Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 is a major turning point in the field of Banking Laws. One among the major peculiarities of this Act is that it gives the provision for easy recovery of assets. The process of taking posession of secured assets is faster than by a regular civil suit in a Court. The proceedings are ex parte. In fact, the Act itself is a notice to the defaulters.
But the borrowers are trying to override the provisions of the Act by filing injunction suits in civil courts either by themselves or through third persons/benamis. In fact there is little chance of success. They are filing the suit in civil court on the belief that they could defeat the power of banks or could delay the proceedings for a while. I don't think that any Court will give even temporary injunction against the proceedings initiated by the bank. In these days a great number of third party suits are being filed to delay the proceedings taken under the Act. But take note dear Advocates- the Act gives power to continue with the proceedings irrespective of any case before Civil Court.[AIR 2007 SC 712]
The Act provides a specific bar to civil suits in Section 34. It says:"No Civil Court shall have jurisdiction to entertain any suit or proceeding in respect of any matter which a Debts Recovery Tribunal or the Appellate Tribunal is empowered by or under this Act to determine and no injunction shall be granted by any Court or other authority in respect of any action taken or to be taken in pursuance of any power conferred by or under this Act or under the Recovery of Debts Due to Banks and Financial Institutions Act". But some parties are suppressing the matter of proceedings initiated under the Act for the purpose of getting an injunction. Even if they do not suppress the same, clever Advocates are being able to convince the Courts that there is no absolute bar. Any how the provision is clear. One thing is that the Court cannot grant injunction. But is there an absolute bar in filing/admitting a suit. If the Court cannot grant injunction, it may usually refrain from giving temporary relief also. But still such suits are being filed on the belief that the lengthy procedures of the Court in sending notices to the opposite party and the appearance and filing of written statements etc makes enough delay in the proceedings. 
Advocates convince that the Courts may be pleased to issue notice. Once notice is issued, the process goes on. So there is a 50% chance to succeed that also in delaying the proceedings. The Courts actually need not admit the suit and even if it admits as I stated above the proceedings will continue irrespective of suit. To make the point clearer we may refer to the wordings of Section 34. It is stated that "no civil Court shall have jurisdiction to entertain any suit....". So another question is "suit in respect to what matter?" The next words of the section is much clearer:"any matter which the Debts Recovery Tribunal by thus Act to determine". So it is clear that no one can bring a suit in respect of any matter which the DRT has power to determine under this Act. Now what sort of power do the DRT possess under this Act, or what do the DRTs determine. The answer for this can be found in Section 17 of the Act. It says that "any person (including borrower), aggrieved by any of the measures referred to in sub-section(4) of section 13 taken by the secured creditor or his authorised officer under this Chapter, may make an application along with such fee, as may be prescribed to the Debts Recovery Tribunal.....". Section 13(4) deals with the taking possession of secured assets. So it is clear that if any bank or secured creditor takes possession of the assets of any person under this Act, no one can bring a suit as a matter of right in view of the bar contained in Section 34 of the Act.
Further take note that whatever be stated in any other Act inconsistent with the SARFESI Act, Section 35 of the SARFESI makes its provisions override any other law. 
Decisions on the point of Jurisdiction
1.2004(2) KLT SC
2.Bhuvanendran v. LIC Housing Finance Ltd. 2009(4) KLT 72.

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