M/s Kesar Multimodal Logistics Ltd. Vs. Union of India & Others

Madhya Pradesh High Court (Division Bench (DB)- Two Judge)

WRIT PETITION, 12620 of 2018, Judgment Date: Jun 22, 2018

Law Laid Down -

• The Reserve Bank of India has issued the circular dated 12.02.2018 in exercise of its statutory functions, therefore, the circular has a statutory force in view of the judgment of the Supreme Court reported as (2002) 1 SCC 367 (Central Bank of  India vs. Ravindra and others) and therefore, there cannot be any estopple against a Statute.
• The decision of the Banks: as to whether the account of the petitioner should be treated under SDR mechanism or the financial assistance advanced to the petitioner is to be recovered under the provisions of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short “the Act”), is a commercial decision taken by the Banks keeping in view their financial risk and the possibility of recovery of the amount from the petitioner. Such decision taken in view of their financial interest does not warrant any interference in exercise of power of judicial review in the writ jurisdiction of this Court.
• The petitioner has invoked the writ jurisdiction of this Court after two of the Banks have issued notice under Section 13(2) of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. The lead Bank has also issued a notice calling upon the petitioner to repay the entire credit facilities. Therefore, the grievance of the petitioner arises out of the threatened proceedings under the Act for which the remedy lies before the Debts Recovery Tribunal under Section 17 of the said Act after possession is taken as held by the Supreme Court in judgments reported as (2004) 4 SCC 311 (Mardia Chemicals Ltd. and others, Etc. Etc. vs. Union of India and others, Etc. Etc.).

M/s Kesar Multimodal Logistics Ltd. Vs. Union of India & Others