Kerala High Court
Deepa George vs S. Valsa on 8 July, 2026
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1
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE S.MANU
WEDNESDAY, THE 8TH DAY OF JULY 2026 / 17TH ASHADHA, 1948
FAO NO. 26 OF 2026
AGAINST THE ORDER DATED 25.02.2026 IN IA 3/2025 IN
OS NO.45 OF 2025 OF III ADDITIONAL SUB COURT, ERNAKULAM
APPELLANT/PETITIONER/PLAINTIFF:
DEEPA GEORGE
AGED 56 YEARS
W/O LATE DR.GEORGE C. JOSEPH, RESIDING AT 402B,
HILITE METROMAX FLATS, NEAR THONDAYAD BYPASS,
KOZHIKODE., PIN - 673016
BY ADVS.
SRI.C.S.MANU
SHRI.S.K.PREMRAJ
SMT.V.SARITHA
SRI.C.A.ANUPAMAN
SHRI.T.B.SIVAPRASAD
SMT.NEETHU.K.SHAJI
SRI.C.Y.VIJAY KUMAR
SMT.MANJU E.R.
SHRI.ALINT JOSEPH
SHRI.PAUL JOSE
SMT.ARUNIMA G.
SMT.DAINY DAVIS
SHRI.MAHESH KUMAR K.
SHRI.SHAMMY S.
SMT.PUNNIYA VIJAYABABU
SMT.ROANNA FLORA KURIAN
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RESPONDENTS/RESPONDENTS/DEFENDANTS:
1 S. VALSA
AGED 81 YEARS
W/O LATE P.T. JOSEPH, RESIDING AT DEEPTHI, B.T.S.
ROAD, EDAPPALLY P.O, KOCHI., PIN - 682024
2 DILU JOSEPH
AGED 53 YEARS
S/O LATE P.T. JOSEPH, RESIDING AT DEEPTHI, B.T.S.
ROAD, EDAPPALLY P.O, KOCHI., PIN - 682024
3 THE FEDERAL BANK LTD
BRANCH ERNAKULAM SOUTH, GRACE, NEAR SRV SCHOOL,
CHITTOOR ROAD, ERNAKULAM, REPRESENTED BY ITS
BRANCH MANAGER., PIN - 682011
4 THE AUTHORISED OFFICER & VICE PRESIDENT
FEDERAL BANK LTD., ERNAKULAM, STATIONED AT LCRD,
FEDERAL TOWER, MARINE DRIVE, ERNAKULAM,
PIN - 682031
5 SUBITHA K.K.
ADVOCATE COMMISSIONER, APPOINTED BY THE COURT OF
THE A.C.J.M (MP/MLA), ERNAKULAM, IN M.C NO.
1248/2024, RESIDING AT VELIKKATHARA HOUSE,
PANAMBUKAD, VALLARPADAM, ERNAKULAM., PIN - 682504
BY ADVS.
SRI.BOBY MATHEW
SHRI.SUNIL SHANKER
SRI.K.N.SIVASANKARAN
SMT.VIDYA GANGADHARAN
SHRI.THOMAS GLAISON
SHRI.ASHLIN SAJU
SMT.MEERA KAZHIPURATH
THIS FIRST APPEAL FROM ORDERS HAVING COME UP FOR
ADMISSION ON 17.06.2026, THE COURT ON 08.07.2026 DELIVERED
THE FOLLOWING:
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[CR]
S.MANU, J.
-------------------------------------------
FAO No.26 of 2026
--------------------------------------------
Dated this the 08th day of July, 2026
JUDGMENT
Appellant is the plaintiff in O.S.No.45 of 2025 on the files
of the third Additional Sub Court, Ernakulam. She has
approached this Court in this appeal, aggrieved by the dismissal
of I.A.No.3 of 2025. The application was filed for interim
injunction against the 3rd respondent from entering into or
trespassing into the plaint schedule property and taking
possession of the same in any manner whatsoever. Suit is for
declaration, partition and injunction.
2. Brief facts essential for disposal of this appeal are as
under:-
Respondents 1 and 2 are respectively the mother and
brother of the appellant. The appellant’s father owned and
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4possessed 15 cents of land and a residential building situated
therein comprised in Survey No.63 of Block 159 of Edapally
North Village. According to the appellant, her father purchased
the property, utilising his own funds. However, the sale deed
was registered in his name as well as in the name of the 1 st
respondent. The document was registered in 1969. After his
retirement, appellant’s father got involved in business activities
and suffered enormous losses. When he was facing legal
proceedings initiated by the creditors and Income Tax
Department, he instituted an insolvency petition before the Sub
Court, Ernakulam as I.P.No.1 of 1993. With the intention to save
the property from legal proceedings, he executed a release deed
in favour of 1st respondent as Document No.1487 of 1993 of
SRO, Edappally. Appellant asserts that no consideration was
paid by the 1st respondent either at the time of initial
procurement of the property or when the release deed was
executed in 1993. She further contends that the 1 st defendant
had no exclusive right over the plaint schedule property and she
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5was holding it only as a benamidar. However, she created a
mortgage in favour of 3rd respondent bank in the year 2008, to
facilitate a loan transaction for the benefit of the 2 nd respondent.
The mortgage was unauthorised, incompetent, null and void as
also illegal. According to the appellant, the 3 rd respondent bank
has not derived any right or interest in the plaint schedule
property by way of the alleged mortgage created by the 1 st
respondent. Appellant asserts that the said property is partible
and she is entitled for her due share.
3. As per the version of the appellant, she came to
know about the mortgage created by the 1 st respondent in
favour of the 3rd respondent only when she noticed a registered
notice issued by the 5th respondent Advocate Commissioner to
the 2nd respondent during a visit to the plaint schedule property.
Thereafter, she filed the suit and also the application for interim
injunction.
4. In the suit, appellant has sought the following
reliefs:-
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6“(i)Pass a decree in favour of the plaintiff for partition
of the plaint schedule property and for separate
possession of the ½ share of the 2/3rd’s share of the
plaint schedule property due to the plaintiff by metes
and bounds.
(ii) Pass a decree of declaration, declaring that the
mortgage if any created by the 1st defendant in favour
of the 3rd defendant bank is unauthorised, null and void
and illegal and did not bind the plaintiff’s father and the
plaint schedule property and also not binding on the
plaintiff.
(iii) Pass a decree of permanent injunction restraining
the 3rd defendant from entering into or trespassing into
the plaint schedule property and to take possession of
the same in any manner whatsoever.
(iv) Allow the cost of the suit to the plaintiff.
(v) Award such other reliefs that are deemed fit and
proper in the facts and circumstances of the case.”
5. The respondents 3 and 4 filed counter affidavit in the
I.A. besides written statement in the suit. They keenly disputed
every contention of the appellant. They pointed out that the
jurisdiction of the Court is barred under Section 34 of the
SARFAESI Act, 2002. They stated that the plaint schedule
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property is a secured asset. They relied on the judgment of the
Hon’ble Supreme Court in Jagdish Singh v. Heeralal and
others [AIR 2014 SC 371]. The respondents 3 and 4 narrated
how the property came to the ownership, possession and
enjoyment of the 1st respondent. They further stated that the
title deed of the property was deposited by the 1 st respondent
with the respondent bank at its branch in M.G. Road, Ernakulam
on 26.06.2008 to create equitable mortgage to secure the
amounts due under the credit limits availed by her for her
proprietorship business. Subsequently, the mortgage was
extended to the credit limits availed by a partnership firm of
which the 2nd respondent was also a partner. Later, the
mortgage was extended to enhance cash credit limits of some
other business establishments also. As the borrowers failed to
service the loan accounts, the same were classified as non-
performing assets on 28.03.2022 and 30.04.2022. Demand
notice was issued on 22.11.2022 and possession notice was
issued on 08.11.2023. Thereafter, M.C.No.1248 of 2024 was
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filed before the Additional Chief Judicial Magistrate’s Court,
Ernakulam, for taking physical possession of the secured asset.
The learned ACJM appointed an Advocate Commissioner. The
Commissioner issued notice to take actual possession of the
secured assets. It was at this point of time the appellant filed
the suit along with the application for interim injunction to
prevent the respondent bank from taking possession of the
property. According to the respondents 3 and 4, the suit is
collusive and filed without any bonafides, only to defeat the
proceedings initiated under the SARFAESI Act. The respondents
3 and 4 have disputed and denied every averment of the
appellant in her plaint as also in the affidavit filed in support of
the application for interim injunction.
6. The learned Sub Judge heard the respective counsel
for the parties and rejected the application for interim injunction
by the impugned order. The learned Judge accepted the
contention of the respondents 3 and 4 that in view of Section 34
of the SARFAESI Act, Civil Court has no jurisdiction to entertain
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a suit in respect of matters the Debt Recovery Tribunal or
Appellate Tribunal is empowered to decide and no injunction can
be granted by the Civil Court. The learned Sub Judge relied on
the judgment in Jagdish Singh (supra). The learned Sub Judge
noted that according to the admitted case of the appellant,
father of the appellant executed a release deed in favour of the
1st respondent in 1993 to defeat legal proceedings at the
instance of the creditors. The learned Judge held that such a
transfer was improper and the appellant has hence approached
the Court with unclean hands. The learned Judge also noted that
till the Advocate Commissioner issued notice to take actual
possession of the secured assets, no claim was raised by the
appellant at any point of time, for partition. The learned Sub
Judge concluded that prima facie case is in favour of
respondents 3 and 4. Likewise, the learned Judge found that the
balance of convenience is also in their favour. Further, the
learned Judge held that if the petition is allowed, irreparable
injury and hardships will be caused to respondents 3 and 4. The
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learned Judge, in a solitary sentence, noted that the decisions
relied on by the learned counsel for the appellant were not
applicable in the case. The application for interim injunction was
thus dismissed.
7. Before this Court, the learned counsel for the
appellant Sri.C.S.Manu vehemently submitted that the learned
Sub Judge has committed grave error by rejecting the
application for injunction. He submitted that the appreciation of
the contentions of the parties by the learned Sub Judge was
totally flawed. He argued that the learned Sub Judge has
rendered the order without ascertaining the extant position of
law with respect to Section 34 of the SARFAESI Act as explained
by the Hon’ble Supreme Court. He also submitted that the
learned Sub Judge has dealt with the application in a highly
prejudiced manner by holding that the appellant had not
approached the Court with clean hands for the reason that her
father had executed a release deed in order to defeat the claims
of his creditors long ago. The learned counsel raised a grievance
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that though several authoritative pronouncements of the
Hon’ble Supreme Court as also of various High Courts were
relied on by him during the course of arguments before the
learned Sub Judge, all those judgments were overlooked and
the learned Judge, in a single sentence, concluded that none of
the judgments cited by the learned counsel is applicable to the
facts of the instant case.
8. He submitted that the 1st respondent had no right to
create a mortgage with respect to the plaint schedule property.
Narrating the sequence of events from the point of time when
the property was purchased by the father of the appellant, he
argued that the 1st respondent was actually holding the property
only as a benamidar of the father of the appellant. No
contribution was made from her side for paying the sale
consideration when the property was bought in the name of the
father of the appellant as also of the 1 st respondent. Again,
when the release deed was executed, no consideration was paid
by her. The funds for acquiring the property were spent entirely
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by the father of the appellant. He submitted that on the demise
of the father, the appellant, the 1st respondent as also the 2nd
respondent gained rights in the plaint schedule property. The
learned counsel submitted that the property is unquestionably
partible and therefore the appellant has rightly instituted the
suit for partition.
9. He submitted that the bar under Section 34 of the
SARFAESI Act would not be attracted in the instant case for the
reason that a plea regarding partition cannot be decided by the
Debt Recovery Tribunal or the Appellate Tribunal. He submitted
that the legal position is now very clear and there is no absolute
bar under Section 34 to entertain any civil suit, on account of
pendency of proceedings under the SARFAESI Act. The bar
applies only to those suits wherein the dispute raised and the
reliefs sought are matters with respect to which the Debt
Recovery Tribunal has jurisdiction to entertain and decide. He
submitted that if the suit is for a relief which is not within the
scope of adjudication by the Debt Recovery Tribunal, it will be
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perfectly maintainable and the bar under Section 34 of the
SARFAESI Act can have no application. He pointed out the reliefs
sought in the suit by the appellant and submitted that the
foremost relief sought is for partition.
10. Sri.C.S.Manu further contended that the learned Sub
Judge has authority to issue an interim injunction also. He
argued that, if the suit is maintainable before the Civil Court,
the Civil Court inherently has authority to pass appropriate
interim orders to preserve the subject matter. Since the subject
matter of the suit instituted by the appellant is the plaint
schedule property over which the respondents 3 and 4 are
claiming rights, the Civil Court ought to have granted injunction
restraining the respondents 3 and 4 from taking possession of
the property. He submitted that the learned Sub Judge has
wrongly rejected the application for interim injunction without
appreciating the facts and circumstances and the law involved.
He therefore submitted that the appeal may be allowed and
interim injunction may be granted as prayed for.
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11. The learned counsel for the appellant relied on the
following judgments:-
1) Income Tax Officer,Cannanore v. M.K Mohammed Kunhi[1968 SCC OnLine SC 71]. 2) Dhulabhai v. State of Madhya Pradesh and Another[1968 SCC OnLine SC 40]. 3) Balkrishna Rama Tarle (dead through legal
representatives) and Another v. Phoenix ARC
Private Limited and Others [(2023) 1 SCC 273].
4) R.D. Jain and Company. v. Capital First
Limited and Anothers[(2023) 1 SCC 675).
5) Central Bank of India and Another v. Prabha
Jain and Others [(2025) 4 SCC 38].
6) KHDFC Bank Limited and Others v. Prestige
Educational Trust [2015 SCC OnLine Ker 22758].
7) Federal Bank Ltd. v. Chief Judicial Magistrate[2025 (3) KLT 146]. 8) Abdu v. Authorised Officer, Federal Bank Ltd[2016 (3) KLT 342] 9) Moosa V.K. v. The Authorised Officer/Deputy
General Manager [2025 Supreme (Online) (Ker)
24023].
10) South Indian Bank Ltd. v. Jahfer M [2025 SCC
OnLine Ker 1787].
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11) Sankaranarayanan v. Major Mathew [2025
Supreme(Online)(Ker)44887].
12) Rajiv Sareen v. Divyanshu Enterprises and
Others [2025 SCC OnLine Del 8354].
13) Bank of Baroda v. Gopal Shriram Panda and
Another[2021 SCC OnLine Bom 466].
14) P.Sathyanarayana v. V. Anjana Devi and
Others [2025 Supreme (Telangana) 809].
15) Bank of Baroda v. Sri Ranjan Chetia and
Others[2014 SCC OnLine Gau 154].
16) UCO Bank and Another v. Manjana Verma
Sahni and Another[2025 Supreme(Online)(HP)
8175].
17) ICICI Bank Ltd. v. Pramod Kumar Garg and
Another[2017 Supreme (Raj) 2413].
12. Conversely, the learned counsel for the respondents 3
and 4, Sri.Sunil Shankar, submitted that no interference is
warranted at the hands of this Court in this appeal. He
submitted that the order passed by the learned Sub Judge is
correct and liable to be upheld. The learned counsel submitted
that the suit was instituted by the appellant after the Advocate
Commissioner appointed by the learned Additional Chief Judicial
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Magistrate issued notice to take possession of the property. Until
then the appellant had not raised any claim for partition. He
pointed out that the demise of the father of the appellant
happened long ago. Thereafter, several years passed and the
appellant never ever raised any claim for partition. He submitted
that it is quite obvious that the appellant is permanently settled
at Kozhikode and she has no genuine rights in the plaint
schedule property. He submitted that the 1 st respondent is the
absolute owner in enjoyment and possession of the property
and she had every right to create a mortgage in favour of the
bank. The bank has proceeded only in accordance with law. He
submitted that the very purpose of incorporating Section 34 in
the SARFAESI Act is to prevent unscrupulous litigants from
making attempts to defeat the proceedings under the SARFAESI
Act by instituting frivolous suits. He contended that the suit has
been filed for partition only for the purpose to contend that it is
maintainable. The learned counsel submitted that the appellant
has filed the suit as an indirect method to defeat the
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proceedings under the SARFAESI Act in collusion with the
respondents 1 and 2. He relied on the following judgments:-
1) Asha Agarwal and Others v. Williamson Magor & Company Limited and Others [2022 SCC OnLine Cal 1389]. 2) Jagdish Singh v. Heeralal and others [(2014) 1 SCC 479].
13. I have elaborately heard the learned counsel for the
appellant and the learned Standing Counsel for respondents 3
and 4 who canvassed their respective contentions fervently.
14. The learned counsel for the appellant placed heavy
reliance on the judgment of the Hon’ble Supreme Court in
Central Bank of India (supra). He pointed out that in the said
case, a suit was filed for declaration of a sale deed as well as
subsequent mortgage to be a nullity and also for possession of
the suit property. The property was treated as a secured asset
by the bank and proceedings under the SARFAESI Act were
initiated. The trial court rejected the plaint in view of the bar
under Section 34 of the SARFAESI Act. Original plaintiff
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approached the High Court against rejection of the suit. High
Court held that the question relating to the validity of the sale
deed and consequent mortgage are matters which the Debt
Recovery Tribunal is not empowered to decide. Therefore, the
High Court held that jurisdiction of the Civil Court to decide
those matters cannot be held to be ousted under Section 34 of
the SARFAESI Act. The bank approached the Supreme Court
aggrieved by the judgment of the High Court. The Hon’ble
Supreme Court, after an elaborate survey of the provisions of
the SARFAESI Act, as also various previous judgments, rejected
the challenge against the view adopted by the High Court. It is
pertinent to note that the judgment in Jagadish Singh (supra)
was distinguished by the Hon’ble Supreme Court in Central
Bank of India(supra). The Hon’ble Supreme Court held that
the judgment in Jagadish Singh (supra) was rendered without
noticing that under Section 17 of the SARFAESI Act, DRT has no
power to partition properties and hence the Civil Court’s
jurisdiction to grant a decree of partition cannot be said to be
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ousted. It is plainly held in Central Bank of India (supra) that
the judgment in Jagadish Singh (supra) cannot be said to be a
precedent on the point. Therefore, the Hon’ble Supreme Court
has concluded in Central Bank of India (supra) that the law
laid down in Jagadish Singh (supra) is not applicable in the
case of suits filed for reliefs which cannot be adjudicated and
granted by the Debt Recovery Tribunal. Learned counsel for the
appellant has relied on various other judgments of different High
Courts also to canvass the proposition that Section 34 of the
SARFAESI Act does not act as a bar in the case of suits filed for
adjudication of issues which are not within the realm of the
jurisdiction of the Debt Recovery Tribunal.
15. I am not elaborately dealing with all those judgments
since in the course of hearing, the arguments were afterward
concentrated on a purely legal aspect as it was suggested to the
learned counsel on both sides to focus on the impact of the
second limb of Section 34, since clarity on the said facet was
found essential to decide the instant appeal.
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16. In that regard, learned Standing Counsel for the
respondents 3 and 4 submitted that he would also agree with
the contention that a genuine suit for partition of a secured
asset may not be hit by the embargo under Section 34 of the
SARFAESI Act. He submitted so without conceding that the suit
is filed by the appellant genuinely for a decree of partition and
without prejudice to the contentions of the bank. He submitted
that even if the suit is found not barred by Section 34 of the
SARFAESI Act, still the bar under the second part of the
provision will stand in the way of granting injunctions against
any proceedings under the SARFAESI Act. In other words, the
contention advanced is that the embargo under the latter part of
Section 34, pertaining to granting of interim injunctions, would
apply even if it is found that the suit is not hit by Section 34 of
the Act. I shall first deal with this contention.
17. Section 34 reads as under:-
“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
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21Recovery Tribunal or the Appellate Tribunal is
empowered by or under this 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).”
18. As noted above, an intricate analysis of the impact of
the second limb of Section 34 is essential in the instant case.
Keeping in mind the law laid down by the Hon’ble Supreme
Court in Central Bank of India (supra) and also by various
High Courts, as rightly pointed out by the learned counsel for
the appellant, I am of the view that Section 34 does not place a
total embargo in the matter of entertaining civil suits even if
proceedings under the SARFAESI Act are pending with respect
to the subject matter of the suit. It is now trite that the
restriction would apply only with respect to matters which can
be adjudicated and decided by the Debt Recovery Tribunal or by
the Appellate Tribunal as the case may be. The question arising
for consideration is therefore pertaining to the impact of the
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latter part of Section 34.
19. The second limb of S.34 forbids granting injunctions
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
the SARFAESI Act or the Recovery of Debts Due to Banks and
Financial Institutions Act, 1993. It is pertinent to note that the
provisions of the SARFAESI Act have overriding effect over other
laws by virtue of Section 35 of the Act. In Section 34, the
legislature has employed the coordinating conjunction ‘and’
between the two limbs of the provision. ‘And’ is usually
employed conjunctively. If ‘and’ employed in Section 34 is
construed conjunctively as canvassed by the learned counsel for
the appellant, the second limb would only mean that in suits
barred by the first limb, no order of injunction shall be issued by
a court or authority. If it is so construed, what would be the
result? If a suit is lodged in a civil court for adjudication of
matters that would fall within the ambit of the jurisdiction of
DRT, it will be hit by the first part of Section 34 and such a suit
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will not be maintainable. In the said situation, the latter part of
S.34 will have no meaning as the question of granting injunction
does not arise in a suit that is not maintainable. To put it
differently, if the embargo on granting of injunction against the
proceedings under the SARFAESI Act or the Recovery of Debts
Due to Banks and Financial Institutions Act, 1993 is reckoned
only as an extension of the first limb, the latter part would
become superfluous if the suit is hit by the first limb of the
Section. However, if the coordinating conjunction “and” is read
disjunctively and latter part of Section 34 regarding granting of
injunctions is reckoned to have an independent existence, the
entire provision can be interpreted meaningfully. In other words,
if it is held that the second part regarding granting of
injunctions would still apply even if the suit is not hit by the first
part of Section 34, the provision becomes entirely meaningful
and every word employed has force and effect. It is a
rudimentary principle of interpretation of statutes that every
word employed by the legislature should be given effect to. The
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Court shall not favour an interpretation that would render the
provisions or their limbs redundant. “And” is typically employed
as a coordinating conjunction; however, it is sometimes
interpreted disjunctively when it is necessary to carry out the
obvious legislative intent, while interpreting statutory
provisions.
20. In Ishwar Singh Bindra and Others v. State of
U.P. [1968 SCC OnLine SC 98] the Apex Court held as under:
“11. Now if the expression “substances” is to be taken
to mean something other than “medicine” as has been
held in our previous decision it becomes difficult to
understand how the word “and” as used in the
definition of drug in Section 3(b)(i) between
“medicines” and “substances” could have been
intended to have been used conjunctively. It would be
much more appropriate in the context to read it
disconjunctively. In Stroud’s Judicial Dictionary, 3rd
Edn. it is stated at p. 135 that “and” has generally a
cumulative sense, requiring the fulfilment of all the
conditions that it joins together, and herein it is the
antithesis of “or”. Sometimes, however, even in such a
connection, it is, by force of a contexts, read as “or”.
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Similarly in Maxwell on Interpretation of Statutes,
11th Edn., it has been accepted that “to carry out the
intention of the legislature it is occasionally found
necessary to read the conjunctions ‘or’ and ‘and’ one
for the other”.
21. In Municipal Corporation of Delhi v. Tek Chand
Bhatia [(1980) 1 SCC 158], the Hon’ble Supreme Court made
the following observations;
“11. In the definition clause, the collection of words
“filthy, putrid, rotten, decomposed and insect-infested”
which are adjectives qualifying the term “an article of
food”, show that it is not of the nature, substance and
quality fit for human consumption. It will be noticed that
there is a comma after each of the first three words. It
should also be noted that these qualifying adjectives
cannot be read into the last portion of the definition i.e.
the word’ “or is otherwise unfit for human consumption”,
which is quite separate and distinct from others. The
word “otherwise” signifies unfitness for human
consumption due to other causes. If the last portion is
meant to mean something different, it becomes difficult
to understand how the word “or” as used in the
definition of “adulterated” in Section 2(i) (f) between
“filthy, putrid, rotten etc.” and “otherwise unfit for
human consumption” could have been intended to be
used conjunctively. It would be more appropriate in the
context to read it disjunctively. In Stroud’s Judicial
Dictionary, 3rd Edn., Vol. 1, it is stated at p. 135:
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26“And’ has generally a cumulative sense requiring the
fulfilment of all the conditions that it joins together,
and herein it is the antithesis of ‘or’. Sometimes,
however, even in such a connection, it is, by force of
a context, read as ‘or’.
“While dealing with the topic ‘OR is read as AND, and
vice versa’, Stroud says in Vol. 3, at p. 2009:“You will find it said in some cases that ‘or’ means
‘and’; but ‘or’ never does mean ‘and’.”
Similarly, in Maxwell on Interpretation of Statutes, 11th
Edn., pp. 229-30, it has been accepted that “to carry
out the intention of the legislature, it is occasionally
found necessary to read the conjunctions ‘or’ and ‘and’
one for the other”. The word “or” is normally disjunctive
and “and” is normally conjunctive, but at times they are
read as vice versa. As Scrutton, L.J. said in Green v.
Premier Glynrhonwy State Co.: “You do sometimes read
“or” as “and” in a statute But you do not do it unless
you are obliged, because “or” does not generally mean
“and” and “and” does not generally mean “or”. As Lord
Halsbury L.C. observed in Mersey Docks & Harbour
Board v. Henderson the reading of “or” as “and” is not
to be resorted to “unless some other part of the same
statute or the clear intention of it requires that to be
done”. The substitution of conjunctions, however, has
been sometimes made without sufficient reasons, and it
has been doubted whether some of the cases of turning
“or” into “and” and vice versa have not gone to the
extreme limit of interpretation.”
22. Intention of the legislature in incorporating an
embargo specifically with respect to granting of injunctions
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against proceedings under the SARFAESI Act is perceptibly to
prevent the civil courts and other authorities from interdicting
the proceedings under the SARFAESI Act or the Recovery of
Debts Due to Banks and Financial Institutions Act, as the case
may be. On an analysis of the provision as a whole, keeping in
mind the settled principles regarding interpretation of statutes, I
am of the opinion that the latter part of the Section has been
resolutely incorporated to prevent the courts and other
authorities from passing orders of injunction, putting
proceedings under the SARFAESI Act or under the Recovery of
Debts Due to Banks and Financial Institutions Act on hold, even
in suits that are not hit by the first part of the provision. If any
other view is taken, the same would be against the established
principles regarding interpretation of statutes.
23. The learned counsel for the respondent had referred
to a judgment of a Division Bench of the Calcutta High Court in
Asha Agarwal and others v. Williamson Magor & Company
Limited and others [2022 SCC OnLine Cal 1389]. It was held
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as under by the court:-
“40. Section 34, as pointed out in Delta International
Limited (supra), clearly has two limbs – as regards the
bar to entertain any suit or proceeding is concerned,
the same was held to be restricted to the inception of
the suit. It was held that once the suit was entertained
and taken on board, there was no scope for dismissing
the same on the first limb of Section 34.
41. However, insofar as the bar to grant of injunction is
concerned, the same is covered by the second limb of
Section 34, which prevents Civil Courts from “granting”
injunction, which can be at any stage of the litigation.
42. Hence, the Trial Court did not commit any
jurisdictional error in observing that, although the suit
may be maintainable, the injunction as sought by the
plaintiffs cannot be granted.
……………………………………………………………………
45. In view of the disjunctive conjunction “and”, as
used in Section 34 of the SARFAESI Act to segregate its
two limbs, there is clear distinction between the
entertainability of a suit at the inception and the grant
of injunction at any stage of the proceeding, both of
which are debarred in respect of a civil court.
46. Hence, in the present case, even if we assume that
the suit was maintainable at the juncture when it was
first instituted, as on the date of passing of the
impugned order of injunction, measures under Section
13 of the SARFAESI Act had already been initiated,
thereby precluding the civil court from granting any
injunction. The injunction sought was a pre-emptive
measure intended to restrain the DRT from exercising
its powers conferred under the SARFAESI Act and in
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particular Sections 13 and 17 of the said Act.
47. In view of the overriding effect of Section 35 of the
SARFAESI Act, the said provisions of the DRT Act would
prevail over any other law, including Section 9 of the
Code of Civil Procedure.”
[ Emphasis added ]
24. It is also noticed that another Division Bench of the
Calcutta High Court in Delta International Limited & others
v. Smt.Nupur Mitra & others [2017 SCC OnLine Cal 13094]
held as under:-
“32. But even in a civil suit which is instituted at a
time when no measures have been taken by a notified
secured creditor or its authorised officer under Section
13(4) of the Act, no injunction can issue – even quia
timet – in respect of any action taken or to be taken in
pursuance of any power conferred by or under the
said Act of 2002 or the Act of 1993. The two limbs of
Section 34 of the said Act are complementary, operate
in tandem and are designed to serve the same
objective. At the stage when the provision first
appeared in the Ordinance that preceded the Act of
2002, it could not have had retrospective operation.
Thus, any suit filed prior to Section 34 of the said Act,
or the corresponding provision in the preceding
Ordinance, coming into operation could not be
regarded as bad even if the matters covered thereby
were capable of being determined by a DRT or DRAT
under the said Act or its preceding Ordinance. But
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30from the date that the provision became effective, no
injunction in respect of any action taken or to be taken
in pursuance of any power conferred by or under the
said Act (or its preceding Ordinance) or under the Act
of 1993 could be issued by any civil court. In suits
filed after such provision has come into effect, it is
possible that the entirety of the reliefs claimed may
not be capable of being granted by a DRT or DRAT. It
is here that the second limb of the provision acts as a
fall-back safety-net to arrest the mischief that it seeks
to do. Even if a civil suit is entertained which contains
some matter that a DRT or DRAT is empowered to
determine by or under the Act of 2002, but the plaint
thereof cannot be rejected since the entirety of the
subject-matter of such suit may not be capable of
determination by a DRT or DRAT; the second limb of
Section 34 prohibits any injunction to be issued by the
civil court in respect of any action taken or to be taken
in pursuance of any power conferred by or under the
said Act or under the Act of 1993.
33. As comprehensive as the bar is under the first
limb of Section 34 of the Act, the only construction
thereof is that the word “is” in the expression “is
empowered by or under this act to determine”
operates only in presenti. A DRT or DRAT has to have
authority to determine the entire-subject-matter of a
suit at the time of its institution, for the bar under the
first limb of such provision to be attracted. If the
authority to determine the subject-matter of the suit
vests in a DRT or DRAT after the institution of the suit,
the suit cannot be regarded as bad. It is here that the
second limb of the provision takes over as it prohibits
the interdiction of any action taken or to be taken in
pursuance of any power conferred by or under the Act
or under the Act of 1993. Thus, a plaint cannot be
rejected – and, similarly, refused to be received – if no
DRT or DRAT is empowered to determine the subject-
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matter thereof at the time of its institution. That is not
to say, however, that even if the bar operates and a
suit is accidentally received, the plaint relating to such
suit cannot be rejected later. It must only emphasised
that the bar operates at the threshold and not if a DRT
or DRAT becomes vested with the authority to
determine the subject-matter of the suit at any time
after the institution of the suit”
[Emphasis added]
25. It is also relevant to refer to a judgment of a learned
Single Judge of the Madras High Court in Sumathi v.
Sengottaiyan [2010 SCC OnLine Mad 1172] wherein it was
held as under:-
“11. True that the plaintiff may institute a Suit for
partition before the competent Civil Court but she
cannot lawfully challenge the proceedings initiated by
the secured creditor under the SARFAESI Act, before
the Civil Court as there is a clear bar under Section 34
of the SARFAESI Act. Section 34 of the SARFAESI Act
imposes a bar on the Civil Court to grant any relief of
injunction with respect to any action taken in
pursuance of the power conferred under the SARFAESI
Act. Therefore, the Trial Court has no authority to
entertain the prayer for injunction sought for by the
plaintiff as against the secured creditors who had
already initiated proceedings under the SARFAESI Act.”
[Emphasis added]
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26. I find support for the conclusions arrived at in the
previous paragraphs of this judgment regarding the impact of
the second limb of Section 34 of the SARFAESI Act in these
judgments of the Calcutta and Madras High Courts.
27. Nevertheless, the learned counsel for the appellant
referred to the judgment of a learned Single Judge of this Court
in KHDFC Bank Limited (supra) and relied on the following
paragraph:-
“22. With respect, I differ with the argument of the
learned Counsel for the petitioners that section 34
creates a blanket ban against the jurisdiction of the Civil
Court to grant an injunction. As per section 34, no
injunction shall be granted by any Court in respect of
“any action taken or to be taken in pursuance of any
power conferred by or under this Act……………”
Therefore, the bar is there only when an order of
injunction is attempted to be granted in respect of any
action taken or to be taken in pursuance of any power
conferred by or under that Act. It cannot be said that a
secured creditor or his authorised officer can initiate
proceedings under section 13(2) or 13(4) of the Act as
against any asset other than the secured asset’. If a
creditor is initiating action against an asset, which is not
a ‘secured asset’, he cannot be termed as a ‘secured
creditor’. Over and above it, such an attempt will not be
an exercise of any power conferred by or under the said
Act. In such case, it cannot be said that the Civil Court
has no power to grant an injunction. ………..”
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28. He submitted that in Abdu (supra) also the learned
Single Judge followed the judgment in KHDFC Bank Limited
(supra). He hence submitted that this Court has already
adopted the view that it is competent for the civil court to
entertain applications for interim injunctions in suits which are
not hit by Section 34 of the SARFAESI Act. Nevertheless, a
careful reading of the judgment in KHDFC Bank Limited
(supra) shows that this Court considered a substantially
different situation in the said case. In the opening paragraph of
the judgment the questions considered are delineated. The said
paragraph is extracted hereunder: –
“(i) Whether, in a case wherein proceedings under
Section 13 of the Securitisation and Reconstruction of
Financial Assets and Enforcement of Security Interest
Act, 2002 (hereinafter referred to as the ‘SARFAESI
Act‘) are initiated by a secured creditor against any
property, which is not a secured asset, the only remedy
available to such a person is to have recourse to
Section 17 of the said Act?
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(ii) In such a case, whether the jurisdiction of the civil
court to grant an injunction is barred under Section 34
of the SARFAESI Act?”
[Emphasis supplied]
29. Therefore, the primary question that was answered
by the learned Single Judge in KHDFC Bank Limited (supra)
was as to whether the only remedy available to a person
aggrieved by proceedings initiated by a secured creditor under
the SARFAESI Act against a property which is not a secured
asset is to have recourse to Section 17 of the Act. As a corollary
of the said issue the Court considered whether in such a case
jurisdiction of the civil court to grant injunction is barred under
Section 34 of the Act. The observations and conclusions in
KHDFC Bank Limited(supra) are to be understood in the
context of the questions framed for consideration in paragraph 1
of the judgment. In Abdu (supra), the judgment in KHDFC
Bank Limited(supra) was followed as the factual matrix was
similar. In the instant case, the suit property is indisputably a
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35
secured asset. Hence, the principles laid down in KHDFC Bank
Limited(supra) and followed in Abdu (supra) are not of any
help in the case on hand. A suit filed with respect a property,
that is not a secured asset stands on a totally different footing
regarding the applicability of Section 34.
30. It is essential to analyse the facts related to the case
while applying precedents, as the law is laid down based on the
factual matrix of the case. A miniscule distinction in the factual
contexts of two cases can have a profound impact on the legal
provisions and principles that are applicable. In this context it
is apposite to refer to the observations of the Hon’ble Supreme
Court in Union of India and another v. Arulmozhi Iniarasu
and others [(2011) 7 SCC 397]:-
“14. Before examining the first limb of the question,
formulated above, it would be instructive to note, as a
preface, the well-settled principle of law in the matter
of applying precedents that the Court should not place
reliance on decisions without discussing as to how the
fact situation of the case before it fits in with the fact
situation of the decision on which reliance is placed.
The observations of the courts are neither to be read
as Euclid’s theorems nor as provisions of statute and
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36that too taken out of their context. These observations
must be read in the context in which they appear to
have been stated. Disposal of cases by blindly placing
reliance on a decision is not proper because one
additional or different fact may make a world of
difference between conclusions in two cases. [Ref.
Bharat Petroleum Corpn. Ltd. v. N.R. Vairamani
[(2004) 8 SCC 579] ; Sarva Shramik Sanghatana (KV)
v. State of Maharashtra [(2008) 1 SCC 494 : (2008) 1
SCC (L&S) 215] and Bhuwalka Steel Industries Ltd. v.
Bombay Iron & Steel Labour Board [(2010) 2 SCC 273
: (2010) 1 SCC (L&S) 608].
[Emphasis Applied]
31. Hence the law laid down in a judgment should not be
mechanically applied in another case, neglecting the variances in
the factual matrices involved in both cases. I am therefore
unable to agree with the submission of the learned counsel for
the appellant that the principles laid down in KHDFC Bank
Limited (supra) and followed in Abdu (supra) can be applied to
decide the instant case.
32. It was vehemently submitted by the learned counsel
for the appellant that the power to preserve the subject matter
of a suit by issuing interim injunctions is available to every civil
court, if the suit is maintainable. He therefore contended that if
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the suit is not hit by the first limb of Section 34 of the SARFAESI
Act, it must be assumed that the civil court is competent to pass
appropriate interim orders including injunctions. The said
contention of the learned counsel for the appellant is also liable
to be rejected since Section 35 of the SARFAESI Act gives
overriding effect to the provisions of the Act. The intention of
the legislature in this regard cannot be overlooked. When
Section 34 of the Act is read in conjunction with Section 35, it is
obvious that the intention is to shield the proceedings under the
SARFAESI Act from being interdicted by any orders of injunction
issued by the courts or other authorities. The object and
purpose of SARFAESI Act was taken note of and explained by
the Hon’ble Supreme Court in Mardia Chemicals v. Union of
India [(2004) 4 SCC 311]. If the contention of the learned
counsel for the appellant is accepted, it will be against the
intention of the legislature manifested in Section 35 of the Act.
Hence the said contention is rejected.
33. Having considered the arguments advanced by both
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sides in the light of principles laid down by the Hon’ble Supreme
Court as also various High Courts, I am of the view that the two
limbs of Section 34 must be read distinctively. Otherwise, as
noted above, the latter part of Section 34 will become
meaningless in situations where suits are hit by the first part of
Section 34. Moreover, the apparent legislative intention to give
overriding effect to the provisions of the SARFAESI Act and to
ensure immunity to the proceedings under the SARFAESI Act
from interference by civil courts and other authorities cannot be
disregarded. Therefore, the resultant conclusion is that even if a
suit is not hit by the first limb of Section 34 of the SARFAESI
Act, no interim injunction can be granted by the civil court
against the proceedings under the SARFAESI Act or the
Recovery of Debts Due to Banks and Financial Institutions Act,
1993.
34. The impugned order, undoubtedly, is not supported
by valid reasoning. The learned Sub Judge relied on the
judgment in Jagdish Singh(supra) without noticing that the
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said judgment has been distinguished in Central Bank of India
(supra) and the Hon’ble Supreme Court has held that the former
judgment was rendered without noticing the scope of the
provisions of Section 17 of the Act. Learned Sub Judge
apparently did not make any reference to various judgments
cited by the learned counsel for the appellant. Though there are
serious flaws in the order passed by the learned Sub Judge, the
ultimate conclusion that no injunction can be granted is not
liable to be disturbed in view of the findings of this Court with
respect to the scope of the latter limb of Section 34 of the
SARFAESI Act. Therefore, the I.A. filed by the appellant for
interim injunction is not liable to be entertained as it is hit by
the second limb of Section 34 of the SARFAESI Act.
In the result, the appeal fails. It is accordingly dismissed.
No costs.
Sd/-
S.MANU
JUDGE
skj
