Writ Petition against NBFC u/s 14(2) SARFAESI Act not maintainable: Delhi HC suggests DRT Approach [Read Order]

The Delhi High Court disposed the Writ Petition against Non-Banking Financial Company (NBFC) under section 14(2) of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act, 2002), as the writ petition is not maintainable against NBFC due to lack of jurisdiction. Also the court suggests the aggrieved party to approach the Debt Recovery Tribunal (DRT) in terms of Section 17 of the SARFAESI Act, 2002. The Petitioner is invoking a writ petition for issuance of appropriate writ, order or directions against the respondent No.1, Tata Capital Financial Services Ltd & Ors with regard to the property in question seeking quashing of the notice dated 02.08.2024 issued by Court Receiver in terms of order dated 26.07.2024 of the Chief Judicial Magistrate, South-West, Dwarka Courts, New Delhi in the proceedings under Section 14(2) of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI Act, 2002). Navigate the World of Currency: Your FX Management Journey Starts Here! Mr. Arman Roop Sharma and Mr. Rahul Gupta, Advocates for Respondent No.1 urged that this court has no jurisdiction to pass any directions primarily for the fact that the writ petition is filed against an NBFC (Non-Banking Financial Company), for which he has invited reference to decision by the Supreme Court in the case of Phoenix ARC Private Limited v. Vishwa Bharati Vidya Mandir. Mr. Ashish Chauhan, Advocate, for the petitioner alluded to decision in the case of PHR Invent Educational Society v. UCO Bank so as to prove that the writ petition is maintainable. Here the petitioner, Ashish Kumar, availed a home loan from the respondent No.4/NBFC in terms of sanction letter for buying the subject property and they had been diligently making payment of EMIs and finally a sale deed was registered in his name. Navigate the World of Currency: Your FX Management Journey Starts Here! The grievance of petitioner is that very unexpectedly he has found a notice pasted at the subject property dated 02.08.2024 whereby purportedly pursuant to proceedings in the complaint case No. 22032/2024 an intimation is given that the physical possession of the property shall be taken over by the respondent No.1 on 23.08.2024. The Counsel for the petitioner urged that a fraud has been played upon the petitioner in as much as now he has been able to secure a copy of another registered sale deed dated 23.01.2023, which would suggest that respondent No.5 Mr. Amit Gupta and respondent No.6 Ms. Pooja Gupta alleged to have sold the subject property to Mohd. Furkan Qureshi S/o Mr. Rahis Qureshi against whom SARFAESI proceedings have been instituted by way of complaint case No. 22032/2024 leading to order dated 26.07.2024. It is vehemently urged that personal photographs of respondents No. 5 and 6 are different than the sale deed which has been executed in his favor and a fraud has been practiced upon him. Navigate the World of Currency: Your FX Management Journey Starts Here! The counsel representing the respondent No.1 has pointed out in the meanwhile complaints have been lodged not only by them but also by petitioner with the police for the alleged fraud and the matter obviously would be investigated in accordance with the law. Justice Dharmesh Sharma observed that the core issue is that the sale deeds are genuine and can be relied upon by which of the parties. But the present writ petition against NBFCs cannot be entertained. The Aggrieved petitioner can approach the Debt Recovery Tribunal (DRT) in terms of Section 17 of the SARFAESI Act. Hence the present writ petition is dismissed without prejudice and the pending application also stands disposed of. Mr. Mukul Bhimani, Advocate represented the Respondent No.4. Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates