Boltmaster India Private Limited vs The Board Of Directors Of Union Bank Of … on 3 January, 2025

Supreme Court – Daily Orders

Boltmaster India Private Limited vs The Board Of Directors Of Union Bank Of … on 3 January, 2025

Author: Hrishikesh Roy

Bench: Hrishikesh Roy

     ITEM NO.57                                 COURT NO.4                      SECTION X

                                      S U P R E M E C O U R T O F           I N D I A
                                              RECORD OF PROCEEDINGS

                                      Writ Petition(s)(Civil)      No(s).    7/2025

     BOLTMASTER INDIA PRIVATE LIMITED & ANR.                                          Petitioner(s)

                                                          VERSUS

     THE BOARD OF DIRECTORS OF UNION BANK OF INDIA & ORS.                             Respondent(s)

     Date : 03-01-2025 This petition was called on for hearing today.

     CORAM :                   HON'BLE MR. JUSTICE HRISHIKESH ROY
                               HON'BLE MR. JUSTICE S.V.N. BHATTI

     For Petitioner(s)                     Mr. Mathews J. Nedumpara, Adv.
                                           Ms. Maria Nedumpara, Adv.
                                           Ms. Hemali Kurne, Adv.
                                           Ms. Rohini Amin, Adv.
                                           Mr. Shameem Fayiz, Adv.
                                           M/S. Lawfic, AOR

     For Respondent(s)

                                UPON hearing the counsel the Court made the following

                                                       O R D E R

1. Heard Mr. Mathews J. Nedumpara, learned counsel appearing for

the petitioners.

2. The petitioners are facing proceedings under The

Enforcement of Security Interest Act, 2002. They have come

before this Court before this Court with the following

prayer:

“a) To declare that the failure on the part of
Signature Not Verified the Central Government/RBI to implement the MSMED
Digitally signed by
NITIN TALREJA
Date: 2025.01.04
Notification dated 29.05.2015, in particular, to
ensure that the Board of Directors of the
15:54:50 IST
Reason:

Banks/financial institutions in this country,

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including the Respondent Bank, constitutes a
committee for ‘stressed micro, small and medium
enterprise’ and further to prevent the Banks and
NBFCs from classifying the account of an MSME as
NPA and resorting to recovery under the SARFAESI,
RDB Act, IBC, NI Act, etc. in violation of the
prohibition to do so as contained in Paragraph 1
and 5(4)(iii) of the said notification, amounts
to gross failure on their part to comply with the
statutory duty cast upon them under Sections 35,
35A, 35AA, 36, 36AA of the Banking Regulation Act
and Sections 45-IE of the Reserve Bank of India
Act, and Sections 9 and 10 of the MSMED Act; and

b) To declare that the entire proceedings
initiated by the Respondent Bank as against the
Petitioner in violation of the notification dated
29.05.2015, which not a single bank/financial
institution in this country has given effect to,
is rendered void ab initio, still born, and that
that alone is the inevitable consequence because
the notification does not provide for any penal
provision for violation thereof, and that such an
inevitable legal consequence is not lost or
extinguished simply because an MSME, which the
law recognizes as predominantly weak and
financially illiterate, had failed to raise such
a plea; and

c) To declare that the Section 13 of the
SARFAESI Act, and Section 19 of the RDB Act,
Sections 7, 9, 10 and 95 of the IBC are
unconstitutional, ultra vires and void and are
liable to be so declared, inasmuch as the said
enactments are wholly one-sided, drafted on the
grossly erroneous premise that the right to
relief, nay, remedies, arise only at the hands of
a banker as against the borrower and that the
enquiry to be conducted is wholly onesided, or in
the alternative to declare that the borrower’s
right to be an actor/petitioner for the

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enforcement of his remedies has to be read into
the said Acts; and

d) To declare that Section 34 of the RDB Act,
and Section 34 of the SARFEASI Act and Section 63
of the IBC which bar the jurisdiction of the
Civil Court to entertain and adjudicate the
Petitioner’s/borrower’s plea against the
Respondent Bank nay, bank/financial institution,
is unconstitutional and void inasmuch as the
Petitioners, victims of the gross breach of
contract, culpable negligence, malicious and
tortious action, so too, violation of the express
statutory provisions at the hands of the
Respondent Bank, are entitled to institute an
action/suit as against the Respondent Bank for
the enforcement of the Petitioners’ right as
against them; and

e) Declare that the MSMED Act in so far as it
has not created a special forum/tribunal to
enforce the inter-se rights and
obligations/remedies, which it has created in
addition to those rights/obligations/remedies
recognized by the common law, the jurisdiction of
the Civil Court is not ousted, for it is
impossible to oust the jurisdiction of the Civil
Court without providing for an alternative
forum/tribunal to adjudicate the inter se
disputes between parties who are governed by the
Act, and further as a corollary thereof, the
DRTs, NCLTs created under the RDB Act 1993 and
the Companies Act 2013 are invested of no
jurisdiction to adjudicate a dispute arising out
of/involving the MSMED Act; and

f) To issue a writ in the nature of certiorari
or any other appropriate writ or order calling
for the entire records and proceedings leading to
the classification of the account of the
Petitioner as NPA, issuance of notices/orders

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under Section 13(2), 13(4) and 14 of the SARFAESI
Act and to quash and set aside the same.”

3. We see no reason to entertain the Writ Petition filed

under Article 32 containing the above prayers. The petition

is accordingly dismissed.

4. Pending application(s), if any, shall stand closed.

(NITIN TALREJA)                            (KAMLESH RAWAT)
ASTT. REGISTRAR-cum-PS                  ASSISTANT REGISTRAR




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