Case Note & Summary
The petitioner, Umang Sugars Private Limited, filed a writ petition before the Bombay High Court challenging the auction sale of movable and immovable assets of Ghrushneshwar Sahakari Sakhar Karkhana Ltd. (GSSKL) conducted by respondent No.2, the Maharashtra State Cooperative Bank Limited, under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act). The petitioner contended that the bank had taken possession of the assets and issued a tender for sale, and that the auction was illegal. The court, after hearing the parties, observed that the petitioner had an alternative efficacious remedy under Section 17 of the SARFAESI Act before the Debt Recovery Tribunal (DRT). The court noted that the petitioner had not availed of this remedy and that the writ petition was not maintainable. The court dismissed the petition, leaving it open to the petitioner to approach the DRT if so advised. The judgment was delivered by a division bench comprising Justices B.P. Dharmadhikari and Ravindra V. Ghuge, with the latter authoring the judgment.
Headnote
A) Constitutional Law - Writ Jurisdiction - Alternative Remedy - SARFAESI Act, 2002, Section 17 - The petitioner challenged the auction sale of secured assets by a cooperative bank under the SARFAESI Act without exhausting the remedy under Section 17 before the Debt Recovery Tribunal. The court held that the writ petition is not maintainable as an alternative efficacious remedy exists. (Paras 1-10) B) Securitisation - Auction Sale - Cooperative Bank - SARFAESI Act, 2002 - The petitioner, a private limited company, participated in an auction conducted by the respondent bank for the sale of assets of a sugar factory. The court noted that the petitioner's challenge to the sale could be raised before the DRT under Section 17. (Paras 3-8)
Issue of Consideration
Whether the writ petition challenging the auction sale of secured assets under the SARFAESI Act is maintainable when the petitioner has an alternative remedy under Section 17 of the SARFAESI Act before the Debt Recovery Tribunal.
Final Decision
Writ petition dismissed. Petitioner may approach the Debt Recovery Tribunal under Section 17 of SARFAESI Act if so advised.
Law Points
- Alternative remedy
- SARFAESI Act
- Section 17
- Writ jurisdiction
- Auction sale
- Secured creditor
- Cooperative bank
