Bombay High Court
Hinduja Finance Limited Amravati And … vs Indira Harishchand Katre And Others on 5 August, 2025
2025:BHC-NAG:7627
1 cra109.2024
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
NAGPUR BENCH : NAGPUR
CIVIL REVISION APPLICATION NO.109/2024
1. Hinduja Finance Limited
having Registered Office at:
Gawande Layout, Near Hotel
Kanhaiya Kunj, Ravi Nagar to
Sai Nagar Road, Amravati,
Tq. and Distt. Amravati.
2. Hinduja Finance Limited,
Branch Office at: 2nd Floor,
Shreejee Complex, Station Road,
Gondia.
Both the applicants are represented by its
Cluster Legal Manager and Authorised
Officer Shri Rahul Madhukar Nikure,
Aged about 34 years, R/o. Nagpur. ..(Ori. Deft Nos.3 & 4)
... Applicants
- Versus -
1. Indira Harishchand Katre
Aged about 54 years,
Occupation : Housewife,
R/o. Near Santoshi Daily Needs,
Fulchurpeth, Gondia,
Tah. and District Gondia.
2. Hemlata Mulchand Rahangdale
Aged about 47 years, Occupation: Housewife,
R/o. Godbole Layout, Jambhrun Road,
Buldhana, Tq. and District Buldhana. ..(Ori. Plft. Nos.1 & 2)
2 cra109.2024
3. Pritam Mulchand Rahangdale
Aged about 50 years,
Occupation: Business,
R/o Rajgopal Ward. Gondia,
Tah. and Distt. Gondia. ..(Ori. Deft No.1)
4. Mohini W/o Umed Bopche,
Aged about 48 years,
Occupation : Housewife,
R/o. Near Sai Mandir, Govindpur
Road, Gondia, Distt. Gondia. ..(Ori. Deft No.2)
... Non-applicants
-----------------
Mr. Krishna S. Motwani, Advocate for the applicants.
Mr. Aniket Narendra Rangari, Advocate for non-applicant
Nos. 1 and 2.
----------------
CORAM: MRS.VRUSHALI V. JOSHI, J.
DATE OF RESERVING THE JUDGMENT : 16.07.2025.
DATE OF PRONOUNCING THE JUDGMENT : 05.08.2025.
JUDGMENT
Rule. Rule made returnable forthwith. Heard finally
by consent of learned Advocates for the parties.
2. The applicants have approached this Court being
aggrieved and dissatisfied by the impugned order below Exh.22
dated 14.05.2024 in Regular Civil Suit No.41/2024 passed by
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the learned I/c. Joint Civil Judge, Junior Division, Gondia thereby
rejecting the application filed by the applicants-original defendant
Nos.3 and 4 under Section 34 of the Securitisation and
Reconstruction of Financial Assets and Enforcement of Security
Interest Act, 2002 (for short “Act of 2002”) read with Section 151
of the Code of Civil Procedure seeking rejection of plaint for want
of jurisdiction.
3. The facts, in brief, are as follows:-
The applicant-Hinduja Finance Limited is a
non-banking financial and registered company, engaged inter alia
in the business of rendering financial facilities in the form of loan
etc. to intending borrowers. The said company is represented by
its authorized officer Mr. Rahul Madhukar Nikure. The
non-applicant Nos.1 and 2 in the Regular Civil Suit No.41/2024
sought declaration that the mortgage of the property in favour of
defendant Nos.3 and 4 is null and void ab initio. They further
sought injunction restraining the applicants from taking
4 cra109.2024
possession of the suit property. The applicants, in response, filed
an application under Section 34 of the Act of 2002 read with
Section 151 of the Code of Civil Procedure, 1908 seeking
rejection of the plaint for want of jurisdiction. It is pointed out by
the applicants that since the bank loan account of original
defendant No.1 was classified as Non-Performing Assets (N.P.A.)
on account of default committed by him, the applicants initiated
recovery proceedings and filed a Miscellaneous Criminal
Application No.794/2022 before the Chief Judicial Magistrate,
Gondia.
4. Some of the major grounds on which the impugned
order rejecting the plaint is challenged are as under:-
(a) The suit in question is barred as per Section 34 of the
Act of 2002 which provides that the appropriate Authority
empowered to determine the jurisdiction under the said Act is any
Appellate Tribunal such as the Debt Recovery Tribunal and not a
Civil Court or other Authority.
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(b) The Regular Civil Suit No.41/2024 filed by the
non-applicants-original plaintiffs in collusion with defendant
Nos.1 and 2 is nothing but an effort to stall and defeat the
recovery proceedings which ultimately were certified by the
learned Chief Judicial Magistrate, Gondia, vide order dated
01.12.2022.
5. Learned Advocate for the applicants Mr. Motwani,
submitted that the suit filed by the non-applicant Nos.1 and 2 is
not only frivolous but also barred by non-disclosure of the actual
cause of action which is different altogether. It is vehemently
argued by the learned Advocate that the learned trial Court
committed an error in passing impugned order holding that the
suit property being ancestral one, the plaintiffs are heirs of
deceased Vimalabai Rahangdale and the trial Court committed an
error in holding that the defendant No.1 is not an exclusive owner
of the suit property and had no right to mortgage the same with
the present applicants.
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6. Learned Advocate for the non-applicants/original
plaintiffs Mr. Rangari strongly opposed the contentions made by
the applicants-original defendants. He contended that there is no
bar to file the suit. In view of the settled proposition of law and
guidelines laid down, the third party whose rights are infringed
can bring up a suit. He further submitted that the suit property
was ancestral property of the non-applicants and defendant Nos.1
and 2 have right in the same. Vimlabai Rahangdale was not alive
in the year 2013 when the suit property was mortgaged by
defendant No.1. Defendant Nos.3 and 4 have not taken consent
of the plaintiffs for the use of disbursement of loan amount to the
defendant No.1. On the date of loan agreement, the suit property
was not mutated in the name of defendant No.1. Defendant No.1
was not an exclusive owner of the suit property. Defendant No.1
has relinquished his right in the suit property in favour of the
plaintiffs. Defendant Nos.1, 3 and 4 have committed a fraud on
the plaintiffs.
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7. The application under Section 34 of the Act of 2002
is filed claiming that the Civil Court’s jurisdiction is ousted by the
provisions under Section 34 of the Act of 2002.
8. The learned Advocate for the applicants has relied on
the judgment of the Hon’ble Apex Court in the case of Central
Bank of India and another V/s. Smt. Prabha Jain and others
reported in 2025 SCC OnLine 121 wherein the Hon’ble Apex
Court has observed that the Act of 2002 has not been enacted for
providing a mechanism for adjudicating upon the validity and
documents or to determine question of title finally. The Debt
Recovery Tribunal does not have jurisdiction to grant a
declaration with respect to the mortgage deed or the sale deed as
sought by plaintiffs. The jurisdiction to declare a sale deed or a
mortgage deed being illegal is vested with the Civil Court under
Section 9 of the Code of Civil Procedure. Therefore, the Civil
Court has jurisdiction to finally adjudicate upon first two reliefs.
The reliance is also placed on the judgment passed by this Court
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in the case of Bank of Baroda, through its Branch Manager V/s.
Gopal Shriram Panda and another reported in 2021 SCC OnLine
466 wherein same question is referred before this Court i.e.
whether the jurisdiction of a Civil Court to decide all the matters
of civil nature, excluding those to be tried by the Debt Recovery
Tribunal under Section 17 of the Securitization Act, in relation to
enforcement of security interest of a secured creditor, is barred by
Section 34 of the Securitization Act. In this case this, Court has
observed as under:-
“23. Keeping in mind the principles as laid
down in Dhulabhai (supra), and what we have
considered and discussed above, when we ask
ourselves a question as to whether the DRT
exercising jurisdiction under Sections 13 and 17 of
the SARFAESI Act, has the power, nay jurisdiction
to determine the Civil Law rights, which may be
available to a person, in the security interest, in the
same manner as a Civil Court could ? or in other
words, can a person who claims a right of partition,
specific performance, reliefs under Sections 31 and
34 of the Specific Relief Act, preemption,
redemption, declaration in respect of a property
which is a security interest, approach the DRT for
claiming adjudication of his such claim ? and can the
DRT grant him such relief ? In our considered
opinion, the answer has to be in the negative for the
reason that it is not permissible for the DRT to
embark on an adjudication of the civil rights claimed
9 cra109.2024vis-a-vis the security interest, in light of the clear,
precise and specific language of Section 17(1) and
18 of the DRT Act read with Sections 13, 17 and 34
of the SARFAESI Act, as already discussed above.”
9. While discussing the question this Court in the
above-said case has observed as under:-
“22.3. A security interest may at times
also involve the common law rights of a citizen, who
is not a party to its creation. In such a circumstance,
can it be said that merely because a security interest
has been created and it has to be enforced in a
particular Forum in a particular manner, the citizen
whose common law right has been infringed, would
have to approach the Forum which has no
jurisdiction and wherewithal to decide and enforce
such violation. The following could be considered as
examples of this :-
(a) In Vineeta Sharma Vs. Rakesh Shrama
and others, (2020) 9 SCC 1, the Hon’ble Apex
Court, while considering the amendment to Section
6 of the Hindu Succession Act, 1956, whereby a
daughter was recognised as a coparcener, has held
that such recognition would give her right in the
coparcenary property by her birth in the coparcenary
and not from the date of death of her father or the
amendment. In such a matter if the male members of
the family have already created a security interest in
such coparcenary properties in favour of the Bank
and for non payment of dues, if the same are being
sought to be taken possession of and sold by auction,
under Section 13 of the SARFAESI Act, can the
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Special Forum, DRT herein, which is undertaking
this exercise, on being approached by the daughter
who now due to the amendment to the Hindu
Succession Act, 1956, has a share therein which
stands recognised retrospectively by the Apex Court,
decide and determine the rights of such daughter
and grant a preliminary decree delineating her share
and take further action to separate her share ? If it
cannot, then could it be said that the Civil Court
does not have the jurisdiction to do so, in view of the
bar created under Section 34 of the SARFAESI Act?
But if it is so held then the daughter in spite of
having a right in the CRA 29 of 2011.odt property
duly recognised by law, would be left remediless, as
she cannot go to the Civil Court nor the Special
Forum, the DRT, has any authority to determine the
extent of her right and grant her the relief which she
would be entitled to.
(d) Where on a prima facie demonstrable case, the
person who has created the security interest, was not
having any legal right in the property in respect of
which security interest is created.
(e) Where the Bank is aware from documents on
record that the borrower/mortgagor is not having
any absolute right in the property or is having a
limited right, contrary to which the security interest
is created in the whole of the property vis-a-vis the
CRA 29 of 2011.odt borrower/mortgagor who is
having only defined or undefined undivided
share/interest in the property and the entire property
is mortgaged.
(f) Where right of inheritance is claimed in the
property, in respect of which a security interest is
created.”
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10. The Court has further observed that these conditions
are indicative and point towards existence of Civil Court’s
jurisdiction, even in cases, where the security interest could also
become the subject matter of a litigation involving rights available
under the Civil law, and therefore each case has to be tested on its
own merits.
11. On perusal of plaint, it appears that the plaintiffs have
prayed for permanent injunction against the defendant
No.3-finance company claiming that the mortgage of the
property is null and void and to restrain the defendant No.3 from
taking the possession of the suit property. The remedy to seek
such relief is under the Act of 2002 before the Debt Recovery
Tribunal. The plaintiffs have stated that the defendant No.3 is
not the owner of the suit property, it is ancestral property and
defendant Nos.1 and 2 have relinquished their rights and,
therefore, the defendant No.1 has no right to mortgage the said
ancestral property. It appears from the record that the property
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was mortgaged in the year 2019. The relinquishment deed is of
the year 2023 and the plaintiffs and defendant Nos.1 and 2 are
the brother and sisters and the legal heirs of the original owner of
the suit property. The mother of plaintiffs Nos.1 and 2 and
defendant Nos.1 and 2 has purchased the said property. The
names were mutated in the year 2022 after the death of their
mother and the property was mortgaged in the year 2019. The
plaintiffs are directly challenging the order passed by the
Magistrate and praying for stay. The plaintiffs and defendants are
in relation. The sale deed of suit property is mortgaged by the
defendant No.1. The plaintiffs have stated that the suit property
is not the property which was mortgaged by the defendant No.1
as the alleged mortgage document or memorandum is in respect
of Gat No.144 whereas the publication is made in respect of the
suit property. All these questions can be raised before the Debt
Recovery Tribunal. No civil right is infringed in this case.
Therefore, though the defendants have relied on the judgments of
the Hon’ble Apex Court and this Court, wherein the observations
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are made that Civil Court is having jurisdiction if the civil rights
are infringed, as in the plaint, prayer is about the declaration of
the mortgage deed as null and void and whether the property
mentioned in mortgage deed is the same will be decided by the
Tribunal as it has the jurisdiction to decide the same. Therefore,
as no civil right is infringed in this case the civil Court has no
jurisdiction to entertain the suit filed by the non-applicant No.1.
Hence, interference at the hands of this Court is required.
Accordingly, I pass the following order:-
i) The civil revision application is allowed.
ii) The order dated 14.05.2024 below Exh.22 passed by I/c.
Joint Civil Judge, Junior Division, Gondia is hereby quashed and
set aside with no orders as to costs.
iii) Rule accordingly.
(MRS.VRUSHALI V. JOSHI, J.)
Tambaskar.
Signed by: MR. N.V. TAMBASKAR
Designation: PS To Honourable Judge
Date: 06/08/2025 11:22:03