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TMI Blog2016 (12) TMI 1017X X X X Extracts X X X X X X X X Extracts X X X X ..... enacted Section 140 of the Jammu & Kashmir Transfer of Property Act, therefore, having clearly stated that the State’s subjects/citizens are by virtue of the said provision protected, SARFAESI cannot intrude and disturb such protection. The whole approach is erroneous. As has been stated hereinabove, Entries 45 and 95 of List I clothe Parliament with exclusive power to make laws with respect to banking, and the entirety of SARFAESI can be said to be referable to Entry 45 and 95 of List I, 7th Schedule to the Constitution of India. This being the case, Section 5 of the Jammu & Kashmir Constitution will only operate in areas in which Parliament has no power to make laws for the State. Thus, it is clear that anything that comes in the way of SARFAESI by way of a Jammu & Kashmir law must necessarily give way to the said law by virtue of Article 246 of the Constitution of India as extended to the State of Jammu & Kashmir, read with Section 5 of the Constitution of Jammu & Kashmir. This being the case, it is clear that Sections 13(1) and (4) cannot be held to be beyond the legislative competence of Parliament as has wrongly been held by the High Court. It is thus clear that the State ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under Section 13 thereof to take possession of secured assets of the borrower and sell them outside the court process. Sections 13 (1) and (4) and 17 are key provisions of SARFAESI relevant for the present case and are set out herein as follows: Section 13. Enforcement of security interest. (1) Notwithstanding anything contained in section 69 or section 69A of the Transfer of Property Act, 1882 (4 of 1882), any security interest created in favour of any secured creditor may be enforced, without the intervention of court or tribunal, by such creditor in accordance with the provisions of this Act. (4) In case the borrower fails to discharge his liability in full within the period specified in sub-section (2), the secured creditor may take recourse to one or more of the following measures to recover his secured debt, namely:-- (a) take possession of the secured assets of the borrower including the right to transfer by way of lease, assignment or sale for realising the secured asset; (b) take over the management of the business of the borrower including the right to transfer by way of lease, assignment or sale for realising the secured asset: PROVIDED that the right to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rovisions of this Act and the rules made thereunder, and require restoration of the management of the business to the borrower or restoration of possession of the secured assets to the borrower, it may by order, declare the recourse to anyone or more measures referred to in sub-section (4) of section 13 taken by the secured creditors as invalid and restore the possession of the secured assets to the borrower or restore the management of the business to the borrower, as the case may be, and pass such order as it may consider appropriate and necessary in relation to any of the recourse taken by the secured creditor under sub-section (4) of section 13. (4) If, the Debts Recovery Tribunal declares the recourse taken by a secured creditor under sub-section (4) of section 13, is in accordance with the provisions of this Act and the rules made thereunder, then, notwithstanding anything contained in any other law for the time being in force, the secured creditor shall be entitled to take recourse to one or more of the measures specified under sub-section (4) of section 13 to recover his secured debt. (5) Any application made under sub-section (1) shall be dealt with by the Debts R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... apply, and that the various Constitution Application to J K Orders issued from time to time under Article 370 makes it clear that Article 246 (1) read with Entry 45 and 95 List I would clothe Parliament with power to enact SARFAESI. In fact, according to them, even the impugned judgment of the High Court concedes this. According to them, once Entry 45 List I has no other competing Entry, inasmuch as List II of the 7th Schedule to the Constitution of India has not been extended to the State of Jammu Kashmir, and Entry 11A dealing with Administration of Justice contained in List III of the 7th Schedule to the Constitution of India does not apply to Jammu Kashmir, and Entry 6 List III dealing with transfer of property also does not apply, it is their case that Entry 45 List I is to be read in its full plenitude and is not cut down by the provisions of any other Entry. If it is found that the entire SARFAESI is in fact enacted under Entry 45 read with 95 of List I, it would be clear that no other enquiry is necessary, as the Act in pith and substance would be referable to these two entries. This being the case, the State s legislative power comes in only if none of the entries o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shmir, in which case only a Presidential Order applying such amendment would take effect. Further, according to him, Section 140 of the Jammu Kashmir Transfer of Property Act is in direct conflict with Section 13 of SARFAESI Act and the Transfer of Property Act must prevail. He further argued that Section 17A and 18B of the SARFAESI Act, being Sections relatable to administration of justice, which is purely a State subject, would also be ultra vires Parliament. He relied upon Article 35A and supported the impugned judgment on this score, and further stated that the various judgments cited on behalf of the appellants were distinguishable as the fact situation in the present case was completely different from the situation in those judgments. 7. Shri Sunil Fernandes, learned Standing Counsel for the State of Jammu Kashmir, referred to Article 370 and the Constitution of Jammu Kashmir in some detail and cited judgments of this Court dealing with the same. He also pointed out local statutory laws which prohibit transfer of land belonging to State residents to non State residents. His submission was that though the SARFAESI Act was enacted by Parliament by virtue of Entry 45 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tive of the Constitution. A federal Constitution, by its very nature, consists of checks and balances and must contain provisions for resolving conflicts between the executive and legislative authority of the Union and the regional units. [at pages 396 - 397] 9. It was found that so far as States other than the State of Jammu Kashmir are concerned, indicia (a) and (b) were absent whereas indicia (c) and (d) were present, and this coupled with a reading of various other Articles of the Constitution led a Constitution Bench of this Court to decide that the federal structure of the Constitution tilts strongly towards the Central Legislature and Central Government. 10. Insofar as the State of Jammu Kashmir is concerned, it is clear that indicia (b) is absent. Insofar as the other indicia are concerned, the State does have its own separate Constitution by which it is governed in all matters, except those surrendered to the Union of India. Amendments that are made in the Constitution of India are made to apply to the State of Jammu Kashmir only if the President, with the concurrence of the State Government, applies such amendments to the State of Jammu Kashmir. The distrib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of Jammu Kashmir is dealt with by a special provision, namely, Article 370. At this juncture, it is necessary to set out this Article which reads as follows:- Article 370. Temporary provisions with respect to the State of Jammu and Kashmir. (1) Notwithstanding anything in this Constitution, (a) the provisions of Article 238 shall not apply in relation to the State of Jammu and Kashmir; (b) the power of Parliament to make laws for the said State shall be limited to (i) those matters in the Union List and the Concurrent List which, in consultation with the Government of the State, are declared by the President to correspond to matters specified in the Instrument of Accession governing the accession of the State to the Dominion of India as the matters with respect to which the Dominion Legislature may make laws for that State; and (ii) such other matters in the said Lists as, with the concurrence of the Government of the State, the President may by order specify. Explanation .- For the purposes of this article, the Government of the State means the person for the time being recognised by the President as the Maharaja of Jammu and Kashmir acting on the advi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to an interesting judgment of this Court, namely, Sampat Prakash v. the State of Jammu Kashmir, (1969) 2 SCR 365. In this case, a writ petition under Article 32 was filed challenging the detention of the petitioner, in which it was contended that Article 370 contained only temporary provisions which cease to be effective after the Constituent Assembly of the State had completed its work by framing a Constitution for the State. The detention of the petitioner was continued without making a reference to the Advisory Board inasmuch as Article 35(c) of the Constitution had given protection to any law relating to preventive detention in Jammu Kashmir against invalidity on the ground of infringement of any of the fundamental rights guaranteed by Part III of the Constitution initially for a period of five years, which was then extended to ten years and fifteen years. These extensions were the subject matter of challenge, and it was sought to be contended that the power of the President, depending on the concurrence of the Government of the State of Jammu Kashmir, must be exercised under Article 370 before dissolution of the Constituent Assembly of the State, and that such power mu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not to apply. But more importantly, the power of Parliament to make laws for the said State shall be limited, in sub-clause (b)(i), to the matters in the Union List and the Concurrent List of the 7th Schedule to the Constitution of India, which in consultation with the Government of the State, are declared by the President to correspond to matters specified in the Instrument of Accession. If other matters contained in the said Constitution outside the Instrument of Accession in the said Lists are to be extended, then they can be extended only with the concurrence of the State. The difference between consultation and concurrence was highlighted in Prem Nath Kaul s case, supra. At this stage, it is necessary to refer to this case in some detail as it goes into the legislative history of Article 370, and the Presidential Orders made under the said Article. We are not directly concerned here with the Jammu Kashmir Big Landed Estates (Abolition) Act, 1950, whose validity was challenged in the said judgment. The judgment goes into great detail as to how the Instrument of Accession to the Union of India was made by Maharaja Hari Singh. What is of importance is to note that after the r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th separately owing to the special conditions that existed at the time of the Instrument of Accession. 14. Under sub-clause (1)(d) of Article 370, other provisions of the Indian Constitution shall apply in relation to the State of Jammu Kashmir subject to such exceptions and modifications as the President may by order specify. In Puranlal Lakhanpal v. President of India , (1962) 1 SCR 688, this Court held that modification in sub-clause (d) is a very wide expression which includes amendment by way of change. This Court held: The question that came for consideration in In re: Delhi Laws Act case(') was with respect to the power of delegation to a subordinate authority in making subordinate legislation. It was in that context that the observations were made that the intention of the law there under consideration when it used the word modification was that the Central Government would extend certain laws to Part C States without any radical alteration in them. But in the present case we have to find out the meaning of the word modification used in Art. 370(1) in the context of the Constitution. As we have said already the object behind enacting Art. 370(1) was to r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urrows, the primary meaning of the word modify is given as to limit or restrict but it also means 'to vary and may even mean to extend or enlarge . Thus in law the word modify may just mean vary , i.e., amend; and when Art. 370(1) says that the President may apply the provisions of the Constitution to the State of Jammu and Kashmir with such modifications as he may by order specify it means that he may vary (i.e., amend) the provisions of the Constitution in its application to the State of Jammu and Kashmir. We are therefore of opinion that in the context of the Constitution we must give the widest effect to the meaning of the word 'modification used in Art. 370(1) and in that sense it includes an amendment. There is no reason to limit the word modifications as used in Art. 370(1) only to such modifications as do not make any radical transformation . [pages 692 693] 15. It has been argued that Parliamentary legislation would also need the concurrence of the State Government before it can apply to the State of Jammu Kashmir under Article 370. This is a complete misreading of Article 370 which makes it clear that once a matter in either the Union Lis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce, external affairs, communications and certain ancillary matters. 17. At this stage, it is necessary to see which of the provisions of the Constitution of India have in fact been applied by Article 370 to the State of Jammu Kashmir. First and foremost, in sub-clause (1)(c) of Article 370, the provisions of Article 1 and Article 370 itself are said to apply by virtue of this sub-clause straightaway. In order to find out what other provisions of the Constitution have been extended to the State of Jammu Kashmir, we have necessarily to go to the Presidential Order of 1950. This Order, which is called the Constitution Application to Jammu Kashmir Order, 1950, began rather warily by extending a few Entries in List I of Schedule 7 and applying only certain clauses and Articles of the Constitution. Since this Order and its amendments are of historical importance only, it is not necessary to refer to them in any detail, as it is the Constitution Application to Jammu Kashmir Order, 1954, that superseded the 1950 Order, and went on to apply various provisions of the Constitution of India to the State of Jammu Kashmir that we are concerned with. Insofar as this case is concerned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion (Twenty-fourth Amendment) Act, 1971, section 2 of the Constitution (Twenty-fifth Amendment) Act, 1971, the Constitution (Twenty-sixth Amendment) Act, 1971, the Constitution (Thirtieth Amendment) Act, 1972, section 2 of the Constitution (Thirty-first Amendment) Act, 1973, section 2 of the Constitution (Thirty-third Amendment) Act, 1974, sections 2, 5, 6 and 7 of the Constitution (Thirty-eighth Amendment) Act, 1975, the Constitution (Thirty-ninth Amendment) Act, 1975, the Constitution (Fortieth Amendment) Act, 1976, sections 2, 3 and 6 of the Constitution (Fifty-second Amendment) Act, 1985 and the Constitution (Sixty-first Amendment) Act, 1988 which, in addition to article 1 and article 370, shall apply in relation to the State of Jammu and Kashmir and the exceptions and modifications subject to which they shall so apply shall be as follows:- By this Order, in Part XI of the Constitution of India, in Article 246 for the words, brackets, and figures clauses (2) and (3) occurring in clause (1), the word, brackets and figure clause (2) shall be substituted, and the words, brackets and figure Notwithstanding anything in clause (3), occurring in clause (2), and the whole of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ame into effect on 17.11.1956. Section 2(1)(a), and Sections 3, 4, and 5 read as follows:- 2. Definitions :- (1) In this Constitution, unless the context otherwise requires- (a) Constitution of India means the Constitution of India as applicable in relation to this State; 3. Relationship of the State with the Union of India :-The State of Jammu and Kashmir is and shall be an integral part of the Union of India. 4. Territory of the State :-The territory of the State shall comprise all the territories which on the fifteenth day of August, 1947, were under the sovereignty or suzerainty of the Ruler of the State. 5. Extent of executive and legislative power of the State :- The executive and legislative power of the State extends to all matters except those with respect to which Parliament has power to make laws for the State under the provisions of the Constitution of India. 21. What is important to note in this Constitution, which was drafted by a Constituent Assembly elected on the basis of adult franchise, is that the State of Jammu Kashmir is stated to be an integral part of the Union of India, and that the executive and legislative power of the State ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ashmir, expressly allows any Constitutional amendment to the Constitution of India to be applied with the concurrence of the State of Jammu Kashmir. This would include within its ken, an amendment which either adds to or subtracts from the State List and confers upon Parliament, either exclusively under List I or concurrently under List III, a subject matter hitherto in the State List. This has been so held in Sampat Prakash s case (supra). Also, in Puranlal Lakhanpal s case (supra), the expression modifications occurring in Article 370(1)(d) has been construed not only to mean to limit or restrict but even to extend or enlarge. Thus, the word modification must be given the widest meaning and would include all amendments which either limit or restrict or extend or enlarge the provisions of the Constitution of India. For this reason also it is clear that nothing can ever be frozen so long as the drill of Article 370 is followed. 23. Given this legislative scenario, we have now to examine SARFAESI in its applicability to the State of Jammu Kashmir. Entries 45 and 95 of List I of the 7th Schedule of the Constitution of India read as follows:- 45. Banking. 95. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... DRT Act and the Securitisation Act have been enacted by Parliament under Entry 45 in List I in the 7th Schedule whereas the Bombay and Kerala Acts have been enacted by the State Legislatures concerned under Entry 54 in List II in the 7th Schedule. To put it differently, two sets of legislations have been enacted with reference to entries in different lists in the 7th Schedule. Therefore, Article 254 cannot be invoked per se for striking down State legislations on the ground that the same are in conflict with the Central legislations. That apart, as will be seen hereafter, there is no ostensible overlapping between two sets of legislations. Therefore, even if the observations contained in Kesoram Industries case [(2004) 10 SCC 201] are treated as law declared under Article 141 of the Constitution, the State legislations cannot be struck down on the ground that the same are in conflict with Central legislations. [para 36] 26. In a recent judgment, namely, UCO Bank Anr. V. Dipak Debbarma Ors ., [Civil Appeal No. 11247 of 2016 and Civil Appeal No. 11250 of 2016] delivered by this Court on 25th November, 2016, this Court has held: 18. The Act of 2002 is relatable to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t I of the 7th Schedule is Banking and not Banker or Banks . To include within the connotation of the expression Banking in Entry 45, List I, power to legislate in respect of all commercial activities which a banker by the custom of bankers or authority of law engages in, would result in re-writing the Constitution. Investment of power to legislate on a designated topic covers all matters incidental to the topic. A legislative entry being expressed in a broad designation indicating the contour of plenary power must receive a meaning conducive to the widest amplitude, subject however to limitations inherent in the federal scheme which distributes legislative power between the Union and the constituent units. The field of banking cannot be extended to include trading activities which not being incidental to banking encroach upon the substance of the entry trade and commerce in List II. [para 36] 29. A judgment of the Privy Council reported in Attorney-General for Canada v. Attorney-General for the Province of Quebec , 1947 Appeal Cases 33, also throws some light on what is the correct meaning to be given to the expression banking . A Quebec Statute deemed as vacant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e three lists it is easier to construe List II in the light of Lists I and II. If there had been no List I, many items in List II would perhaps have been given much wider interpretation than can be given under the present scheme. Be that as it may, we have the three lists and a residuary power and therefore it seems to us that in this context if a Central Act is challenged as being beyond the legislative competence of Parliament, it is enough to enquire if it is a law with respect to matters or taxes enumerated in List II. If it is not, no further question arises. (At page 67) 31. At this juncture, it is important to advert to State of Jammu Kashmir v. M.S. Farooqui , (1972) 1 SCC 872. This judgment dealt with the interplay between the Jammu Kashmir Government Servants Prevention of Corruption (Commission) Act, 1962 as against the All India Services (Discipline and Appeal) Rules, 1955. In para 7 of the judgment it was noticed that Parliament could legislate by virtue of Entry 70 List I on All India Services, and Rules made under Article 309 of the Constitution are referable to this Entry. This being the case, the question that this Court had to answer was as to whether t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s up a machinery in order to enforce the provisions of the Act. In pith and substance, SARFAESI does not deal with transfer of property . In fact, in so far as banks and financial institutions are concerned, it deals with recovery of debts owing to such banks and financial institutions and certain measures which can be taken outside of the court process to enforce such recovery. Under Section 13(4) of SARFAESI, apart from recourse to taking possession of secured assets of the borrower and assigning or selling them in order to realise their debts, the banks can also take over the management of the business of the borrower, and/or appoint any person as manager to manage secured assets, the possession of which has been taken over by the secured creditor. Banks as secured creditors may also require at any time by notice in writing, any person who has acquired any of the secured assets from the borrower and from whom money is due or payable to the borrower, to pay the secured creditor so much of the money as is sufficient to pay the secured debt. It is thus clear that the transfer of property, by way of sale or assignment, is only one of several measures of recovery of a secured debt o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 34. In State of Maharashtra v. Narottamdas Jethabai , (1950) 1 SCR 51, this Court upheld the Bombay City Civil Courts Act, and in so doing, referred specifically to the following Entries in the legislative lists of the Government of India Act, 1935. Entry 53, List I: Jurisdiction and powers of all courts except the Federal Court, with respect to any of the matters in this List . Entries 1 and 2, List II: 1. . . . the administration of justice; constitution and organisation of all courts except the Federal Court . 2. Jurisdiction and powers of all courts except the Federal Court, with respect to any of the matters in this List . Entry 15, List III: Jurisdiction and powers of all courts except the Federal Court, with respect to any of the matters in this List. 35. Justices Fazal Ali, Mahajan, and Mukherjea held that Administration of Justice contained in Entry 1 of List 2 of the Government of India Act, 7th Schedule, would include jurisdiction and power of courts generally, but that Entry 53 of List 1 would refer to special powers referable to a particular entry in the Union List as opposed to the general power contained in Entry 1 List 2. It w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Kashmir. 38. The judgment of the High Court is wholly incorrect in referring to Entry 11A of the Concurrent List. First and foremost, as has been noted by us above, the Entry is not extended to the State of Jammu Kashmir. From this, the counsel for the respondents sought to contend that Parliament would, therefore, have no power under the Concurrent List to legislate on the subject matter Administration of Justice . Under Section 5 of the Jammu Kashmir Constitution, we have seen that Administration of Justice would come into play only when Entries 45 and 95 of List 1 are not attracted. Even if this were not so, we have seen in the two judgments cited hereinabove, the expression administration of justice is general and must give way to the special laws that are enacted under Entry 95 List I when coupled with another Entry in the same List in this case Entry 45 List I. The relevant part of Section 140 of the Jammu Kashmir Transfer of Property Act, on which great reliance has been placed by learned counsel for the respondents, provides:- 140. Exemptions of certain instruments from restriction imposed on transfer of immovable property. Nothing contained in Irshad d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able properties. The State legislature having enacted Section 140 of the Jammu Kashmir Transfer of Property Act, therefore, having clearly stated that the State s subjects/citizens are by virtue of the said provision protected, SARFAESI cannot intrude and disturb such protection. The whole approach is erroneous. As has been stated hereinabove, Entries 45 and 95 of List I clothe Parliament with exclusive power to make laws with respect to banking, and the entirety of SARFAESI can be said to be referable to Entry 45 and 95 of List I, 7th Schedule to the Constitution of India. This being the case, Section 5 of the Jammu Kashmir Constitution will only operate in areas in which Parliament has no power to make laws for the State Thus, it is clear that anything that comes in the way of SARFAESI by way of a Jammu Kashmir law must necessarily give way to the said law by virtue of Article 246 of the Constitution of India as extended to the State of Jammu Kashmir, read with Section 5 of the Constitution of Jammu Kashmir. This being the case, it is clear that Sections 13(1) and (4) cannot be held to be beyond the legislative competence of Parliament as has wrongly been held by the Hi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... RNITY assuring dignity of the individual and the unity of the nation; IN OUR CONSTITUENT ASSEMBLY this seventeenth day of November, 1956, do HEREBY ADOPT, ENACT AND GIVE TO OURSELVES THIS CONSTITUTION. It is to be noted that the opening paragraph of the Constitution of India, namely WE THE PEOPLE OF INDIA, having solemnly resolved to constitute India into a SOVEREIGN SOCIALIST SECULAR DEMOCRATIC REPUBLIC and to secure to all its citizens has been wholly omitted in the Constitution of Jammu Kashmir. There is no reference to sovereignty. Neither is there any use of the expression citizen while referring to its people. The people of Jammu Kashmir for whom special rights are provided in the Constitution are referred to as permanent residents under Part III of the Constitution of Jammu Kashmir. Above all, the Constitution of Jammu Kashmir has been made to further define the existing relationship of the State with the Union of India as an integral part thereof. 43. It is thus clear that the State of Jammu Kashmir has no vestige of sovereignty outside the Constitution of India and its own Constitution, which is subordinate to the Constitution of India. It is the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rent Lists. As has been held by us, the whole of SARFAESI is referable to Entry 45 and 95 of List I. Secondly, what has been missed by the impugned judgment is that Entry 95 List I is a source of legislative power for Parliament for conferring power and jurisdiction on the District Court and the High Court respectively in respect of matters contained in SARFAESI. And third, the subject Administration of Justice is only general and can be referred to only if Entry 95 List I read with Entry 45 List I are not attracted. We are afraid that despite the judgment in Narottamdas Jethabai and Jamshed Guzdar s case (supra) , the High Court, even though it refers to Narottamdas Jethabai, has completely missed this crucial aspect. Most importantly, even if it is found that Section 140 of the Jammu Kashmir Transfer of Property Act entitles only certain persons to purchase properties in the State of Jammu Kashmir, yet, as has been held hereinabove, Rule 8(5) proviso which recognizes this provision, has been brushed aside. In any case an attempt has first to be made to harmonise Section 140 of the Jammu Kashmir Transfer of Property Act with SARFAESI, and if such harmonization is im ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ial Assets and Enforcement of Security Interest Act, 2002 cannot be enforced in the State of J K; It is further held that the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 can be availed of by the banks, which originate from the State of J K for securing the monies which are due to them and which have been advanced to the borrowers, who are not State subjects and residents of the State of J K and who are non State subjects/ non citizens of the State of J K and residents of any other State of India excepting the State of J K. Having held that the provisions of SARFAESI cannot be applied to the State of Jammu Kashmir, it is a contradiction in terms to state that SARFAESI can be availed of by banks which originate from the State of Jammu Kashmir for securing monies which are due to them and which have been advanced to borrowers who are not the residents of the State of Jammu Kashmir. 48. We therefore set aside the judgment of the High Court. As a result, notices issued by banks in terms of Section 13 and other coercive methods taken under the said Section are valid and can be proceeded with further. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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