KINGFISHER AIRLINES LTD Vs. STATE BANK OF INDIA

JUDGEMENT

(1.) THE present application is filed by the respondent - company, contending that the petitioners, who are a consortium of banks, lead by, M/s State Bank of India are said to have filed an application under Section 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (Hereinafter referred to as the 'SARFAESI Act', for brevity) before the Court of the Chief Metropolitan Magistrate, Esplanade, Mumbai, in Mis.Application no.342/2013, contending that the petitioners who were entitled to take physical possession of the building known as "Kingfisher House", Andheri, Mumbai, under the provisions of the SARFAESI Act, apprehend resistance and were seeking the assistance of the Court. The said property, consisting of a basement, lower ground, ground and an upper floor, with a built up area of 1586.24 Square Metres, was admittedly mortgaged by the respondent in favour of the petitioners to secure the various credit facilities made available to the respondent.

(2.) THE respondent has hence sought that this court direct the petitioner - banks or its representative not to take physical possession of the said property. The application being listed for "Orders" before this court on 18.11.2013, the following order was passed :

(3.) ON the other hand, the learned Senior Advocate Shri S.Naganand would contend that the present application is misconceived and is not maintainable. It is stated that SBICAP is neither a party to the main petition or the Application and hence any relief claimed would not bind the said entity. It is contended that the Company Petition is yet to be admitted and even at this stage, it would not be possible to invoke Section 443 of the Companies Act, 1956. That there is direct bar of jurisdiction for this Court to intervene in terms of Sections 34 and 35 of the SAFFAESI Act. The remedy, if any, of the respondent - company is in terms of Section 17 of the SARFAESI Act and an appeal may be filed before the DRT, in respect of the measures under Section 13(4) of the SARFAESI Act. It is also sought to be pointed out that the interim relief claimed by the respondent does not arise out of the same cause of action on which the main petition is filed and therefore on principle, the respondent, who is in the position of a defendant is precluded from seeking such relief as against the petitioners who are in the position of plaintiffs. The cause of action arising under the SARFAESI Act and the basis for the Company Petition are not the same and cannot be mingled. It is also contended that the position of law as regards an interim relief always being granted in aid of the main relief in a proceeding - would disentitle the respondent to any such relief as it is neither in aid of any main relief or ancillary thereto. It is further contended that the petitioners have instituted the Company petition by standing outside the winding up in so far as their secured interests are concerned and without relinquishing their rights and interests as secured creditors. It is claimed that even if all the secured interests of the respondent are brought to sale, the petitioners are not in a position to realize all of their outstanding dues and hence have filed the Company Petition and that this is unequivocally stated in the Petition itself. It is contended that such dual or multiple proceedings are not barred. It is contended that the Authorized Officer of SBICAP having rejected the replies by the respondent - company to the notices issued under Section 13(2) of the SARFAESI Act, is said to have taken "symbolic" possession of "Kingfisher House" on behalf of the petitioners on 10.8.2013. It is thereafter that an application is filed before the Court of the Chief Metropolitan Magistrate, Esplanade, Mumbai. It is hence contended that the petitioners have acted in accordance with law. It is also stated that the reference to the attachment by the Office of the Tax Recovery Officer (TDS) or the Assistant Commissioner of Service Tax in respect of the same property, are irrelevant to the present application. In any event, it is stated that the rights created in favour of the secured creditors over the secured asset in question, has a precedence over charges, if any, of the Taxation Authorities. Reliance is placed on several authorities to support the contentions of the Petitioners.