the purview of the proceedings of the SARFAESI Act and
the Judgments and decrees of the Courts below do not hit or inject
the Debt Recovery Tribunal or any other Appellate Tribunal to
function under the provisions of SARFAESI Act with reference to the
very same plaint schedule property which is a secured asset
mortgaged by the borrower/the landlord/the respondent herein.
There is no conflict of orders passed by the Courts below with the
orders that may be passed under SARFAESI Act and RDBI Act 1993.
From the above said facts and circumstances and legal position, it is
obvious and evident that the appellants’ relationship is only with their
landlord and they are nothing to do with the secured creditor/the
banker who advanced housing loan to their landlord as a borrower.
Just because their landlord has become the defaulter before the bank
with reference to payment of equated monthly installments of a
housing loan with respect to the plaint schedule property, the tenants
cannot take undue advantage of the same and exploit by refraining to
20 BKMJ
Sa No.28 of 2021
make payments of rents flouting their oral lease and understanding
between the parties.
18. In view of the forgoing reasons, the Second Appeal has to fail as
there is no substantial question of law for interference of this Court
under Section 100 C.P.C. and the appellants herein are directed to
vacate the plaint schedule property within four (4) months from today
by complying with the other terms of the decree of the trial Court as
it is. It is needless to mention that the respondent shall bring it to
the notice of the secured creditor and the learned Debt Recovery
Tribunal in which the proceedings are pending about this Judgment of
this Court enabling them to take necessary action and passing of
orders suitably with respect to the secured asset of the respondent
herein/borrower under the provisions of SARFAESI Act r/w RDBI Act.
19. Accordingly, the Second Appeal is dismissed. There shall be no
order as to costs.
As a sequel, miscellaneous petitions, if any pending in the
Second Appeal, shall stand closed.
_________________________
JUSTICE B. KRISHNA MOHAN
12th February, 2021.
Note:-
L.R. Copy to be marked.
(B/o)
Yvk
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