Division Bench Rules Writ Petitions Non-Maintainable Amidst Pending Tribunal Proceedings
In a significant ruling, the Allahabad High Court's Division Bench has quashed interim orders issued by a Single Judge Bench in a dispute under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002. The judgment was delivered in the matter of M/s Waheguru Projects Pvt. Ltd. v. M/s Arora Auto Center, with the court emphasizing the non-maintainability of writ petitions when statutory remedies are already availed and pending before the Debt Recovery Tribunal (DRT).
Presided over by Justice Rajan Roy and Justice Syed Qamar Hasan Rizvi, the court heard a series of appeals challenging the interim orders that had directed the restoration of possession of a secured asset to Bharat Petroleum Corporation Limited (BPCL) and its sub-lessee, M/S Arora Auto Center, Lucknow. The property in question had been repossessed by a bank following securitization proceedings under the SARFAESI Act, 2002.
The Division Bench scrutinized the maintainability of the writ petitions filed under Article 226 of the Constitution of India, concluding that such petitions were not appropriate given the ongoing statutory proceedings before the DRT. The court reiterated the settled legal position that writ jurisdiction should not be invoked when alternative remedies are available and pending, a principle upheld by numerous Supreme Court precedents.
Moreover, the court questioned the jurisdiction of the Single Judge Bench to entertain the writ petitions, noting that the petitions should have been listed before a Division Bench as per the High Court's rules and orders. The court criticized the practice of counsel endorsements influencing the listing of cases, underscoring that jurisdiction should be determined by court protocols, not counsel notes.
The judgment highlighted the extensive securitization applications already filed by BPCL and M/S Arora Auto Center before the DRT, which addressed similar reliefs to those sought in the writ petitions. The court emphasized that the issues pertaining to tenant rights, lease validity, and securitization proceedings were appropriate for adjudication by the DRT.
In addressing concerns over hazardous materials on the secured asset, the court suggested that parties approach appropriate authorities under the Petroleum Rules, 2002 for safe removal, ensuring compliance with safety regulations.
The Division Bench's decision underscores the judiciary's commitment to procedural integrity and adherence to statutory frameworks, particularly in financial disputes involving securitization laws. The judgment serves as a reminder of the boundaries of writ jurisdiction in the face of available statutory remedies.
Bottom line:-
Writ petitions under Article 226 of the Constitution of India are not maintainable when statutory remedies under the SARFAESI Act, 2002 are already availed and pending before the Debt Recovery Tribunal (DRT).
Statutory provision(s): SARFAESI Act, 2002 Sections 13(4), 14, 17, Article 226 of the Constitution of India, Petroleum Rules, 2002
