Reiterates that a High Court must consider subsisting orders of Debts Recovery Tribunals in SARFAESI matters; conflicting directions are not tenable and prior orders ignoring Tribunal restraint may be recalled. This judgment reaffirms precedent and clarifies procedural handling for banks and borrowers in financial sector recovery disputes. It serves as binding authority within the Calcutta High Court for quashing or recalling writ orders conflicting with pending DRT restraint.
Summary
| Category | Data |
|---|---|
| Case Name | WPA/15960/2025 of CANARA BANK Vs THE DISTRICT MAGISTRATE NORTH 24 PGS AND ORS |
| CNR | WBCHCA0328302025 |
| Date of Registration | 15-07-2025 |
| Decision Date | 28-10-2025 |
| Disposal Nature | DISMISSED |
| Judgment Author | HON’BLE JUSTICE AMRITA SINHA |
| Court | Calcutta High Court |
| Precedent Value | Binding within Calcutta High Court jurisdiction |
| Overrules / Affirms | Recalled earlier High Court order dated 24-10-2025 due to contradiction with DRT order |
| Type of Law | SARFAESI Act / Debt Recovery / Writ Jurisdiction |
| Questions of Law | Can the High Court direct enforcement of SARFAESI measures when a DRT restraining order is operative and was not brought to court’s notice? |
| Ratio Decidendi |
The High Court’s order directing enforcement of a District Magistrate’s order under the SARFAESI Act was passed in ignorance of a subsisting DRT order restraining such action. Since both the Tribunal’s and High Court’s orders were conflicting, and the earlier High Court order was passed without knowledge of the Tribunal order, the High Court has recalled its previous directive. Parties have been directed to pursue remedies before the DRT where proceedings are pending. The writ petition was accordingly dismissed. |
| Facts as Summarised by the Court |
The order dated 24th October 2025 directing the District Magistrate, North 24-Parganas to enforce an order was passed without knowledge of a restraining order issued by the DRT on 9th September 2025 in SA 335 of 2022, which was brought to the court only upon mentioning. The DRT’s order restrained the Bank from taking possession of the secured asset or acting on the District Magistrate’s direction pending the securitisation application filed by borrowers. |
Practical Impact
| Category | Impact |
|---|---|
| Binding On | All subordinate courts within the Calcutta High Court jurisdiction |
| Persuasive For | Other High Courts handling similar conflicts between DRT orders and writ proceedings |
| Overrules | Recalls Calcutta High Court order dated 24-10-2025 in same proceeding |
| Follows | Procedural propriety in ensuring harmony between Tribunal and High Court orders |
What’s New / What Lawyers Should Note
- High Court writ orders enforcing SARFAESI actions will be recalled if a contrary DRT stay/restraining order is shown to exist and was not disclosed earlier.
- Legal practitioners must ensure all relevant subsisting Tribunal orders are brought to the High Court’s notice when seeking writ directions in SARFAESI matters.
- This judgment establishes that failure to disclose relevant DRT restraints may result in dismissal or recall of High Court writs, even after disposal.
- Parties are specifically directed to pursue remedies before the Tribunal when DRT proceedings are pending.
Summary of Legal Reasoning
- The order of 24th October 2025 was passed by the High Court without knowledge of the DRT’s restraining order dated 9th September 2025 in SA 335 of 2022.
- The DRT’s order explicitly restrained Canara Bank from taking possession of the secured asset or proceeding based on the District Magistrate’s order until the pending securitisation application was disposed.
- The omission was unintentional, as the Bank’s advocate was unaware of the subsisting DRT order, so it could not be brought to the Court’s attention at the time of the earlier hearing.
- As both orders were contrary—one restraining and one directing enforcement—the High Court recalled its own order passed in ignorance of the Tribunal’s restraint.
- Parties were granted liberty to approach the DRT for further reliefs, and the writ petition was dismissed to avoid conflicting judicial orders.
Arguments by the Parties
Petitioner (Canara Bank)
- No express argument recorded in the order relating to the issue; however, earlier order for enforcement of recovery under SARFAESI was sought.
Respondent Nos. 6 to 8 (Borrowers)
- Submitted that the High Court’s earlier enforcement order was granted without considering the DRT’s prior order restraining the Bank from proceeding to take possession.
State
- No specific argument on the DRT restraint is recorded in the judgment.
Factual Background
The present writ arose from a SARFAESI dispute where Canara Bank sought enforcement of a District Magistrate’s order for possession of a secured asset. However, Respondent Nos. 6 to 8 brought to the High Court’s notice that the Debts Recovery Tribunal-I, Kolkata, had passed a restraining order on 9th September 2025 in SA 335 of 2022, against the Bank taking possession until the pending securitisation application was resolved. The High Court’s earlier order dated 24th October 2025—directing enforcement—was granted without awareness of the DRT’s restraint due to non-disclosure by the Bank’s counsel at the time.
Statutory Analysis
- The judgment involves application of the SARFAESI Act, especially concerning the power of District Magistrate to enforce measures for recovery.
- The DRT’s jurisdiction under the SARFAESI Act to issue interim restraint orders against banks from proceeding was recognized.
- The High Court clarified that its writ power cannot be exercised in a manner that conflicts with a subsisting DRT order under the SARFAESI Act.
- No “reading down” or constitutional interpretation is recorded in the judgment.
Procedural Innovations
- The Court permitted recall of its own writ order passed in ignorance of a relevant Tribunal order.
- Clarified that parties have liberty to approach the DRT for necessary reliefs, reinforcing the principle of parallel remedy before the Tribunal.
Alert Indicators
- ✔ Precedent Followed – Order recalling earlier High Court direction due to conflict with Tribunal restraint is consistent with procedural propriety and existing law on hierarchy and comity of judicial/tribunal orders.