SC Resolves Conflict Between SARFAESI Act & Rent Control Act

It… saddens us to see the manner in which the decision in the case of Harshad Govardhan Sondagar, (2014) 6 SCC 1 has been misinterpreted… random sentences have been picked up from the judgment and used, without any attempt to understand the true purport of the judgment in its entirety. It is a well settled position of law that a word or sentence cannot be picked up from a judgment to construe that it is the ratio decidendi on the relevant aspect of the case. The decision of this Court rendered in the case of Harshad Govardhan Sondagar cannot be understood to have held that the provisions of the SARFAESI Act override the provisions of the Rent Control Act, and that the Banks are at liberty to evict the tenants residing in the tenanted premises which have been offered as collateral securities for loans on which default has been done by the debtor/landlord… It is a settled position of law that once tenancy is created, a tenant can be evicted only after following the due process of law, as prescribed under the provisions of the Rent Control Act. A tenant cannot be arbitrarily evicted by using the provisions of the SARFAESI Act as that would amount to stultifying the statutory rights of protection given to the tenant.”

Hon’ble Justice V. Gopala Gowda, Vishal Kalsaria v. Bank of India, [Criminal Appeal No. 52 of 2016].

Hon’ble Justice V. Gopala Gowda was on the Bench in Harshad Govardhan Sondagar as well!

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