Gujarat High Court Pursues Case Relating To Delayed Decision, Despite a Fixed Schedule, Says Matter Be Looked Upon and Order Be Passed as Early as Possible

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The present Petition was filed before the Gujarat High Court to get a grievance addressed, that despite there being a fixed time schedule framed by the statute to decide an application made under Section 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, it had not been adhered to. The Court observed many similar cases and directed the Respondent to pass the order soon.

Background

The Petitioner had given financial assistance to Manish Gopalbhai Patel against the securities, as mentioned in the Petition. The valid mortgage deed had also been undertaken and executed in favour of the Petitioner, with regard to the properties mentioned in the Petition. Also, all the necessary documents were validly executed. 

But since the borrowers had not paid the number of their dues regularly, their account became NPA on 09.07.2019 as per the guidelines framed by the Reserve Bank of India. Resultantly the Petitioner had issued a notice to the borrowers under Section 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, and asked the borrowers to repay the amount. The borrowers had neither replied nor any representation was made by them and nor any amount was paid towards their dues, so it necessitated the petitioner to file an application under Section 14 of the same Act on 21.03.2020.

Submissions before the Court

Petitioner’s Submissions

Learned Advocate for the Petitioner, Mr Dhruvik Patel had submitted that whenever such kind of eventualities had taken place before, where Section 14 application was not getting decided, the Courts had to pass an Order directing the authorities to take an urgent decision.

So, for that purpose, the Petitioner had filed the present Petition under Articles 226 and 227 of the Constitution of India to seek such relief. The learned advocate Mr Patel had also referred to some similar decisions, which were attached to the Petition compilation and had requested that a Writ of Mandamus or Order be passed in the present case also to direct the Respondent no. 2 to pass appropriate orders against Manish Gopalbhai Patel and Ors., under Section 14 of the Act, 2002.

By way of the Petition, it was also prayed that without any further delay, the possession of the Mortgage schedule property was taken and handed over to the Petitioner. 

Respondent’s Submissions

The learned Assistant Government Pleader for the Respondent authority, Mr Hardik Mehta had submitted that the authority had not intended to delay the proceedings, but since the application had been given on 21.03.2020 when the period of lockdown was strictly ordered on account of the Covid-19 pandemic, therefore, under this bona fide circumstance, some lapse might have taken place, but it was not deliberately that the authority had ignored the application.

As such, it was further requested that since on similar circumstances, several Courts had passed Orders, similar Order be passed. It was asserted that the authority will surely adhere to the direction given by the Court.

Court’s Observations

In light of the submissions put forth by the learned advocates for both the parties and going through the material on record, the Court observed that the application dated 21.03.2020 under Section 14 of the Act had yet not been disposed of by the respondent authority and the same was stated to be pending. 

The Court clarified that the statute requires that the said application as and when submitted must be disposed of as per the time schedule to avoid any unnecessary delay as public money was involved. The Bench also considered that even the co-ordinate Benches in a similar circumstance as in the decisions attached to the petition compilation, had issued directions and as such, this Court was also inclined to consider the request of the petitioner while disposing of the petition.

Court’s Directions

With these observations, the Court disposed of the present Petition. It directed the Respondent, i.e. the District Collector, before whom the application dated 31.3.2020 under Section 14 of the Act was pending, to examine and decide the matter as early as possible and in any case, not later than 30 days from the date of receipt of this Order.

The Court made it clear that time and again, such kind of grievances were voiced out by several financial institutions, hence the Respondent No.1 was directed to look into the issue. Further, he must issue necessary directions and circulate amongst the District Collector or the office of the District Magistrate, before whom such applications were being submitted, for their disposal within the time schedule.

Click here to read the Judgment.


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