Two Telangana High Court judges reject SBI’s claim that it is better than market watchdog to recover amounts from defaulters
Published Date – 06:20 AM, Thu – 15 June 23
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Hyderabad: Two judges of the Telangana High Court comprising Justice P Naveen Rao and Justice Nagesh Bheemapaka dismissed two writ petitions filed by SBI against Sebi. The bench dismissed SBI’s claim that it had the upper hand over the market watchdog in recovering amounts from defaulters.
The issue concerns two private companies, Midfield Industries and SVCL Pvt Limited, which secured loans from SBI in 2004 and 2006 against immovable properties. As the company defaulted and the loan was declared NPA, SBI initiated recovery proceedings under the Sarfaesi Act.
However, the same was challenged by the SBI when the sub-registrar refused to register the property in the name of the successful bidder, citing the prohibition order passed by Sebi. The bank said it should be prioritized in the recovery as it disbursed loans long before Sebi issued the 2020 moratorium. It also noted that the Sarfaesi Act and the RDB Act have a non-fixed clause, so it will take precedence over the SEBI Act.
Sebi, on the other hand, argues that the present case does not fall under the non-positive clause. Sebi argued that these entities committed breaches early on, issued such notices and now SBI cannot accept such requests. Sebi said the ban was passed to protect hundreds of thousands of investors.
bail denied
Judge K Lakshman refused to grant early bail to the owner of the city’s Stylish Spa. Ramawath Swathi faces charges of operating prostitution under the guise of a spa business. Lawyers for the petitioner argued that this was a bogus case and said the petitioner has all valid licenses to operate the spa.
The lawyer also pointed out that CCTV footage could be inspected. Prosecutors argued the matter involved trafficking of married women. He said the case was still under investigation and opposed granting bail, saying the petitioner, if released, could influence witnesses and tamper with evidence.
