The Supreme Court observed that a time limit of 45 days for filing an application under Section 17 of SARFAESI Act is provided for quick enforcement of the security.
As per Section 17 of the SARFAESI Act, the application against measures to recover secured debts, has to be filed before the Debts Recovery Tribunal within forty five days from the date on which such measure had been taken.
In this case, the DRT dismissed the Section 17 application on the ground that it was filed beyond the statutory period of limitation of 45 days. Later it allowed the review petition filed against this order. The DRAT set aside this order observing that there has never been an error apparent on the face of record for exercising the review jurisdiction. A writ petition was filed challenging the DRAT order before the High Court, which stayed the DRAT order and allowed DRT to proceed with the Securitization Application.
In appeal, the Apex Court bench of Justices BR Gavai and PS Narasimha observed that the High Court was not justified in staying the operation of the order of the DRAT which came to the conclusion that there was no error apparent on the face of record for the DRT to invoke the review jurisdiction and recall its order. The court observed:
"The reason for providing a time limit of 45 days for filing an application under Section 17 can easily be inferred from the purpose and object of the enactment. In Transcore v. Union of India and Anr. this Court held that the SARFAESI Act is enacted for quick enforcement of the security. It is unfortunate that proceedings where a property that has been brought to sale and third-party rights created under the provisions of the Act, have remained inconclusive even after a decade."
Setting aside the impugned interim order, the bench directed the High Court to dispose of the Writ Petition expeditiously, preferably within a period of three months.
Bank Of Baroda vs Parasaadilal Tursiram Sheetgrah Pvt. Ltd. | 2022 LiveLaw (SC) 671 | CA 5240 of 2022 | 11 August 2022 | Justices BR Gavai and PS Narasimha
Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 ; Section 17 - The reason for providing a time limit of 45 days for filing an application under Section 17 can easily be inferred from the purpose and object of the enactment - SARFAESI Act is enacted for quick enforcement of the security. - Referred to Transcore v. Union of India and Anr (2008) 1 SCC 125. (Para 12)