KOTAK MAHINDRA BANK LIMITED versus GIRNAR CORRUGATORS PVT. LTD. & ORS. on 5 January 2023

KOTAK MAHINDRA BANK LIMITED

v.

GIRNAR CORRUGATORS PVT. LTD. & ORS.

(Civil Appeal No.6662 of 2022)

JANUARY 05, 2023

[M. R. SHAH AND KRISHNA MURARI, JJ.]

Securitisation and Reconstruction of Financial Assets andEnforcement of Security Interest Act, 2002 (SARFAESI Act) – ss.13(2), 13(4), 14, 17, 26E – Micro, Small and Medium EnterprisesDevelopment Act, 2006 (MSMED Act) – ss. 15-23, 24 – Whetherthe MSMED Act would prevail over the SARFAESI Act and whetherrecovery proceedings/recoveries under MSMED Act would prevailover the recoveries made/recovery proceedings under provisionsof the SARFAESI Act – Held : Sec 15 to 23 of the MSMED Actprovides a special mechanism for adjudication of dispute betweenbuyer and seller – But does not provides for priority over debt duesof the secured creditor akin to s.26E of the SARFAESI Act – A‘priority’ conferred / provided under Section 26E of the SARFAESIAct would prevail over the recovery mechanism of the MSMEDAct – There is no repugnancy between the two Acts – In the absenceof any specific provision for priority in the MSMED Act, if MSMEDAct is allowed to prevail it would defeat the very object and purposeof SARFAESI Act – Under section 14 of the SARFAESI Act, DistrictMagistrate or the Chief Metropolitan Magistrate is required to assistthe secured creditor in getting the possession of the secured assets– Neither, District Magistrate or Metropolitan Magistrate wouldhave jurisdiction to adjudicate the matter between secured creditorand debtor – Person aggrieved by the steps u/s. 13(4) and s.14 ofthe SARFAESI Act has to approach Debts Recovery Tribunal byway of appeal/application u/s. 17 of the SARFAESI Act – Recoveriesunder the SARFAESI Act with respect to the secured assets wouldprevail over the recoveries under the MSMED Act.

Allowing the appeal, the Court

HELD: 1. In the entire Micro, Small and MediumEnterprises Development Act, 2006 (MSMED Act), there is no

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Aspecific express provision giving ‘priority’ for payments underthe MSMED Act over the dues of the secured creditors or overany taxes or cesses payable to Central Government or StateGovernment or Local Authority as the case may be. In sharpcontrast to this, Section 26E of the Securitisation andBReconstruction of Financial Assets and Enforcement of SecurityInterest Act, 2002 (SARFAESI Act) which has been inserted videAmendment in 2016, it provides that notwithstanding anythinginconsistent therewith contained in any other law for the timebeing in force, after the registration of security interest, the debtsdue to any secured creditor shall be paid in ‘priority’ over allCother debts and all revenue taxes and cesses and other ratespayable to the Central Government or State Government or LocalAuthority. However, the priority to secured creditors in paymentof debt as per Section 26E of the SARFAESI Act shall be subjectto the provisions of the IBC. At this stage, it is required to beDnoted Section 26E of the SARFAESI Act which is inserted in2016 is also having a non-obstante clause. As per the settleposition of law, if the legislature confers the later enactment witha non-obstante clause, it means the legislature wanted thesubsequent / later enactment to prevail. Thus, a ‘priority’Econferred / provided under Section 26E of the SARFAESI Actwould prevail over the recovery mechanism of the MSMED Act.Sections 15 to 23 of the MSMED Act are providing a specialmechanism for adjudication of the disputes and to adjudicate andresolve the disputes between the supplier and buyer – micro orsmall enterprise. At the cost of repetition, it is observed thatFMSMED Act does not provide any priority over the debt dues ofthe secured creditor akin to Section 26E of the SARFAESI Act.[Para 7][883-B-G]

2. SARFAESI Act has been enacted providing specificmechanism / provision for the financial assets and securityGinterest. It is a special legislation for enforcement of securityinterest which is created in favour of the secured creditor –financial institution. Therefore, in absence of any specificprovision for priority of the dues under MSMED Act, if thesubmission on behalf of respondent No.1 for the dues underH

MSMED Act would prevail over the SARFAESI Act, then in thatcase, not only the object and purpose of special enactment /SARFAESI Act would be frustrated, even the later enactment byway of insertion of Section 26E of the SARFAESI Act would befrustrated. If the submission on behalf of respondent No.1 isaccepted, then in that case, Section 26E of the SARFAESI Actwould become nugatory and would become otiose and/orredundant. Any other contrary view would be defeating theprovision of Section 26E of the SARFAESI Act and also the objectand purpose of the SARFAESI Act. [Para 9][884-D-G]

3. While exercising power under Section 14 of theSARFAESI Act, even the District Magistrate has no jurisdictionand/or District Magistrate and/or even the Chief MetropolitanMagistrate has no jurisdiction to adjudicate the dispute betweensecured creditor and debtor. Under Section 14 of the SARFAESIAct, the District Magistrate or the Chief Metropolitan Magistrateas the case may be is required to assist the secured creditor ingetting the possession of the secured assets. Under Section 14of the SARFAESI Act, neither District Magistrate norMetropolitan Magistrate would have any jurisdiction to adjudicateand/or decide the dispute even between the secured creditorand the debtor. If any person is aggrieved by the steps underSection 13(4) / order passed under Section 14, then the aggrievedperson has to approach the Debts Recovery Tribunal by way ofappeal / application under Section 17 of the SARFAESI Act. It isobserved and held that so far as recoveries under the SARFAESIAct with respect to the secured assets would prevail over therecoveries under the MSMED Act to recover the amount underthe award / decree passed by the Facilitation Council. [Paras 10and 11][885-B-D, F-G]

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 6662of 2022.

From the Judgment and Order dated 11.08.2017 of the High Courtof Madhya Pradesh Bench at Indore in Writ Appeal No.248 of 2017.

Amar Dave, Himanshu Bhushan, Krishnayan Sen, Advs. for theAppellant.

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ASaurabh Mishra, AAG, Niranjan Reddy, Sr. Adv., Pulkit Tare,Aditya Shekhar, Abhishek Sharma, Sunny Choudhary, Shiv Sagar Tiwari,Arjun Garg, Advs. for the Respondents.

The Judgment of the Court was delivered by BM. R. SHAH, J.

1. Feeling aggrieved by and dissatisfied with the impugnedjudgment and order passed by the Division Bench of the High Court ofMadhya Pradesh at Indore dated 11.08.2017 in Writ Appeal No. 248 of2017, by which the Division Bench of the High Court has allowed theCsaid appeal preferred by respondent No.1 herein and has quashed andset aside the judgment and order passed by the learned Single Judge andhas observed and held that Micro, Small and Medium EnterprisesDevelopment Act, 2006 (hereinafter referred to as ‘MSMED Act’) willprevail over Securitisation and Reconstruction of Financial Assets andDEnforcement of Security Interest Act, 2002 (hereinafter referred to as‘SARFAESI Act’), the secured creditor – Kotak Mahindra Bank Limitedhas preferred the present appeal.

The facts leading to the present appeal, in nut shell, are as under:

E1.1 One Mission Vivacare (hereinafter referred to as ‘debtor’)advanced various credit facilities by the appellant bank – secured creditor.In order to secure the various credit facilities, Plot Nos. 16 and 14, situatedin SEZ Area of Dhar were mortgaged along with certain movable fixedassets.

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F1.2 On account of default in payment of loan / debt, the bank-initiated recovery proceedings in respect of the secured assetscontemplated under Section 13(2) of the SARFAESI Act. The bank –secured creditor filed an application before the District Magistrate on17.06.2014 under Section 14 of the SARFAESI Act seeking assistanceGfrom taking possession of the secured assets. By order dated 24.09.2014,the District Magistrate allowed the said application by directing the SDM,District: Dhar to take vacant possession of the secured assets. However,no action was taken and therefore, the bank submitted applications tothe District Magistrate and the SDM complaining non-compliance ofthe order to take possession of the secured assets. Finally, SDM issuedH

KOTAK MAHINDRA BANK LTD. v. GIRNAR CORRUGATORSPVT. LTD. & ORS. [M. R. SHAH, J.]

direction to the Naib Tehsildar vide communication dated 07.11.2015 tocomply the order of the District Magistrate and obtain the possession bytaking police assistance. Thereafter vide order dated 21.03.2016, NaibTehsildar refused to take possession and to comply the order dated24.09.2014 on the ground that one recovery proceeding is pending forrecovery of certain amounts from the secured assets and on the groundthat the recovery certificate issued in favour of respondent No.1 (originalrespondent No.4 before the High Court) was already pending forrecovery of certain amounts from the aforesaid two secured assets. Atthis stage, it is required to be noted that the recovery certificates wereissued in favour of respondent No.1 pursuant to the award passed bythe Facilitation Council on 11.09.2014 which was in favour of respondentNo.1 herein, which was under provisions of MSMED Act. The orderpassed by the Naib Tehsildar refusing to take possession of the securedassets pursuant to the order passed by the District Magistrate dated24.09.2014 was the subject matter of writ petition before the learnedSingle Judge of the High Court by way of Writ Petition No.2569 of2016. While refusing to take possession of the secured assets pursuantto the order passed by the District Magistrate under Section 14 of theSARFAESI Act, Naib Tehsildar observed that MSMED Act being aspecial enactment enacted subsequent to SARFAESI Act would haveoverriding effect and therefore, MSMED Act would prevail over theSARFAESI Act.

1.3 The learned Single Judge allowed the writ petition preferredby the bank – secured creditor and set aside the order passed by theNaib Tehsildar by observing that the provisions of SARFAESI Act wouldprevail and if respondent No.1 is aggrieved by the order passed by theDistrict Magistrate under Section 14 of the SARFAESI Act or themeasures taken under Section 13(4) of the SARFAESI Act, he mayprefer an appeal/application under Section 17 of the SARFAESI Actbefore the Debts Recovery Tribunal.

1.4 Feeling aggrieved by and dissatisfied with the judgment andorder passed by the learned Single Judge holding that the SARFAESIAct would prevail, respondent No.1 herein in whose favour there wasan award under provisions of the MSMED Act and in whose favour therecovery certificates were issued, filed the present writ appeal beforethe Division Bench of the High Court. By the impugned judgment and AB

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Aorder, the Division Bench of the High Court has allowed the said appealand has set aside the judgment and order passed by the learned SingleJudge and has observed and held that MSMED Act being the laterenactment, the same shall prevail over the SARFAESI Act.

1.5 The impugned judgment and order passed by the DivisionBBench of the High Court holding that MSMED Act being later enactment,the same would prevail over the SARFAESI Act the bank – securedcreditor has preferred the present appeal.

2. Shri Amar Dave, learned counsel appearing for the appellantbank – secured creditor has vehemently submitted that as such, there isCno repugnancy between the provisions of SARFAESI Act and MSMEDAct. It is submitted that non- obstante clause in the MSMED Act, i.e.Section 24 provides that provisions under Sections 15 to 23 shall haveeffect notwithstanding anything inconsistent therewith contained in anyother law for the time being in force. It is submitted that Sections 15 toD23 of the MSMED Act only provide for special mechanism foradjudication of the dispute along with enforcing certain other contractualand business terms on the parties such as time limit for payments andinterest in case of delayed payments. It is submitted that the perusal ofthe said scheme, from Sections 15 to 23 of the MSMED Act, clearly Eshows that there is no express ‘priority’ envisaged for payments underthe MSMED Act over the dues of secured creditors or over any taxesor cesses payable to Central Government or State Government or LocalAuthority as the case may be. It is submitted that no provision to thiseffect is consciously provided. It is submitted that in sharp contrast tothis, the perusal of the scheme of SARFAESI Act, including in SectionF26E, thereof leaves no room for doubt that the legislature has expresslyand unambiguously provided for a legal framework exclusively on theissue of ‘priority’ of payment of dues. It is submitted that in case ofcertain other legislations, there is express provision for the manner inwhich the dues thereunder may either have a charge over the propertyGor have ‘priority’ over other dues. Reference is made to the provisionsof the Maharashtra Value Added Tax Act, 2002; Employees’ ProvidentFund and Miscellaneous Provisions Act, 1952; Kerala General SalesTax Act, 1963; Workmen’s Compensation Act, 1923; Central ExciseAct, 1944; Enforcement of Security Interest and Recovery Debts LawsHand Miscellaneous Provisions (Amendment) Act, 2016, etc. It is submitted KOTAK MAHINDRA BANK LTD. v. GIRNAR CORRUGATORSPVT. LTD. & ORS. [M. R. SHAH, J.]

that in the absence of such express provisions, there can be no basis toignore the specific scheme of the SARFAESI Act in comparison to suchspecific scheme under the MSMED Act with regard to ‘priority’ ofpayments. It is submitted that any such ‘priority’ over and above thedues of secured creditors or government dues has to be expressly andunambiguously provided for and cannot be read by implication. It issubmitted that viewed from this angle, in fact, there is no conflict betweenthe two schemes, i.e. MSMED Act and SARFAESI Act as far as thespecific subject of ‘priority’ is concerned.

2.1It is further submitted that Section 26E of the SARFAESIAct being subsequently inserted vide amendment in 2016,the non-obstante clause in Section 26E of the SARFAESIAct shall prevail over the provisions of MSMED Act.Reliance is placed on the decision of this Court in case ofBank of India vs. Ketan Praekh & Ors. [(2008) 8 SCC148 (para 28)].

2.2Making above submissions, it is prayed to allow the presentappeal and quash and set aside the impugned judgment andorder passed by the Division Bench and restore the judgmentand order passed by the learned Single Judge by holdingthat the recoveries under SARFAESI Act shall be accordedpriority over recoveries under MSMED Act.

3. The present appeal is vehemently opposed by Shri NiranjanReddy, learned Senior Counsel appearing for respondent No.1.

3.1Learned counsel appearing for respondent No.1 hasvehemently submitted that MSMED Act has been enactedto promote and protect the interests of the small and mediumscale enterprises which is a source of livelihood for severalcitizens and contributes towards 27% to the GDP. It issubmitted that therefore, aggressive provisions were broughtin for the recovery of dues and compound interests aregiven in MSMED Act which is not present in any otherlegislations and is in the nature of a beneficial legislation. Itis submitted that therefore, in view of Section 24 of theMSMED Act which provides for an overriding effect overother prevailing laws, the provisions with respect to A

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Arecoveries under MSMED Act shall prevail over therecoveries under SARFAESI Act.

3.2It is submitted that the financial institutions have variousother means of recovery including SARFAESI Act, IBCetc. as being a secured creditor to an extent of also takingBpersonal guarantee from the Directors of the company incertain cases. However, such liberty of taking personalguarantees etc. are not available to MSME and theycompletely rely on MSMED Act for recovery of dues andas such have only one method of recovery by virtue of theCaward which is in the nature of a decree from the FacilitationCouncil. It is submitted that in the above said context, anoverriding provision is provided under Section 24 of theMSMED Act.

3.3It is submitted that Section 24 of the MSMED Act providesDfor an overriding effect over other prevailing laws. It issubmitted that the provisions of Sections 15 to 23 of theMSMED Act shall have effect notwithstanding anythinginconsistent therewith contained in any other law for thetime being in force. It is submitted that the entire schemeEof provisions under Chapter V – Sections 15 to 23 whichincludes delayed payments, recovery of amounts due, andestablishment of Facilitation Council and its award has anoverriding effect on all other legislations includingSARFAESI Act. It is submitted that therefore, an awardfrom the Facilitation Council will also have an overridingFeffect by virtue of Section 24. It is submitted that theintention of the legislature is clear as the overriding provisionis for a particular set of delayed payments recoverymechanism provided under MSMED Act which is also inconsonance with object and purpose of the MSMED Act.

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3.4It is further submitted that MSMED Act is a subsequentlegislation and by providing Section 24 of the MSMED Act,the legislature has purposefully and knowingly supersededall the recovery procedures prevailing at that relevant pointof time, by its non-obstante clause. It is submitted that if H

PVT. LTD. & ORS. [M. R. SHAH, J.]

any contrary interpretation is to be given to the said positionof law, then the same would make Section 24 redundant,which by all means is not the intention of the legislature. Itis submitted that if SARFAESI Act is given overriding effectover the MSMED Act, then it would render awards of theFacilitation Council as non-executable in all cases wherethere is a secured creditor. It is submitted that the samewould severely affect the existence and growth of theMSME and is also against object of the MSMED Act.

3.5It is submitted that as per the law laid down by this Court incatena of decisions, if two enactments have competing non-obstante provision and nothing repugnant, then the non-obstante clause of the subsequent statute would prevail overthe earlier enactments. It is submitted that the principletherefore would be that the court must look into the objectivesof the two Special Acts. It is submitted that if the legislaturestill confers the later enactment with a non-obstante clause,it means the legislature wanted the enactment to prevail. Itis submitted that therefore, non-obstante clause in MSMEDAct, i.e. Section 24 would prevail over the recoverymechanism of SARFAESI Act, being enacted later in pointof time, overriding all other laws being in force at that pointof time.

3.6It is submitted that the State Madhya Pradesh in exerciseof powers conferred under Section 30 read with sub-section(3) of Section 21 of the MSMED Act made the Rules knownas ‘M.P. Micro and Small Enterprises Facilitation CouncilRules, 2006’ for procedure to be followed for recovery ofamounts due. It is submitted that under the said Rules, thedecree, award or order passed under provisions of MSMEDAct shall be executed by the Collector of the Districtconcerned and the amount due shall be recovered as arrearsof land revenue. It is submitted that as per Section 137 ofMadhya Pradesh Land Revenue Code, 1959, land revenuewould have first charge on the proceeds of the recovery ofdues from the subject property. It is submitted that

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ASARFAESI Act does not provide that it will haveprecedence over a decree / award of the decree holder.

3.7It is submitted that Section 240A of the IBC, 2016 providesexception of certain provisions of Section 29A of the IBCto MSME. It is submitted that it is a settled law that IBC,B2016 would override SARFAESI Act and therefore, in thesaid context also, MSMED Act may have precedence overSARFAESI Act.

3.8It is further submitted that MSMED Act is an extension ofthe welfare policy of the State and may need to beCconsidered in order to balance the larger public interest ofthe small and medium scale enterprises and their means ofexistence. It is submitted that therefore, to strike the balanceof interest for survival of small and medium scaleenterprises, it is prayed to interpret the provisions in favourDof the small and medium scale enterprises and to hold thatthe recoveries under MSMED Act would prevail over therecoveries under SARFAESI Act.

3.9Making above submissions, it is prayed to dismiss the presentappeal.E4. Heard learned counsel appearing for the respective parties atlength.

5. The short question which is posed for the consideration of thisCourt is whether the MSMED Act would prevail over the SARFAESIFAct? The question is whether recovery proceedings / recoveries underthe MSMED Act would prevail over the recoveries made / recoveryproceedings under provisions of the SARFAESI Act?

6. It is the case on behalf of respondent No.1 that in view ofGSection 24 of the MSMED Act which provides that the provisions ofSections 15 to 23 of the MSMED Act would have overriding effect andshall have effect notwithstanding anything inconsistent therewithcontained in any other law for the time being in force and in view of thefact that the MSMED Act being a later enactment, then the SARFAESIAct, the MSMED Act would prevail over the SARFAESI Act.H

7. While appreciating the above submissions, it is required to beappreciated that Sections 15 to 23 of the MSMED Act only provide forspecial mechanism for adjudication of the dispute along with enforcingcertain other contractual and business terms on the parties such as timelimit for payments and interest in case of delayed payments. In the entireMSMED Act, there is no specific express provision giving ‘priority’ forpayments under the MSMED Act over the dues of the secured creditorsor over any taxes or cesses payable to Central Government or StateGovernment or Local Authority as the case may be. In sharp contrast tothis, Section 26E of the SARFAESI Act which has been inserted videAmendment in 2016, it provides that notwithstanding anything inconsistenttherewith contained in any other law for the time being in force, afterthe registration of security interest, the debts due to any secured creditorshall be paid in‘priority’over all other debts and all revenue taxes andcesses and other rates payable to the Central Government or StateGovernment or Local Authority. However, the priority to secured creditorsin payment of debt as per Section 26E of the SARFAESI Act shall besubject to the provisions of the IBC. Therefore, such dues vis-a-vis duesunder the MSMED Act, as per the decree or order passed by theFacilitation Council debts due to the secured creditor shall have a priorityin view of Section 26E of the SARFAESI Act which is later enactmentin point of time than the MSMED Act. At this stage, it is required to benoted Section 26E of the SARFAESI Act which is inserted in 2016 isalso having a non-obstante clause. Even as per the submission on behalfof respondent No.1, two enactments have competing non-obstanteprovision and nothing repugnant, then the non-obstante clause of thesubsequent statute would prevail over the earlier enactments. As perthe settle position of law, if the legislature confers the later enactmentwith a non-obstante clause, it means the legislature wanted the subsequent/ later enactment to prevail. Thus, a ‘priority’ conferred / provided underSection 26E of the SARFAESI Act would prevail over the recoverymechanism of the MSMED Act. The aforesaid is to be considered alongwith the fact that under provisions of the MSMED Act, more particularlySections 15 to 23, no ‘priority’ is provided with respect to the dues underthe MSMED Act, like Section 26E of the SARFAESI Act.

8. As observed hereinabove, Sections 15 to 23 of the MSMEDAct are providing a special mechanism for adjudication of the disputes A

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Aand to adjudicate and resolve the disputes between the supplier andbuyer – micro or small enterprise. At the cost of repetition, it is observedthat MSMED Act does not provide any priority over the debt dues of thesecured creditor akin to Section 26E of the SARFAESI Act. At themost, the decree / order / award passed by the Facilitation Council shallBbe executed as such and the micro or small enterprise in whose favourthe award or decree has been passed by the Facilitation Council shall beentitled to execute the same like other debts / creditors. Therefore,considering the provisions of Sections 15 to 23 read with Section 24 ofthe MSMED Act and the provisions of the SARFAESI Act, as such,there is no repugnancy between two enactments viz. SARFAESI ActCand MSMED Act. As such, there is no conflict between two schemes,i.e. MSMED Act and SARFAESI Act as far as the specific subject of‘priority’ is concerned.

9. At this stage, the object and purpose of the enactment ofSARFAESI Act is required to be considered. SARFAESI Act has beenDenacted to regulate securitization and reconstruction of financial assetsand enforcement of security interest and to provide for a central debtsof security interest created on property rights, and for matters connectedtherewith or incidental thereto. Therefore, SARFAESI Act has beenenacted providing specific mechanism / provision for the financial assetsEand security interest. It is a special legislation for enforcement of securityinterest which is created in favour of the secured creditor – financialinstitution. Therefore, in absence of any specific provision for priority ofthe dues under MSMED Act, if the submission on behalf of respondentNo.1 for the dues under MSMED Act would prevail over the SARFAESI

FAct, then in that case, not only the object and purpose of specialenactment / SARFAESI Act would be frustrated, even the later enactmentby way of insertion of Section 26E of the SARFAESI Act would befrustrated. If the submission on behalf of respondent No.1 is accepted,then in that case, Section 26E of the SARFAESI Act would becomenugatory and would become otiose and/or redundant. Any other contraryGview would be defeating the provision of Section 26E of the SARFAESIAct and also the object and purpose of the SARFAESI Act.

10. Even otherwise the Naib Tehsildar was not at all justified innot taking possession of the secured assets / properties as per orderHdated 24.09.2014 passed by the District Magistrate under Section 14 of the SARFAESI Act. The order passed by the Naib Tehsildar refusing totake possession of the secured assets / properties despite the order passedunder Section 14 of the SARFAESI Act on the ground that recoverycertificates issued by respondent No.1 for recovery of the orders passedby the Facilitation Council are pending, is wholly without jurisdiction.While exercising power under Section 14 of the SARFAESI Act, eventhe District Magistrate has no jurisdiction and/or District Magistrate and/or even the Chief Metropolitan Magistrate has no jurisdiction to adjudicatethe dispute between secured creditor and debtor. Under Section 14 ofthe SARFAESI Act, the District Magistrate or the Chief MetropolitanMagistrate as the case may be is required to assist the secured creditorin getting the possession of the secured assets. Under Section 14 of theSARFAESI Act, neither District Magistrate nor Metropolitan Magistratewould have any jurisdiction to adjudicate and/or decide the dispute evenbetween the secured creditor and the debtor. If any person is aggrievedby the steps under Section 13(4) / order passed under Section 14, thenthe aggrieved person has to approach the Debts Recovery Tribunal byway of appeal / application under Section 17 of the SARFAESI Act.Therefore, the order passed by the Naib Tehsildar refusing to take thepossession pursuant to the order passed by the District Magistrate underSection 14 of the SARFAESI Act was wholly without jurisdiction andtherefore also the same was liable to be set aside.

11. In view of the above and further reasons stated above, theimpugned judgment and order passed by the Division Bench of the HighCourt is unsustainable and the same deserves to be quashed and setaside. Consequently, the present appeal is allowed. The impugnedjudgment and order dated 11.08.2017 passed by the Division Bench ofthe High Court of Madhya Pradesh at Indore in Writ Appeal No. 268 of2017 is set aside and the judgment and order passed by the learnedSingle Judge is hereby restored. It is observed and held that so far asrecoveries under the SARFAESI Act with respect to the secured assetswould prevail over the recoveries under the MSMED Act to recover theamount under the award / decree passed by the Facilitation Council. It isrightly observed by the learned Single Judge that if respondent No.1 isaggrieved by the order passed by the District Magistrate under Section14 of the SARFAESI Act, it will be open for him to initiate proceedingsunder Section 17 of the SARFAESI Act which be considered in AB

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Aaccordance with law and on its merits and subject to the provisions ofSection 17 and the provisions of the SARFAESI Act.

12. The present appeal is accordingly allowed. No order as tocosts.

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(Assisted by : Abhishek Pratap Singh and Rahul Rathi, LCRAs)

Appeal allowed.

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