2019 (10) TMI 220 - HC - Indian Laws

Maintainability of petition - availability of alternate remedy of appeal - Payment of balance One Time Settlement (OTS) amount - grant of 6 months time to pay balance OTS amount from the date of disposal of the writ petition - SARFAESI Act - HELD THAT - The recovery proceedings is initiated under SARFAESI Act. The SARFAESI Act provides for alternative remedy under Section 17 of the SARFAESI Act. Since, the petitioner has alternate remedy available under the Statue, it may not be appropriate for this Court to entertain the writ petition. But, it is not total bar to entertain the writ petition, when the petitioner makes out extraordinary ground. In the case on hand, no extraordinary ground is made out to entertain the writ petition except saying that if petitioner is granted some time he would make payment. The petitioner has not complied with the terms of one time settlement. Hence, as the petitioner has alternate and efficacious remedy under the SARFAESI Act, the writ petition is not entertained - petition dismissed.

Summary

Issues:
Challenge to E-Auction sale notice under SARFAESI Act, request for extension of time for payment of remaining OTS amount.

Analysis:
The petitioner, a rice mill, availed financial assistance from the respondent bank but failed to repay the loan, leading to recovery proceedings under SARFAESI Act. The petitioner proposed a one-time settlement (OTS) which the bank accepted, offering to close the dues for a specified amount and granting six months to pay. However, the petitioner did not adhere to the settlement terms, prompting the bank to issue an auction sale notice. The petitioner challenged this notice, seeking an extension to pay the remaining OTS amount.

The court noted that the SARFAESI Act provides an alternative remedy under Section 17, making it inappropriate for the court to entertain the writ petition unless extraordinary grounds are presented. In this case, the petitioner failed to demonstrate any exceptional circumstances beyond requesting more time for payment. The court referenced a Supreme Court case highlighting the importance of timely repayment of loans from public funds and the adverse impact of frivolous litigation on financial institutions and the economy. As the petitioner had an alternate and efficacious remedy under the SARFAESI Act, the court declined to entertain the writ petition, dismissing it and granting the petitioner liberty to seek redress through the appropriate forum.