Rajasthan High Court: Mahendar Kumar Goyal, J. dismissed the writ petition in view of availability of alternative remedy to the petitioners under the provisions of the SARFAESI Act.
The instant writ petition was filed by the borrowers for quashing the order dated 15-03-2022 passed by the Chief Metropolitan Magistrate, Jaipur Metropolitan-I in Civil Miscellaneous Case No.164/2022 under Section 14 of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for brevity, “SARFAESI Act”) with a further direction to the respondent to grant them benefit of moratorium.
Counsel for petitioners submitted that remedy of appeal is not available to them against an order passed under Section 14. He submitted that in view of existence of an arbitration clause in the loan agreement and filing of an application under Section 9 of the Arbitration and Conciliation Act, 1996 (for brevity, “the Act of 1996”) by the respondent, the respondent could not have resorted to the provisions of Section 14 of the SARFAESI Act.
Counsel for the respondent submitted that the writ petition is not maintainable as the petitioners have an alternative and efficacious remedy under Section 17 of the SARFAESI Act.
The Court relied on Balaji Enterprises v. Authorised Officer in SB Civil Writ Petition No 9054 of 2021 wherein it was observed that
“These writ petitions filed by the petitioners deserves to be dismissed for the reasons; firstly, the petitioners are having alternative efficacious statutory remedy under the SARFAESI Act, 2002; secondly, the guidelines issued by the R.B.I. can be very much looked into by the Debts Recovery Tribunal as well as by the banks while examining the reply if submitted by the petitioners against the notices served upon them and lastly in the facts and circumstances in view of the judgment passed by the Hon’ble Supreme Court in the matter of I.C.I.C.I Bank Limited as well as the Pheonix India (both supra), I am not inclined to exercise the extraordinary jurisdiction of this Court under Article 226 of the Constitution of India. Hence, these writ petitions stand dismissed.”
The Court observed that the contention of learned counsel for the petitioners that in view of availability of arbitration clause and invocation of Section 9 of the Act of 1996, the proceedings under the SARFAESI Act could not have been resorted to, does not merit acceptance.
The Court held “the writ petition is dismissed in view of availability of alternative remedy to the petitioners under the provisions of the SARFAESI Act.”[Om Prakash v. Hero Housing Finance Ltd., S.B. Civil Writ Petition No. 6199/2022, decided on 11-05-2022]
For Petitioner(s): Mr. Prahlad Sharma
For Respondent(s): Mr. Pramod Kumar