Case Note & Summary
The petitioner, Sunil Jaidev Sharma, filed a writ petition before the Bombay High Court challenging an order dated 27 September 2016 passed by the Chief Metropolitan Magistrate, Esplanade, Mumbai, in Misc. Application No. 513/MISC/2016 in Securitisation Application No. 420/SA/2013, and a notice dated 24 October 2016 issued by the Court Commissioner pursuant to that order. The petitioner was a third person, neither a borrower, guarantor, nor mortgagor, in relation to the secured assets. The Court noted that the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act) provides a remedy under Section 17 for any person aggrieved by measures taken under Section 13(4) or Section 14 of the Act. The term 'any person' includes a third person like the petitioner. Since an efficacious alternative remedy was available, the Court declined to entertain the writ petition and disposed it of, granting the petitioner liberty to approach the Debts Recovery Tribunal under Section 17 of the SARFAESI Act.
Headnote
A) Civil Procedure - Alternative Remedy - Writ Jurisdiction - The Court held that where an efficacious alternative remedy under Section 17 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act) is available, a writ petition under Article 226 of the Constitution is not maintainable. The petitioner, a third person, was directed to avail the remedy before the Debts Recovery Tribunal. (Paras 2-4)
Issue of Consideration
Whether a writ petition is maintainable when an alternative statutory remedy under Section 17 of the SARFAESI Act is available to a third person aggrieved by measures taken under Sections 13(4) and 14 of the Act.
Final Decision
The writ petition is disposed of as the remedy under Section 17 of the SARFAESI Act is available to the petitioner to challenge the impugned order and notice. The petitioner is at liberty to approach the Debts Recovery Tribunal under Section 17 of the SARFAESI Act.
Law Points
- Alternative remedy
- SARFAESI Act
- Section 17
- third person
- writ petition not maintainable
Case Details
2016 LawText (BOM) (11) 18
Writ Petition (L) No. 3025 of 2016
Anoop V. Mohta, A. S. Gadkari
Mr. Rishab Shah along with Mr. Kunal Mehta I/by Aditya Deolekar for the petitioner; Mr. Umashankar S. Upadhayay, AGP for respondent No.1/State; Mr. Umesh Shetty along with Ms. Vinita Hombalkar I/by Orbit Law Services for respondent No.2.
State of Maharashtra and 4 ors.
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Nature of Litigation
Writ petition challenging order of Chief Metropolitan Magistrate and notice of Court Commissioner under SARFAESI Act.
Remedy Sought
Petitioner sought to quash the impugned order and notice.
Filing Reason
Petitioner, a third person, was aggrieved by measures taken under SARFAESI Act.
Previous Decisions
Order dated 27 September 2016 passed by Chief Metropolitan Magistrate, Esplanade, Mumbai in Misc. Application No. 513/MISC/2016 in Securitisation Application No. 420/SA/2013.
Issues
Whether a writ petition is maintainable when an alternative statutory remedy under Section 17 of the SARFAESI Act is available to a third person aggrieved by measures taken under Sections 13(4) and 14 of the Act.
Submissions/Arguments
Petitioner argued that he is a third person and not a borrower, guarantor, or mortgagor. Respondents submitted that alternative remedy under Section 17 is available.
Ratio Decidendi
Where an efficacious alternative remedy under Section 17 of the SARFAESI Act is available to any person including a third person aggrieved by measures under Sections 13(4) and 14, a writ petition under Article 226 is not maintainable.
Judgment Excerpts
We are inclined to dispose of the present writ petition as a remedy under the The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 ( for short, SARFAESI Act) is available to challenge impugned order dated 27 September 2016 passed by the learned Chief Metropolitan Magistrate, Esplanade, Mumbai in Misc. Application No. 513/MISC/2016 in Securitisation Application No. 420/SA/2013 and notice dated 24 October 2016 issued by the Court Commissioner pursuant to the said order.
Admittedly, the Petitioner is the 'third person' being neither borrower nor guarantor nor mortgagor.
The term 'any person' as mentioned in Section 17 which includes any third person like the Petitioner who is aggrieved by any measure referred in Sections 13 (4) & 14 of the SARFAESI Act, taken by the secured creditor/financial institution.
Procedural History
The petitioner filed a writ petition before the Bombay High Court challenging an order dated 27 September 2016 of the Chief Metropolitan Magistrate and a notice dated 24 October 2016 of the Court Commissioner. The Court heard the parties and disposed of the petition on 21 November 2016.
Acts & Sections
- Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002: Section 17, Section 13(4), Section 14
