The Delhi High Court rules that the SC/ST (Prevention of Atrocities) Act cannot be used to block banks from exercising lawful mortgage rights. This landmark observation clarifies the limits of the Act in financial and property disputes.
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NEW DELHI: In an observation that could impact the intersection of property rights and social justice laws, the Delhi High Court addressed whether the provisions of the Scheduled Castes and Scheduled Tribes (Prevention of Atrocities) Act, 1989 (SC/ST Act), can be invoked to prevent a bank from exercising its lawful mortgage rights.
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Background of the Case
The dispute traces back to a 2013 credit facility of ₹16.69 crore extended by Axis Bank to Sundev Appliances Ltd, secured against a mortgaged property in Vasai, Maharashtra. After the borrower defaulted, the account was declared a non-performing asset (NPA) in 2017, prompting Axis Bank to invoke its rights under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI).
Subsequently, a civil dispute arose over the ownership of the mortgaged property, leading a person to approach the National Commission for Scheduled Tribes (NCST), alleging violation of Sections 3(1)(f) and (g) of the SC/ST Act. These sections relate to:
- Section 3(1)(f): Wrongful occupation or cultivation of land belonging to an SC/ST member.
- Section 3(1)(g): Wrongful dispossession of an SC/ST member of their land or premises.
The Commission had issued summons asking Axis Bank’s Managing Director (MD) and Chief Executive Officer (CEO) to appear in person, prompting the bank to challenge the proceedings.
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Delhi High Court’s Observation
Justice Sachin Datta of the Delhi High Court made a prima facie observation that the SC/ST Act provisions regarding wrongful occupation or dispossession of land are not attracted in the context of the bank exercising its lawful mortgage rights.
The Court noted:
“Sections 3(1)(f) and (g) of the Atrocities Act are not attracted inasmuch the same cannot be invoked to preclude/prevent the exercise of mortgage right/security interest of the petitioner.”
Furthermore, the Court highlighted that requiring senior officials of Axis Bank to appear in person before the NCST lacked rationale and that the proceedings before the Commission are without jurisdiction.
The case is scheduled for the next hearing on February 5, 2026.
Appearance:
For Axis Bank: Senior Advocate Satvik Varma with advocates Manmeet Singh, Alok Shanker, Anugrah Robin Frey, Shantanu Parmar, Ajay Raj and Balram
Case Title:
Axis Bank Limited v National Commission for Scheduled Tribes & Ors
W.P.(C) 16123/2025
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