Uttarakhand

StateCommission

A/149/2020

Bank of Baroda - Complainant(s)

Versus

Aas Mohammad - Opp.Party(s)

Mr. Anurag Nautiyal

21 Oct 2022

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION UTTARAKHAND

DEHRADUN

 

FIRST APPEAL NO. 149 / 2020

 

1.         Bank of Baroda through its Branch Manager

            Near Kotwali, Jwalapur

Haridwar, Uttarakhand

 

2.         Bank of Baroda through its Authorised Officer

            Regional Office, Dehradun Region

…… Appellants / Opposite Parties

 

Versus

 

1.         Sh. Aas Mohammad S/o Sh. Aftar Ahmad

House No. 57, Mohalla Kassaban (Hajjawan)

            Jwalapur, Haridwar

 

2.         M/s Taj Trading Company

            through its Proprietor Sh. Aas Mohammad S/o Sh. Aftar Ahmad

            House No. 57, Mohalla Kassaban (Hajjawan)

            Jwalapur, Haridwar

 

3.         Smt. Imrana W/o Sh. Aftar Ahmad

            House No. 57, Mohalla Kassaban (Hajjawan)

            Jwalapur, Haridwar

…… Respondents / Complainants

 

Sh. Anurag Nautiyal, Learned Counsel for the Appellants

None for Respondents

 

Coram: Hon’ble Mr. Justice D.S. Tripathi, President

               Mr. Udai Singh Tolia,                         Member-II

                                   

Dated: 21/10/2022

ORDER

(Per: Justice D.S. Tripathi, President):

 

This appeal under Section 41 of the Consumer Protection Act, 2019 has been preferred against the impugned judgment and order dated 16.10.2020 passed by the District Consumer Disputes Redressal Commission, Haridwar (in short “The District Commission”) in consumer complaint No. 45 of 2020; Sh. Aas Mohammad and others Vs. Bank of Baroda and another, by which the consumer complaint was allowed and the appellants – opposite parties were restrained from recovering at once the amount in respect of loan account                     No. 41440500000014 of the respondents – complainants.  The appellants – opposite parties were further directed to adjust the entire amount deposited by the respondents – complainants in the above loan account, besides to pay Rs. 10,000/- towards compensation and litigation expenses.

 

2.       Facts giving rise to this appeal, in brief, are that according to the consumer complaint, the complainant Nos. 1 & 2 – respondent Nos. 1 & 2 had opened a cash credit account bearing                       No. 41440500000014 with the opposite party No. 1 – Bank of Baroda, Jwalapur, Haridwar (appellant No. 1 herein) of Rs. 5,00,000/-.  In respect of the said account, the complainant No. 3 – respondent No. 3 stood as guarantor.  The complainant No. 1 was depositing the cash earned from the business in the aforesaid account.  On 11.12.2019, the complainants received a notice from appellant No. 1, thereby asking for repayment of entire outstanding amount of Rs. 5,42,114/- within a period of 60 days’ from the receipt of the notice.  On receipt of the notice, the complainant No. 1 approached the appellant No. 1, who directly him to approach appellant No. 2.  The complainant No. 1 met the appellant No. 2 on 06.01.2020 and inquired about the aforesaid notice.  The appellant No. 2 asked the complainant No. 1 to wait for some time.  The account has been classified as NPA (Non-Performing Assets) by the bank, which goes to show deficiency in service on the part of the bank.  Therefore, the consumer complaint was filed by the complainants before the District Commission.

 

3.       The appellants filed written statement before the District Commission, wherein it was pleaded that in view of Section 34 of Securitization and Reconstruction of Financial Assets and Enforcement of Securities Interest (SARFAESI) Act, 2002, the Consumer Fora has no jurisdiction to entertain the consumer complaint.  As per the provisions of Section 34 of the SARFAESI Act, 2002, the action initiated or to be initiated by any secured creditor in NPA account is protected from the action in any civil or other court and the aggrieved person can file the application / file before Debt Recovery Tribunal under Section 17 and 18 of the SARFAESI Act, 2002.  There is no question of any deficiency in service on the part of the bank in the instant matter and the consumer complaint is liable to be dismissed.

 

4.       After giving opportunity of hearing to the parties, the consumer complaint has been decided by learned District Commission vide impugned judgment and order dated 16.10.2020, thereby allowing the consumer complaint in the above terms.  Feeling aggrieved, the appellant has preferred the instant appeal.     

 

5.       We have heard arguments advanced by learned counsel for the appellants and perused the record.  None appeared on behalf of respondents.  Vide order dated 29.07.2022, service of notice upon respondents was held to be sufficient.

 

6.       In para 4 of the consumer complaint, it was stated that on 11.12.2019, the complainants received a notice from appellant No. 1.  In the written statement filed by the appellants before the District Commission, a specific plea was taken that in view of the provisions of Section 34 of the SARFAESI Act, 2002, the consumer complaint is barred and the Consumer Fora has no jurisdiction in the matter in issue.  Perusal of the record reveals that in response to the stay application moved by the complainants before the District Commission, objections were filed on behalf of the appellants, which are Paper Nos. 28 to 29 on the record of this appeal and in para 12 of the said objections, it was stated that the complainants have themselves admitted in the consumer complaint that on 11.12.2019, notice to deposit the outstanding amount in concerned loan account within 60 days’, was served by and on behalf of the bank.  In para 17 of the said objections, it was specifically stated that the bank had taken the legal action as per law under SARFAESI Act, 2002 and notice under Section 13(2) of SARFAESI Act, 2002 was issued.

 

7.       The consumer complaint in question was filed by the complainants before the District Commission on 05.02.2020, i.e., after issuance of notice dated 11.12.2019 by the bank under Section 13(2) of Securitization and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002.  Thus, as per law, the consumer complaint filed by the complainants was not at all maintainable and ought to have been dismissed on the sole ground that the bank has already initiated the proceedings under the provisions of Securitization and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002, prior to filing of the consumer complaint.  A bare perusal of the impugned judgment and order passed by the District Commission shows that inspite of the appellants having taken a specific plea in the above regard in the written statement and the District Commission having quoted the same in the impugned judgment and order, failed to consider and record finding on such an important aspect of the matter.

 

8.       Hon’ble Apex Court in the case of Jagdish Singh Vs. Heeralal and others reported in 2013 STPL (Web) 895 SC, has held that the civil court jurisdiction is completely barred so far as the “measure” taken by a secured creditor under sub-section (4) of Section 13 of Securitization and Reconstruction of Financial Assets and Enforcement of Securities Interest (SARFAESI) Act, 2002, against which an aggrieved person has a right of appeal before the DRT or the Appellate Tribunal, to determine as to whether there has been any illegality in the “measures” taken.  Hon’ble National Commission in the case of Standard Chartered Bank Vs. Virendra Rai reported in II (2013) CPJ 337 (NC), has held that the Civil Court or Forum can not interfere in the proceeding initiated under Securitization and Reconstruction of Financial Assets and Enforcement of Securities Interest (SARFAESI) Act, 2002.  Hon’ble National Commission by judgment and order dated 25.11.2013 passed in Revision Petition    No. 1653 of 2013; M/s India Bulls Housing Finance Ltd. Vs. Hardayal Singh, has held that the case pertains to SARFAESI Act, 2002 and neither the District Forum nor the State Commission had jurisdiction to try the case.  In the said decision, Hon’ble National Commission has placed reliance upon a judgment of Hon’ble Supreme Court given in Civil Appeal No. 1359 of 2013; Yashwant G. Ghaisas and others Vs. Bank of Maharashtra, wherein Hon’ble Apex Court has held:

 

“The appellants challenged the action of the bank by filing a complaint under Section 21 of the Consumer Protection Act, 1986 (for short, ‘the 1986 Act’).  The National Commission referred to Section 34 of the 2002 Act whereby jurisdiction of all Courts and authorities to entertain challenge to the action taken by the bank has been ousted and dismissed the complaint by recording the following observations:

The National Commission is not empowered to arrogate to itself the powers which come within the jurisdiction of Debt Recovery Tribunals.  This matter is purely covered with the jurisdiction of DRT or DRAT.  If there is any grievance against the notice under Section 13(2) of the SARFAESI Act that should be brought to the notice of the concerned authority.  It is well settled that main creditor and the guarantors are equally responsible.”

 

9.       For the reasons aforesaid as well as in view of the above settled law, the consumer complaint filed by the complainants before the District Commission, was not at all maintainable. 

 

10.     For the foregoing reasons, we are of the considered opinion that the impugned judgment and order passed by learned District Commission suffers from material illegality, warranting interference by this Commission.  Consequently, the appeal deserves to be allowed and the impugned judgment and order passed by learned District Commission is liable to be set aside.

 

11.     Appeal is allowed.  Impugned judgment and order dated 16.10.2020 passed by the District Commission is set aside and consumer complaint No. 45 of 2020 is dismissed.  No order as to costs.  The amount deposited by the appellants with this Commission, be released in their favour.   

 

12.     A copy of this Order be provided to all the parties free of cost as mandated by the Consumer Protection Act, 1986 / 2019.  The Order be uploaded forthwith on the website of the Commission for the perusal of the parties.

 

 

(U.S. TOLIA)                            (JUSTICE D.S. TRIPATHI)

               Member-II                                                President

 

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