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TMI Blog2024 (12) TMI 1461X X X X Extracts X X X X X X X X Extracts X X X X ..... ac) upon the petitioners, which the petitioners shall deposit with the Registrar General of this Court within a period of one month from today. On deposit of such cost, it shall be transmitted to the account of the High Court Legal Services Committee, Allahabad. - Hon'ble Vivek Kumar Birla And Hon'ble Dr. Yogendra Kumar Srivastava, JJ. For the Petitioner : Zain Abbas For the Respondent : A.S.G.I.,Amit Shukla,C.S.C. ORDER 1. Heard Sri Mathews J. Nedumpara (through Video Conferencing) along with Sri Zain Abbas, learned counsel for the petitioners, Sri Vivek Kumar Singh, learned counsel appearing for respondent nos.7 and 8, Sri Sanjay Kumar Gupta, learned counsel appearing for respondent nos.3 to 6, Sri Raj Mohan Upadhyay, learned Standing Counsel for State-respondents and Sri Amit Shukla, learned counsel for respondent no.12. 2. Present petition has been filed seeking following reilefs: a. To declare that the Section 13 of the SARFAESI Act, and Section 19 of the RDB Act, Sections 7, 9, 10 and 95 of the IBC are unconstitutional, ultra vires and void and are liable to be so declared, inasmuch as the said enactments are wholly one-sided, drafted on the grossly erroneous premis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orum/tribunal to adjudicate the inter se disputes between parties who are governed by the Act, and further as a corollary thereof, the DRTs, NCLTs created under the RDB Act, 1993 and the Companies Act, 2013 are invested of no jurisdiction to adjudicate a dispute arising out of/involving the MSMED Act; e. To declare that the entire recovery steps initiated by Respondent Bank under the SARFAESI Act or any other law, is without jurisdiction, illegal and void inasmuch as the Respondent are not entitled to take recourse to any forum of recovery of the amounts they claim to be due to them from the Petitioner except in the manner permitted by the 'Committee for Corrective Action Plan' contemplated in notification S.O. 1432 (E) dated 29.5.2015, and quash and set aside the entire action taken by the Respondent Bank under Section 13 (2), 13 (4) and 14 of the SARFAESI Act/Section 19 of the RDB Act; f. To declare that the Petitioners are entitled to be compensated from the Respondents No.2 Bank for the loss and injury, which it has suffered on account of the gross breach of contract and trust, culpable negligence, and malicious and tortious action at the hands of the Bank, financial in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fraud and further to quash and set aside the same; k. To issue a Writ in the nature of Prohibition or any other appropriate Writ or order or direction restraining and prohibiting Respondent Bank/Financial institution, their agents, servants, officers, representatives from taking any action for recovery under the SARFAESI Act, IBC, Arbitration and Conciliation Act, Recovery of Debts and Bankruptcy Act, Negotiable Instruments Acts or any other law in respect of the amounts they falsely claim to be due from the Petitioner, in particular restraining Respondent no.3, from dispossessing the Petitioner of his/his company's properties; l. To issue a Writ in the nature of Mandamus or any other Writ, order or direction directing Respondent no.2, Board of Directors of the Axis Bank, to constitute a committee for the resolution of the stress in the unit of the Petitioners Company, an MSME, as contemplated in paragraph 2 of the notification dated 29.5.2015 issued under the MSMED Act, and further to direct the Committee to resolved the stress in accordance with the said notification and such other relevant notifications/regulations framed by the RBI; m. To grant a perpetual mandatory injunc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anding Counsel for the State respondents. 2. At present, no notice is required to be issued to respondent nos. 2, 9 and 10. 3. At the outset, a preliminary objection has been raised on the strength of earlier order passed by this Court in Writ - C No. 26449 of 2024 (M/S Benara Autos Pvt. Ltd. 3 Ors. Vs. State of U.P. 4 Ors.), decided on 12.08.2024. That order reads as below : 1. Heard Shri Zain Abbas, learned counsel for the petitioners and Shri Sanjay Kumar Pathak, learned counsel for the respondent-Bank. 2. Proceedings have arisen under SARFAESI Act. Petitioners seek time both for reason of marriage to be solemnised in the family of the private-petitioners and also for reason to litigate. 3. Learned counsel for the Bank states, if the petitioners were to apply to the Bank, the Bank would consider the request for limited accommodation for reason of marriage in the family. 4. Leaving that course open to the petitioners, interference claimed in the present petition is declined. Merit issues may be contested in statutory proceedings. 5. Accordingly, the writ petition stands dismissed. 4. It has thus been submitted, all grounds of challenge being raised now were available to the petit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ence, malicious and tortious action, so too, violation of the express statutory provisions at the hands of the Respondent Bank, are entitled to institute an action/Petition as against the Respondent Bank for the enforcement of the Petitioners' right as against them; c. To declare that the Petitioner being an MSME within the meaning of Sections 7 and 8 of the MSMED Act of 2006, it is entitled to the benefits of the said Act and, in particular, the notification S.O. 1432 (E) dated 29.5.2025 issued by the Central Government under Section 9 of the Act which provides for a mechanism of resolution of stress of MSMEs, as also, the circulars and guidelines issued by the Reserve Bank of India under Section 10 of the MSMED Act and further that no proceedings for recovery of the amounts due by the MSMEs to banks/financial institutions, nay, even operational creditors, shall lie against the Petitioner under the SARFAESI Act, RDB Act, IBC, Negotiable Instruments Act or any other law, for recovery of the amounts allegedly due, inasmuch as the MSMED Act being a special law/later law in relation to the aforesaid enactments, the MSMED Act will prevail over them and recovery can be made only in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt having the force of law; h. To declare that the failure on the part of the Central Government/RBI to implement the MSMED notification dated 29.5.2015, in particular, to ensure that the Board of Directors of the Banks/financial institutions in this country, including the Respondent Bank, constitutes a committed for 'stressed micro, small and medium enterprise, and further to prevent the Banks and NBFCs from classifying the account of an MSME as NPA and resorting to recovery under the SARFAESI, RDB Act, IBC, NI Act, etc. in violation of the prohibition to do so as contained in Paragraph 1 and 5 (4) (iii) of the said notification, amounts to gross failure on their part to comply with the statutory duty cast upon them under Sections 35, 35A, 35AA, 36, 36AA of the Banking Regulation Act and Sections 45-IE of the Reserve Bank of India Act, and Sections 9 and 10 of the MSMED Act; i. To grant a perpetual mandatory and/or prohibitory injunction, mandating and the directing Central Government and the RBI to enforce the notification dated 29.5.2015 in its true letter and spirit and further to direct the Central Government and the RBI to ensure that recovery action initiated against the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es of the case may require; p. Issue a writ, order, or direction, which this Hon'ble Court may deem fit and proper under the facts and circumstances of the case. q. Award the cost of the petition to the petitioner. 6. At this stage, Sri Sanjay Kumar Gupta, learned counsel appearing for respondent nos.3 to 6 has pointed out that when on the last date, i.e. 29.11.2024, the prayer made by learned counsel for the petitioners to take up the matter out of turn was rejected by this Court, which was before lunch hours, writ petition, being WPL/35823/2024, which is pending consideration, was mentioned before the concerned Bench of the Bombay High Court to be taken up. The said petition was also filed by the same petitioners, with the same prayers and, the next date fixed therein is 18.12.2024. The prayer made in WPL/35823/2024 is quoted as under: a. To declare that the entire proceedings initiated by the Respondent Bank as against the Petitioner in violation of the notification dated 29.5.2015 which not a single bank/financial institution in this country has given effect to, renders such proceedings void ab initio, still born, which alone is the inevitable consequence because the notifi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the SARFAESI Act and Section 63 of the IBC which bar the jurisdiction of the Civil Court to entertain and adjudicate the Petitioner's/borrower's plea against the Respondent Bank nay, bank/financial institution, is unconstitutional and void inasmuch as the Petitioners, victims of the gross breach of contract, culpable negligence, malicious and tortious action, so too, violation of the express statutory provisions at the hands of the Respondent Bank, are entitled to institute an action/suit as against the Respondent Bank for the enforcement of the Petitioners' right as against them; f. declare that the 1st Petitioner being an MSME within the meaning of Sections 7 and 8 of the MSMED Act of 2006, it is entitled to the benefits of the said Act and, in particular, the notification S.O. 1432 (E) dated 29.5.2025 issued by the Central Government under Section 9 of the Act which provides for a mechanism of resolution of stress of MSMEs, as also, the circulars and guidelines issued by the Reserve Bank of India under Section 10 of the MSMED Act and further that no proceedings for recovery of the amounts due by the MSMEs to banks/financial institutions, nay, even operational credito ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n to set off/adjust the insurance money received from the ECGC together with interest as against the claim against the Petitioners; j. declare that the Petitioners are entitled to be compensated from the Respondents No.3 Bank for the loss and injury, which it has suffered on account of the gross breach of contract and trust, culpable negligence, and malicious and tortious action at the hands of the Bank, financial institution and its officers, which loss and injury far exceeds the very claim of the Bank as against the Petitioners and therefore, no amount is due to the Respondents by the Petitioner and further that the Respondents have no enforceable rights as against the Petitioner; k. declare that the guidelines and notifications issued by the Reserve Bank of India from time to time empowering the bank and financial institutions to declare a borrower as a willful defaulter is without authority of law, for such a declaration amounts to a civil death and further that the Petitioners, nay, a borrower is not liable to be declared as a willful defaulter except by the authority of an Act of Parliament or statutory instrument having the force of law; l. To declare that the various writ p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thout 60 days prior notice is unconstitutional and void inasmuch as it denies the very access to justice, particularly of the weaker sections of Society to whom Article 226 and 32 remain a mirage; r. declare that the proviso to Section 113 of the CPC which mandate that Civil Courts shall refer any question of law as to the constitutionality of a statutory instrument to the High Court is unconstitutional and void inasmuch as it deprives the Civil Court, a court of record of plenary original jurisdiction empowered and competent, nay, duty bound to embark upon any controversy of a civil nature under the sun, accessible to even the least privileged, of its pristine glory and efficacy; s. pass such further and other orders as the nature and circumstances of the case may require. 7. Submission of learned counsel for the respondents, therefore, is that the present petition, with all knowledge about pendency of earlier petitions with the same prayers, is not maintainable and, it is nothing but an abuse of the process of law and, the same is liable to be dismissed with heavy cost. 8. Learned counsel for the petitioners, replying the preliminary objection, submits that the principle of estop ..... X X X X Extracts X X X X X X X X Extracts X X X X
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