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HIGH COURT OF DELHI
Date of Decision: 10th July, 2024
MR. MOHAMAD IMRAN .....Petitioner
Through: Mr. Shivendu, Mr. Atul Kumar Singh, Advocates.
Through: Mr. Jagdish Chandra Solanki, SPC
Counsel for R-2/RBI (appearance not given)
JUDGMENT
1. Allowed, subject to all just exceptions.
2. The application stands disposed of. W.P.(C) 9331/2024 & CM APPL. 38231/2024 (stay)
3. The petitioner is invoking the extraordinary jurisdiction of this Court under Article 226 of the Constitution of India, besides supervisory jurisdiction of this court under Article 227 of the Constitution of India for issuance of appropriate writ, directions, or orders against the respondents seeking the following reliefs:- “i. Allow the instant Petition thereby issuing a Writ of the Mandamus or any other appropriate writ directing the Respondent state to direct the banks/NBFCs to not charge the pre-EMIs or full EMIs from the Petitioner under subvention plan scheme till the delivery of possession of booked flat; ii. Issue a Writ of Mandamus or any other appropriate writ directing the Respondent state to direct the Banks/NBFCs to charge all the pre-EMIs/full EMIs till the possession is not delivered from the Respondent builders; iii. Issue a Writ of Mandamus or any other appropriate writ directing Respondent No.1 & 2 to direct the Respondent No.4 to withdraw the case against petitioner under The Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2022 (SARFAESI Act).”
4. Learned counsels for respondents No. 1 and 2 are present on advance notice. However, none appeared on behalf of the respondent No.3/Ratan Buildtech. Pvt. Ltd/Builder and respondent No.4/TATA Capital Housing Finance Ltd.
5. Shorn off unnecessary details, it is the case of the petitioner that, lured by the offer made by respondent No.3 to set up a residential colony/project called „Ratan Pearls‟, he agreed to buy residential units B-1101 and B-1106 in their project at GH-01D, Sector-16, Greater Noida, District Gautam Budh Nagar, State of Uttar Pradesh. It is submitted that the flats were purchased under the Subvention Plan Scheme, whereby the respondent No.3/Builder was supposed to pay the pre-EMIs until possession. It is the case of the petitioner that a sum of Rs. 31,16,882/- for each unit have been paid by him after availing of the housing loan from respondent No.4, which amounts to almost 90% of the sale value of the flats. It is the case of the petitioner that until such time the actual possession is given to the petitioner, the builder is duty bound to pay the pre-EMIs. The grievance is that, despite their being a Subvention Plan invoked in terms of the circular of the Reserve Bank of India No. RBI/2013-14/217 DBOD.BP.BC.No. 51/08.12.015/2013-14 dated 03.09.2013, the respondent No. 4 has initiated proceeding under the SARFAESI Act[1].
6. Having heard the learned counsels for the parties and upon perusal of the record, this Court finds that the present Writ Petition is not maintainable. The Co-ordinate Bench of this Court has passed a detailed order in a bunch of matters titled Supertech Urban Home Buyers Association (SUBA) Foundation v. Union of India[2] and several other writ petitions, wherein similar reliefs were claimed by the home buyers against the builders as well as banks from whom home loan had been obtained for buying and allotment of residential flats in different projects. It would be relevant to re-produce some of the observations made by this Court, which go as under: -
1 The Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2022 2 W.P.(C) 9491/2020 dated 14.03.2023 writ or order can be issued under Article 226 of the Constitution so as to compel the authorities to remedy a breach of contract pure and simple. Reference can be made to the decision of the Hon‟ble Supreme Court in the case of Bareilly Development Authority (supra).
87. The pleadings between the parties would further go on to indicate that the respondents-financial institutions are alleging breach on the part of the petitioners and are claiming full adherence of the RBI Circular. In any case, since the rights of the homebuyers are flowing from the terms of the contract and if, there is any breach of RBI Circulars at the instance of banks/ financial institutions, the same by itself cannot entitle the homebuyers for the relief, which they have claimed in the instant writ petitions. In any case, the breach of RBI Circular is again a question of fact that can still be gone into before the appropriate court.
88. The cases in hand are purely contractual in nature. As has been noted, the „builder-buyer agreement‟ also categorically provides for an arbitration clause, whereby, any dispute pertaining to the said agreement was to be referred to arbitration. In some of the cases, the homebuyers have already approached the alternate forums and their cases are pending. In some cases where the banks have initiated insolvency proceedings against them, the homebuyers can raise their claim before the concerned Tribunal. There are various statutes such as RERA Act, Consumer Protection Act, Insolvency and Bankruptcy Code, 2016, SARFAESI Act etc., where the petitioners can raise their grievances. It would not be advisable to entertain a writ petition under Article 226 of the Constitution under the facts of the present cases.
89. The Division Bench in the case of Vineet Gupta (supra) is seized with the matter where the order passed by the DRT is under challenge. No final opinion has been expressed in the same. However, the Division Bench in the case of Sunil Kumar Pandey (supra) has clearly declined to entertain the writ appeal involving almost similar issues. The nature of the relief, as has been quoted in the preceding paragraphs, which are multiple in nature, are apparently not capable of being decided in summary jurisdiction of the writ court.
90. So far as the decision of the learned Single Judge of the High Court of Karnataka in the case of Mudit Saxena (supra) is concerned, firstly the same is not binding on this court and secondly, it has already been stayed by the Division Bench of the Karnataka High Court and therefore, it would not be appropriate to take any view on the basis of the said decision. Nevertheless, this court has considered the submissions made by the respective parties and has taken a view not to entertain these petitions in exercise of power under Article 226 of the Constitution of India.
91. In view of the aforesaid, this court, in view of the availability of alternative remedies, does not find it appropriate to entertain these writ petitions and, therefore, the same are dismissed alongwith the pending application(s), if any.
92. This court has not expressed any opinion on the merits of the case and has consciously not given any finding with respect to the violations/nonviolations on the part of the respective parties, as the same would prejudice their rights before different forum where multiple proceedings are going on. However, since the interests of large number of homebuyers are involved in these cases, if the homebuyers‟ avail alternative remedies, as may be available to them, the same may be considered and decided expeditiously in accordance with law.”
7. It is also pertinent to mention here that a Division Bench of this Court, in the case of Sunil Kumar Pandey v. Union of India[3], also had an occasion to consider the said aspect of law in a similar factual and circumstantial context, and the following observations were made:
3 LPA 576/2022 dated 01.11.2022
8. There is no gainsaying that the aforesaid observations on the point of law squarely apply to the facts and circumstances discussed in the instant Writ Petition. Even on a careful perusal of Section 174 of 4 17. [Application against measures to recover secured debts].—(1) Any person (including borrower), aggrieved by any of the measures referred to in sub-section (4) of section 13 taken by the secured creditor or his authorised officer under this Chapter,[1] [may make an application along with such fee, as may be prescribed,] to the Debts Recovery Tribunal having jurisdiction in the matter within fortyfive days from the date on which such measure had been taken: [Provided that different fees may be prescribed for making the application by the borrower and the person other than the borrower. [Explanation.—For the removal of doubts, it is hereby declared that the communication of the reasons to the borrower by the secured creditor for not having accepted his representation or objection or the likely action of the secured creditor at the stage of communication of reasons to the borrower shall not entitle the person (including borrower) to make an application to the Debts Recovery Tribunal under this sub-section.] [(1A) An application under sub-section (1) shall be filed before the Debts Recovery Tribunal within the local limits of whose jurisdiction— (a) the cause of action, wholly or in part, arises; (b) where the secured asset is located; or
(c) the branch or any other office of a bank or financial institution is maintaining an account in which debt claimed is outstanding for the time being.] [(2) The Debts Recovery Tribunal shall consider whether any of the measures referred to in sub-section (4) of section 13 taken by the secured creditor for enforcement of security are in accordance with the provisions of this Act and the rules made thereunder. [(3) If, the Debts Recovery Tribunal, after examining the facts and circumstances of the case and evidence produced by the parties, comes to the conclusion that any of the measures referred to in sub-section (4) of section 13, taken by the secured creditor are not in accordance with the provisions of this Act and the rules made thereunder, and require restoration of the management or restoration of possession, of the secured assets to the borrower or other aggrieved person, it may, by order,— (a) declare the recourse to any one or more measures referred to in sub-section (4) of section 13 taken by the secured creditor as invalid; and (b) restore the possession of secured assets or management of secured assets to the borrower or such other aggrieved person, who has made an application under sub-section (1), as the case may be; and
(c) pass such other direction as it may consider appropriate and necessary in relation to any of the recourse taken by the secured creditor under sub-section (4) of section 13.] (4) If, the Debts Recovery Tribunal declares the recourse taken by a secured creditor under sub-section (4) of section 13, is in accordance with the provisions of this Act and the rules made thereunder, then, notwithstanding anything contained in any other law for the time being in force, the secured creditor shall be entitled to take recourse to one or more of the measures specified under sub-section (4) of section 13 to recover his secured debt. [(4A) Where—
(i) any person, in an application under sub-section (1), claims any tenancy or leasehold rights upon the secured asset, the Debt Recovery Tribunal, after examining the facts of the case and evidence produced by the parties in relation to such claims shall, for the purposes of enforcement of security interest, have the jurisdiction to examine whether lease or tenancy,— (a) has expired or stood determined; or (b) is contrary to section 65A of the Transfer of Property Act, 1882 (4 of 1882); or the SARFAESI Act shows that once SARFAESI proceedings have been initiated by the bank/financial institution, the only remedy for the petitioner, who is the homebuyer and without any iota of doubt, a borrower lies under Section 17 of the SARFAESI Act. There is no reason for this Court to deviate from the well-established legal norms already thrashed out and decided in the aforesaid cases.
9. In fact, the issue is no longer res integra, considering the decision by the Supreme Court in the case of K. Sreedhar v. Raus Constructions Private Limited[5], wherein practices on the part of the litigants/ borrowers in directly approaching the High Court without recourse to the alternate remedy provided under Section 17 of the SARFAESI Act was deprecated.
(c) is contrary to terms of mortgage; or
(d) is created after the issuance of notice of default and demand by the Bank under subsection (2) of section 13 of the Act; and
(ii) the Debt Recovery Tribunal is satisfied that tenancy right or leasehold rights claimed in secured asset falls under the sub-clause (a) or sub-clause (b) or sub-clause (c) or sub-clause (d) of clause (i), then notwithstanding anything to the contrary contained in any other law for the time being in force, the Debt Recovery Tribunal may pass such order as it deems fit in accordance with the provisions of this Act.] (5) Any application made under sub-section (1) shall be dealt with by the Debts Recovery Tribunal as expeditiously as possible and disposed of within sixty days from the date of such application: Provided that the Debts Recovery Tribunal may, from time to time, extend the said period for reasons to be recorded in writing, so, however, that the total period of pendency of the application with the Debts Recovery Tribunal, shall not exceed four months from the date of making of such application made under sub-section (1). (6) If the application is not disposed of by the Debts Recovery Tribunal within the period of four months as specified in sub-section (5), any part to the application may make an application, in such form as may be prescribed, to the Appellate Tribunal for directing the Debts Recovery Tribunal for expeditious disposal of the application pending before the Debts Recovery Tribunal and the Appellate Tribunal may, on such application, make an order for expeditious disposal of the pending application by the Debts Recovery Tribunal. (7) Save as otherwise provided in this Act, the Debts Recovery Tribunal shall, as far as may be, dispose of the application in accordance with the provisions of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (51 of 1993) and the rules made thereunder.]
10. In view of the abovesaid discussion, the present Writ Petition is dismissed. The petitioner shall be at liberty to seek an appropriate remedy in accordance with the law.
11. The pending application also stands disposed of.
DHARMESH SHARMA, J. JULY 10, 2024