Supreme Court

Bank Of Baroda and Anr. Vs. Parasaadilal Tursiram Sheetgrah .Pvt Ltd. And Ors.

MANU/SC/0992/2022

11.08.2022

Commercial

For quick enforcement of the security, Section 17 of SARFAESI Act provides a time limit of 45 days for filing an application

Present appeal by Bank of Baroda is against an Interlocutory Order of stay passed by the High Court. The Writ Petition was filed by the Respondent Company against the order in appeal by the Debt Recovery Appellate Tribunal. By this order, the challenge laid to the Sale Certificate issued in favour of the Auction Purchaser under Section 17 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 was dismissed on the ground of limitation.

Present is a case where the Company, with its own independent identity, is contesting the proceedings. It is apparent that, the Directors were also contesting the matter by filing the Section 17 application. Even the legal representatives of one of the deceased Directors were party to the application under Section 17. Further, DRAT came to the conclusion that the original order passed by the DRT has been arrived at after a detailed consideration and that there is no justifiable ground for invoking the review jurisdiction.

The reason for providing a time limit of 45 days for filing an application under Section 17 can easily be inferred from the purpose and object of the enactment. In Transcore v. Union of India and Anr., this Court held that the SARFAESI Act is enacted for quick enforcement of the security. It is unfortunate that proceedings where a property that has been brought to sale and third-party rights created under the provisions of the Act, have remained inconclusive even after a decade.

The High Court was not justified in staying the operation of the order of the DRAT which came to the conclusion that there was no error apparent on the face of record for the DRT to invoke the review jurisdiction and recall its order dismissing the application under Section 17 of the Act. Appeal allowed.

Tags : Stay Grant Legality

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