Khajan Chandra Joshi vs. State Of Uttarakhand

Held

The Court held that the nature of the reliefs sought in the writ petition, which involved settling rights between rival entities and quashing proceedings under the SARFAESI Act and IBC, entailed an appreciation of evidence. Such an exercise is not within the scope of proceedings under Article 226 of the Constitution of India. Therefore, the writ petition was not amenable to writ jurisdiction. The Court dismissed the writ petition, but granted the petitioner liberty to pursue their remedies by seeking impleadment in the ongoing proceedings under the SARFAESI Act and IBC. The issue of priority of statutory dues over bank dues and the legality of the e-sale proceedings were not decided on merits.

Facts

The petitioner, Khajan Chandra Joshi, filed a writ petition seeking various directions. These included taking possession of factories at Industrial Estate, Patal Devi, Almora, quashing e-sale proceedings initiated by Dena Bank for assets of Alps Pharmaceutical Pvt. Ltd., and ensuring statutory dues of workmen, provident fund, central excise, income tax, and GST have priority over bank dues. The petition also aimed to safeguard the interests of the State government regarding a mortgage on land and the petitioner's investment in buildings, plant, and machinery. The core dispute appears to be between two rival entities, "Alps Pharmaceutical Company" and "Alps Pharmaceutical Private Limited," concerning their rights and properties. These properties were mortgaged with Dena Bank, leading to independent proceedings under SARFAESI Act and IBC.

Key Issues

1. Whether the High Court, under Article 226 of the Constitution of India, has the jurisdiction to entertain a writ petition seeking directions for the settlement of rights between rival entities and to quash proceedings initiated under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, and The Insolvency and Bankruptcy Code, 2016, especially when such reliefs entail appreciation of evidence. Petitioner's Arguments: The petitioner sought various directions to protect statutory dues and investments, implying a need for court intervention to ensure fairness and priority of certain claims over secured creditors. Respondents' Arguments: The respondents, through their counsel, implicitly argued that the nature of the reliefs sought requires detailed examination of evidence, which is beyond the scope of writ jurisdiction. The Court's reasoning suggests this was the prevailing argument leading to the dismissal.