THE HON’BLE SRI JUSTICE N.V.RAMANA AND THE HON’BLE SRI JUSTICE P. DURGA PRASAD W.P.Nos.24272 of 2011 and 25356 of 2011 ORDER: (per the Hon’ble Sri Justice P.Durga Prasad) Both the Writ Petitions are filed for issuance of writ of Mandamus declaring the inaction of the 1st respondent Bank over the possession notice dated 05.12.2009 issued under Section 13 of SARFAESI Act, 2002 in respect of the notice schedule property standing in the name of respondent Nos.2 to 8 malafide, motivated, illegal, arbitrary and discriminatory. The 1st respondent bank initially extended Rs.60,00,000/- working capital facility to the 2nd respondent prior to 1992. Later, the aggregate credit facilities were enhanced from time to time to Rs.90 lakhs, Rs.117 lakhs, Rs.177 lakhs, Rs.202 lakhs. The said credit facilities were duly secured by hypothecation of stocks, book debts and plant and machinery and by mortgage of immovable property owned by respondent Nos.2 to 8. The writ petitioners as directors of 2nd respondent signed as guarantors for the aforesaid credit facilities along with others, but they did not mortgage any of their personal properties to secure the said credit facilities. The accounts of the 2nd respondent have become NPA as they failed to repay the amount due under the credit facilities. The 1st respondent instituted O.A.No.44 of 2003 on 20.03.2003 before Debts Recovery Tribunal, Visakhapatnam, which was transferred and renumbered as O.A.No.165 of 2006 on the file of Debts Recovery Tribunal, Hyderabad. The said O.A. was filed for recovery of Rs.2,65,62,667.95 Ps. An Advocate-Commissioner was appointed by the Debts Recovery Tribunal, Visakhapatnam in I.A.No.358 of 2003 in O.A.No.44 of 2003 to take inventory of plaint and machinery and other movables of 2nd respondent secured to the 1st respondent on 07.06.2003. According to the writ petitioners, the 3rd respondent has disposed off the plant and machinery and other movable properties and misappropriated the sale proceeds without crediting the same to the loan account. Some of the properties covered by O.A. were acquired by the Government and the 3rd respondent has received the compensation and misappropriated the same. According to the writ petitioners, the 3rd respondent has sold away the immovable properties secured with the 1st respondent bank and misappropriated the same. Admittedly, the 1st respondent has initiated proceedings under SARFAESI Act by issuing notice under Section 13 (2) of the Act on 08.11.2007 for recovery of Rs.1,98,81,159/- outstanding as on 31.03.2001. Thereafter possession notice was also issued on 05.12.2009 under Rule 8 (1) of the Security Interest (Enforcement) Rules, 2002. Thereafter, the 1st respondent has not proceeded further on the possession notice for recovery of the entire dues with interest and the writ petitioners have received an Order passed in I.A.No.1352 of 2009 in O.A.No.165 of 2006 attaching the agricultural lands belonging to them, which were never secured by them to the 1st respondent bank. Therefore, they are seeking the relief of issuance of writ of Mandamus for inaction of 1st respondent in not taking action against respondent Nos.2 to 8 The 1st respondent has filed the counter pleading that the writ petition is not maintainable as the petitioners have not availed the alternative remedy available to them under Section 17 of the SARFAESI Act. According to them, they have issued possession notice under Section 13 (4) of the SARFAESI Act for recovery of dues and the said proceedings were challenged by the petitioners before the Debts Recovery Tribunal, Visakhapatnam in S.A.No.203 of 2009 and the Debts Recovery Tribunal, Visakhapatnam has declared that the bank is entitled to proceed under SARFAESI Act by order dated 19.05.2010. Against the said Order, the 2nd respondent along with the present writ petitioners approached the Debts Recovery Appellate Tribunal, Chennai, but the said authority dismissed the appeal on 25.11.2010. According to them, the writ petitioners being the guarantors allowed the disposal of the company’s properties knowing fully well that the said properties were mortgaged with the bank. According to them, they have initiated action under SARFAESI Act by following the rules and they have not violated any of the provisions of law including the provisions of SARFAESI Act. The writ petitioners have filed rejoinder to the counter filed by the 1st respondent stating that they have not filed any appeal against the orders passed by the Debts Recovery Tribunal, Visakhapatnam on 19.05.2010 and the 2nd respondent represented by 3rd respondent has filed the said appeal. Therefore, from the above pleadings, it is evident that the writ petitioners are the guarantors for the credit facilities extended by the 1st respondent to the 2nd respondent and the 1st respondent already initiated action for recovery of the outstanding amount by filing O.A.No.165 of 2006 before the Debts Recovery Tribunal, Hyderabad and also issued notice under Section 13 (2) of SARFAESI Act. The above proceedings were initiated by the 1st respondent against the respondents 2 to 8 including the writ petitioners. Writ petitioners are not challenging any of the actions taken against them by the 1st respondent by filing O.A. before the Debts Recovery Tribunal or initiating the proceedings under SARFAESI Act, but they are only questioning the inaction of the 1st respondent in not proceeding further in pursuance of the notice issued on 05.12.2009 under SARFAESI Act against respondent Nos.2 to 8. As admitted by the writ petitioners, the 1st respondent has filed O.A.No.165 of 2006 before the Debts Recovery Tribunal, Hyderabad and also filed I.A.No.1352 of 2009 in the said O.A. and obtained attachment Order of the properties of the guarantors including the writ petitioners. They also issued notice under Section 13 (2) of the SARFAESI Act and subsequently issued possession notice under Rule 8 (1) of the Security Interest (Enforcement) Rules, 2002. The said notice was issued to the respondent Nos.2 to 8 including the writ petitioners and the properties belonging to the 2nd respondent was taken as symbolic possession on 05.12.2009 itself. Admittedly, the said notice was not questioned by the writ petitioners. The 2nd respondent has filed S.A.No.203 of 2009 before the Debts Recovery Tribunal, Visakhapatnam and the same was disposed off by the Order dated 19.05.2010 holding that the 1st respondent is entitled to proceed under SARFAESI Act. Against which the 2nd respondent has filed an appeal before Debts Recovery Appellate Tribunal, Chennai and the same was dismissed on 25.11.2010. Therefore, it cannot be said that the 1st respondent has not taken any action for recovery of the amount. One of the reliefs prayed for is to restrain the 1st respondent from interfering with the personal properties not secured for the credit facilities extended to the 2nd respondent company pending disposal of the writ petitions. As rightly observed above that the present writ petitions are not directed against the Orders passed in I.A.No.1352 of 2009 in O.A.No.165 of 2006 by the Debts Recovery Tribunal, Hyderabad. But, from one of the relief sought for by the writ petitioners, it is evident that the writ petitioners filed these petitions only to seek relief against the orders passed in I.A.No.1352 of 2009 in O.A.No.165 of 2006. The 1st respondent has issued the possession notice on 05.12.2009, the 2nd respondent has questioned the same in appeal and the same was dismissed on 25.11.2010. Therefore, from the above discussion it cannot be said that there is inaction on the part of the 1st respondent with regard to recovery of the amounts due to them against respondent Nos.2 to 8. Thus, there are no merits in the writ petitions and the same are liable to be dismissed. In the result, the Writ petition Nos.24272 and 25356 of 2011 are dismissed, but in the circumstances without costs. _______________________ JUSTICE N.V.RAMANA. _____________________________ JUSTICE P. DURGA PRASAD Dated:20-10-2011 Ksp