SC posts plea on SARFAESI Act for final disposal on April 27

SC posts plea on SARFAESI Act for final disposal on April 27

By Aqib Ahmad
New Delhi: The Supreme Court of India has posted the special leave petition against J&K High Court’s landmark ruling—that last year said the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act cannot be enforced in J&K as it will undermine state’s special status—for  ‘final disposal’ on April 27.
“Post the matters for final disposal on 27 April 2016 on top of the list, subject to overnight part heard,” Justices Kurian Joseph and Rohinton Fali Nariman said.
Hearing the SLP filed by the State Bank of India, the apex court also granted liberty to J&K government for filing counter affidavit.
In a 76-page detailed judgment, the High Court had said the Act, which was enacted by the Indian parliament in 2002, modifies the State Transfer of Property Act, State Civil Procedure Code, Civil Courts Act, and State Limitation Act.
“It also affects the rights of state subject/citizens recognised by the constitution of India and constitution of state of J&K,” the bench said, ruling that the Parliament lacks competence to make laws affecting immoveable property rights of the state subjects.
The court further noted that only J&K, by virtue of the section 5 of the state constitution, has the absolute sovereign power to legislate laws touching the rights of its state subjects or citizens regarding their immoveable properties.
“The state legislature, in terms of section 140 of Transfer of Property Act, 1882, has authorised for mortgage of property in favour of the institutions mentioned therein. The sale of immoveable property in pursuance to a Civil Court Decree obtained by the bank/financial institution in respect of the mortgaged property cannot be made in favour of the non-state subjects,” the judgment said.
Referring to Article 35(A) of the constitution of India, the High Court said it clarifies constitutional relationship between people of rest of India with the people of J&K.
“It is in essence an information to the citizens of rest of country that on constitutional and legal plank they in all respects do not constitute a class with citizens of state of Jammu and Kashmir,” the court had said, and held that the citizens of J&K have their own constitution, and their sovereign character which cannot be challenged, altered or abridged.
“The power of Parliament to make laws in respect of J&K is circumscribed and it can make laws for it only where permitted by state and not otherwise, and that too in accordance with mechanism prescribed by Article 370 of constitution of India,” the court had said.

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