SC/ST Act cannot be invoked to stop banks from exercising mortgage rights: Delhi High Court

The Delhi High Court recently said that the provisions of the Scheduled Castes and Scheduled Tribes (Prevention of Atrocities) Act, 1989 (SC/ST Act) relating to wrongful occupation or dispossession of land cannot be invoked to prevent a bank from exercising its lawful mortgage rights [Axis Bank Limited v National Commission for Scheduled Tribes & Ors]. 

Justice Sachin Datta made the prima facie observation while staying the proceedings initiated by the National Commission for Scheduled Tribes against Axis Bank, its Managing Director (MD) and the Chief Executive Officer (CEO). 

“Prima facie, in the context of the facts of the present case, 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,” the Court said.

The Commission had ordered Axis Bank’s MD and CEO to appear in person after a representation was made by a person alleging violation under Sections 3(1)(f) and (g) of the SC/ST Act. 

While Section 3(1)(f) penalises wrongfully occupation or cultivation of land belonging to a member of the SC/ST community, Section 3(1)(g) punishes wrongful dispossession of a member of the SC/ST community of his land or premises. 

The case arose from a 2013 credit facility of ₹16.69 crore sanctioned by Axis Bank to Sundev Appliances Ltd, secured by a mortgaged property in Maharashtra's Vasai. After the borrower defaulted, the account was declared a non-performing asset in 2017, prompting the bank to invoke its rights under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI).

A subsequent civil dispute over ownership of the mortgaged property led one of the persons to approach the National Commission for Scheduled Tribes. 

After considering the case, the High Court said that the proceedings pending before the Commission are without jurisdiction. 

“Also, the proceedings pending before respondent no.1 [National Commission for Scheduled Tribes], particularly, the summons issued therein which requires the MD & CEO of the petitioner [Axis Bank] to appear before the respondent no.1, are without jurisdiction. No rationale has been recorded for requiring senior officials of the petitioner to appear personally before the respondent no.1,” the Court recorded. 

The case will be heard next on February 5, 2026. 

Senior Advocate Satvik Varma with advocates Manmeet Singh, Alok Shanker, Anugrah Robin Frey, Shantanu Parmar, Ajay Raj and Balram appeared for Axis Bank. 

[Read Order]