JAGDISH SINGHversusHEERALAL AND OTHERS

                        [2013) 12 S.C.R. 232


A                          JAGDISH SINGH
                                   v.
                      HEERALAL AND OTHERS
                   (Civil Appeal No. 9771 of 2013)

                         OCTOBER 30, 2013
B
         [K.S. RADHAKRISHNAN AND A.K. Slt<RI , JJ.]

     SECURITISATION AND RECONSTRUCTION OF
  FINANCIAL ASSETS AND ENFORCEMENT OF
C SECURITY INTEREST ACT, 2002:
       ss. 2(zc) and 2(zf) - Security interest - Onginal title deeds
  of properties deposited with bank creating equitable mortgage
  against loan - Held: Security interest, within the meaning of
  s.2(zf) has been created in respect of the properties in
0
  question which are secured assets within the meaning of
  s.2(zc), in favour of the secured creditor (the bank) within the
  meaning of s.2(zd) -- On failure to re-pay, the bank can always
  enforce its security interest over the secured assets.

E      ss.13(4), 17 and 34 - Title deeds deposited with bank as
  security against loan - Borrower failed to repay the loan - Bank
  sold the property after publishing the auction notice - Suit by
  plaintiff's claiming the property as HUF property - Held: In
  case the borrower fails to discharge his /iab1/ity, the bank can
F take the "measures" provided in s.13(4) for recovery of the
  loan amount - s.17confers a right of appeal to any person,
  aggrieved by any of the "measures" referred to in sub-s. (4)
  of s.13 taken by the secured creditor- Expression 'any person'
  used in s. 17 is of wide import and takes witbjn its fold the
G borrower, the guarantor as also the plaintiffs in the-suit as well
  - Thus, irrespective of the question whether the civil suit is
  maintainable or not under the Act itself, a remedy is provided
  to such persons so that they can invoke the provisions of s. 17,
  in case the bank (secured creditor) adopts any measure
H                                232
           JAGDISH SINGH v. HEERALAL                      233

including the sale of secured assets, on which plaintiffs claim A
interest.
     s. 34 rlw s. 35 - Civil court not to have jurisdiction - Held:
Civil court jurisdiction is completely barred, as regards the
"measure" taken by a secured creditor under sub-s. (4) of s.13 B
against which an aggrieved person has a right of appeal
before ORT or Appellate Tribunal to determine as to whether
there has been any illegality in the "measures" taken - Bank,
in the instant case, has proceeded only against secured
assets of borrowers - In the circumstances, High Court was in c
error in holding that only civil court has jurisdiction to examine
 as to whether the "measures" taken by secured creditor under
sub-s. (4) of s.13 were legal or not - Judgment of High Court
 is set aside - Code of Civil Procedure, 1908 - s.9.

      Respondent no. 6 obtained a loan from the Bank of D
India on 17.2.2000. The loan was secured by equitable
mortgage executed by respondent Nos.7 to 9 in respect
of the suit land. Respondent Nos.6 to 8 also created
equitable mortgage on three houses, which were in their
respective names. Original title deeds of all the properties E
were deposited with the bank. Since they committed
default in re-paying the loan, the bank initiated
proceedings         under     the    Securitisation       and
Reconstruction of Financial Assets and Enforcement of
 Security Interest Act, 2002 and, ultimately, the auction of F
 the suit land was confirmed by the Bank 8.11.2005 on the
 appellant-auction purchaser depositing the required
 amount. Respondents Nos. 1 to 5 filed a suit in the Court
 of the District Judge against respondent Nos.7 to 9 and
 others including the appellant and the Bank, for a G
 declaration of title, partition and permanent injunction.
 Respondent no. 6 and the Bank filed a preliminary
 objection before the civil court under 0. 7 r.11 of the Code
  of Civil Procedure, 1908 stating that in view of s. 13 read
  with s. 34 of the Securitisation Act, the civil court had no H
    234      SUPREME COURT REPORTS             [2013] 12 S.C.R


A jurisdiction to entertain the suit. The civil court upheld the
  preiiminary objection holding that the suit was not
  maintainable. However, the High Court allowed the
  appeal of respondents nos. 1 to 5. Aggrieved, the auction-
  purchaser filed the appeal.
B
          Allowing the appeal, the Court

        HELD: 1.1 The auction notice was duly published in
   the newspapers on 30.09.2005. No objection was raised
   by the plaintiffs and the suit land was auctioned on
c 08.11.2005, which was settled in favour of the highest
   bidder - the appellant. The entire auction price was paid
  ·by the appellant and the sale in his favour was duly
   confirmed. Respondent Nos.7 to 9 challenged the sale
   notice by filing an application before the ORT, which was
D  dismissed   on 21.07.2006, and as no appeal was preferred
   against it, it attained finality. Respondent Nos.1 to 5 filed
   the suit claiming the properties as belonging to HUF. But,
   the facts would clearly indicate that the properties in
   question were purchased by respondent Nos.6 to 8 in
E their individual names, long after the death of the
   common ancestor and that too by registered sale deeds
   and no claim was ever made at any stage by any member
   of the HUF that the said properties were HUF properties
   and not the individual properties of rnspondents nos. 6
F to 8. [para 10-11) [241-H; 242-A-E]
       1.2 Security interest, within the meaning of s.2(zf) has
  been created in respect of the properties in question
  which are secured assets within the meaning of s.2(zc),
  in favour of the secured creditor (the bank) within the


                                                                   •
G meaning of s.2(zd). On failure to re-pay, the bank, secured
  creditor can always enforce its security interest over the
  secured assets. [para 13) [243-A-B]

      2.1 Section 13(1) of the Securitisation Act states that
H notwithstanding anything contained in s.69 or 69A of the
             JAGDISH SINGH v. HEERALAL                    235

Transfer of Property Act, 1882, any security interest             A
created in favour of any secured creditor may be
enforced, without the intervention of the court or tribunal
by such creditor, in accordance with the provisions of
the Act. In case the borrower fails to discharge his liability,
the bank can take the "measures" provided in s.13(4) of           B
the Securitisation Act for recovery of the loan amount.
One of the measures provided by the statute is to take
ilossession of secured assets of the borrowers, including
the right to transfer by way of lease, assignment or
realizing the secured assets. [para 14 and 22] [243-C-D;          c
249-A-B]

     2.2 Section 17 of the Securitisation Act confers a right
of appeal to any person, if that person is aggrieved by
any of the "measures" referred to in sub-s. (4) of s.13
taken by the Secured Creditor. The expression 'any                D
person' used in s.17 is of wide import and takes within
its fold the borrower, the guarantor or any other person
who may be affected by action taken uls 13(4) of the
Securitisation Act. Therefore, the expression 'any person'
referred to in s.17 would take in the plaintiffs in the suit      E
as well. Thus, irrespective of the question whether the
civil suit is maintainable or not, under the Securitisation
Act itself, a remedy is provided to such persons so that
they can invoke the provisions of s.17 of the
Securitisation Act, in case the bank (secured creditor)           F
adopts any measure including the sale of the secured
assets, on which the plaintiffs claim interest. [para 15, 17
and 18] [244-E-F; 247-A-D]

    United Bank of India v. Satyavati Tondon and Others           G
                   =
2010 (9) SCR 1 (2010) 8 SCC 11 O; Nahar Industrial
Enterprises Limited v. Hongkong Shanghai Banking
                                 =
Corporation 2009 (12) SCR 54 (2009) 8 SCC 646, Indian
Bank v. ABS Marine Products Pvt. Ltd. 2006 (1) Suppl.
         =
SCR 52 (2006) 5 SCC 72 - referred to.
                                                                  H
    236     SUPREME COURT REPORTS              [2013] 12 S.C.R.


A        2.3 Section 34 of the Securitisation Act ousts the civil
    court jurisdiction. The opening portion of s.34 clearly
    states that no civil court shall have jurisdiction to
    entertain any suit or proceeding "in respect of any
    matter" which a ORT or an Appellate Tribunal is
B   empowered by or under the Securitisation Act to
    determine."The expression 'in respect of any matter'
    referred to in s.34 would take in the "measures" provided
    under sub-s.(4) of s.13 of the Securitisation Act.
    Consequently, if any aggrieved person has got any
C   grievance against any "measures" taken by the borrower
    under sub-s. (4) of s.13, the remedy open to him is to
    approach the ORT or the Appellate Tribunal and not the
    civil court. Civil court in such circumstances has no
    jurisdiction to entertain any suit or proceedings in
    respect of those matters which fall under sub-s. (4) of s.13
D   of the Securitisation Act because those matters fell within
    the jurisdiction of the ORT and the Appellate Tribunal.
    Further, s.35 says, the Securitisation Act ·overrides other
    laws, if they are inconsistent with the provisions of that
    Act, which takes in s.9 CPC as well. [para 19 and 22] [247-
E   E; 249-C-F]
       Mardia Chemicals and Others v. Union of India and
                              =
  Others 2004 (3) SCR 982 (2004) 4 SCC 311; Central Bank
  of India v. State of Kera/a and Others 2009 (3) SCR 735      =
F (2009) 4 SCC 94, and Authorised Officer, Indian Overseas
  Bank and Others v. Ashok Saw Mill 2009 (11) SCR 599 =
  (2009) 8 sec 366 - referred to.
       2.4 The bank, in the instant case, has proceeded only
  against secured assets of the borrowers. In the
G circumstances, the High Court was in error in holding that
  only civil court has jurisdiction to examine as to whether
  the "measures" taken by the secured creditor under sub-
  s. (4) of s.13 of the Securitisation Act wem legal or not.
  The judgment of the High Court is set aside. [para 23]
H [249-H; 250-A-B]
           JAGDISH SINGH v. HEERALAL                       237


                     Case Law Reference:                           A

    2004 (3) SCR 982             referred to        Para 8

    2009 (3) SCR 735             referred to        Para 8

    2010 (9) SCR 1               referred to        Para 8         B
    2009 (11) SCR 599            referred to         Para 8

    2009 (12) SCR 54             referred to         Para 9

    2006 (1) Suppl. SCR 52       referred to         Para 9
                                                                   c
    CIVIL APPELLATE JURISDICTION : Civil Appeal No.
9771 of 2013.

    From the Judgment and Order dated 05.08.2010 of the
High Court of Madhya Pradesh, Bench at Indore in Civil First
                                                                   0
Appeal No. 130 of 2008.

    A.K. Chitale, Niraj Sharma, Sumi! Kumar Sharma for the
Appellant.

     Sanjay Parikh, Mamta Saxena, A.N. Singh, Bushra               E
Parveen (for Anitha Shenoy), Soma Mullick (for Pranab Kumar
Mullick), Pukhrambam Ramesh Kumar for the Respondents.

    The Judgment of the Court was delivered by

    K.S. RADHAKRISHNAN, J. 1. Leave granted.                       F
     2. The appellant herein was the auction purchaser, being
the highest bidder for Rs.18,01,000/-, in respect of the land
admeasuring one acre in Khasra Nos.104/3 and 105/2, Patwari
Halka No.4, Village Segaon, Anjad Road, Barwani, M.P., which       G
was brought to sale for recovery of loan amounts under the
provisions of the Securitisation and Reconstruction of Financial
Assets and Enforcement of Security Interest Act, 2002 (for short
"the Securitisation Act"). The auction was confirmed by the
bank on 08.11.2005 on the appellant's depositing Rs.2,90,250/      H
    238       SUPREME COURT REPORTS                  (2013] 12 S.C.R.


A - by 09.11.2005 and remaining 75% within 15 days. The
  appellant was not put in possession of the property in question
  even though the auction was confirmed.

       3. The appellant - auction purchaser then came to know
B that Respondent Nos.1 to 5 herein have filed a Civil Suit
  No.16A/07 in the Court of District Judge, Barwani District for
  a declaration of title, partition and permanent injunction against
  Respondent Nos.7 to 9 and others in which the appellant and
  the bank were also made parties. Following are the reliefs
C sought for in the said civil suit:

          "(A) Decree may be passed in favour of the plaintiff and
          against the defendants for declaration of title lo this effect
          that one acre land in survey No.104/3 and 10512 described
          in plaint para 4 (a) is undivided joint family property of
D         plaintiff and defendants No.1 to 4 and the defendants have
          no right to mortgage it or attachment and auction of the
          same against any loan recovery by defendant No.5 and if
          defendants No.1 to 5 might have created any charge on
          the said land then it is not binding on the plaintiff.
E
          (B) Decree of partition may be passed in favour of the
          plaintiffs and against the defendants for division of the suit
          land by metes and bounds and decree may be passed for
          separating the land of title of the plaintiffs and mutation
          effected in revenue papers.
F
          (C) Decree of permanent injunction may be passed in
          favour of the plaintiffs against the defendant that the
          defendants shall not, directly or indirectly, transfer, auction
          or interfere over the suit land of the plaintiff in any manner.
G
          (D) Costs of the suit may be awarded c;1gainst the
          defendants.
          (E) Other relief which the Hon'ble Court may deem proper
          may be granted to the plaintiff against the defendants."
H
            JAGDISH SINGH v. HEERALAL                        239
              [K.S. RADHAKRISHNAN, J.]
     4. Respondent Nos.7 to 9 herein, in the meanwhile, filed        A
an application before the Debt Recovery Tribunal (for short "the
ORT"), Jabalpur under Section 17 of the Securitisation Act
challenging the sale notice dated 08.11.2005. The application
was opposed by the bank and the same was dismissed by the
ORT vide its order dated 21.07.2006.                                 B

     5. Respondent Nos.6 and 7 (the Bank) filed a preliminary
objection before the civil court stating that in view of Section
13 read with Section 34 of the Securitisation Act, the civil court
has no jurisdiction to entertain the suit. The court, therefore,     C
framed the following issues:

     "Whether under the provisions of Section 34 & 35 of
     SARFAESI Act 2002 this court does not have the
     jurisdiction to decide the suit as mentioned in special
     pleadings in para 10 of the written statement of defendant      D
     No.10 and also mentioned in para 15 of the written
     statement of defendant Nos.6 & 7."

     6. The civil court upheld the preliminary objection stating
that if the plaintiffs had any right, they ought to have filed an    E
appeal under Section 17 of the ORT Act and not a suit in view
of the specific bar contained in Section 34 of the Securitisation
Act. Civil court, therefore, passed an order on 18.01.2008
holding that the suit is not maintainable and, hence, the
application preferred by the bank under Order 7 Rule 11 of the       F
Civil Procedure Code (for short "the CPC") was allowed.

     7. Aggrieved by the said order, Respondent Nos.1 to 5
herein filed Civil First Appeal No.130/08 before the High Court
of Madhya Pradesh at Indore. The High Court, however,
allowed the appeal. The operative portion of the judgment reads      G
as follow:

     "I have perused the contents of the plaint from the record
     of the case. A bare perusal of the plaint indicates that the
     plaintiffs have raised the question of title, on the basis of   H .
    240       SUPREME COURT REPORTS                   [2013] 12 S.C.R.


A         Joint Hindu Family property and they being the members
          of the Joint Hindu Family, it has been pleaded by them that
          the property in question had been acquired through the
          earnings of the joint family property. On that basis, it has
          been maintained by them that the property in question was
B         liable to be treated as Joint Hindu Family property, and not
          the exclusive property of the defendants. In these
          circumstances, on the bare perusal of the contents of the
          plaint, it cannot be suggested at all that the civil suit, filed
          by the plaintiffs, is barred under any provisions of the
c         Securitisation and Reconstruction of Financial Assets and
          Enforcement of Security Interest Act, 2000, or that civil
          court has no jurisdiction in the matter."

         8. Aggrieved by the same, this appeal has been preferred.
    Shri A.K. Chitale, learned senior counsel appearing for the
D   appellant, submitted that the High Court has not properly
    appreciated the scope of Section 34 of the Securiti:sation Act
    and has completely over-looked the principle laid down by this
    Court in various Judgments with regard to the scope of Section
    9 CPC vis-a-vis Section 34 of the Securitisation Act. Reference
E   was made to the Judgments of this court in Mardia Chemicals
    and Others v. Union of India and Others (2004) 4 SCC 311,
    Central Bank of India v. State of Kera/a and Others (2009) 4
    SCC 94, United Bank of India v. Satyavati Tondon and Others
    (2010) 8 SCC 110 and Authorised Officer, Indian Overseas
F   Bank and Others v. Ashok Saw Mill (2009) 8 SCC 366.
    Learned senior counsel submitted that the appellant is a bona
    fide purchaser for value and the sale was confirmed in his favour
    as early as on 08.11.2005. Further, it was pointed out that the
    application preferred by Respondent Nos. 7 to 9 before the
G   DRT, challenging the sale notice dated 08.11.2005, was also
    dismissed by the DRT on 21.07.2006. Consequently, the High
    Court was not justified in interfering with the order passed by
    the District Judge.

          9. Shri Sanjay Parikh, learned counsel appeal'ing for the
H
            JAGDISH SINGH v. HEERALAL                     241
              [K.S. RADHAKRISHNAN, J.]
respondents, on the other hand, submitted that the High Court A
has rightly interfered with the order of the District Judge after
having found that the civil court has got the jurisdiction to deal
with the rights of the respondents - plaintiffs. Learned counsel
submitted that the High Court has correctly appreciated the
scope of Section 34 of the Securitisation Act. Reference was B
made to the Judgments of this Court in Nahar Industrial
Enterprises Limited v. Hongkong Shanghai Banking
 Corporation (2009) 8 SCC 646, Indian Bank v. ABS Marine
 Products Pvt. Ltd. (2006) 5 SCC 72 and also to the Mardia
 Chemicals Ltd. (supra). Learned counsel submitted that the       c
 ORT, exercising powers under Section 17 of the Securitisation
 Act, cannot decide the rights of Respondent Nos.1 to 5 vis-a-
 vis Respondent Nos.7 to 9 in a proceeding under Section 17
 of the Securitisation Act and civil court is the right forum to
 decide as to whether the secured assets are ancestral 0
 properties of a Hindu Undivided Family (HUF) and they were
 acquired through the earnings out of the joint family properties.

Discussion

        10. The Bank of India had advanced a loan of Rs.25 lakhs E
 to M/s Guru Om Automobiles, 10th respondent herein, through
 its proprietor, the 6th respondent on 17.02.2000. The loan was
 secured by equitable mortgage executed by Respondent Nos.7
 to 9 in respect of land measuring one acre in Khasra No.104/
 3 and 10512, Patwari Halka No.5, Village Seagon, Anjad Road, F
 Barwani, MP. Respondent Nos.6 to 8 had also created
 equitable mortgage on three houses, which were in their
  respective names. Original title deeds of all the above-
  mentioned properties were duly deposited with the bank at the
  time of availing of the loan. Since they committed default in re- G
  paying the loan, the bank issued notice under Section 13(2) of
  the Securitisation Act and took steps under Section 13(4) of
  the Securitisation Act in respect of properties on 01.03.2004.
  Auction notice was duly published in the newspapers on
   30.09.2005. No objection was raised by the plaintiffs and the H
   suit land was auctioned on 08.11.2005, which was settled in
    242       SUPREME COURT REPORTS                [2013] 12 S.C.R.


A favour of the highest bidder - the appellant herein. The entire
  auction price was paid by the auction purchaser and the sale
  in his favour was duly confirmed. Respondent Nos.7 to 9
  challenged the sale notice, as already indicated, by filing an
  application No.19/2005 before the ORT, Jabalpur, which was
B dismissed on 21.07.2006. No appeal was preferred against
  that order and that order has attained finality.

          11. We notice, at this juncture, Respondent Nos.1 to 5 filed
    Civil Suit No.16A/07 in the Court of the District Judge, Barwani
    against the appellant, as well as the bank and Respondent
C   Nos.6 to 9, alleging that the family members of Respondent
    Nos.1 to 9 herein being sons/grandsons of deceased Premji,
    constituted a HUF engaged in agriculture. It was stated that the
    said properties were purchased in the names of Respondent
    Nos.7 to 9 out of the funds of HUF and house Nos.41/1, 42/3
D   and 42/2 were also purchased in the names of Respondent
    Nos.6 to 8 respectively, out of the funds of HUF and, therefore,
    the properties of HUF. But, the facts would clearly indicate that
    the properties referred to above were purchased by
    Respondent Nos.6 to 8 in their individual names, long after the
E   death of Premji and that too by registered sale deeds and no
    claim was ever made at any stage by any member of the HUF
    that the suit land was a HUF property and riot the individual
    property. Respondent Nos.7 to 9 had purchased those lands
    vide sale deed dated 14.09.1999 and the 6th respondent had
F   also purchased in his individual name House No.42/1 on
    31.03.1998 vide registered sale deed'. Similarly, Respondent
    No.7 had also purchased House No.42/3 in his individual name.
    No claim, whatsoever, was made at any stage by any member
    of the family that those properties and buildings were HUF
G   properties and not the individual properties of Respondent
    Nos.6 to 8 herein.

         12. We find that the bank had advanced loans on the
    strength of the above-mentioned documents which stood in the
    names of Respondent Nos.6 to 9. Due to non-repayment of the
H
                JAGDISH SINGH v. HEERALAL                        243
                  [K.S. RADHAKRISHNAN, J.]
loan amount, the Bank can always proceed against the secured           A
assets.

     13. Security interest, within the meaning of Section 2(zf)
has been created in respect of the above mentioned properties
which are secured assets within the meaning of Section 2(zc),          B
in favour of the secured creditor (the bank) within the meaning
of Section 2(zd). On failure to re-pay, the bank, secured creditor
can always enforce its security interest over the secured assets.

      14. Secured asset is defined under Section 2(zc) of the
Securitisation Act to mean the property on which security C
interest is created. Section 13( 1) of the Securitisation Act states
that notwithstanding anything contained in Section 69 or 69A
of the Transfer of Property Act, 1882, any security interest
created in favour of any secured creditor may be enforced,
without the intervention of the court or tribunal by such creditor, D
in accordance with the provisions of the Act. In case the
 borrower fails to discharge his liability, the bank can take the
 measures provided in Section 13(4) of the Securitisation Act
 for recovery of the loan amount. The "measures" available for
 enforcement of security interest is dealt with in the following E
 provision:

      13. Enforcement of security interest -

      (1)to(3)                     )()()(            )()()(   )()()(

                                                                           F
      (4) In case the borrower fails to discharge his liability in
      full within the period specified in sub-section (2), the
      secured creditor may take recourse to one or more of the
      following measures to recover his secured debt, namely:-
                                                                       G
      (a) take possession of the secured assets of the borrower
      including the right to transfer by way of lease, assignment
      or sale for realising the secured asset;

      (b) take over the management of the business of the                  H
       .   •,
    244       SUPREME COURT REPORTS                [2013] 12 S.C.R.


A         borrower including the right to transfer by way of lease,
          assignment or sale for realising the secured asset:

                PROVIDED that the right to transfer by way of lease,
          assignment or sale shall be exercised only where the
          substantial part of the business of the borrowi~r is held as
B
          security for the debt:

                PROVIDED further that where the management of
          whole of the business or part of the business is severable,
          the secured creditor shall take over the management of
c         such business of the borrower which is relatablelo the
          security or the debt;

          (c) appoint any person (hereafter referred to as the
          manager), to manage the secured assets the possession
D         of which has been taken over by the secured creditor;

        (d) require at any time by notice in writing, any person who
        has acquired any of the secured assets from the borrower
        and from whom any money is due or may become due to
        the borrower, to pay the secured creditor, so much of the
E       money as is sufficient to pay the secured debt."

       15. Section 17 of the Securitisation Act confers a right of
  appeal to any person, including the borrower, if that person is
  aggrieved by any of the "measures" referred to in sub-section
F (4) of Section 13 taken by the Secured Creditor. The operative
  portion of Section 17 is extracted hereinbelow for ready
  reference:

        "17. Right to appeal: (1) Any person (including borrower),
        aggrieved by any of the measures referred to in sub-
G       section (4) of section 13 taken by the secured creditor or
        his authorised officer under this Chapter, may make an
        application along with such fee, as may be prescribed to
        the Debts Recovery Tribunal having jurisdiction in the
        matter within forty-five days from the date on which such
H       measure had been taken:
       JAGDISH SINGH v. HEERALAL                        245
         [K.S. RADHAKRISHNAN, J.]
PROVIDED that different fees may be prescribed for              A
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           8
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          C
Tribunal under sub-section (1) of Section 1.

(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      D
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       E
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 of
the secured assets to the borrower or restoration of
possession of the secured assets to the borrower, it may
                                                                F
by order·, declare the recourse to any one or more
measures referred to in sub-section (4) of section 13 taken
by the secured assets as invalid and restore the
 possession of the secured assets to the borrower or
 restore the management of the secured assets to the            G
 borrower, as the case may be, and pass such order 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.
                                                                    H
    246 .   SUPREME COURT REPORTS                 [2013] 12 S.C.R.


A      (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
8      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.

       (5) Any application made under sub-section (1) shall be
       dealt with by the Debts Recovery Tribunal as expeditiously
c      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
D      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
E
       Recovery Tribunal within the period of four months as
       specified in sub-section (5), any party 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
F      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.

G      (7) Save as otherwise provided in this Act, the Debts
       Recovery Tribunal shall, as far as may be, dispose of
       application in accordance with the provisions of the
       Recovery of Debts Due to Banks and Financial Institutions
       Act, 1993 and the rules made thereunder."
H
           JAGDISH SINGH v. HEERALAL                          247
             [K.S. RADHAKRISHNAN, J.]
     16. Any person aggrieved by any order made by the ORT             A
under Section 17 may also prefer an appeal to the Appellate
Tribunal under Section 18 of the Act.

     17. The expression 'any person' used in Section 17 is of
wide import and takes within its fold not only the borrower but        B
also the guarantor or any other person who may be affected
by action taken under Section 13(4) of the Securitisation Act.
Reference may be made to the Judgment of this Court in
Satyavati Tondon's case (supra).

     18. Therefore, the expression 'any person' referred to in C
Section 17 would take in the plaintiffs in the suit as well.
Therefore, irrespective of the question whether the civil suit is
maintainable or not, under the Securitisation Act itself, a
remedy is provided to such persons so that they can invoke the
provisions of Section 17 of the Securitisation Act, in case the D
bank (secured creditor) adopt any measure including the sale
of the secured assets, on which the plaintiffs claim interest.

      19. Section 34 of the Securitisation Act ousts the civil court
jurisdiction. For easy reference, we may extract Section 34 of         E
the Securitisation Act, which is as follow:

     "34. Civil Court not to have jurisdiction - No civil court
     shall have jurisdiction to entertain any suit or proceeding
     in respect of any matter which a Debts Recovery Tribunal
     or the Appellate Tribunal is empowered by or under this           F
     Act to determine and no injunction shall be granted by any
     court or other authority in respect of any action taken or to
     be taken in pursuance of any power conferred by or under
     this Act or under the Recovery of Debts Due to Banks and
     Financial Institutions Act, 1993 (51 of 1993).                    G
     20. The scope of Section 34 came up for consideration
 before this Court in Mardia Chemicals Ltd. (supra) and this
 court held as follow:
                                                                       H
    248       SUPREME COURT REPORTS                    [2013] 12 S.C.R.


A          "50. It has also been submitted that an appeal is
           entertainable before the Debts Recovery Tribunal only after
           such measures as provided in sub-section (4) of Section
           13 are taken and Section 34 bars to entertain any
           proceeding in respect of a matter which the Debts
B          Recovery Tribunal or the Appellate Tribunal is empowered
           to determine. Thus before any action or measure is taken
           under sub-section (4) of Section 13, it is submitted by Mr
           Salve, one of the counsel for the respondents that there
          would be no bar to approach the civil court. Therefore, it
c         cannot be said that no remedy is available to the
           borrowers. We, however, find that this contention as
          advanced by Shri Salve is not correct. A full reading of
          Section 34 shows that the jurisdiction of the civil court is
          barred in respect of matters which a Debts Recovery
          Tribunal or an Appellate Tribunal is empowered to
D
          determine in respect of any action taken "or to be taken
          in pursuance of any power conferred under this Act". That
          is to say, the prohibition covers even matters which can
          be taken cognizance of by the Debts Recovery Tribunal
          though no measure in that direction has so far been taken
E         under sub-section (4) of Section 13. It is further to be noted
          that the bar of jurisdiction is in respect of a proceeding
          which matter may be taken to the Tribunal. Therefore, any
          matter in respect of which an action may be taken even
          later on, the civil court shall have no jurisdiction to entertain
F         any proceeding thereof. The bar of civil court thus applies
          to all such matters which may be taken cognizance of by
          the Debts Recovery Tribunal, apart from those matters in
          which measures have already been taken under sub-
          section (4) of Section 13."
G
         21. Section 13, as already indicated, deals with the
    enforcement of the security interest without the intervention of
    the court or tribunal but in accordance with the provisions of the
    Securitisation Act.
H
            JAGOISH SINGH v. HEERALAL                         249
              [K.S. RAOHAKRISHNAN, J.]
      22. Statutory interest is being created in favour of the A
secured creditor on the secured assets and when the secured
creditor proposes to proceed against the secured assets, sub-
section (4) of Section 13 envisages various measures to
secure the borrower's debt. One of the measures provided by
the statute is to take possession of secured assets of the B
borrowers, including the right to transfer by way of lease,
assignment or realizing the secured assets. Any person
aggrieved by any of the "measures" referred to in sub-section
(4) of Section 13 has got a statutory right of appeal to the ORT
 under Section 17. The opening portion of Section 34 clearly c
 states that no civil court shall have jurisdiction to entertain any ·
 suit or proceeding "in respect of any matter" which a ORT or
 an Appellate Tribunal is empowered by or under the
 Securitisation Act to determine. The expression 'in respect of
 any matter' referred to in Section 34 would take in the
                                                                       0
 "measures" provided under sub-section (4) of Section 13 of the
 Securitisation Act. Consequently if any aggrieved person has
 got any grievance against any "measures" taken by the
 borrower under sub-section (4) of Section 13, the remedy open
 to him is to approach the ORT or the Appellate Tribunal and
 not the civil court. Civil Court in such circumstances has no E
 jurisdiction to entertain any suit or proceedings in respect of
 those matters which fall under sub-section (4) of Section 13 of
 the Securitisation Act because those matters fell within the
 jurisdiction of the ORT and the Appellate Tribunal. Further,
  Section 35 says, the Securitisation Act overrides other laws, if F
 they are inconsistent with the provisions of that Act, which takes
  in Section 9 CPC as well.

      23. We are of the view that the civil court jurisdiction is
 completely barred, so far as the "measure" taken by a secured        G
 creditor under sub-section (4) of Section 13 of the Securitisation
 Act, against which an aggrieved person has a right of appeal
 before the ORT or the Appellate Tribunal. to determine as to
 whether there has been any illegality in the "measures" taken.
 The bank, in the instant case, has proceeded only against            H
    250      SUPREME COURT REPORTS               [2013] 12 S.C.R.


A secured assets of the borrowers on which no rights of
  Respondent Nos.6 to 8 have been crystalised, before creating
  security interest in respect of the secured assets In such
  circumstances, we are of the view that the High Court was in
  error in holding that only civil court has jurisdiction to examine
B as to whether the "measures" taken by the secured creditor
  under sub-section (4) of Section 13 of the Securitisation Act
  were legal or not. In such circumstances, the appeal is allowed
  and the judgment of the High Court is set aside. There shall
  be no order as to costs.
c R.P.                                            Appeal allowed.