IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM MONDAY, THE 11TH OCTOBER 2010 / 19TH ASWINA 1932 WP(C).No. 27232 of 2010(D) ------------------------- PETITIONER : --------------- K.ABDUL SALAM, PROPRIETOR, CROWN TEX, T.C.28/2322,SREEKANDESWARAM,OVER BRIDGE, M.G.ROAD,TRIVANDRUM. BY ADV. SRI. N.K. MOHANLAL RESPONDENT(S): ------------------------- 1. AUTHORISED OFFICER AND CHIEF MANAGER, INDIAN BANK, ASSET RECOVERY MANAGEMENT BRANCH, II, WELLINGTON ESTATE, CIRCLE OFFICE BUILDING, 4TH FLOOR, 55/ETHIRAJ SALAI, CHENNAI-600008. 2. CHIEF MANAGER, INDIAN BANK, HEAD OFFICE, 66,RAJAJI SALAI,CHENNAI-670 001. 3. M/S.EAST WEST TRAVEL AND TRADE LINKS LIMITED, 75 F, NEHRU ROAD, WHILE PARLE, EAST MUMBAI, PIN-400099, REPRESENTED BY ITS MANAGING DIRECTOR. 4. AHAMMED HUSSAIN, S/O.SHAMSUDDIN MUSALIYAR PUTHENVEEDU, MYLACAUD P.O., KOLLAM. R1 & R2 BY ADV. SRI.S.EASWARAN R4 BY ADVS. SRI.V.V.RAJA SRI.R.RANJITH THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 11/10/2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: Mn C.K.ABDUL REHIM, J. ------------------------------------------- W.P.(C).No.27232 of 2010 ------------------------------------------- Dated this the 11th day of October, 2010 J U D G M E N T ---------------------- Petitioner claims to be a tenant in a building which was proceeded against under the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act), at the behest of respondents 1 and 2. Consequent to default committed in repayment of a loan availed by the 3rd respondent, proceedings under the SARFAESI Act was initiated and the immovable properties of the 3rd respondent wherein the building in question is situated, was taken over symbolic possession. The petitioner claims that he is conducting business in textiles in a portion of the building in question since 1996 onwards, on the basis of a rental arrangement entered with the 3rd respondent. 2. The petitioner had approached this court on an earlier occasion when SARFAESI proceedings were pursued. Ext.P2 is the judgment of this court in WP(C).No. 10922/10. W.P.(C).27232/10-D -2- Referring to a Division Bench judgment of this court in Business India Builders & Developers Ltd. Vs. Union Bank of India (2007(2) KLT 237) it is observed that the tenant of a building, which is proceeded under the SARFAESI Act, has no right over and above that of the landlord as to continue in occupation from not being evicted under the proceedings. Therefore the writ petition was dismissed reserving liberty of the petitioner if any, to pursue actions to acquire rights and interests over the property, if he is interested. 3. The above judgment was pronounced during April 2010. It is stated that the Bank had thereafter notified the property for sale through Ext.P3 notice. It is the contention of the petitioner that, pursuant to the sale notified, the petitioner had participated in the proceedings and submitted tender which was refused to be accepted by the officials of the Bank. Ext.P5 is the copy of the tender alleged to have been submitted by the petitioner and Ext.P6 is the copy of Demand Draft alleged to have been drawn for the purpose of remitting EMD. On rejection of the tender submitted by the petitioner and conduct of sale, the petitioner submitted Ext.P7 representation requesting the authority to conduct re-sale. Since the said representation was W.P.(C).27232/10-D -3- not considered, the present writ petition is filed seeking to quash the sale conducted pursuant to Ext.P3 & P4 notices. It is also contended that since proceedings for winding up of the 3rd respondent company is pending before the High Court of Bombay, the sale proceedings conducted by the respondents 1 & 2, without obtaining sanction from that court is not sustainable. Petitioner inter alia prayed for a direction to restrain the respondents 1 and 2 from dispossessing the petitioner from the building in question. 4. In the counter affidavit filed on behalf of respondents 1 and 2 it is mentioned that the petitioner had not taken any action pursuant to Ext.P2 judgment which had attained finality between parties inter se. It is further stated that the allegation regarding submission of tender documents before the time stipulated for sale, is absolutely untrue. The petitioner had never submitted any tender before 11 A.M. on 13.8.2010, as alleged. It is pointed out that in Ext.R1(a) representation submitted by the petitioner on 28.8.2010, it is admitted that he had reached the Bank before “11.30 A.M” with the tender documents and the Demand Draft whereas the time fixed was 11.00 A.M. It is mentioned that the writ petition was filed much W.P.(C).27232/10-D -4- after the date of the sale and after the sale was confirmed. It is mentioned that the bid submitted by the 4th respondent was accepted and the sale was confirmed in favour of the 4th respondent on 24.8.2010 and he was issued with a sale certificate on 15.9.2010, on deposit of the entire amount. It is further stated that the sale was confirmed in favour of the 4th respondent for a sum of Rs.1,37,51,000/-, whereas the tender alleged to have been submitted by the petitioner is only for an amount of Rs.13,72,000/-. It is contended by the respondents 1 and 2 that the filing of the writ petition is a sheer abuse of the process of the court and it was filed only as a part of the repeated attempts from the side of the petitioner to hold of the proceedings initiated for realising amounts due from the 3rd respondent. 5. The 4th respondent had filed a counter affidavit in which similar contentions as that of respondents 1 and 2 are raised. It is contended that the challenge raised against the proceedings is covered against the petitioner in view of various pronouncements of this court, as reported in 2007(2) KLT 237 and 2005(4) KLT SN 96 (Page 70). It is alleged that the attempt of the petitioner is in conjunction and collusion with the W.P.(C).27232/10-D -5- 3rd respondent in an attempt to resist the proceedings initiated by the Bank and that the petitioner is estopped from raising any such contention in view of Ext.P2 judgment. 6. While considering the issues involved, it is noticed that the petitioner had challenged the proceedings based on the very same claim in Ext.P2 writ petition. The judgment in Ext.P2 deciding the issue had attained finality between parties inter se. Further, the law settled as on today is to the effect that the tenant of a building is not having any right to object the proceedings initiated under SARFAESI Act. However, learned counsel for petitioner pointed out that the question is now pending consideration before the Full Bench. It is brought to my notice that after confirmation of the sale, now respondents 1 and 2 had approached the Chief Judicial Magistrate Court invoking Section 14(1) of the Act for getting dispossession of the petitioner from the building. If the petitioner has got any case that he is entitled to continue in possession by virtue of any rights as a tenant, it is left open to him to agitate the matter before the Chief Judicial Magistrate. 7. With respect to challenge against the sale, I do not find any material discrepancy to interfere with, invoking powers W.P.(C).27232/10-D -6- under Article 226 of the Constitution of India. If the petitioner claims that the sale was vitiated due to any material irregularity, remedy of the petitioner as a person who claims to have participated in the sale, is to approach the appropriate forum under the statute. It is pertinent to note that even though the petitioner was given liberty to work out his remedies to protect his interests, through the earlier judgment, nothing is brought out to show that he had made any attempt in that line. As stated above, Ext.P2 being a judgment which had attained finality between the parties inter se, I am not at all inclined for any interference on the very same issue. Accordingly the writ petition deserves no merit and the same is dismissed. However, it is made clear that dismissal of this writ petition will not cause any prejudice to the petitioner to invoke statutory remedies if any available to him under law. C.K.ABDUL REHIM, JUDGE. okb