YASHVANTBHAI MANUBHAI PATEL Vs. RECOVERY OFFICER

JUDGEMENT

(1.) This petition under Article 226 of the Constitution of India is filed by the petitioners essentially against the order dtd. 11/9/2017 passed by the Recovery Officer of DRT-I, Ahmedabad in recovery proceedings R.P. No.1515-B (sic.) by which the notice is issued upon the present petitioners under Sec. 25B of the The Recovery of Debts and Bankruptcy Act, 1993 (hereinafter referred to as "RDB Act" for short).

(2.) Learned advocate Mr. Sachin D. Vasavada for the petitioners submitted that the petitioners were the guarantors for loan facility availed from the respondent-financial institution by the principal debtor namely the Rajpur Mills Limited. The said mill went into liquidation and Company Judge of this Court passed an order appointing Official Liquidator for the purpose of liquidating the assets of New Rajpur Mills. It is submitted that as per the provisions of the Companies Act, particularly Ss. 429A and 430 of the Companies Act, the assets of New Rajpur Mills after being liquidated was to be disbursed accordingly. It is submitted that the respondent-financial institution being the creditor had also staked their claim in the liquidation proceedings and this Court by its order had ordered paying of the dues of the respondent-financial institution.

(3.) As against this, learned advocate Mr. Indravadan Parmar for the respondent No.2 submitted at the outset that the petition itself is not maintainable as it is an order passed by the Recovery Officer in exercise of its power under Sec. 25 of the RDB Act and therefore, as an alternative remedy, there is a provision for appeal before the DRT as well as DRAT which the petitioners have not resorted to. It is submitted that there is a fallacy in the argument of learned advocate for the petitioners that in view of winding up proceedings having culminated into disbursement of amount recovered from the liquidation proceedings, the debt will stand satisfied.