HIGH COURT OF CHHATfISGAKH AT BILA8PUR Writ Petition (Q No.5929 of2009 PETITIONERS: I. 3. M/s ABS Metals Ltd., Coxnpany registered under Provisions of Companies Act, 1956, Registered office at Plot No.129, 130 and 138, Light Industrial Area, Bhilai, CG, fhrough its Director, Sunil Agrawal/S/o Late Shri Bengali Lal Agrawal, aged adult, resident of: Plot No.IO, Old Nehni Nagar, BIiilai, Distf. Durg, CG, presentiy at Central Jail, Durg M/ s ABS Steels Ud. , Compajay registered under Provisions of CoinpaB.ies Act, 1956, Registered office ^ at: Plot No.t37-A, Light Industrial Area, Bhilai, CG, thn)ugh its Dirccfor, Anil Agrawal, S/o Late Shri Bengali Lal Agrawal, aged adult, resident of: Plot No. 10, Old Nehm Nagar, Bhilai, Distt. Durg, CG, prcsenfly at Central Jail, Durg M/s DM EngiQ.eering Ltd., Com.pan.y registered under Provisious of Cosapasiies Aet, 1956, Registered office at: Plot No. 129, 130 aad 138, Light Industrial Area, Bhilai, ••• CG, fhrough its Director, Vijay Agrawal, S/ o Late Shri Bengali Lal 2^grawal, aged adult, resident of: Plot No.IO, Old Nehizi Nagar, Bhilai, Distt. Durg, CG/ preseiitiy at Central Jail, Durg Anil Agrawal, S/o Late Shri Bengali Lal Agrawal, aged adiilt, resident of: plot No,10, Old Nehm N^ar, Bhflai, Distt. Durg, CG/ Presently at Central Jail, Durg Sunil Agrawal, S/o Late Shri Bengali Lal Agrawal, aged adult, resident of: plot No, 10, Old Nehm Nagar, Bhilai, Distt. Durg, CG, Presentfy at Central Jail, Durg 'r^- ^ RESPONDENTS: -Versus- 1. 2. Vijay Agrawal, S/o Late Shri BengaM Lal Agrawal, aged adult, resident of: plot No.IO, Old Nehm Nagar, Bhilai, Distt Durg, CG, Presentiy at Central Jail, Diirg The Azithorised Officer, Punjab National Baa.k, Circle Office, Raipur(CG) Punjab National Baak, Civic Centre Branch, Bhilai, District Durg (CG) through its - Chief Maoiager Prcseiit; Shri Satish Agrawal, counsel for the petitioners. Single Bench: Hon'ble Shri Dhirendra Mishra, J. ORAL ORDER (20-10-2009) 1. The petitioners by the mstaat petition have prayed for quashing of initiatiou aod continuance of the recoveiy proceedings iiiitiated agaiiist thein under th.e Securitisation aod Reconstniction of Finarxcial Assets and Enlbrcenieiit of Security Interest Act, 2002 (for short s^ie Act") vide demaiid notice dated 8-7-2009 (Ax3iiexure-P/9), They have also prayed for qziashiag of possession noticedated 12-9-2009 (Annexure-P/10), auction iiotice (Annexure-P/ 11) and Sale notice (Annexure-P/ 13), 2. Briefly stated^ grievance of tiie petitioners is fhat petitioBer No.l was saiictioned cash credit faciMty by the respondent baiik to th.e extexit of Rs, One thousaad lakhs and term loan of Rs.71.96 lakhs, Petitioner No.2 was also enjoymg cash credit facility of Rs.900 lakhs from the State Baxik of India, Commercial Braiich, Raipur before 31st Januaxy, 2009, The loan account was subsequently taken over by tlie respondent baxik vide their saiictioii letter dated 31-1-2009 and cash credit faciMty of Rs. Niae Hundred lakhs was eiitiaace.d to Rs. One thousaiid four hundred lakhs. Siinilarly, petitioner No.3 was also enjoying cash credit lacility of Rs. Five Hundred Ftfty iakhs aad oatstaQ.dHigbalaiice i^i term loaa account was Rs.86.24 lakhs. The said loaa accouut was taken over by respondent basik vide saixction letter dated 31-1-2009 and cash credit faciUty of Rs.550; lakhs was eBlianced to Rs,800 ^ lalchs. -A-J-- :'j i.:--^ 3. On fhe basis of comiplaiat of respondent bank dated 9-5-2009 tliat the petitioners have disappeared after selljjsg hypothecafed goods, ofience undcr Section 406 read wifh Section 34 of tlie IPC was i^gistered on 17-5-2009, A demaixd notice under section 13 (2) of the Act was published in the newspaper, as fhe petitioners were not available ia their given address at Bfailai. Petitioners No.4 to 6 were arrested on 7-8-2009. Finally possession notice under Section 13 (4) ofthe Act was piibMsbed iii the newspaper on 12-9-2009 and auction notice was published on 20-9-2009 aad the auction is scheduled for 21st October, 2009, The petitioners could uot subinit their representation agaiast the cleniand notice as the notice was never served personafly upon tliem. A representation was siibmiitted by petitioner No.6 through tds legal advisor ou 21-9-2009 aad 29-9-2009, however, fbe sam.e has not been repMed. 4\ Shii Satish Agrawal, leamed counsel for the petitioners subinitted that froni the above facts, it is evident fhat the petltioners wen? never served personally with fhe deinaad notice iixider Section 13 (2) micl they were se.rved on.ly fh.rough'pzibtication in. the .newspaper., Sioce the petitio.ners were out of fhe local area of Bhilai/'they coiild iiot subm.it-their objection to the deinand notice iinder Sectioa 13 (2) of fhe Act aiid fiiiatly, they were arrested on 7-8-2009. Theirbail application lias been rejected as the saine was opposed by the baolc, Possessiou notice under section 13 (4) of flie Act or fhe auction xiotice was also iiever served upon ttie petitioners isi jall aixd fhe sarae has beexi seived tbrough pubUcation in fhe newspaper. Sm:ce tlie petitioners are in custody, they had uo opportanity to reply fhe above notices. The wliole exercise of tbe respondent baiik in taking possession of tfae seciired assets and plitting it to auction withoiit proper notice to tbe petitioners is.withoiit azithority of law and in. violation of fhe provisions contaiiied ia fh.e Act aiid the rules framed tliereiinder. The respon.deiit bank is conteiiiplating to sell raortgaged property ia hot haste without waitiag for statutory period of appeal available to fb.e petitiouers. 5. He fiixlher submitted tliat fh.e date of aiiction was earUer fixed 011 21st October, 2009, however, the same has 'now been adjozimed for 30th November, 2009. He further submitted that fhe respondent baak may be directed to provide aa opportunity to the petitioners to subxnit rcpreseiitation agaio.st the deinaad notice dated 8-7-2009 axid fhey niay ^ be furtlier directed to decide the same ia accordance with fhe provisions contaiiied in Section 13 (3A) of the Act before proceediiig fartlier iri fhe matter of auction, 6. I have heai'd leam-ed counsel for the petitioners on admission, 7. From. perusal of tlie deraaad notice dated 8-7-2009 (Annexure-P/9), it appeai's that tlie dem.aiid notice iiiider Section 13 (2) was published ia tlie newspaper, as.notices sent to the petitioners fhrough registered post were retumed with an endorseineuf /addressee left/preniises locked\ Wheu the petitioners did not respond to demaiid notice withia ttie statutory period of60 days aiid did not repay tiie loaii witli interest, the baiik ia exercise of powers iinder Section 13 (4) oftlie Act read witli nile 8 of tlie rules piibMshed possession notice, By tliis notice also, the petitioners were directed to pay dues on or beforc 30 days frosn fhe date of pubMcation of fhe notice, faltmg which property .mortgaged was to be aiictioned, Oii petitioners" own adxaission, fhey subinitted their representation fhrough their legal advisor ouly on 21-9--2009/22-9- 2009 (Annexure-P/12) i.e. after publicatioii of possession notice of Annexure-P/ 10 and auction notice ofAnneuxre-P/ 11. 8. Fro32i the docuisients available on record^ it is evident that when fiie deniarid notice issued to the petitioners was retumed unserved HI thcir given address, the sanie was publtshed ia fhe newspaper. In these circuisistao.ces^ grievaace of the petitioners fhat the bank initiated recovery proceedio.gs wifhoiit proper service of notice upon the petitioners is wifhout any basis. 9. Even otlienvise, the petitioners had statutory remedy of prefemag appeal under Section 17 of tlie Act before the Debts Recovery Tribiiiial aiid thus, fhey had equally efficacious alteiiiative statutoiy remedy for redressal of their •grievao.ces. It is true tliat alteraative rexxiedy does not operate as a bax< to tlie exercise of writ court juiisdictiou aii.d fh.e sam.e is fhe rule ofdiscretion. However, the petitioiiers havenot been able to estahMsh aiiy exceptional cause for directiy approachiiig this Coiirt witliout takiug recourse to the specific statatory altemative reniedy avallable to tliein under Section 17 of the Act. lO.Keepiag in view overall conduct of the petitioners ni the niatter/ 1 am. iiot iiicMned to entertaia fhis petition io. view of fhe specific stetutory ^-''::T^. 's^, '^., ^" ^ r'l^ If 1.1. '^iii^ .^.; :t. i 1\;-,; '^^^^ •^.J:"^~\^ ^ i^ ', <^ altemative remedy available to the petitioners under Section 17 of fhe Act. 1 l.The petition is accordmgly dismissed. Sd/- Dhirendra Mishra Judge Ban/e 1 'v ^ te