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Judgment
Sushrut Arvind Dharmadhikari, J
Heard on the question of admission and interim relief.
This petition under Article 226 of the Constitution of India has been filed assailing the Auction Letter dated 29.03.2024 passed by the private respondent No.2 under Section 8(5) and 9(1) of the Security Interest (Enforcement) Rules, 2002.
Learned counsel for the petitioners contended that the petitioners are the citizen of India having business within the jurisdiction of this Court. Petitioners availed credit facilities of Rs. 81,50,000/- from the respondents No. 1 and 2 in the shape of loan against mortgage on 13.02.2016 for their business requirement. Petitioners paid the installments regularly till 2020, however, due to Covid-19 their business was financially affected. Thereafter, respondents No. 1 and 2 initiated action under the provisions of Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as the 'SARFAESI Act'). The loan account of the petitioners was classified as Non Performing Asset (NPA). On 29.03.2024, respondents served the impugned letter of Auction Proceeding as per rules to the petitioners. On 19.04.2023, the respondent No.3/Additional District Magistrate passed an order for handing over the possession of mortgaged property to the respondents. Hence, this petition.
Heard learned counsel for the petitioners.
On perusal of the writ petition along with Annexures, it is seen that no relief has been claimed against the respondent No. 3/State. The only relief claimed in this petition is against respondent No. 2 which is a private limited company and is not "State" within the meaning of Article 12 of the Constitution of India, therefore not amenable to the writ jurisdiction of this Court. On this ground, the petition deserves to be dismissed.
The Hon'ble Apex Court in the case of Phoenix ARC Private Limited Vs. Vishwa Bharati Vidhya Mandir and Others reported in (2022) 5 SCC 345 has held that if proceedings are initiated under the SARFAESI Act and/or proposed action is to be taken and the borrower is aggrieved by any of the actions of the private bank/ARC, the borrower has to avail the remedy under the SARFAESI Act and no writ petition would lie and/or is maintainable and/or entertainable. Earlier also, this issue was dealt with by the co-ordinate Bench of this Court (at Gwalior) in W.P. No. 8074/2016. The writ petition was dismissed as not maintainable vide order dated 21.11.2016 holding that writ petition under Article 226 of the Constitution of India is not maintainable against a private bank.
Taking into consideration, the settled legal position, this petition against a private company is not maintainable, therefore, does not call for interference by invoking extraordinary jurisdiction under Article 226 of the Constitution of India.
The petition is accordingly dismissed as not maintainable. However, petitioners are at liberty to approach the competent authority seeking redressal of their grievance in accordance with law.