Case Note & Summary
The petitioner, K.L. Kumaraswamy, filed a writ petition under Articles 226 and 227 of the Constitution of India seeking to quash an order dated 21.08.2015 passed by the Debt Recovery Appellate Tribunal, Chennai. The petitioner claimed title to a property situated at Vardhamanaiah Block, 5th Cross, Shankarapuram, Bangalore, based on a decree for specific performance in O.S. No.1977/1996, which was under challenge in R.F.A. No.1166/2011 before the High Court. However, no sale deed had been executed in his favour. The property was sought to be sold by the Debt Recovery Tribunal in proceedings under the SARFAESI Act, 2002, initiated by the first respondent, Dhanalaxmi Bank Ltd., against the borrower/guarantor. The petitioner was neither a borrower nor a guarantor. The court held that the petitioner had no locus standi to maintain the writ petition as he was not an aggrieved person under the SARFAESI Act. The writ petition was dismissed at the preliminary hearing stage.
Headnote
A) Constitutional Law - Writ Jurisdiction - Locus Standi - Articles 226 and 227 of the Constitution of India - Petitioner, not being a borrower or guarantor, challenged DRT order - Held that the petitioner has no locus standi to invoke writ jurisdiction as he is not an aggrieved person under the SARFAESI Act (Para 1-3).
Issue of Consideration
Whether a person who is neither a borrower nor a guarantor can maintain a writ petition challenging an order of the Debt Recovery Appellate Tribunal under the SARFAESI Act, 2002
Final Decision
The writ petition was dismissed at the preliminary hearing stage for lack of locus standi.
Law Points
- Writ jurisdiction under Articles 226 and 227 of Constitution of India
- Debt Recovery Tribunal jurisdiction
- SARFAESI Act applicability
- Locus standi of third party claiming title through decree for specific performance
Case Details
2015 LawText (KAR) (09) 46
W.P.No.39316/2015 (GM-DRT)
Dhanalaxmi Bank Ltd., Sri S. Chandrashekar, Sri B.V. Basavaraju
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Nature of Litigation
Writ petition under Articles 226 and 227 of the Constitution of India challenging an order of the Debt Recovery Appellate Tribunal, Chennai.
Remedy Sought
Quashing of the impugned order dated 21.08.2015 passed by the Debt Recovery Appellate Tribunal, Chennai.
Filing Reason
The petitioner claimed title to a property that was being sold by the Debt Recovery Tribunal under the SARFAESI Act, despite being neither a borrower nor a guarantor.
Previous Decisions
The petitioner had obtained a decree for specific performance in O.S. No.1977/1996, which was under challenge in R.F.A. No.1166/2011 before the High Court. No sale deed had been executed in his favour.
Issues
Whether the petitioner, who is neither a borrower nor a guarantor, has locus standi to challenge the DRT order under writ jurisdiction.
Submissions/Arguments
The petitioner argued that he had title to the property based on a decree for specific performance and that the property should not be sold.
Ratio Decidendi
A person who is neither a borrower nor a guarantor under the SARFAESI Act has no locus standi to challenge proceedings before the Debt Recovery Tribunal or to invoke writ jurisdiction under Articles 226 and 227 of the Constitution of India.
Judgment Excerpts
The petitioner is neither a borrower nor a guarantor.
His grievance is the property bearing No.17 situated at Vardhamanaiah Block, 5th cross, Shankarapuram, Bangalore is now sought to be brought to sale by the Debt Recovery Tribunal.
Procedural History
The petitioner filed a writ petition under Articles 226 and 227 of the Constitution of India challenging an order dated 21.08.2015 passed by the Debt Recovery Appellate Tribunal, Chennai. The petition came up for preliminary hearing before a Division Bench of the High Court of Karnataka.
Acts & Sections
- Constitution of India: Articles 226, 227
- Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002:
