# Asset Reconstruction Co., India Ltd.(Arcil) v. State of U.P. & Ors

- **Citation:** (2022) 5 ILRA 371
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2022-05-25
- **Case number:** Writ C No. 6529 of 2022
- **Bench:** Surya Prakash Kesarwani, Jayant Banerji
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/asset-reconstruction-co-india-ltd-arcil-v-state-of-u-p-ors-48534
- **Pages:** 8

## Headnote

(A) Civil Law - Possession of secured asset
- The Securitisation and Reconstruction of
Financial
Assets
and
Enforcement
of
Security Interest Act, 2002 - Section 14(1)
- provide a machinery for empowering
banks,
financial
institutions
and
reconstruction company - power to take
possession of secured assets and to sell or
manage it - proviso to Section 14(1) of
SARFAESI Act, 2002 - on receipt of the
affidavit from the Authorised Officer, the
District
Magistrate
or
the
Chief
Metropolitan Magistrate, as the case may
be - shall after satisfying with the
contents of the affidavit - pass suitable
orders
for
the
purpose
of
taking
possession of the secured asset - within a
period of thirty days from the date of
application - if no order is passed within
the said stipulated period of thirty days
for reasons beyond his control - he may,
after recording reasons in writing for the
same, pass order within such further
period -not exceeding in aggregate sixty
days - inability to take possession within
the prescribed time-limit does not render
the District Magistrate Functus Officio.
(Para -8)

Petitioner is secured creditor - order passed
under secion 14(1) of SARFAESI Act - Staterespondents not given physical possession of
secured asset in question to petitioner - order
not complied with - dismissed by DRT -
respondent Nos.2 and 3 shift their responsibility
upon respondent No.4 - not taking any action
despite Government Order.(Para -3,4,5, )

HELD:- Direction to respondents Nos.1 and 4 to
give physical possession of secured asset in
question to petitioner-bank within one month &
also direction to the Chief Secretary of the State
to issue clear directions to all the concerned
authorities in the State to comply strictly the
provisions of Section 14 of the SARFAESI Act,
2002 and handover physical possession of the
secured asset to the concerned bank/ financial
institutions/ reconstruction company within the
prescribed
time,
if
there
is
no
legal
impediment.(Para - 11,12)
372 INDIAN LAW REPORTS ALLAHABAD SERIES
Writ Petition allowed. (E-7)

List of Cases cited:-

## Text

5 All. Asset Reconstruction Co., India Ltd.(Arcil) Vs. State of U.P. & Ors.
371
fact. Since it cannot be disputed that the
claimant is entitled to the insured amount,
we decline to offer any interference under
Article 226 of the Constitution on a
technical ground raised by learned counsel
for the petitioner that the order should have
been passed by the Committee and not the
District Magistrate, in her individual
capacity. The claimant-respondent being
eligible to receive Rs. 5,00,000/- from the
petitioner against the insurance policy, no
real prejudice has been caused to the
petitioner, by the impugned order."

6. The learned counsel for the
petitioner could not dispute the same.

7. In view of the final judgment
already rendered by coordinate Bench of
this Court, we do not find any good ground
to take a different view of the matter.

8. Accordingly, the petition stands
dismissed.
----------
(2022)05ILR A371
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 25.05.2022

BEFORE

THE HON'BLE SURYA PRAKASH
KESARWANI, J.
THE HON'BLE JAYANT BANERJI, J.

Writ C No. 6529 of 2022

Asset Reconstruction Co., India Ltd.(Arcil)
 ...Petitioner
Versus
State of U.P. & Ors. ...Respondents

Counsel for the Petitioner:
Sri Krishna Mohan Asthana

Counsel for the Respondent:
C.S.C.

(A) Civil Law - Possession of secured asset
- The Securitisation and Reconstruction of
Financial
Assets
and
Enforcement
of
Security Interest Act, 2002 - Section 14(1)
- provide a machinery for empowering
banks,
financial
institutions
and
reconstruction company - power to take
possession of secured assets and to sell or
manage it - proviso to Section 14(1) of
SARFAESI Act, 2002 - on receipt of the
affidavit from the Authorised Officer, the
District
Magistrate
or
the
Chief
Metropolitan Magistrate, as the case may
be - shall after satisfying with the
contents of the affidavit - pass suitable
orders
for
the
purpose
of
taking
possession of the secured asset - within a
period of thirty days from the date of
application - if no order is passed within
the said stipulated period of thirty days
for reasons beyond his control - he may,
after recording reasons in writing for the
same, pass order within such further
period -not exceeding in aggregate sixty
days - inability to take possession within
the prescribed time-limit does not render
the District Magistrate Functus Officio.
(Para -8)

Petitioner is secured creditor - order passed
under secion 14(1) of SARFAESI Act - Staterespondents not given physical possession of
secured asset in question to petitioner - order
not complied with - dismissed by DRT -
respondent Nos.2 and 3 shift their responsibility
upon respondent No.4 - not taking any action
despite Government Order.(Para -3,4,5, )

HELD:- Direction to respondents Nos.1 and 4 to
give physical possession of secured asset in
question to petitioner-bank within one month &
also direction to the Chief Secretary of the State
to issue clear directions to all the concerned
authorities in the State to comply strictly the
provisions of Section 14 of the SARFAESI Act,
2002 and handover physical possession of the
secured asset to the concerned bank/ financial
institutions/ reconstruction company within the
prescribed
time,
if
there
is
no
legal
impediment.(Para - 11,12)
372 INDIAN LAW REPORTS ALLAHABAD SERIES
Writ Petition allowed. (E-7)

List of Cases cited:-

1. B.O.B. Vs D.M. Maharajganj & ors. , Writ-C
No.1755 of 2022

2. C. Bright Vs The District Collector & ors. , AIR
2020 SC 5747 (para-20)

(Delivered by Hon'ble Surya Prakash
Kesarwani, J.
&
Hon'ble Jayant Banerji, J.)

1. Heard Sri K.M. Asthana, learned
counsel for the petitioner and Sri B.P. Singh
Kachhwah, learned standing counsel for the
State-respondents.

2. On 31.03.2022, this Court passed
the following order:

"Heard Shri Krishna Mohan
Asthana,
learned
counsel
for
the
petitioner and learned Standing Counsel
for the State-respondents.

This writ petition has been filed
praying for the following relief:

"i) issue an appropriate writ
order or direction of suitable nature,
commanding the respondent Authority,
the Additional District Magistrate (Fin
and Rev), Gautam Budh Nagar and the
Sub Divisional Magistrate Sadar, Gautam
Budh Nagar to complete the process of
physical possession of the immovable
secured asset to the petitioner situated at
House No. C-50, Sector 20, Noida,
District Gautam Budh Nagar UP 201001
as per the provisions under Section 14(2)
of the SARFAESI Act 2002 in compliance
of the order dated 07.10.2016 passed
under Section 14(1) of the Act, 2002 by
the Competent Authority under the Act
2002.

ii) Issue an appropriate writ
order or direction of suitable nature,
commanding the respondent no. 2, 3 & 4
to ensure actual physical possession of
the
immovable
mortgaged
property/secured asset to the petitioner
under the provisions of Section 14(2) of
the
SARFAESI
Act,
2002
without
requiring to deposit amount for providing
police force within a period to be
specified by this Hon'ble Court.

iii) Issue a writ order or direction
of
suitable
nature
commanding
the
respondent
authorities
to
extent
all
administrative/police
assistance
in
completing
the
process
of
physical
possession of the immovable property/
secured assets to the petitioner under
Section 14 of the SARFAESI Act, 2002."

Learned counsel for the petitioner
submits that more than five years have been
passed since the order under Section 14(1)
of the Securitisation and Reconstruction of
Financial Assets and Enforcement of
Security Interest Act, 2002 was passed yet
the respondent nos. 1 to 4 have not yet
given physical possession of the mortgaged
property.

Learned Standing Counsel prays
for and is granted 10 days' time to a
counter affidavit.

Petitioner shall have three days,
thereafter, to file a rejoinder affidavit.

Put up as a fresh case before the
appropriate Bench on 15.4.2022."

3. Undisputed facts of the present
case are that the petitioner is the secured
creditor. An order dated 07.10.2016 under
Section 14(1) of The Securitisation and
Reconstruction of Financial Assets and
Enforcement of Security Interest Act, 2002
(hereinafter referred to as ''SARFAESI Act,
2002') was passed by the respondent No.2.
Despite repeated request of the petitioner,
5 All. Asset Reconstruction Co., India Ltd.(Arcil) Vs. State of U.P. & Ors.
373
the State-respondents have not given
physical possession of the secured asset in
question to the petitioner. A counter
affidavit has been filed on behalf of the
respondent Nos.2 and 3. In paragraphs 12
and 17 of the counter affidavit, the
respondents
No.2
and
3,
i.e.
the
Additional District Magistrate and the
Sub-Divisional Magistrate, have stated as
under:

"12. That in reply to the
contents of paragraph Nos. 22 and 23 of
the writ petition it is stated that the
Respondent No. 5 challenged the order
dated
07.10.2016
before
the
Debt
Recovery Tribunal in SA No. 662 of
2016. The aforesaid SA was dismissed by
the Debt Recovery Tribunal vide order
dated 03.01.2022. It is further submitted
that the necessary action for handing
over the possession has to be taken at
the level of the Respondent no.4. It is
respectfully submitted that as per the
procedure
the
petitioner
had
to
coordinate with the Respondent No. 4 for
the compliance of order dated 07.10.2016
passed by the answering Respondent No.
2. From the pleading it is evident that the
petitioner at no point of time informed the
answering respondents that the order
dated 07.10.2016 has not been complied
with. It is also relevant to state that as
per the pleading itself, the matter
remained pending before DRT till
03.01.2022,
hence,
therefore,
the
possession could not have been handed
over to the petitioner till the decision of
the Debt Recovery Tribunal.

17. That in reply to the contents
of paragraph Nos. 31, 32 and 33 of the
writ petition it is stated that the
answering
respondents
have
already
passed the order for handing over the
physical possession of the mortgaged
property to the petitioner and further
action has to be taken by the police
department."

4. From the aforequoted paragraphs
No.2 and 3 of the counter affidavit filed
by the respondents No.2 and 3, it is
evident that the order dated 07.10.2016
passed by the respondent No.2 under
Section 14 of the SARFAESI Act, 2002,
was not complied with even after the S.A.
No.662 of 2016 filed by the respondent
No.5/ borrower was dismissed by the
DRT
on
03.01.2022.
From
the
aforequoted paragraphs of the counter
affidavit, it is also evident that the
respondent Nos.2 and 3 have attempted to
shift
their
responsibility
upon
the
respondent
No.4,
i.e.
the
Police
Commissioner, Varanasi Zone, Varanasi,
who is not taking any action despite the
Government Order dated 14.02.2022.

5. In the judgment dated 18.02.2022
passed in Writ-C No.1755 of 2022 (Bank of
Baroda vs. District Magistrate Maharajganj
and 4 others), this Court quoted the
Government
Order
dated
13.09.2021
whereby the State Government has issued
certain directions to all the District
Magistrate of the State of Uttar Pradesh. In
the aforesaid judgment in the case of Bank
of Baroda (supra), this Court observed in
paragraphs-7 to 12, as under:-

"7. The enclosures to the personal
affidavit of the Chief Secretary reveal that a
Government Order dated 13.09.2021 was
issued by the Secretary, Government of
Uttar Pradesh directing all the District
Magistrates of Uttar Pradesh to decide all
the pending cases under Section 14 of the
Securitization
and
Reconstruction
of
Financial Assets and Enforcement of
Security Interest Act, 2002 (in short
374 INDIAN LAW REPORTS ALLAHABAD SERIES
'SARFAESI Act') within 30 days (in case
there is no legal impediment to the same)
pursuant to the judgment dated 24.08.2021
passed by this Court. Further, the second
enclosure is another Government Order
issued by the Special Secretary to the
Government of U.P. dated 11.02.2022 to all
the District Magistrates directing strict
compliance of the Government Order dated
13.09.2021 issued pursuant to the judgment
and order dated 24.08.2021 passed in WritC No.7126 of 2021.

8. The judgment of this Court
dated 24.08.2021 has already been quoted
above. A specific direction has been issued
to all the District Magistrates of the State
to keep a record/register of all the pending
applications filed under Section 14 of the
SARFAESI Act that may clearly disclose
to the District Magistrate (on a fortnightly
basis) details of all institutions of such
applications made in that district and their
disposal within time. Further directions in
the judgment are as follows:-

"The said register may be duly
inspected by the District Magistrate from
time to time and also countersigned by
him. Based on the entries recorded in
such register, a quarterly report of all
institution of applications filed under
Section 14 of the Act together with the
length of pendency of each application be
sent to the Registrar General of this Court
in the tabular form that may indicate the
requirement of the Act is being fulfilled, in
letter and spirit, who shall place the same
before the appropriate Committee dealing
with the functioning of the Debt Recovery
Tribunals and Debt Recovery Appellate
Tribunals."

9. There is nothing on record to
demonstrate that the District Magistrates
are maintaining record/registers and are
monitoring the disposal of applications
filed under Section 14 of the SARFAESI
Act. The counter affidavit filed on behalf of
the District Magistrate in the case in hand
reflects that by an order dated 22.05.2017,
this Court in Writ-C No.22486 of 2017
directed further proceedings against the
respondent no.2 to be kept in abeyance with
liberty to deposit the demanded amount
with up-to-date interest with four equal
installments with the last installment to be
paid by 30.06.2018. It has nowhere been
stated in the counter affidavit that the
application under Section 14 of the
SARFAESI Act could not be disposed of by
the authority concerned for want of
information regarding non-compliance of
the aforesaid judgment and order dated
22.05.2017 passed by this Court in Writ- C
No.22486 of 2017. Rather, it has been
stated that due to COVID-19, the judicial
work was suspended in the last years.

10. Such a conduct by the
authority, charged with deciding/disposing
of the applications filed under Section 14 of
the SARFAESI Act, cannot but be said to be
action taken pursuant to the order dated
10.02.2022 passed by this Court in the
present writ petition. It is evident that the
Government Order dated 13.09.2021, that
has been enclosed as Annexure-1 to the
personal affidavit filed by the Chief
Secretary has been neglected by the
respondent-authority/the authority seized of
the case under Section 14 of the SARFAESI
Act.

11. This Court is dealing with
several writ petitions every week being
filed by secured creditors seeking directions
to the District Magistrate for deciding
applications under Section 14 of the
SARFAESI Act.

12. Under the circumstances, it is
for the Chief Secretary of the State to take a
serious look at the state of affairs and
ensure compliance of the judgment and
order dated 24.08.2021 passed by this
5 All. Asset Reconstruction Co., India Ltd.(Arcil) Vs. State of U.P. & Ors.
375
Court as well as the Government Orders
issued by the Government itself and take
suitable action for violation of the same.
We also direct the Chief Secretary of State
of Uttar Pradesh to also ensure compliance
of those directions in the judgment dated
24.08.2021 which are highlighted in bold
letters above."

6. Legislative Mandate of Section 14
of the SARFAESI Act, 2002 is to the Chief
Metropolitan Magistrate or the District
Magistrate within whose jurisdiction the
secured asset or other documents relating
thereto may be situated or found, and the
aforesaid two officers are statutorily bound
to take possession thereof, and even the
Chief Metropolitan Magistrate or the
District Magistrate, as the case may be, on
the request being made to him, are
statutorily bound to take possession of such
asset and documents relating thereto and to
forward the such asset and documents to
the
secured
creditors
provided
an
application is submitted by the secured
creditor accompanied by an affidavit
containing averments as provided
in
Section 14 of the Act.

7. In the case of C.Bright vs. The
District Collector & Ors. AIR 2020 SC
5747 (para-20), Hon'ble Supreme Court
held as under:-

"20. The Act was enacted to
provide a machinery for empowering banks
and financial institutions, so that they may
have the power to take possession of
secured assets and to sell them. The DRT
Act was first enacted to streamline the
recovery of public dues but the proceedings
under the said Act have not given desirous
results. Therefore, the Act in question was
enacted. This Court in Mardia Chemical,
Transcore and Hindon Forge Private
Limited has held that the purpose of the Act
pertains to the speedy recovery of dues, by
banks and financial institutions. The true
intention of the Legislature is a determining
factor herein. Keeping the objective of the
Act in mind, the time limit to take action by
the District Magistrate has been fixed to
impress upon the authority to take
possession of the secured assets. However,
inability to take possession within time
limit
does
not
render
the
District
Magistrate Functus Officio. The secured
creditor has no control over the District
Magistrate who is exercising jurisdiction
under Section 14 of the Act for public good
to facilitate recovery of public dues.
Therefore, Section 14 of the Act is not to be
interpreted literally without considering the
object and purpose of the Act. If any other
interpretation is placed upon the language
of Section 14, it would be contrary to the
purpose of the Act. The time limit is to
instill a confidence in creditors that the
District Magistrate will make an at- tempt
to deliver possession as well as to impose a
duty on the Dis- trict Magistrate to make
an earnest effort to comply with the man-
date of the statute to deliver the possession
within 30 days and for reasons to be
recorded within 60 days. In this light, the
remedy under Section 14 of the Act is not
rendered redundant if the Dis- trict
Magistrate is unable to handover the
possession. The District Magistrate will
still be enjoined upon, the duty to facilitate
delivery of possession at the earliest."

8. Thus, the law stands settled that the
SARFAESI Act, 2002 has been enacted to
provide a machinery for empowering
banks,
financial
institutions
and
reconstruction company, so that they may
have the power to take possession of
secured assets and to sell or manage it. The
purpose of the SARFAESI Act, 2002
376 INDIAN LAW REPORTS ALLAHABAD SERIES
pertains to the speedy recovery of dues by
banks,
financial
institutions
and
reconstruction
company.
The
second
proviso to Section 14(1) of the SARFAESI
Act, 2002 itself mandates that on receipt of
the affidavit from the Authorised Officer,
the District Magistrate or the Chief
Metropolitan Magistrate, as the case may
be, shall after satisfying with the contents
of the affidavit, pass suitable orders for
the purpose of taking possession of the
secured asset within a period of thirty
days from the date of application and if
no order is passed within the said
stipulated period of thirty days for
reasons beyond his control, he may, after
recording reasons in writing for the
same, pass order within such further
period but not exceeding in aggregate
sixty days. However, inability to take
possession within the prescribed timelimit does not render the District
Magistrate Functus Officio. The District
Magistrate or the Chief Metropolitan
Magistrate, as the case may be, is under
statutory obligation. Section 14 of the
SARFAESI
Act,
2002
itself
creates
statutory obligation upon the District
Magistrate or the Chief Metropolitan
Magistrate, as the case may be, for public
good to facilitate recovery of public dues,
to instil a confidence in creditors that the
District Magistrate will make an attempt to
deliver possession as well as imposes a
duty on the District Magistrate to make an
earnest effort to comply with the mandate
of the statute to deliver the possession
within the prescribed time. Even if the
prescribed time limit has passed over and
the District Magistrate could not handover
possession of the secured asset, still the
District
Magistrate
or
the
Chief
Metropolitan Magistrate, as the case may
be, will be enjoined upon the duty to
facilitate the delivery of possession at the
earliest. In the light of the these settled
position and a clear statutory mandate, the
stand taken by the respondents in the
counter affidavit is nothing but prima facie
a disobedience of the legislative mandate of
the Government Orders as well the
judgments of Hon'ble Supreme Court and
this Court.

9. That apart, it appears that pursuant
to order dated 24.08.2021 passed in Writ-C
No.7126 of 2021, the State Government
has
issued
a
Government
Order
No.117fjV@6&iq0&11&22&15fjV@2022
dated 14.02.2022, which is reproduced
below:

"ई-
मेल/
कोटशकेस/
अत्यन्त
महत्वप णश

सूंख्या- 117 ररट/ 6 - पु० - 11 - 22 -
15ररट/2022

प्रेषक,

अवनीर् कुमार अवस्थी,

अपर मुख्य सभचव,

उत्तर प्रदेर् र्ासन।

सेवा में,

1- पुलिस आयुक्त,

 लखनऊ/
कानपुर/ वाराणसी/ गौतमबुद्धनगर।

2- समस्त वरिष्ठ पुलिस अधीक्ष / पुलिस
अधीक्षक,

उत्तर प्रदेर्।
गृह (पुभलस) अनुिाग-11 लखनऊः
भदनाूंक 14 फरवरी, 2022

भवषयः-
भसक्योररटाइजेर्न
एूंड
ररकन्स्ट्रक्शन आफ फाइनेंभर्यल एसेट्स एूंड
एनफोसशमेंट आफ भसक्योररटी इूंटरेस्ट एक्ट
(सरफेसी अभधभनयम- 2002) की धारा - 14 के
अन्तगशत कायशवाही भकये जाने के सम्बि में।

महोदय,
5 All. Asset Reconstruction Co., India Ltd.(Arcil) Vs. State of U.P. & Ors.
377

उपयुशक्त भवषयक श्री बीपी भसूंह कछवाह,
स्थायी
अभधवक्ता
मा०
उच्च
न्यायालय,
इलाहाबाद
के
पत्र
भदनाूंक
13.01.2022
(छायाप्रभत सूंलग्न) का कृपया सूंदिश ग्रहण करने
का कष्ट करें।

2- उल्लेखनीय है भक भसक्योररटाइजेर्न
एूंड ररकन्स्ट्रक्शन आफ फाइनेंभर्यल एसेट्स
एूंड एनफोसशमेंट आफ भसक्योररटी इूंटरेस्ट एक्ट
(सरफेसी अभधभनयम- 2002) की धािा -14 के
अन्तर्गत दायि सभी िम्बित प्रकिण ों क
लिस्तारित कििे के दौिाि लििालधकारिय ों
द्वािा
यथावश्यकता
माोंर्
कििे
पि
लियमािुसाि आवश्यक पुलिस बि (यभद
भकसी प्रकार की कोई कान नी/ भवभधक बाधा न
हो तो) उपिब्ध किाये िािे का प्रालवधाि है।

3- इस सम्बि में भवत्त भविाग के भवत्त
(सूंस्थागत) अनुिाग- 35 के र्ासनादेर् सूंख्या-
533 बी/ भव० (सूं०) अनु०- 35- 2021, भदनाूंक
13.09.2021 की प्रभत सूंलग्न कर प्रेभषत करते हुये
मुझे यह कहने का भनदेर् हुआ है भक उपरोक्त
भनदेर्ो का कडाई के साथ अनुपालन सुभनभित
भकया जाय। यभद इन भनदेर्ो के अनुपालन मे
भर्भथलता हेतु भकसी अभधकारी/ कमशचारी को
उत्तरदायी पाया जाता है, तो उसके भवरूद्ध
सूंगत भनयमोूं के अन्तगशत दण्डात्मक कायशवाही
की जायेगी।

सोंिग्नकः यथ परि।

िवदीय,

(अवनीर् कुमार अवस्थी)

 अपर मुख्य सभचव।

सोंख्य एवों लदिाोंक तदैव।

प्रलतलिलप लिम्नलिम्बित क सूचिाथग एवों
आवश्यक कायगवाही हेतु प्रेलितः-

1- पुभलस महाभनदेर्क, उत्तर प्रदेर्,
लखनऊ।

2- अपर पुभलस महाभनदेर्क (कान न
एवूं व्यवस्था), उत्तर प्रदेर्, लखनऊ।

3-
अपर
पुभलस
महाभनदेर्क,
प्रयागराज जोन, प्रयागराज।

4- गाडश फाइल।

आज्ञा से,

(राकेर् कुमार मालपाणी)

भवर्ेष सभचव।"

10. Counter affidavit filed by the
respondent Nos.2 and 3 is apparently in
defiance of judgments of this Court as well
as the direction issued by the State
Government from time to time particularly
the aforequoted G.O. dated 14.02.2022.
Thus, the facts as stated leaves no manner
of doubt that there is failure on the part of
the respondent Nos.1 to 4 to discharge their
duty under Section 14 of the SARFAESI
Act, 2002.

11. For all the reasons aforestated, the
writ petition is allowed. The respondent
Nos.1 and 4 are directed to give physical
possession of the secured asset in question
to the petitioner-bank within one month, if
there is no legal impediment.

12. We also direct the Chief Secretary
of the State of Uttar Pradesh to issue clear
directions to all the concerned authorities in
the State of Uattar Pradesh to comply
strictly the provisions of Section 14 of the
SARFAESI Act, 2002 and
handover
physical possession of the secured asset to
the concerned bank/ financial institutions/
reconstruction
company
within
the
prescribed time, if there is no legal
impediment. Such direction shall be issued
by the Chief Secretary within two weeks
from today.

13. Let a copy of this order be sent
by the Registrar General of this Court to
the Chief Secretary of the Government of
Uttar Pradesh within three days, for
compliance.
----------
378 INDIAN LAW REPORTS ALLAHABAD SERIES
(2022)05ILR A378
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 20.04.2022

BEFORE

THE HON'BLE VIVEK KUMAR BIRLA, J.
THE HON'BLE VIKAS BUDHWAR, J.

Writ C No. 7603 of 2022

M/s CALSTAR STEEL LTD. & Anr.
 ...Petitioners
Versus
NORTH EASTERN RAILWAY & Ors.
 ...Respondents

Counsel for the Petitioners:
Sri Ravi Kant, Sri Uday Gupta, Sri Adarsh
Bhushan

Counsel for the Respondents:
A.S.G.I., Sri Krishna Agarwal

(A) Arbitration Law - Arbitration and
Conciliation Act, 1996 - Sections 7,9 & 17 -
Interim measures ordered by arbitral
tribunal - arbitration is an important
alternative
dispute
redressal
process
which
needs
to
be
encouraged
-
availability of alternative remedy does not
preclude the High Court from entertaining
a writ petition in appropriate case - Court
while entertaining a writ petition has to
bear-in-mind the fact as to whether the
dispute so raised does not involve factual
issues which comprise complex questions
of fact. (Para -24,27 )

(B) Writ Jurisdiction - High Court should
not
exercise
its
extraordinary
writ
jurisdiction
when
an
efficacious
alternative remedy is available - is a Rule
of prudence and not a Rule of law - Rule of
alternative remedy is a Rule of discretion
and not a Rule of jurisdiction - Merely
because the Court may not exercise its
discretion, is not a ground to hold that it
has no jurisdiction- it will be for the High
Court to decide in the peculiar facts and
circumstances of each case whether it
should exercise its extraordinary writ
jurisdiction or not. (Para -28)

Certain dispute arose with respect to land
allotted to petitioners - manufacturing BG PSC
sleepers - excess possession of the land beyond
the land allotted to them - entailed to
correspondence being exchanged from time to
time - contract in writing executed between
respondents and petitioners - arbitration
clause
- petitioners signatories to the
agreement - issue in question itself arbitrable -
within the scope of arbitration clause which can
be
entertained
and
adjudicated
by
the
arbitrator.(Para -6,7,25 )

HELD:-
Dispute raised by parties centers
around
factual
issues
wherein
complex
questions
of
facts
are
involved
whose
determination requires oral evidence. Court
under Article 226 of the Constitution of India
cannot
make
any
enquiry
into
disputed
questions of fact while taking evidence. writ
petition not maintainable on the ground of
alternative efficacious remedy as provided under
Clause 23 of the agreement, leaving it open to
the petitioners to seek remedy as available
under Section 23 of the Act of 1996. (Para -30
)

Writ Petition dismissed. (E-7)

List of Cases cited:-

1. St. of J & K & anr. Vs Dev Dutt Pandit ,
(1999) 7 SCC

2. U.O.I. Vs Varindera Constructions Ltd. &
ors., (2018) 7 SCC 794

3. U.P.P.T.C. Ltd. & anr. Vs CG Power &
Industrial Solutions Ltd. anr. , AIR Online 2021
SC 243

4. Bal Krishna Ram Vs U.O.I. & anr. , 2020 (2)
SCC 442

5. P.N.B. & ors. Vs Atmanand Singh & ors.,
(2020) 6 SCC 256

(Delivered by Hon'ble Vivek Kumar Birla, J.