With the judgment by Justice A.M. Badar, at Kerala High Court delivered on November 2, 2020 in the case – Authorized Officer, Indian Bank v. K.J. George & Others, the Supreme Court’s clear view has been reiterated that in the absence of a statutory power for enlarging the time, no court even the High Court can extend the period of limitation in the SARFAESI Act. There is no provision for extension of the period of limitation of 45 days prescribed by section 17 of the Act by condoning the delay.
In the light of the positions of law crystallized in the various judgments, neither the Debts Recovery Tribunal (DRT) has power to condone the delay while exercising powers under section 17 of the SARFAESI Act. While passing the impugned order in this case, the DRT committed an error of law by overlooking the settled law on the aspect of limitation in entertaining an application under section 17 of the Act.
The writ petition was filed by the respondents – K.J. George and his wife Mariamma against the demand notices of November 6, 2009 and July 27, 2010 as well as sale notice of November 20, 2010. Nothing prohibited the petitioners in that writ petition, to bring to the notice of this Court (HC) subsequent development in the matter.
The DRT committed an error by putting blame regarding non-disclosure of this fact on the petitioner herein. It was a specific case of the petitioner herein, while defending in the WP 38409/2010, that the remedy lies elsewhere and, therefore, the HC had dismissed the said petition by relegating the petitioner to the DRT. The dismissal was without prejudice to the right of the petitioners in the said petition to take up all their contentions before the DRT.
In the opinion of the Court, the petitioner’s counsel rightly relied upon the judgment of the Supreme Court in the case – Superintendent (Tech. I) Central Excise IDD Jabalpur & Others v. Pratap Rai –(1978) 3 SCC 113, wherein the term ‘ without prejudice’ came to be interpreted to mean that the fresh proceedings can be entertained provided those are according to the provisions of law and for initiating such fresh proceedings even there is no requirement of seeking permission from the court.
In the case in hand, the remedy of the respondents 1 and 2 of challenging sale notice of February 11, 2011 was barred by passage of 45 days and therefore, even if this Court had noted that these respondents can take up all their contentions before the DRT appropriately while dismissing the petition, the challenge to the fresh sale notice of February 11, 2011 had become time barred, by that time.
A bare reading of provisions of section14(2)of the Limitation Act, 1963 makes it clear that the time spent on prosecuting another civil proceedings for the same relief can be excluded when such proceeding is prosecuted in good faith. In the case in hand, the reliefs claimed in WP 38409/2010 and Securitization Application 165/2012 were totally different as both these proceedings were based upon different causes of action. Therefore, section 14(2) has no application to this case.
The question which fell for consideration was whether the instant Original petition could be entertained in view of availability of remedy of challenging the impugned order passed by the DRT by filing an appeal under section 18 of the SARFAESI Act. The availability of alternate and efficacious statutory remedy generally warrants not entertaining that petition. This is a rule of self imposed limitation. In its decision of the case – Commissioner of Income Tax v. Chhabildass Agarwal- (2014) 1 SCC 603, the Supreme Court has held as under:
"15. Thus, while it can be said that this Court has recognized some exceptions to the rule of alterative remedy that is, where the statutory authority has not acted in accordance with the provisions of the enactment in question or in defiance of the fundamental principles of judicial procedure, or has resorted to invoke the provisions which are repealed , or when an order has been passed in total violation of the Nathmal case, Titagarh Paper Mills Case and other similar judgments that the High Court will not entertain a petition under Article 226 of the Constitution, if an effective alternate remedy is available to the aggrieved person or the statute under which the action complained of has been taken itself contains a mechanism for redressal of grievance still holds the field. Therefore, when a statutory forum is created by law for redressal of grievances, a writ petition should not be entertained ignoring the statutory dispensation."
It is thus clear that where the statutory authority has not acted in accordance with the provisions of the enactment in question or if it is demonstrated that there is defiance of principles of judicial procedure then despite availability of alternate remedy , this Court (HC) can exercise its writ jurisdiction. In this case the judgment of Kerala HC in writ appeal 1797/2009 decided onAugust31, 2015 operates as a writ prohibiting the DRT from entertaining time barred application under section 17 of the SARFAESI Act, apart from the fact that there is no statutory provision in the SARFAESI Act, which is undoubtedly a Special Act, to condone delay in taking recourse to the remedy prescribed under section 17 of the said Act. Still the DRT assumed jurisdiction in exercising the power under section 17 with a reasoning which cannot stand scrutiny of law.
In this view of the facts of the case, despite availability of alternate remedy of preferring an appeal, as the impugned order of the DRT is in totally defiance of the fundamental principles of judicial procedure and causing violation of the provisions of the SARFAESI Act, it needs to be held that the instant Original Petition as framed and filed is maintainable.
According to the HC , as the DRT has committed an error of law in entertaining time barred application under section 17 of the SARFAESI Act by assuming jurisdiction and has further gone into the merits of the case despite lack of jurisdiction to entertain time barred claim, the impugned order of the DRT needs to be quashed and set aside.
In the result, the HC has allowed the Original petition by quashing and setting aside order of the DRT and also rejected the Securitisation Application 165/2012 filed by the respondents –K.J.George Varghese and his wife.
