KAYA INFRAATECH PROJECTS Vs. AUTHORISED OFFICER

JUDGEMENT

(1.) THE petitioner has come before this Court challenging the notice issued under Section 13(4) of the SARFAESI Act, whereby the respondent had sought to take possession of the land for the amount due and payable to the respondent bank. The petitioner does not deny the fact that it had availed of financial facilities from the respondent bank. At the time of taking financial facilities, the petitioner had deposited the title deeds and revenue documents on the properties owned by the firm measuring to an extent of 42.5 acres as collateral security. According to the petitioner, the original deeds and the revenue records including patta, chitta and adangal reveal that the property in question are agricultural dry lands, a fact, which the bank itself was fully aware. In the circumstances, the petitioner states that the notice dated 7.7.2012 issued under Section 13(4) of the SARFAESI Act, as against the agricultural property is hit by Section 31(1) of the SARFAESI Act. In the circumstances, the notice calling upon the petitioner to pay a sum of Rs.10,93,98,151.28 as on 31.3.2012, failing which to take possession of the property, is totally illegal and contrary to the provisions of the Act.

(2.) LEARNED Senior counsel appearing for the petitioner placed heavy reliance on the decision reported in (2012) 5 MLJ 571 (Eshwar Purushothaman Gardens V. Authorised Officer, Indian Bank zonal Office, Coimbatore), and submitted that on the face of the clear bar under Section 31(1) of the SARFAESI Act to proceed against the agricultural lands, the proceedings initiated against the petitioner is void ab initio. He further relied on paragraph No.27 of the decision, wherein it was held that if the available materials are sufficient to arrive at a clear finding that the secured asset is an agricultural property, there is no inhibition in the defaulter approaching this Court challenging the notice issued under Section 13(4) of the SARFAESI Act without exhausting the statutory remedy under the Act. In the face of the observation by this Court in paragraph Nos.27 and 28, learned senior counsel appearing for the petitioner submits that the petitioner's rights be protected.

(3.) LEARNED senior counsel appearing for the petitioner, however, pointed out that if the petitioner is to be driven to the Debts Recovery Tribunal as by way of exhausting the statutory remedy, then there would be an onerous condition under Section 17 of the SARFAESI Act of complying with the payment of not less than 25% of the demanded amount. In the circumstances, considering the prima facie case made by the petitioner, this Court may exercise its discretion to interfere with the proceedings.