Hyderabad: The Hyderabad High Court upheld the notification of the Centre bringing co-operative banks within the purview of SARFAESI Act (Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act), 2002.
A division bench comprising Justice Ramesh Ranganathan and Justice M. Satyanar-ayana Murthy was dismissing a petition filed by Inder Raj Agarwal seeking to set aside the notification dated January 28, 2003 issued by the Union of India.
The petitioner also challenged a notice dated February 21, 2015 issued by the AP Vardhaman (Mahila) Co-operative Bank under the provisions of Section 13(4) and 12 of the Act against him for the recovery of loan.
The petitioner said that he had stood guarantor for a loan by pledging his open plot. He said as the firm failed to repay the loan, the bank invoked the provisions of the SARFAESI Act for recovery and issued notice for auction of his property in January this year.
He contended that the bank was registered as a “co-operative society” and has no power to invoke the SARFAESI Act.
While hearing the case, the bench noticed that the bank was repeatedly thwarted in recovering the money due for the past 13 years and the petitioner had tried to avoid repaying the loan by challenging the notification.
The bench observed, “It would be inappropriate for this court to exercise its discretion to entertain the petition as it is an abuse of process of court, and is another attempt to scuttle the efforts of the respondent-bank from putting the subject property to sale and thereby realise its dues.”
While slapping Rs 25, 000 costs on the petitioner , the bench said when a person invokes the equitable and extraordinary jurisdiction of the High Court, under Articles 226/227 of the Constitution, he must approach the court not only with clean hands but also with a clean mind, a clean heart and a clean objective.
While dismissing the petition, the bench said that “the judicial process should never become an instrument of oppression or abuse or a means to subvert justice.”
