A bench of Justice BV Nagarathna and Justice R Mahadevan ruled so while dealing with a writ petition, seeking declarations against the proceedings initiated by the respondent under Sections 13(2), 13(4), and 14 of the SARFAESI Act, and Section 19 of the Recovery of Debts and Bankruptcy Act, 1993 (RDB Act).

Before the Supreme Court, the petitioner submitted that once a decree (including an ex-parte decree) has been passed, the principle of transit in rem judicatam applies, and the underlying cause of action merges into the decree. It was also contended that the general principle of res judicata would consequently bar any further proceeding on the same cause of action, and that the provisions of the SARFAESI Act could not have been invoked in the present case.

Considering the submission, the bench perused Section 35 of the SARFAESI Act which reads as, “35. The provisions of this Act to override other laws. - The provisions of this Act shall have effect, notwithstanding anything inconsistent therewith contained in any other law for the time being in force or any instrument having effect by virtue of any such law.”

Applying the aforesaid, the Supreme Court refused to accept the petitioner's contention. It, thus, held that, “having regard to the fact that the provisions of the SARFAESI Act, 2002 have an overriding effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force or any instrument having effect by virtue of any other law, we find that the provisions of the said Act would override.”

Case: KK Praveen v JM Financial Asset Reconstruction Company P Ltd & Ors

Citation : 2026 LiveLaw (SC) 932

Appearance:

For Petitioner: Dr Linto K.B., AOR; Mr Mathews J Nedumpara, Adv.; Ms Maria Nedumpara, Adv.; Ms Hemali Suresh Kurne, Adv.; Mr Shameem Fayiz, Adv.; Mr Samuel Dara, Adv.; Mr Jeevan R. Patil, Adv.; Mr Rakesh Kumar, Adv.