Aditya Birla Finance Limited Versus Shri Carnet Elias Fernandes Vemalayam and others
Madhya Pradesh High Court (Division Bench (DB)- Two Judge)
WA, 784 of 2018, Judgment Date: Jul 13, 2018
The provisions of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short “the Act”) override all other provisions of the law which are inconsistent therewith, therefore, will prevail over the provisions of all other Statutes and so as the Arbitration and Conciliation Act, 1996 to the extent of inconsistencies. Thus, the proceedings initiated by the appellant under Section 14 of the Act cannot be said to be illegal on account of a Receiver appointed in proceedings under Section 9 of the Arbitration and Conciliation Act. - Reliance is placed upon; (2018) 3 SCC 85, (Authorized Officer, State Bank of Travancore and another vs. Mathew K.C.); (2009) 4 SCC 94 (Central Bank of India vs. State of Kerala and others); (2004) 4 SCC 311 (Mardia Chemicals Ltd. and others etc. etc. vs. Union of India and others, etc. etc.); and a Division Bench decision of this Court in M.P. No.2271/2018 (M/s Crest Steel and Power Private Limited and others vs. Punjab National Bank & others) decided on 10.05.2018.
The Act does not contemplate symbolic or actual possession - Reliance is placed upon Supreme Court judgments reported as (2008) 1 SCC 125 (Transcore vs. Union of India and Another) as approved in (2009) 4 SCC 94 (Central Bank of India vs. State of Kerala and others).
In terms of Section 14 of the Act, the District Magistrate is duty bound to hand over physical possession to the secured creditor.
The proceedings under Section 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 are not the proceedings to adjudicate the rights of the parties. Therefore, no notice is contemplated to be served upon debtor, as such proceedings are taken only after serving notice under Section 13 of the Act. - Followed - Judgment of the Supreme Court reported as (2013) 9 SCC 620 (Standard Chartered Bank, etc. vs. V. Noble Kumar and others, etc) and Bombay High Court decision rendered in Trade Well vs. Indian Bank, (2007 Cri LJ 2544 (Bom.).
Aditya Birla Finance Limited Versus Shri Carnet Elias Fernandes Vemalayam and others