IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE P.R.RAMACHANDRA MENON TUESDAY, THE 25TH MAY 2010 / 4TH JYAISHTA 1932 WP(C).No. 15159 of 2010(T) -------------------------------------- PETITIONER(S): ------------------------- 1. MAYADEVI.K.U, WIFE OF E.A.JAYAKUMAR, 50/114C, VISHNU VIHAR, PONEVAZHI, PONEKKARA, KOCHI-682 026. 2. E.A.JAYAKUMAR, SON OF AYYAPPAN PILLAI, 50/114C, VISHNU VIHAR, PONEVAZHI, PONEKKARA, KOCHI-682 026. 3. SEENA, WIFE OF JOHNSON, PROPRIETRIX, M/S.VISHNU GOLD MANUFACTURING UNIT, 48/2030-C, SUJITRA BUILDINGS, PADOM STOP, ELAMAKKARA, KOCHI-26. BY ADV. SRI.M.RAMESH CHANDER SMT.K.A.SANJEETHA RESPONDENT(S): -------------------------- 1. STATE BANK OF INDIA, STRESSED ASSETS RESOLUTION CENTRE, 40/974, IIND FLOOR, RS BUILDING, M.G.ROAD, ERNAKULAM-682 011. 2. THE DEBT RECOVERY TRIBUNAL, ERNAKULAM. 3. THE CHIEF MANAGER, STATE BANK OF INDIA, STRESSED ASSETS RESOLUTION CENTRE, 40/974, IIND FLOOR, RS BUILDING, M.G.ROAD, ERNAKULAM-682 011. R1 & R3 BY ADV. SRI.K.K.CHANDRAN PILLAI THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 25/05/2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: P.R.RAMACHANDRA MENON, J --------------------------- W.P(C) No.15159 of 2010-T ---------------------------- Dated this the 25th day of May, 2010. J U D G M E N T The petitioners are challenging the course pursued by the respondent Bank in proceeding against ‘A and C’ schedule properties shown in Ext.P1 O.A filed before the Debt Recovery Tribunal, to be sold in public auction, invoking the remedy under the SARFAESI Act; after turning down the request of the petitioners to proceed against the property shown as Schedule B, over which also security interest has been created and is situated very near to the M.G Road and by the side of the property belonging to the ‘Veekshanam Press, which may generate much more amounts than that is required to clear the entire liability of the petitioner. The request made by the petitioner in this regard has been turned down in a single line reply, as borne by Ext.P6 issued by the Bank. 2. The case of the petitioner as put forth by the learned counsel is that, pursuant to the attachment ordered by the Debt Recovery Tribunal in Ext.P3 application preferred by the respondent Bank, further proceedings have been pursued, which are not correct W.P(C) No.15159 of 2010-T 2 or sustainable and that the petitioner has already filed a review petition, which is stated as still pending. It is in the said circumstances, that the present Writ Petition has been filed under Article 227 of the Constitution of India, invoking the supervisory jurisdiction over the Debt Recovery Tribunal. 3. Even though the Writ Petition has been filed under Article 227 of the Constitution of India, the prayers raised are the following: “i) to call for the records leading to Ext.P6 and P7 and quash the same by issuance of a writ of certiorari or any other writ, direction or order. ii) to issue a writ of mandamus or any other writ, direction or order, directing the first respondent bank to proceed against the Schedule B property in Ext.P1 first and bring them for sale/auction so as to recovery the amount due from the petitioners and other defendants in O.A.No.194 of 2008 and thereafter to proceed against the property in Schedule A and C, in case it does not satisfy the amount due to the Bank. iii) to issue a writ of mandamus or any other writ, direction or order, directing the Bank to consider and pass orders on Ext.P5 and till then, keep in abeyance the future proceedings pursuant to Ext.P7. iv) to grant such other reliefs as this Honourable Court may deem fit in the circumstances of the case. The sequence of events as brought to the notice of this Court W.P(C) No.15159 of 2010-T 3 shows that the B schedule property (called as ‘Veeshanam property’) was purchased by the second petitioner in the year 2005 and it was after creating security interest over the said property as well, along with A and C schedule properties belonging to the petitioners a loan was procured from the respondent for meeting the requirement of the petitioners. But the petitioner could not satisfy the repayment on time, under which circumstances, the Bank declared the account as 'NPA' and proceed with further steps under the SARFAESI Act and Ext.P7 is the notice of sale scheduled on 26.5.2010, wherein only A and C schedules have been shown as subjected to the auction. 4. The case of the petitioners is that Ext.P5 representation was submitted by the petitioners on 30.3.2010 seeking to proceed against the ‘Veekshanam property’ (B schedule), which was declined by the Bank by sending Ext.P6 reply dated 5.4.2010. The reason, though not discernible from Ext.P6, as put forth in the counter affidavit filed is that, according to the respondent Bank, the petitioner is not having the title over the property in question (B Schedule) and that there was obstruction from other corners as well, with regard to the rights and enjoyment over the said property. The averments raised by the petitioners have been chosen to be W.P(C) No.15159 of 2010-T 4 rebutted by the Bank, by filing a detailed counter affidavit stating that even though it was stated in Ext.P1 O.A filed before the Debt Recovery Tribunal that the second petitioner is the owner of the B schedule property having possession and other rights, it is revealed that the position is something else. 5. The learned counsel for the respondent Bank submits that, the case moulded by the petitioners referring to the course and events in respect of Exts.P3 and P4 is not correct or sustainable. It is brought to the notice of this Court that Ext.P3 application for attachment by Bank was in respect of yet another property owned by the second petitioner in Edappally Village, Edappally Sub District specifically giving the relevant schedule and this property that was ordered to be attached by the Debt Recovery Tribunal, which in turn has absolutely no connection with the ‘B schedule’, forming the subject matter of the present Writ Petition. This being the position, the pendency of Ext.P4 application before the DRT is no bar for the respondents in proceeding against the property concerned, which was subjected to the sale as notified in Ext.P7. 6. Even though the factual particulars in this regard have been brought to light in the counter affidavit filed by the Bank, W.P(C) No.15159 of 2010-T 5 nothing is forthcoming from the part of the petitioner in the reply affidavit; particularly with regard to the scope and applicability of Exts.P3 and P4 and the connection with ‘B Schedule’ property. This being the position, the attempt of the petitioner to invoke the supervisory jurisdiction under Article 227 in respect of the alleged jurisdictional error or the course pursued by the Tribunal is quite out of place and no interference is possible. More so, when the petitioner has not chosen to produce the alleged order of attachment in respect of the property concerned. This becomes very significant, in view of the submission made from the part of the Bank that, in so far as the ‘B schedule’ property is concerned, there is no necessity to have it attached, since security interest has been created over all the three properties ‘A, B and C’ which do not require to be attached for being proceeded against. It is also stated that the averments made by the petitioner that Schedule B property alone is the mortgaged property, whereas A and C schedule properties are collateral properties are not correct or sustainable. 7. The next question to be considered is whether there is an infringement of the legal provisions on the part of the Bank while W.P(C) No.15159 of 2010-T 6 proceeding against A and C Schedule properties before proceeding against B Schedule property. It is stated by the learned counsel for the petitioner that, the petitioner was ready and willing to have the property sold in private sale, which however could not be implemented because of the alleged recalcitrant attitude of the Bank. There is absolutely no material to sustain or support the said contention. That apart, when security interest is created over different properties for meeting the requisite extent of the loan amount, it is for the secured creditor to choose his rights and remedies and to proceed against the particular property concerned. 8. The reasons for taking no steps against the ‘B Schedule’ property, have been given in the counter affidavit, referring to the adverse circumstances including the various litigations between different parties in respect of the said property, before the Civil Court and elsewhere. It is also stated that even the second petitioner himself had approached this Court earlier, by filing W.P(C) No.20410 of 2007, seeking for police protection. It is further stated that the concerned property, stated as purchased by the petitioner in the year 2005, was actually the property belonging to the late Sali Ibrahim Sait, who had handed over the possession to one W.P(C) No.15159 of 2010-T 7 Mr.K.P.Noorudeen, on the basis of the agreement executed in the year 7.11.1975 prescribing the total sale consideration as Rs.75,000/-, out of which Rs.50,000/- was paid/accepted and the balance was stipulated to be paid as specified therein. It is also stated that the property later came to the hands of the ‘Veekshanam Printing and Publishing Company Ltd’, who had constructed certain buildings, after availing loan from the UCO Bank and some other litigations are also there, in this regard, as to the rights and liberties. It is further stated that the very same property ie. the ‘B Schedule’ property stated as belonging to the second petitioner was agreed to be sold to M/s.Skyline Builders and a sum of Rs.40 lakhs was accepted as advance sale consideration. But because of some disputes, the prospective purchaser was not willing to proceed with the sale and accordingly, a civil suit was filed against the second petitioner for return of the advance sale consideration, which is stated as decreed. It is also revealed from Ext.P11 judgment passed by the Civil Court that M/s.Skyline Builders withdrew from proceeding further with the sale, because of some boundary disputes. However, it remains the fact that the said party has W.P(C) No.15159 of 2010-T 8 obtained a decree in respect of the said property. Because of the multiplicity of the litigations involving the said property ie. the B Schedule, it is contended by the Bank that the said property cannot be compelled to be sold first, before proceeding against the other properties ie. A and C Schedules; submits the learned counsel. 9. This Court finds considerable force in the said submission, more so, when it is for the security creator to decide as to which of the properties offered as security should be proceeded against first, for realisation of the amount stated as due from the parties concerned; unless it is substantiated that the course being pursued by the Bank/secured creditor is quite arbitrary or contrary to the relevant provisions of the statute or the terms of agreement, as the case may be. In the instant case, no such adverse circumstance is pointed out or established and the only contention of the petitioner is that ‘B Schedule’ property, if subjected to sale is likely to generate more amounts and that the residence situated in the other property could be spared. Both the above contentions are not relevant, to place any hurdle in the way of the respondent Bank from proceeding against the properties scheduled to be sold vide Ext.P7 notification. W.P(C) No.15159 of 2010-T 9 10. In the above facts and circumstances, this Court finds it difficult to accept the version of the petitioners that the matter is liable to be interfered invoking the power under Article 227 of the Constitution of India, nor does it require to be entertained by issuing a Writ of Mandamus under Article 226. Accordingly interference is declined and the Writ Petition is dismissed. Sd/- P.R.RAMACHANDRA MENON JUDGE //True Copy// P.A to Judge ab W.P(C) No.15159 of 2010-T 10