Final Order 1

Order Details: Notice of Motion
Pdf Text: CNR No.
IN THE BOMBAY CITY CIVIL COURT AT BOMBAY
NOTICE OF MOTION NO.2323 OF 2019
IN
S.C. SUIT NO.1536 OF 2019
M/s. Shalibhadra Cottrade Pvt. Ltd. … Plaintiff
V/s.
Bank of Baroda … Defendant
Appearances :
Ld. Adv. Rushabh Shah for plaintiff.
Ld. Adv. Yasmin Sarang for defendant.
CORAM : HIS HONOUR JUDGE
SHRI MILIND V. KURTADIKAR
(C.R. No.20)
DATED : 23rd AUGUST, 2019
ORDER
Plaintiff has taken out this notice of motion for directing
the defendant to make discloser and provide copies of sanction letters
and the security documents and for temporary injunction restraining the
defendant from taking any steps against plaintiff.
2. It is argued on behalf of plaintiff that plaintiff is a company
and Ravindra Khona is the Director. Plaintiff is having cash credit
facility of 8.50 Crores with the defendant bank. Plaintiff has secured
various properties and deposits as collateral security for said cash credit
facility. On 11.01.2019 plaintiff has received letter from defendant
bank alongwith statement of account showing that last deposit was
made on 31.07.2018. In fact thereafter on twice deposits were made by
MHCC01 006424 2019
-- 1 of 6 --
NM 2323/2019 .. 2 .. Suit No.1536/2019
plaintiff. However, defendant bank has not considered those deposits
and abruptly declared plaintiffs account as NPA on 30.09.2018. On
such averment defendant has initiated proceeding against plaintiff
before Ld. CMM under the provisions of Securitisation and
Reconstruction of Financial Assets and Enforcement of Security Interest
Act (hereinafter referred as SARFAESI Act). As a result of wrong
declaration of plaintiffs account as NPA led to stoppage of banking
facilities. Plaintiffs trade debtors did not pay money to plaintiff
resulting in a huge outstanding position. Plaintiff is prejudiced because
of abrupts stoppage of banking facility. On several occasions plaintiff
has requested defendant to provide copy of security documents and
loan agreements. However, defendant has neither given inspection nor
provided copies hereof. Therefore, plaintiff is constrained to file this
suit directing the defendant for discloser of documents and supplying
copies thereon.
3. Defendant bank has resisted this application on the ground that
suit is not maintainable in view of section 34 of the SARFAESI Act. As
per said section jurisdiction of Civil Court is expressly barred. It is
argued that by the end of May 2019 the outstanding amount was
11,63,70,341/ against the sanction limit of 11.50 Crores. Said account
never came within limit thereafter. It was remained out of order for a
period of more than 90 days. Said facility was sanctioned against
collateral security by way of deposit of title deeds of flats. On
30.09.2018 plaintiffs account turned into NPA. After 31.05.2019
plaintiff has not made any payment. Therefore, defendant has
constrained to take steps under SARFAESI Act. Accordingly, defendant
has applied under section 13 (2) of SARFAESI Act before Ld. CMM for
taking possession of secured properties of plaintiff. If plaintiff is having
-- 2 of 6 --
NM 2323/2019 .. 3 .. Suit No.1536/2019
any grievance then the remedy is under section 17 of SARFAESI Act.
However, instead of approaching there plaintiff is knocking doors of
Civil Court. This application is filed with ulterior motive to give go by
or counter check to the action legally initiated by defendant under
SARFAESI Act. Apart from it as per plaintiffs demand inspection and
copies of documents were given to him. Therefore the application is
nothing but abuse of process of law and liable to be rejected.
4. It is an admitted position on record that plaintiff is having
cash credit facility with defendant bank to the tune of Rs.11.50 Crores
on collateral security of cash and assets. Now it is the grievance of
defendant bank that plaintiffs account went out of order and became
NPA. Therefore, as per provision of SARFAESI Act defendant bank has
initiated legal action under section 13 (2) of said act before Ld. CMM
for taking possession of secured properties to liquidate the outstanding
amount. On the other hand it is grievance of plaintiff that defendant
bank has abruptly declared account as out of order and NPA and stoped
the banking facilities. It has caused series prejudice to plaintiff.
Because of it plaintiffs debtors has stoped the payment. The claim put
forth by defendant bank and documents relied upon are very much
contrary to each other. Therefore, plaintiff wants inspection and
discloser of the documents as relied on the defendant.
5. No doubt as per section 13 of SARFAESI Act the secured
creditor has right to enforce right against any interest credited security
under provisions of this act without intervention of Court. Section 13
(2) provides issuance of notice to defaulter by secured creditors to
liquidate the dues within 60 days and on failure right is accrued to
secured creditor to apply under section 13 (4) of the SARFAESI Act
-- 3 of 6 --
NM 2323/2019 .. 4 .. Suit No.1536/2019
before Ld. Court to take the majors to recover the secured debts by
taking possession and sale of property. It is also settled legal position
that in case of any grievance the borrower or a person under a liability
to secured creditor may approach before DRT by way of appeal under
section 17 of the SARFAESI Act and as per section 34 of said act
jurisdiction of Civil Court is expressly barred. In such legal position it is
necessary to see whether what is the grievance of plaintiff that too
whether it comes under section 17 or he can seek redress before Civil
Court.
6. It is the grievance of plaintiff that he is having cash credit
facility of Rs.8.50 Crores and secured certain cash and assets as
collateral securities. However, by way of application made before CMM
it reveals that defendant bank is seeking possession of certain properties
which at all not given as security. Bank has abruptly declared account
as NPA and stoped the banking facilities. It has caused series prejudice
to plaintiff.
7. So from above contention made in application it can be
inferred that plaintiff is having grievance about the contention raised
and prayers made by defendant bank in application under section 13
(2) of SARFAESI Act made before the Ld. CMM. It goes to show that
he is raising grievance to the action taken out by defendant bank under
SARFAESI Act. As discussed above in case of such grievance remedy is
open to plaintiff to file appeal before DRT under section 17 of the
SARFAESI Act. In that context jurisdiction of Civil Court is totally
barred. Though plaintiff put forth the case that he want the inspection
and discloser of the security documents, the ultimate intention is to
create obstruction in the proceedings legally taken out by bank under
-- 4 of 6 --
NM 2323/2019 .. 5 .. Suit No.1536/2019
SARFAESI Act. Therefore, there is no force in the contention made out
by plaintiff.
8. The Ld. Counsel for plaintiff has relied on two citations...
(2004) 4 Supreme Court Cases 311 and AIR 1969 Supreme Court
78. The Ld. Counsel for plaintiff relied on above citations on the point
that Civil Court has every jurisdiction only if it is expressly barred. No
doubt it is the rule that Civil Court has every jurisdiction unless it is
expressly or impliedly barred. If any separate remedy under special act
alongwith forum is provided and if that forum is able to give finality to
the cause in issue then it can be said that the jurisdiction of Civil Court
is impliedly barred.
9. I have gone through both the citations. It is observed that
before holding bar to jurisdiction of Civil Court, Court has to see the
scheme of the statute in question of the adequacy or sufficiency of the
remedies provided by it. If that forum is able to provide finality to the
dispute then jurisdiction of Civil Court is barred. If that forum is not
able to give finality then it can be said that Civil Court has jurisdiction
to entertain the cause. Here, as per the scheme of SARFAESI Act
separate forum is provided to give finality to the cause. Therefore,
jurisdiction of Civil Court is barred. So the citations above are not
helpful to the case made out by plaintiff.
10. To conclude there is no substance in the contention made
out by plaintiff. The notice of motion is liable to be dismissed.
Accordingly, the order.
-- 5 of 6 --
NM 2323/2019 .. 6 .. Suit No.1536/2019
ORDER
1. NM No.2323/19 in SU No.1536/19 is hereby dismissed.
( MILIND V. KURTADIKAR )
Judge, (C.R. No.20)
Dt.: 23/08/2019 City Civil Court, Gr. Mumbai
Dictated on : 23.08.2019
Transcribed on : 23.08.2019
Signed on : 28.08.2019
sbk/
“CERTIFIED TO BE TRUE AND CORRECT COPY OF THE ORIGINAL
SIGNED JUDGEMENT/ORDER”
UPLOAD DATE TIME NAME OF STENOGRAPHER
29.08.2019 04.25 p.m. Sanjay Baliram Kaskar
(Stenographer H.G.)
Name of the Judge HHJ Shri M.V. Kurtadikar
(CR No.20)
Date of Pronouncement of
Judgement/Order.
23.08.2019.
Judgement/order signed by P.O on 28.08.2019.
Judgement/order uploaded on 29.08.2019.
-- 6 of 6 --