Satish Kumar vs State Bank of India and Another

K. Kannan, J.—The writ petition has been filed at the instance of a person claiming to be a tenant of the premises which has been the subject of mortgage and the complaint is that the financial institution has dispossessed him in purported exercise of power u/s 13(4) of SARFAESI Act. An oral submission urged on behalf of the petitioner is that he has been inducted in possession of the property in April 2006 and the mortgage had been created only subsequently on 10.11.2006. The respondent filed the objection denying the petitioner''s entitlement and also contended that the petitioner''s lease had not commenced before the creation of the mortgage. The petitioner has filed exhibits P-5 and P-6 which referred to grant of landline telephone connection and issuance of an insurance agency to the petitioner''s sister at the property. Both these documents relate to the period subsequent to the mortgage.

The learned Counsel appearing on behalf of the petitioner states that he has documents to establish that his tenancy was created even prior to the creation of the mortgage. This Court has held in Delhi Punjab Goods Carrier (P) Ltd v. Bank of Baroda 2008 (2) I.S.J. (Banking) 61 that in the matter of enforcement of security u/s 13(4) of SARFAESI Act, a tenant who has come by possession subsequent to the period of creation of mortgage will have no right resist the financial institution from taking possession. This case will have relevance in an undisputed case where the tenancy came about subsequent to the creation of the mortgage. When the issue as to when the lease had been created in favour of the petitioner is a disputed question of fact, this Court exercising jurisdiction under Article 226, cannot adjudicate upon it without affording to the parties a scope for a full-fledged evidence and enquiry. The petitioner appears to have filed a civil suit seeking for injunction before he was dispossessed but he has withdrawn the same when the possession was taken by the financial institution.

Under the present circumstances, the issue could be decided only in a Forum where adjudication of a disputed question of fact will become possible. The petitioner has an effective alternative remedy to his right to challenge the act of taking possession u/s 13(4) by preferring an appeal u/s 17 of the SARFAESI Act. Any time taken in the bona fide prosecution of his right before this Court will be excluded and when an appeal is filed u/s 17, DRT will consider taking up the same on file by excluding the period of bona fide prosecution before this Court for the parties to limitation in preferring the appeal.

Reserving to the petitioner such liberty, the writ petition is disposed of. There shall be however no directions as to costs.