5 it^^^^SS-^ '^ CIN HIGH COURT OF CHHATTIS6ARH AT BILASPUR WRIT PETITION (c) N0.2-%^6 OF 2011 PETITIONER ^^s ^w^ 'z^y .•o- ,,«r <!;•' RESPONbENTS Vs M/s Shwet Chemicals India Private Ltd., a company duly registered under the relevant provisions of the Coifipanies Act, 1956 having its office at 21 Samta Colony, Raipur- (C6) through Shri Ritesh Agarwal, son of Shri Kamal Kumar Agarwal, aged about 33 years, resident of Samta Colony, Raipur (C6) State Bank of India, a banking company duly incorporated under the relevant provisions of Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980 having inter-alia amongst other branches a branch office at Medium Enterprises (Sales Hub), SME Branch Premises, Sround Floor, Zonal Office Premises, Byron Bazar, Raipr (C6) and its Stressed Assets Management Branch at 1, Arera Hills, 1st Floor, Near District Jail, Bhopal (MP) 462 011. ^y' ^ PETITION UN&ER ARTICLE 226/227 OF THE CONSTITUTION OF INDIA ff:^ HIGH COURT OF CHHATTISGARH AT BILASPUR WRIT PETITION (0 No. 2350 of2011 PETITIONER RESPONDENT M/s. shwet Chemicals India Private Ltd. VERSUS State Bank oflndia. WRIT PETITION UNDER ARTICLE 226/227 OF THE CONSTITUTION OFINDIA SB: Hon!ble Shri Satish K. Aenihotri. J. Present: Shri Kshitij Shanna, Advocate for the petitioner. ORDER (ORAL) (Passedon 23rd dayof June,201l) 1. Challenge in this petition is to the notice dated 15.04.2011 whereby it was directed to take possession of the charged/mortgaged properties ofthe borrower. 2. Case of the petitibner/Company is that the alleged demand notice under section 13(2) of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short 'the Act,.2002') dated 10.11.2010 was not served upon the petitioner/Company but the same have been served on the Directors of the petitioner/Company. Thus, the initial notice under section 13(2) of the Act, 2002 including the impugned communication dated 15.04.2011 (Annexure P/l) for taking possession ofthe mortgaged property is bad in law and deserves to be set aside. 3. Leamed counsel further submits that the right of the petitioner/Company to file objection to the notice under section |ni,|p^4 .--•'~ \'":^^... \ ',-:!^"la€\ ^IBI^ S ». ^a s '^t .s' ..^' .'f .^ ''^^•'••:''a'''_^i/ :i.>f-t.'SisT A^" ^^' 13(2) ofthe Act, 2002 and thereafter consideration under section 13(3A) ofthe Act, 2002 have been taken away before passmg the order under section 13(4) of the Act, 2002. Thus, the impugned communication is bad, vitiated and illegal. The impugned coinmunication dated 15.04.2011 (Annexure P/l) has clearly stated that the notice dated 10.11.2010 under section 13(2) of the Act, 2002 was served and thereafter, there was no response within 60 days as specified under the provisions of section 13(2) of the Act, 2002. Thus, the respondent/Bank proceeded to take action under section 13(4) ofthe Act, 2002. Sub sections (2) and (4) of section 13 of the Act, 2002, read as under: 13. Enforcement of security interest.— (1) XXX XXX XXX (2) Where any borrower, who is under a liability to a secured creditor under a security agreement, makes any default in repayment of secured debt or any instalment thereof, and his account in respect ofsuch debt is classified by the secured creditor as non-performing asset, then, the seciired creditor may require tfae borrower by notice in writing to discharge in full his liabilities to the secured creditor within sixty days from the date of notice failing which the secured creditor shall be entitled to exercise all or any of the rights under sub section (4). (3) xxx (3A) xxx XXX XXX XXX XXX (4) In case the borrower fails to discharge his liability in full within the period specified in sub-section (2), the secured creditor may take recourse to one or more of the following measures to recover his secured debt, namely:- •^ '•f^y. ;s .^ & aih 6. ^^- (a) take possession ofthe secured assets ofthe borrower including the right to transfer by way of lease, assignment or sale for realising the secured asset; (b) take over the management of the business of the borrower including the right to transfer by way of lease, assignment or sale for realising the secured asset: Provided that the right to transfer by way of lease, assignment or sale shall be exercised only where the substaatial part ofthe business of the borrower is held as security for the debt:, Provided further that where the management of whole of the business or part of the business is severable, the secured creditor shall take over the management ofbusiness of the borrower which is relatable to the security forthedebt.". (c) appoint any person (hereafter referred to as the manager), to manage the secured assets the possession of which has been taken over by the secured creditor; (d) require at any time by notice in writing, any person who has acquired any of the secured assets from the borrower and from whom any money is due or may become due to the borrower, to pay the secured creditor, so much of the money as is sufficient to pay the secured debt." Under section 17 of the Act, 2002, right to appeal is provided which can be preferred by any person mcluding the borrower aggrieved by any ofthe measures referred to in sub-section (4) and of section 13 of the Act, 2002 by the secured creditors or his authorized officer. The petitioner, without taking recourse to statutory right to appeal under section 17 of the Act, 2002, when the order under section 13(4) of the Act, 2002 has been passed seeks mdulgence ofthis Court by this petition. .1 ^^' In City and Industrial'Development Corpn. V.Dosu Aardeshir Bhiwandiwala , the exercise ofjurisdiction ofthe High Court on the ground that efficacious remedy is available to the petitioner has been well settled. It was, inter alia, held that the Court while exercising its jurisdiction under Article 226 of the Constitution of India, is duty bound to consider availability of the altemative or efficacious remedy for the resolution ofthe dispute. In the case on hand, the efficacious statutory remedy ofappeal imder section 17 oftheAct, 2002 is available. Thus, this court declines to entertain the petitioner under Article 226 ofthe Constitution oflndia. In a catena of decisions, the Supreme Court has clearly held that the only course available to the secured creditor after completion ofthe stage under section 13(4) oftheAct, 2002 is to take recourse to section 17 ofthe Act, 2002. (See: Transcorev. Union oflndia and Indian Overseas Bank v. Ashok Saw Mill). Thus, this petition is dismissed as not maintainable at this stage, reserving liberty to the petitioner to take recourse-to statutory appellate forum ayailable under the provisions ofsection 17 ofthe Act. 2002. Sd/- SatishK.Ag] Judge Amit i-^- ^2 (2009) 1 SCC 168 (2008) 1 SCC125 (2009) 8 SCC 366 T t( ^-—" • • .: ..;.,.,!• j-);-:-;;!^^j;,;:j^^)(itaKaES^B-L~U»f' '—BtMll-°SBlRS: