G. Rajasuria, J.
Broadly but briefly, narratively but precisely, the relevant facts absolutely necessary and germane for the disposal of this application would run thus:
(1) The plaintiff filed the suit seeking the following reliefs:
(a) to declare that the entire proceedings initiated by the defendant purported to be under Section 13(4) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 dated 27-7-2009 attempting to proceed against the plaintiff?s property as null and void.
(b) consequently, to grant permanent injunction restraining the defendant, their servants, agents, men, working or claiming through them from in any way proceeding against the plaintiff?s property in any manner whatsoever pursuant to the notice dated 27-7-2009 under Section 13(4) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002.
(ii) The same plaintiff filed this application seeking injunction as under:
?to grant permanent injunction restraining the respondent/defendant, their servants, agents, men, working or claiming through them from in any way proceedings against the plaintiffs property in any manner whatsoever pursuant to the notice dated 27-7-2009 under Section 13(4) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act 2002, pending disposal of the suit.?
2. The parties are referred to hereunder according to their litigative status and raking in the C.S. After entering appearance, the respondent filed the counter.
3. Heard both sides.
4. The gist and kernal, the pith and marrow of the case of the plaintiff would run thus:-
(a) Like a bolt from the blue, the possession notice under Section 13(4) of the SARFAESI Act, dated 27-7-2009, for the immovable property was came to be affixed on the premises of the plaintiff, described in the schedule of the plaint. Whereupon, the plaintiff was constrained to file suit in the District Munsif Court, Chengalpet, seeking injunction as against the defendant herein and subsequently this suit also has been filed for the aforesaid reliefs.
(b) The plaintiff purchased the suit property from one Devika Rani, who is turn purchased the suit property earlier from the following persons:
1. S. Santhana Marian
2. M.R. Vincent
3. G. Gnanam
4. Smt. S. Varuvel Thayammal
5. G. Pushpammal
6. S. Dasan
7. S. Navamani
8. S. Anthoni Ammal
9. A. Amsadasan
10. A. ADdennisan
11. A. Rose Garmela
12. A. Arulmani
(c ) The defendant bank, which claims to have mortgage right over the suit property, by virtue of the equitable mortgage created by deposit of title deeds by one Arulmani for himself and on behalf of the plaintiff?s vendor?s vendors on the strength of the Power Deed dated 17-9-1990, had no right at all to create such mortgage. The Bank, suppressing the real facts simply approached the DRT and obtained some order, which is emerged by practising fraud and misrepresentation and it should be taken as non-est in the eye of law. Fraud vitiates everything and the plaintiff being the purchaser of the suit property, without notice of all those happenings, is entitled to be protected. Accordingly, the petitioner/plaintiff prays for injunction.
5. Whereas, the case of the defendant bank as found set out in the counter could pithily and precisely, tersely and briefly be portrayed thus:
(a) Arulmani is not only the Power Agent of the plaintiff herein, but he also happened to be one of the co-shares of the suit property and the plaintiff?s vendor?s vendors had the power to create mortgage in favour of the Bank.
(b) Over and above that, the bank instituted the suit in C.S. 1694 of 1994 for recovery of money due under the mortgage before this Court. At the advent of the special enactment, namely, The Recovery of Debts Due to Banks and Financial Institutions Act, 1993, the case was transferred from the original side of this Court to the Debts Recovery Tribunal, as its value exceeded Rs. 10,00,000/-, whereupon the DRT concerned issued notice to the plaintiff?s vendor?s vendors and after effecting service duly on the respondents therein, in the way known to law, the DRT proceeded with the matter and passed the order on 3-9-1997 and the recovery certificate was issued on 5-1-1998.
(c) The bank, after finding that there are lot of hurdles and difficulties in recovering the debt, has chosen to press into service the provisions of the SARFAESI Act also.
(d) At this juncture, the plaintiff, who knowingly and collusively purchased the suit property, pending the aforesaid proceedings, did choose to file the suit for bare injunction before the District Munsif Court, Chenglepet and after failing to get any interim order there, the same plaintiff has chosen to file this suit in this Court and got interim injunction, which is liable to be vacated.
6. The point for consideration is as to whether the plaintiff is entitled to an injunction as prayed for.
7. The learned senior counsel for the plaintiff, by placing reliance on the averments in the affidavit, accompanying the petition, as well as in the plaint, would set forth and put forth his argument as under:
(i) Arulmani had no authority to create legally an equitable mortgage by deposit of title deeds in favour of the defendant bank.
(ii) the doctrine of lis pendens is having no operation in the facts and circumstances of this case, as Section 52 of the Transfer of Property Act is applicable only relating to suits and other proceedings and not proceedings before the DRT.
(iii) the possession notice dated 27-7-2009 issued by the defendant under the SARFAESI Act is barred by limitation, so to say, by virtue of Section 36 of the SARFAESI Act.
(iv) The plaintiff is not duty bound to pray for setting aside the order of the DRT, as fraud vitiates everything and in fact, the plaintiff was not aware of any such mortgage created by its vendor?s vendors and the plaintiff could simply ignore the same.
(v) Despite issuance of notice in the year 2005 by the plaintiff, there was no response from the Bank. Accordingly, he prays for the grant of interim injunction.
8. Whereas, by way of torpedoing and pulverising the arguments on the side of the learned counsel for the plaintiff, the learned counsel for the respondent/defendant would advance his argument as under:-
(i) the very purchase made by Devika Rani from her vendors is hit by lis pendens and for that matter, the sale effected by Devika Rani in favour of the plaintiff also is hit by lis pendens, as the suit was instituted in the year 1994 before this Court in C.S. 1694/1994. Subsequently, it was transferred and as such, the proceedings before the DRT so far this case is concerned should be treated as one in continuation the Civil Court proceedings and it will attract Section 52 of the Transfer of Property Act. Arulmani mortgaged the suit property with the expressed consent as well as connivance of the plaintiff?s vendor?s vendors and in fact, Arulmani himself happens to be one of the co-shares, relating to the suit property. Despite receipt of notice from DRT, the plaintiffs vendor?s vendors simply kept quiet and that shows and evinces that they ratified the very said mortgage created by Arulmani in favour of the Bank.
(ii) The proceedings initiated by the Bank by issuing possession notice under Section 13(4) of SARFAESI Act on 27-7-2009 is not hit by limitation for the reason that already there is subsisting secured mortgage debt in favour of the bank and that it also got crystallised in the form of debt recovery certificate, which was issued on 5-1-1998 and within 12 years period, so to say on 27-7-2009 itself, the SARFAESI Act was invoked by the Bank and in such a case, it cannot be labelled or termed, projected or put forth as though the initiation of proceedings under the SARFAESI Act is barred by limitation. The suit also is not tenable in view of Section 34 of the SARFAESI Act.
9. Both sides cited decisions in support of their arguments, wherefore it is just and necessary to consider all those pleas and precedents in seriatim.
10. The learned Senior counsel for the plaintiff, ex facie and prima facie, in my opinion, appropriately and convincingly too, developed his argument that the power deed dated 17-9-1990 executed by the plaintiffs vendor?s vendors in favour of Arulmani did not contain a specific clause for creating mortgage in favour of the bank purely for the purpose of securing the prompt repayment of the debt by a 3rd party, even though the said power deed empowers Arulmani to create mortgage for the purpose of doing amelioratory work concerning the family property, as contemplated in the power deed itself.
11. The learned counsel for the plaintiff cited the following decisions to highlight the capacity of the Power Agent.
(i) AIR 1933 Privy Council 78, O.A.P.R.M.A.R. Adaikappa Chettiar v. Thomas Cook and Son (Bankers) Ltd,:
(ii) AIR 1940 Madras 650, P.L.S.S. Ramanathan Chettiar v. K.M.V.V. Kumarappa Chettiar;
(iii) AIR (38) Punjab 371, D.H.M. Framji v. The Eastern Union Bank Ltd., Chittagong;
(iv) AIR 1985 Karnataka 213, Syndicate Bank, Bangalore v. I.K. Amitha;
(v) AIR 1997 Bombay 142, Devkubai N. Mankar v. Rajesh Builders;
(vi) AIR 1952 Madras 559, P.M. Desappa Nayanim Varu v. Ramabhaktula Ramiah;
(vii) 1968 (2) MLJ 574, Anantha Pillai v. Rathnasabapathy Mudaliar.
12. The above decisions would highlight that the Power Agent cannot act exceeding his powers and if he does so, it would not bind the principal.
13. The learned counsel for the plaintiff also cited the following decisions to highlight that fraud vitiates everything:
(i) (2003) 8 SCC 319, Ram Chandra Singh v. Savitri Devi;
(ii) (2007) 4 SCC 221: (AIR 2007 SC 1546), A.V. Papayya Sastry v. Govt. of A.P.
14. There could be no quarrel over such a proposition. However, in this case, the contention of the defendant also should necessarily be considered relating to the plea of ratification of the Power Agent?s act by the principal.
15. Whereas, the learned counsel for the respondent Bank would develop his argument that the clauses as found set out in the power deed are capable of being construed as one enabling Arulmani to create mortgage in favour of the bank.
16. At this juncture, I would like to extract hereunder the relevant clauses in the power deed dated 17-9-1990.
??????(1) that we hereby appoint one of us, Mr. A. Arulmani, lawful Attorney in our names on our behalf to exercise any or all of the power and to do all acts, things and deeds hereinafter mentioned in connection without movables and immovable properties as described in the schedule hereunder. (2) To manage and administer the properties and monies belonging to us and our families. (3) To take possession of all the properties as we are now or in any way during our absence become entitled to and to being any action or other proceedings in respect to or for or concerning all or any such property and also to demand, receive and recover and give receipt for the rents and profits thereof for the use, to sell absolutely, dispose of and convey the same or any part thereof????..
?????..(12) We do hereby agree to confirm and ratify all acts, deeds or things done by virtue of these presents by our said attorney or any agent or any substitute appointed by him. (13) And to raise funds from banks, private bodies financial institution or any other person or persons for the improvement of the properties and Attorney is empowered to sign all the relevant documents to it. (14) To sell any of the properties inherited from late and do all acts and deeds that may be necessary.?
17. A plain reading of these clauses would prima facie support only the contention of the plaintiff and not the defendant. The question arises as to why then this Court cannot simply grant injunction on that ground itself pending disposal of the suit and that too, in view of the prima facie facts available in favour of the applicant/plaintiff.
18. At this juncture, a plausible and discernible argument has been put forth by the learned counsel for the defendant that this Court has to take into consideration the conduct of the parties and also the facts relating to ratification of the mortgage created by Arulmani as well as the connivance on the part of the plaintiff?s vendor?s vendors in relation to the mortgage created by Arulmani. If really Arulmani?s conduct in creating equitable mortgage by way of deposit of title deeds was not approved or ratified or connived at by the plaintiff?s vendor?s vendors certainly, they should have swung into action and did something in that regard. There is no shard or shred, miniscule or scintilla, molecular or iota of evidence to display and demonstrate that the plaintiff?s vendor?s vendors ever raised their cudgel as against Arulmani, who happens to be one of the co-sharers of the suit property. Despite receipt of notice by DRT, the plaintiff?s vendor?s vendors kept quiet and clung to taciturnity. Hence, at this stage, I am of the view that there is ex facie and prima facie evidence to suppose or suspect that there was connivance/ratification relating to the Act of Arulmani for creating equitable mortgage by deposit of title deeds.
19. The learned Senior Counsel for the plaintiff would implore and entreat that connivance/ratification cannot be assumed or presumed without taking evidence.
20. I fully agree with the view as put forth by the learned Senior Counsel for the plaintiff. However, at this stage, this Court is only concerned with the prima facie case available on either side. As of now, I could see no plausible explanation convincingly forthcoming from the side of the plaintiff that there was no implied ratification or connivance relating to the act of Arulmani in creating equitable mortgage by deposit of title deeds with the bank on his behalf and on behalf of the plaintiff?s vendor?s vendors.
21. At this juncture my mind is reminiscent and redolent of the following adage ?He who seeks equity must do equity and he who comes to equity must come with clean hands?.
22. Injunction is a discretionary remedy, for which, the petitioner/plaintiff should prove the preponderance of probabilities in their favour. But in this case, in view of the reasons set out supra and more specifically in view of the conduct of the plaintiff?s vendor?s vendors in not in any way raising their little finger as against the conduct of Arulmani in creating equitable mortgage by way of deposit of title deeds with the bank. The present plaintiff, who simply stepped into the shoes of its vendor cannot now veer round and take any plea quite antithetical to the conduct evinced by its vendor?s vendors.
23. The learned counsel for the defendant would cite the following two decisions in support of his plea of ratification:
(i) 49 Ind Cas 758, NA.PE.RM.LE.SI.THA. Lakshumanan Chetty v. SE.VE.NA.SI.THA. Chidambaram Chetty;
(ii) 64 Ind Cas 768, Saiyed Muhammad Haneef v. B. Irri Prasad and Muhammad Askari.
24. The learned counsel for the plaintiff would submit that had the plaintiff?s vendor?s vendors simply kept quiet without alienating the suit property, then at least there would be some scope for the presumption that the plaintiff?s vendor?s vendors might have connived at or ratified the act of Arulmani; for which, the learned counsel for the defendant appositely and convincingly replied by pointing out that simply because the plaintiff?s vendor?s vendors sold the suit property in favour of Devikarani, that it does not mean that they did not ratify or connive at the act of Arulmani and furthermore, even after creation of the mortgage, the mortgagor can transfer the right in the immovable property concerned in favour of another.
25. The learned counsel for the defendant also by inviting the attention of this Court to the notice dated 20-10-2005 would put forth his argument that the plaintiff, which is not an ordinary person, but a corporate body, having the assistance of legal advisers, even though had the knowledge about the said creation of mortgage by Arulmani and also the DRT proceedings, simply kept quite and only after the serving of SARFAESI notice on 27-7-2009, they have chosen to take legal action just to thwart the bank?s attempt to recover the dues under debt.
26. However, the learned senior counsel for the plaintiff would contend that simply based on the notice dated 20-10-2005, the defendant cannot try to fasten the plaintiff with the knowledge about the past proceedings.
27. Be that as it may. On due enquiry, the plaintiff could have ascertained all the past happenings. Furthermore, there is one other vital fact which the plaintiff itself openly, without mincing words would admit in the said notice of the year 2005 that the original title deeds have not been given to it by the vendor. This is not an insignificant or pococurante fact to be ignored. A prudent purchaser and that too, a genuine purchaser is expected to demand for the original title deeds from the vendor. In fact, the sale in favour of the plaintiff was effected as early as on 8-5-1998 and till date, the plaintiff is not in possession of the original title deeds and for that matter up to 2005, they kept quiet without demanding from their vendor Devikarani, the original title deeds. As such, based on these facts, the learned counsel for the defendant would submit that the plaintiff had knowledge about the past proceedings and that the plaintiff?s contention that he was an innocent purchaser for value without notice should not be taken for gospel truth by this Court. In fact, the learned counsel for the defendant has gone to the extent of arguing that the plaintiff engaged in constructing huge buildings as per his own version and in such a case, the plaintiff cannot be heard to contend or plead that he had no knowledge about the proceedings in connection with the suit property.
28. Be that as it may, these are all maters, which have to be dealt with during trial. Now for the purpose of deciding as to whether injunction could be granted or not, this Court is only concerned with ex facie and prima facie case.
29. In respect of the contention on the part of the learned counsel for the defendant that the sales effected during the pendency of the proceedings are hit by lis pendens, I am of the view this larger issue need not be considered at this stage and I relegate it to the trial stage so that parties can adduce evidence and thereafter argue on that finally.
30. Regarding the maintainability of the suit is concerned, I would like to point out that since the plaintiff pleads that fraud was practiced on the authority and there are precedents to the effect that if the suit is instituted challenging certain proceedings on the ground of fraud, then such a suit cannot simply be thrown away by invoking Section 34 of the SARFAESI Act. In this connection, the following decision has been fruitfully cited on the side of the plaintiff:
2008 (1) CTC 471, S. V. Subramaniam v. Cypress Semiconductor Technology India Private Limited, certain excerpts from it would run thus:
(d) Section 17 of the 1993 Act relates to jurisdiction, powers and authority of Tribunals, as quoted hereunder:
?Section 17. Jurisdiction, powers and authority of Tribunals ? (1) A Tribunal shall exercise, on and from the appointed day, the jurisdiction, powers and authority to entertain and decide applications from the banks and financial institutions for recovery of debts due to such banks and financial institutions.
(2) An appellate Tribunal shall exercise, on and from the appointed day, the jurisdiction, powers and authority to entertain appeals against any other made, or deemed to have been made, by a Tribunal under this Act.?
On the other hand, Section 18 of the 1993 Act imposes a ?bar of jurisdiction?, which reads as follows:
?Section 18. Bar of jurisdiction ? On and from the appointed day, no Court or other authority shall have, or be entitled to exercise, any jurisdiction, powers or authority (except the Supreme Court, and a High Court exercising jurisdiction under Articles 226 and 227 of the Constitution) in relation to the matters specified in Section 17.?
From the aforesaid provisions, it would be evident that there is no total ouster or jurisdiction of the civil Court. The ouster is by virtue of Section 18 of the 1993 Act, which sets out that no Court or other authority can try matters of recovery of debts. Insofar as the reliefs which do not pertain to debts, on a plain reading of Section 17 of the 1993 Act, are concerned, there can be no doubt that the Civil Court will still retain the jurisdiction Centurion Bank Ltd. v. Indian Lead Ltd., 2000 (100) Comp Cas 537.
(h) In the present case, as the plaintiff is neither the Bank/financial institution nor the borrower, the provisions of Section 17 of the 1993 Act are not attracted. It is not the case of the Bank that they filed an application for recovery of its debt from the plaintiff. The plaintiff who is not a party before the DRT, has only alleged fraud played by the parties to obtain orders from the DRT and therefore, in view of the decisions of the Supreme Court, as referred to above, we hold that the present suit is not barred by the provisions of Section 18 of the 1993 Act.?
31. As such, in view of the aforesaid decision, at this stage itself this Court cannot simply arrive at the conclusion that the suit itself is not maintainable.
32. Regarding the limitation point is concerned, the learned Senior counsel would admit that even though such a plea was not specifically raised in the plaint, yet the same could be raised for the reason that it is a pure question of law by virtue of Section 3 of the Limitation Act. He would, by placing reliance on Section 36 of the SARFAESI Act, would canvas his argument to the effect that more than twelve years elapsed ever since the alleged mortgage deed was executed in favour of the bank and it is quite obvious from the records. As against which, the learned counsel for the defendant would submit that within the limitation period, the bank filed the suit, which was subsequently transferred to DRT, which passed the order on 3-9-1997; consequently, the recovery certificate was issued on 5-1-1998 and calculating the period of limitation from 5-1-1998 till 27-7-2009 the date of issuance of possession notice under Section 13(4) of SARFAESI Act, 12 years period did not elapse.
33. I could see considerable force in the submission made by the learned counsel for the defendant for the following reasons.
The term ?debt? as defined in the the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 is found adopted in the SARFAESI Act.
?S.2(g) of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993:
?debt? means any liability (inclusive of interest) which is claimed as due from any person by a bank or a financial institution or by a consortium of banks or financial institutions during the course of any business activity undertaken by the bank or the financial institution or the consortium under any law for the time being in force, in cash or otherwise, whether secured or unsecured, or assigned, or whether payable under a decree or order of any civil Court or any arbitration award or otherwise or under a mortgage and subsisting on, and legally recoverable on, the date of the application? (Emphasis supplied)
34. A plain reading of the definition of the ?debt? as contained in the The Recovery of Debts Due to Banks and Financial Institutions Act, 1993 would exemplify and demonstrate that given a ?decree debt? could be taken as a ?debt?. It is quite obvious and axiomatic that for obtaining decree, considerable time would be taken by a litigant and in some cases, it might exceed even ten years or fifteen years and in such a case, if twelve years period of limitation for enforcing mortgage is calculated from the date of accrual of the cause of action based on mortgage due under the bank, then the relevant portion of the definition of ?debt?, as contemplated under the The Recovery of Debts Due to Banks and Financial Institutions Act, 1993 as well as SARFAESI Act would be rendered nugatory or otiose. It is therefore crystal clear that the twelve years? limitation period has to be reckoned from the date of decree or the debt recovery certificate issued by the Tribunal. The question might arise as to whether the provisions of the SARFAESI Act, so to say Section 13(4) could be pressed into service for the purpose of executing a decree debt or the certificate issued under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993.
35. I am of the considered and firm opinion that the provisions of the SARFAESI Act could rightly be utilised for the purpose of executing a decree debt or the debt got crystallised in the debt recovery certificate, in view of the definition of ?debt?, as referred to supra.
36. The learned Senior counsel for the plaintiff, by inviting the attention of this Court to Section 36 of the SARFAESI Act would submit that Section 36 of the Act contemplates only the term ?financial asset? and not ?debt?.
37. Hence, it is just and necessary to refer to the definition of ?financial asset? as found defined under Section 2(1) of the SARFAESI Act and it is extracted hereunder for ready reference.
?Section 2(1): ?financial asset? means debt or receivables and includes ?
(i) a claim to any debt or receivables or part thereof, whether secured or unsecured; or
(ii) any debt or receivables secured by, mortgage of, or charge on, immovable property; or
(iii) a mortgage, charge, hypothecation or pledge of movable property; or
(iv) any right or interest in the security, whether full or part underlying such debt or receivables; or
(v) any beneficial interest in property, whether movable or immovable, or in such debt, receivables, whether such interest is existing, future, accruing, conditional or contingent; or
(vi) any financial assistant;?
38. A plain reading of the above definition would reveal and connote that the term ?financial asset? includes debt and thereby the definition as contained in Section 2(g) of the The Recovery of Debts Due to Banks and Financial Institutions Act, 1993 is ushered in. As such, the phrase ?financial asset? and the term ?debt? including ?secured debt? are all interlinked and interwoven, interconnected and entwined with one another like a cobweb and the term ?debt? envisages the ?decree debt? as well as the ?debt recovery certificate.?
39. The learned Senior counsel for the plaintiff also by inviting the attention of this Court to sub-sections (1) and (2) of Section 13 of the Act would develop his argument that unless sub-sections (1) and (2) of Section 13 are attracted, the question of invoking Section 13(4) does not arise and accordingly if viewed, the debt recovery certificate cannot be taken as one contemplated under sub-section (1) or (2) of Section 13.
40. I am of the considered opinion that Section 13(4) as well as sub-sections (1) and (2) of Section 13 are widely worded to include even mortgage debts, which got crystallised in the form of a decree or debt recovery certificate. No doubt, the term ?debt recovery certificate? is not contemplated in the definition as contained under Section 2(g) of the The Recovery of Debts Due to Banks and Financial Institutions Act, 1993. But still, the clause, ?whether payable under a decree or order of any civil Court or any arbitration award or otherwise or under a mortgage and subsisting on, and legally recoverable on, the date of the application? would amply make the point clear that the said clause is wide enough to include even the debt recovery certificate. Accordingly, if viewed it is clear that ex facie and prima facie the notice issued under Section 13(4) of the SARFAESI Act on 27-7-2009 cannot be held to be one barred by limitation.
41. The learned counsel for the defendant would cite the decision of the Honourable Apex Court reported in (2008) 1 Supreme Court Cases 125: (AIR 2007 SC 712) Tanscore v. Union of India, certain excerpts from it would run thus:
?14. There is one more reason for enacting the NPA Act, 2002. When the civil Courts failed to expeditiously decide suits filed by the banks/FIs, Parliament enacted the DRT Act, 1993. However, DRT did not provide for assignment of debts to securitisation companies. The secured assets also could not be liquidated in time. In order to empower banks or FIS to liquidate the assets and the secured interest, the NPA Act was enacted in 2002. The enactment of the NPA Act is, therefore, not in derogation of the DRT Act. The NPA Act removes the fetters which were in existence on the rights of the secured creditors. The NPA Act is inspired by the provisions of the State Financial Corporations Act, 1951 (?the SFC Act?), in particular Sections 29 and 31 thereof. The NPA Act proceeds on the basis that the liability of the borrower to repay has crystallised; that the debt has become due and that on account of delay the account of the borrowers has become substandard and non-performing. The object of the DRT Act as well as the NPA Act is recovery of debt by non-adjudicatory process. These two enactments provide for cumulative remedies to the secured creditors. By removing all fetters on the rights of the secured creditor, he is given a right to choose on or more of the cumulative remedies. The object behind Section 13 of the NPA Act and Section 17 r/w Section 19 of the DRT Act is the same, namely, recovery of debt. Conceptually, there is no inherent or implied inconsistency between the two remedies. Therefore, as stated above, the object behind the enactment of the NPA Act is to accelerate the process of recovery of debt and to remove deficiencies/obstacles in the way of realisation of debt under the DRT Act by the enactment of the NPA Act, 2002.
66. We have already analysed the scheme of both the Acts. Basically, the NPA Act is enacted to enforce the interest in the financial assets which belongs to the bank/FI by virtue of the contract between the parties or by operation of common law principles or by law. The very object of Section 13 of the NPA Act is recovery by non-adjudicatory process. A secured asset under the NPA Act is an asset in which interest is created by the borrower in favour of the bank/FI and on that basis alone the NPA Act seeks to enforce the security interest by non-adjudicatory process. Essentially, the NPA Act deals with the rights of the secured creditor. The NPA Act proceeds on the basis that the debtor has failed not only to repay the debt, but he has also failed to maintain the level of margin and to maintain value of the security at a level is the other obligation of the debtor. It is this other obligation which invites applicability of the NPA Act. It is for this reason, that Sections 13(1) and 13(2) of the NPA Act proceed on the basis that security interest in the bank/FI needs to be enforced expeditiou
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sly without the intervention of the court/tribunal; that liability of the borrower has accrued and on account of default in repayment, the account of the borrower in the books of the bank has become non-performing. For the above reasons, the NPA Act states that the enforcement could take place non-adjudicatory process and that the said Act removes all fetters under the above circumstances on the rights of the secured creditor.? 42. As such, it is clear that the Bank is entitled to proceed under both the enactments, namely, DRT Act and SARFAESI Act. 43. The tour d?horizon of the learned counsel for the plaintiff would be to the effect that the bank being in an advantageous position, as per the The Recovery of Debts Due to Banks and Financial Institutions Act, 1993 as well as SARFAESI Act cannot be allowed to erode the right of an innocent person, by resorting to the draconian provisions of the Act and necessarily the Bank should be injuncted and a fair opportunity should be accorded to the plaintiff to put forth his case during trial. 44. To the risk of repetition and pleonasm without being tautalogous I would like to point out that necessarily the conduct of the plaintiff should be considered at the stage of granting injunction. Here my discussion supra would clearly denote and display that there are lot of facts which are speaking against the conduct of the plaintiff, so to say the plaintiff?s vendor?s vendors and without those clouds being dispelled or cleared; the plaintiff cannot be taken as the one who succeeded in establishing the prima facie case for obtaining injunction from this Court. As such, straightway no injunction could be granted in favour of the applicant/plaintiff. However, in view of the various contentious issues pleaded by the learned Senior counsel for the applicant/plaintiff, I am of the view that if at all any injunction could be granted, it should be subject to the following terms and conditions. The applicant/plaintiff should furnish security in the form of bank guarantee or deposit of cash to the tune of half of the claim made by the respondent bank. 45. The learned counsel for the respondent bank would submit that as on the date of granting of ad interim injunction by this Court, the amount due is favour of the bank was Rs.2,30,00,000/- and odd and half of it would come to Rs.1,15,00,000/-. 46. The learned counsel for the respondent bank insists for mandating the plaintiff to furnish security for the entire dues. However, if such a direction is given, in the facts and circumstances of this case, it may not be just and proper. Accordingly, the plaintiff is directed to furnish security to the tune of Rs.1,15,00,000/- (One crore fifteen lakhs) on or before 22-11-2009 and till then, the injunction already granted by this Court shall be in force and if there is any default, the injunction will get automatically vacated and it is open to the defendant to proceed further. On such furnishing of security, injunction shall continue pending disposal of the suit. 47. The learned counsel for the respondent bank would make an extempore submission that taking advantage of the order of this Court, the plaintiff shall not create any encumbrance over or alienate in any manner the suit property. 48. I would like to make it clear by ordering that the applicant/plaintiff shall not alienate or encumber the suit property, pending disposal of the suit. Accordingly, this application is disposed of. Order accordingly.