1 srk IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVL JURISDICTION Writ Petition (Lodging) No.634 of 2010 Mrs.Rita Singh, Director, Hotel Sai Siddhi Pvt.Ltd. Petitioner Vs. The Union of India & ors. Respondents Mr.Mathews J. Nedumpara with Ms.Rohini Amin for petititoner. Mr.K.R.Choudhary with Mr.M.S.Bharadwaj for respondent no.1. Mr.Lalitkumar Jain i/b. Lalitkumar Jain & Co. for resp.no.4. Mr.V.S.Shetty for resp.no.8 Mr.Nikhil Rajani i/b. Mr.V.Deshpande for resp.no.10. CORAM: B. H. MARLAPALLE & MRS.MRIDULA BHATKAR, JJ. March 23, 2010. P.C. 1. We have heard the learned counsel for the petitioner. The petitioner claims to be one of the Directors of Hotel Sai Siddhi Pvt. Ltd. Writ 2 Petition (Lodging) No.532 of 2010 was filed by M/s. Hotel Sai Siddhi Pvt. Ltd. and the same came to be rejected by us on 15th March 2010. 2. We had made it clear that the remedy of the petitioner was by way of an appeal before the Debt Recovery Appellate Tribunal to challenge the sale proceeds of the secured property as undertaken by the State Bank of India. It appears that when Writ Petition (Lodging) No.532 of 2010 was rejected by us on 15/3/2010, Review Application No.2 of 2010 was pending in S.A. No.99 of 2009 which was filed under Section 17 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002 (for short “the Securitisation Act”). The said review application was filed by M/s. Hotel Sai Siddhi Pvt. Ltd. and not by the present petitioner. The learned counsel for the petitioner states that the petitioner has come before this Court for the first time and she is aggrieved because her personal property is part of the property which is subject matter of the sale. 3. Admittedly the auction sale has taken place on 18th March 2010 i.e. after the review application was rejected by the Tribunal on 17/3/2010. The bid accepted by the Bank is of the sum of Rs.61.40 crores. O.A. No. 3 105 of 2007 was filed before the Debt Recovery Tribunal No.III by the State Bank of India and the Corportation Bank was impleaded as Defendant No.5 as it had a pari pasu charge on the secured property. The said O.A. was allowed on 6th May 2009 and M/s. Hotel Sai Siddhi Pvt. Ltd. did not file any appeal. The learned counsel for the petitioner states that the Company has filed a review application before the DRT so as to recall the order dated 6th May 2009. This statement is disputed by the learned counsel appearing for both the Banks. However, Writ Petition No.2510 of 2009 came to be filed by the company and the said petition came to be disposed off on 19/12/2009 by accepting the Minutes of the Order presented before the Court. The Company admitted and accepted the judgment dated 6th May 2009. The company also agreed and undertook to pay on or before 18th January 2010 a sum of Rs.20,72,96,281/- to the State Bank of India and an amount of Rs.16,41,51,141/- to the Corporation Bank. The State Bank was aggrieved on the issue of interest and, therefore, it has filed Appeal No.244 of 2009 before the Debt Recovery Appellate Tribunal at Mumbai against the order dated 6th May 2009 passed in O.A. No.105 of 2007. As per clause 6 of the Consent Terms in the event the petitioner – Hotel Sai Siddhi Pvt.Ltd. failed to make payments as noted hereinabove, the State Bank of India was at liberty to to take steps to 4 enforce the securities mortgaged, in accordance with law. The learned counsel for the petitioner states that a fresh Notice of Motion has been taken out in Writ Petition No.2510 of 2009 for speaking to minutes of the order so far as minutes of order are concerned. 4. Be that as it may, it is pertinent to note that the company approached this Court by filing Notice of Motion No.27 of 2010 in Writ Petition No. 2510 of 2009 and prayed for extension of time to make payments to the Banks. The said Notice of Motion was disposed off on 17th February 2010 by granting extension upto 20/2/2010 and in the extended period as well the company failed to make the payments to both the Banks. In the mean while on 12/2/2010 the Bank had issued a proclamation for auction sale of immovable and movable properties of the company. At this stage or even prior to the order dated 19/12/2009 passed in Writ Petition No.2510 of 2009, the petitioner had approached the DRT by filing S.A. No.99 of 2009 under Section 17 of the Securitisation Act. In the said application the following reliefs were prayed: (a) The impugned notices dated 15/2/2008 and 5/6/2009 at Exhibits “I” and “J” issued by the respondents to the Applicants, be quashed and/or set aside. 5 (b) That the Hon’ble Tribunal may be pleased to declare that the coercive measure of taking over the possession of the said property, as resorted to by the Respondent Bank is illegal and contrary to law. (c) That the Hon’ble Tribunal may be pleased to order and/or direct the Respondents to restore the possession of immovable properties being the Hotel Sai Siddhi Pvt. Ltd. being at Goa including the other adjacent property, which is not a part of the charge created in favour of the Respondent No.1. 5. As noted earlier, this application came to be dismissed by the DRT on 16/11/2009. 6. Writ Petition (Lodging) No.532 of 2010 was rejected by us on 15/3/2010 and it appears that Review Application No.2 of 2010 filed in S.A. No.99 of 2009 was pending and on 17/3/2010 the said review application has been rejected and this is how this writ petition in the third round has been brought before us by the present petitioner. 7. Admittedly the order dated 16/11/2009 which has become final so 6 far s the DRT is concerned, after rejection of the review application, is an appealable order under Section 18 of the Securitisation Act. The sale of the secured property has been completed on 18/3/2010. S.A. No.99 of 2009 was filed by the company and two of its Directors viz. Shri Amit Digvijay Singh and Smt. Rita Digvijay Singh – the present petitioner and they invoked the jurisdiction of the DRT by the said application filed under Section 17 of the Securitisation Act. It cannot, therefore, lie in their mouth that the DRT had no powers to entertain the said application and that the order dated 16/11/2009 is passed without jurisdiction. Having realised that almost all the prayers set out in this petition were the prayers made in Writ Petition (Lodging) No.532 of 2010, the petitioner has made an additional prayer challenging the validity of Rule 8(5) of the Security Interest (Enforcement) Rules, 2002. The petitioner contends that the said Rule is unconstitutional and void in as much as while it provides that before effecting the sale of immovable property referred to in Rule 9(1), the Authorized Officer shall obtain valuation of the property from the approved valuer and in consultation with the secured creditor, fix the reserve price of the property, it does not provide for notice of such valuation being given to the secured debtor if the property is sought to be sold. In case it is the grievance of the petitioner in this petition that the 7 property sold has been undervalued, we do not find any bar in such question being agitated in the appeal to be filed before the Debt Recovery Appellate Tribunal against the order dated 16/11/2009 and when such a statutory appellate remedy is available we do not see any reason to entertain a writ petition under Article 226 of the Constitution at this stage and all issues which are raised before us and the issue of execution of decree and all other issues can be raised before the appellate forum. 8. Hence the petition is rejected. 9. Certified copy is expedited. (MRS.MRIDULA BHATKAR, J.) (B. H. MARLAPALLE, J.)