M/S LALTA PRASAD PYARE LAL THRU. PROPRIETOR SHRI KAMAL KUMAR MEHROTRA AND 2 OTHERS v. DEBTS RECOVERY TRIBUNAL LKO. THRU. ITS PRESIDING OFFICER AND 2 OTHERS
A227/4351/2025 · 2025-07-23
Pankaj Bhatia
body2025
DailyLaw.ai
[ 2025 DAILYLAW 153144 (ALL) · dailylaw.ai ]
DailyLaw.ai
[ 2025 DAILYLAW 153144 (ALL) · dailylaw.ai ]
Judgment text
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Neutral Citation No. - 2025:AHC-LKO:42371 High Court of Judicature at Allahabad (Lucknow) ********* Court No. - 7 Case :- MATTERS UNDER ARTICLE 227 No. - 4351 of 2025 Petitioner :- M/S Lalta Prasad Pyare Lal Thru. Proprietor Shri Kamal Kumar Mehrotra And 2 Others Respondent :- Debts Recovery Tribunal Lko. Thru. Its Presiding Officer And 2 Others Counsel for Petitioner :- Devesh Srivastava,Gautam Sadana Counsel for Respondent :- Amit Kumar Singh,C.S.C.,Gaurav Singh Hon'ble Pankaj Bhatia,J.
1. Heard learned counsel for the petitioners and Sri Amit Kumar Singh, learned counsel for respondent no.
3.
2. The present petition has been filed challenging the
order dated 11.07.2025 passed by the Debts Recovery Tribunal, Lucknow, whereby an application filed by the petitioners for early hearing as well as the application for grant of interim relief have been rejected. 3. The facts in brief are that the respondent-Bank had initiated proceedings in terms of the provisions of the SARFAESI Act, 2002. It is stated by the Bank that notices were served under Section 13(2) of the SARFAESI Act, 2002, and thereafter, a possession notice
was also given on 21.09.2024. The petitioners filed an S.A. before the Debts Recovery Tribunal, Lucknow, challenging the action of the respondent-Bank. One of the grounds was that two different dates were indicated in the notices. 4. During the pendency of the said S.A., as the respondent-Bank wanted to take possession pursuant to the order passed under Section 14 of the SARFAESI Act, 2002, an application was moved for early hearing and grant of interim relief. The Debts Recovery Tribunal, Lucknow decided both applications and held that even from the date of the notice under Section 13(2) of the SARFAESI Act, 2002, i.e., 04.06.2023, the entire securitization appeal becomes hopelessly time-barred. It also recorded findings with regard to the service of notices under Sections 13(2) and 13(4) of the SARFAESI Act, 2002, and dismissed the applications. 5. Submission of learned counsel for the petitioner is that all the measure as specified under Section 13 of the SARFAESI Act, 2002 gives rise to a separate cause of action for approaching the Debt Recovery Tribunal under Section 17 of the SARFAESI Act. Reliance is placed upon a Division Bench judgment of the High Court of Telangana in the case of M/s. Alpine Pharmaceuticals Pvt. Ltd. and Anr. v. Andhra Bank (Writ Petition No.13936 of 2019) Dated 24.01.2020 wherein the Division Bench had considered a similar submission and had noticed as under :-
71.
From these decisions, it follows that the series of steps from the date of issue of Section 13(4) of the Act, up to the date of the auction notice can be challenged by the borrower when he challenges the auction notice
under Section 17 of the Act; though the cause of action started when possession was taken, the said cause of action is continued by the issuance of auction sale notice by the Bank; even if the borrower had not filed an Application under Section 17 of the Act at the time of his dispossession, he cannot be deprived of the opportunity to approach the DRT for post Section 13(4) events as well; and the DRT is entitled to question the action taken by the secured creditor and the transactions entered into by virtue of Section 13(4) of the Act. 6. It is no longer res integra that proceedings under Section 14 of the SARFAESI Act, 2002, are a step in aid of Section 13 of the Act and has been settled by the Hon'ble Supreme Court in the case of Kanaiyalal Lalchand Sachdev v. State of Maharashtra, (2011) 2 SCC 782, wherein, in paragraph no. 22, it held as under :-
"22. We are in respectful agreement with the above enunciation of law on the point. It is manifest that an action under Section 14 of the Act constitutes an action taken after the stage of Section 13(4), and therefore, the same would fall within the ambit of Section 17(1) of the Act. Thus, the Act itself contemplates an efficacious remedy for the borrower or any person affected by an action under Section 13(4) of the Act, by providing for an appeal before the DRT."
7. Thus, the finding recorded by the Debts Recovery Tribunal, Lucknow, holding that the S.A. is hopelessly time-barred, is ex facie contrary to the settled law. In view thereof, the preliminary objection raised by the
learned counsel for the respondent that an alternative remedy of appeal is prescribed cannot be upheld, as ex facie, the order passed by the Debts Recovery Tribunal, Lucknow, is contrary to the settled legal position.
8. Accordingly, the order dated 11.07.2025 is set aside,
and the matter is remanded to the Debts Recovery Tribunal, Lucknow, to pass a fresh order. While doing so, the Tribunal shall consider the law as explained in the cases of M/s. Alpine Pharmaceuticals Pvt. Ltd. (supra) and Kanaiyalal Lalchand Sachdev (supra).
9. Till the decision afresh by the Debts Recovery Tribunal, Lucknow, as directed above, no steps shall be taken for taking any coercive possession from the petitioners.
10. The petition stands disposed of. (Pankaj Bhatia, J)
Order Date :- 23.7.2025 A.Dewal Digitally signed by :- ASHISH DEWAL High Court of Judicature at Allahabad, Lucknow Bench