THE AUTHORISED OFFICER, STATE BANK OF INDIA versus M/S ALLWYN ALLOYS PVT. LTD. AND ORS.

Citation: [2018] 4 S.C.R. 477 · Decided: 17-05-2018 · Supreme Court of India · Bench: DIPAK MISRA · Disposal: Appeal(s) allowed
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Judgment (excerpt)

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477
 THE AUTHORISED OFFICER,
STATE BANK OF INDIA
v.
  M/S ALLWYN ALLOYS PVT. LTD. AND ORS.
(Civil Appeal No. 5248 of 2018)
MAY 17, 2018
[DIPAK MISRA, CJI, A. M. KHANWILKAR AND
DR. D.Y. CHANDRACHUD, JJ.]
Securitisation and Reconstruction of Financial Assets and
Enforcement of Security Interest Act, 2002 – s.34 – Equitable
mortgage created by respondent Nos. 2 to 4 in respect of the subject
flat in favour of appellant-bank – Failure to repay the loan amount
– Claim for title over the subject flat by respondent no.5 and 6 (writ
petitioners) – DRT and DRAT held that document “MOU” relied
upon by respondents no.5 and 6 was created after the equitable
mortgage and it was unregistered document which would not confer
any right, title and interest in their favour in the said flat and on
that basis rejected the relief claimed by respondent no.5 and 6 to
restrain the bank from proceeding with the auction of the flat –
High Court held that issue involved disputed facts and directed
respondent no.5 and 6 to contest the matter before proper forum –
On Bank’s  appeal, held: The mandate of s.13 and in particular
s.34 of 2002 Act clearly bars filing of civil suit – For, no civil court
can exercise jurisdiction to entertain any suit or proceeding in
respect of any matter which a DRT or DRAT is empowered by or
under this Act to determine and no injunction can be granted by
any Court or authority in respect of any action taken or to be taken
in pursuance of any power conferred by or under the Act – The
fact that the stated flat is the subject matter of a registered sale
deed executed by the respondent Nos. 5 and 6 in favour of
respondent Nos. 2 to 4 and sale deed has been deposited with the
Bank along with the share certificate and other documents for
creating an equitable mortgage and the Bank has initiated action
in that behalf under the 2002 Act, is indisputable – It is also not
disputed that respondent no.5 is in physical possession of the subject
flat – If so, the question of permitting the respondent nos.5 and 6 to
  [2018] 4 S.C.R. 477
   477
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478
SUPREME COURT REPORTS
[2018] 4 S.C.R.
approach any other forum for adjudication of issues raised by them
concerning the right, title and interest in relation to the said property,
cannot be countenanced – High Court did not analyse the efficacy
of the concurrent finding of fact recorded by the DRT and DRAT
but opined that the same involved factual issues warranting
production of evidence and a full-fledged trial – The approach of
High Court is not tenable in law – Bank/Banking.
Allowing the appeal, the Court
HELD: 1. The mandate of Section 13 and, in particular,
Section 34 of the Securitisation and Reconstruction of Financial
Assets and Enforcement of Security Interest Act, 2002 clearly
bars filing of a civil suit. For, no civil court can exercise jurisdiction
to entertain any suit or proceeding in respect of any matter which
a DRT or DRAT is empowered by or under this Act to determine
and no injunction can be granted by any Court or authority in
respect of any action taken or to be taken in pursuance of any
power conferred by or under the Act. The fact that the stated flat
is the subject matter of a registered sale deed executed by the
respondent Nos. 5 and 6 (writ petitioners) in favour of respondent
Nos. 2 to 4 and which sale deed has been deposited with the
Bank along with the share certificate and other documents for
creating an equitable mortgage and the Bank has initiated action
in that behalf under the 2002 Act, is indisputable. If so, the
question of permitting the respondent Nos.5 and 6 (writ
petitioners) to approach any other forum for adjudication of issues
raised by them concerning the right, title and interest in relation
to the said property, cannot be countenanced. The High Court
has not analysed the efficacy of the concurrent finding of fact
recorded by the DRT and DRAT but opined that the same involved
factual issues warranting production of evidence and a full-fledged
trial.  [Para 6][481-G-H; 482-A-C]
2. The High Court could not have directed the Bank to
deposit Rs.25 Lacs in an interest earning deposit and the profits
of the said deposit to enure to the benefit of the successful party.
Such a direction was wholly uncalled for. [Para 8][482-F-G]
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479
CIVIL APPELLATE JURISDICTION:  Civil Appeal No.5248
of 2018.
From the Judgment and Order dated 30.08.2016 of the High Court
of Judicature at Bombay in WP No.7480/2014.
Vikas
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