Dev Dutt Sharma vs Punjab National Bank And Another

Sharad Kumar Sharma, J

The petitioner had filed the present writ petition for the following reliefs:-

"(i) A writ, order or direction in the nature of certiorari quashing the order dated 18/7/2016 as well as the notice dated 21/4/2015 issued by the respondent no. 1 under section 13(2) of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002 under the facts and circumstances as narrated and/or any other order relief which this Hon'ble High Court deems fit and proper in the facts and circumstances of the case.

(ii) A writ order or direction in the nature of mandamus directing the respondent bank to accept the amount due in easy instalments of three years.

(iii) Any other suitable writ, order or direction which this Hon'ble Court may deem fit and proper in the circumstances of the case.

(iv) Award the cost of petition to the petitioner."

At the time when the writ petition was instituted as back as on 08.08.2016, the challenge was given by the petitioner was to the notice issued to him under Section 13(2) of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002 in relation to property i.e. Flat No. A-402, Doon Paradise Apartment, 111 Rajpur Road, Dehradun.

The brief backdrop under which this case has emanated is that the petitioner claims his rights over the mortgaged property over which he claims right by virtue of an agreement for rent dated 14.11.2011 which was for 11 months in relation to the property which was mortgaged by the principal borrower with the Bank, for the loan advances which was obtained from bank by mortgaging Flat No. A-402, Doon Paradise Apartment, 111 Rajpur Road, Dehradun (hereinafter to be called as "the property in dispute").

On an occurrence of default, as against the principal borrower, who has mortgaged the property with the bank for the purposes of loan advances, the petitioner is said to have thereafter entered into a registered agreement for sale on 08.06.2012 with regards to mortgage property in dispute by paying an advance money of Rs. 30.00 lakh and the balance was agreed to be paid at the time of the execution of the sale deed to the award the property, as would be apparent from the contents of Annexure-3 i.e Agreement for Sale, executed between the petitioner and respondent No. 2.

The bank alleging that as there was the default and continued to operate leading to declaration of account as NPA, subsequently, had to initiate the proceedings under Section 13(2) of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002 and notices were issued. Simultaneously, the Bank, as per the writ petition itself, particularly as pleaded in para 15 of the writ petition, which is quoted hereunder:-

"15. That in the meanwhile the respondent no. 1 issued the notice under section 13(2) of the Act 2002 and further filed the case before the Debt Recovery Tribunal Lucknow against the respondent No. 2 without impleading the petitioner as the necessary party and the petitioner moved the application for the impleadment. The same is pending."

It is an admitted case of the petitioner that the Bank has already approached before the Debt Recovery Tribunal, Lucknow as against the respondent No. 2, wherein the petitioner contends that he ought to have been impleaded as a party since he has initially entered into Rent Agreement on 14.11.2011 and had later entered into an Agreement for Sale on 08.06.2012 i.e. by virtue of Annexure 3 with the principal borrower and hence before the DRT proceedings, he becomes a necessary party.

What is important to be recorded at this stage of the judgement itself is that its' not the case of the petitioner ever that he was taken by way of a surprise with regard to the pendency of the DRT proceedings, as against the principal borrower i.e. Respondent No. 2, because the fact of the pendency of the proceedings have been referred in para 15 of the writ petition, then in all propriety, it demanded that the petitioner should have filed an application for impleadment before the DRT, itself in case if any right was claimed or flowing to him in relation to the property in dispute in pursuance to the Agreement for Sale allegedly executed in his favour by the mortgager of the property i.e. Respondent No. 2.

The petitioner instead of choosing to approach before the learned Debt Recovery Tribunal for seeking an appropriate remedy, he had rather instituted the present writ petition, the coordinate Bench of this Court at the time of admission had passed an interim order, directing the petitioner to deposit a sum of Rs. 10.00 lakh with the respondent/bank as would be apparent from the order dated 11.08.2016 passed by this Court. The said order was not complied with and there was a subsequent order referred in the order sheet of 01.09.2016, wherein the petitioner had given an undertaking to deposit Rs. 5.00 lakh with the respondent/bank within the period of one month i.e. on or before 01.10.2016. We will have to be conscious of the facts the two orders of depositing the amount passed on 11.08.2016 and 11.09.2016, are in the nature of interim, which cannot be treated to have decided a night of the petitioner.

While the writ petition was pending consideration, the proceeding which was drawn against the principal borrower before the learned Debt Recovery Tribunal has attained its finality and the judgement has been rendered on 25.01.2019. This fact about passing of the ex parte judgement is also reflected from the pleading which has been brought on record by the petitioner by an Application No. 6251/2019 which is being taken up today. The DRT on 25.01.2019 has passed the following orders in the proceedings of TA No. 448 of 2018 (Old OA No.596 of 2015 of DRT, Lucknow), Punjab National Bank v. Shagufta Kesari and others.

"ORDER

(i) The Original Application is allowed declaring that the Defendants are liable to pay jointly and severally a total sum of Rs. 30,61,970.44 Os, (Rupees Thirty Lacs Sixty-One Thousand Nine Hundred Seventy and Paisa Forty-Four only) to Applicant Bank alongwith pendente-lite and future interest @ 10.00% per annum simple rate of interest on reducing balance from the date of filing of the O.A. i.e. 21.07.2015 till the date of realization with costs.

(ii) Applicant Bank is entitled to recover aforesaid amount by sale of mortgaged property. The amount, if any, already recovered by sale of any mortgage property or otherwise shall be adjusted towards the debt and only the balance amount shall be recoverable. If the dues of Applicant Bank still remain unsatisfied, the same shall be recovered by attachment and sale of the personal movable and immovable assets of the Defendants jointly and severally. Applicant Bank is at liberty to enforce the claim through due process of law.

(iii) Any other application pending stands disposed of.

(iv) Recovery Certificate be issued forthwith in above terms U/s 19(22) of the Recovery of Debts and Bankruptcy Act, 1993 (as amended from time to time) and be sent to the Recovery Officer-I, DRT, Dehradun.

(v) Applicant Bank is directed to file revised statement of account before the Recovery Officer of this Tribunal. Parties are directed to appear before the Recovery Officer-I, DRT, Dehradun on 18.03.2019.

(vi) The Defendants are herby restrained by means of injunction from depleting, transferring, encumbering, alienating, selling or otherwise dealing with their properties/estates without first paying the above claim of Applicant Bank.

(vii) In case, any of the Defendants expire, the legal representatives shall be liable to pay in proportion to the inheritance.

(viii) Copy of this Judgement and Recovery Certificate be given Dasti to Applicant Bank and be sent to the Defendants free of cost by Registered Post in terms of section 19(21) (i) of the RDB Act, 1993 (as amended from time to time) and Rules as well as to the Recovery Officer and after due compliance, file be consigned to record room.

Applicant Bank is directed to file a Memo of Cost, if not filed earlier, for preparing Recovery Certificate U/s 19(22) of the Recovery of Debts and Bankruptcy Act, 1993 (as amended from time to time)."

In annexure-5 to the said Application, he refers to the judgement of the learned Debt Recovery Tribunal as rendered on 25.01.2019 in TA No. 488 of 2018. As far as the intention and purpose of the notice under Section 13(4) of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002 that seems to have attained finality after rendering of the judgement by the learned Debt Recovery Tribunal vide its judgement dated 25.01.2019 for which there is altogether a separate channel provided under SARFAESI Act, 2002 for redressal of the grievance against the judgement.

One another aspect, which has been argued at the behest pleadings which has been raised by the petitioner is that the learned Senior Counsel for the respondent/bank submits that looking to the relief No. C as sought in the application No. 6251 of 2019, which is quoted hereunder:-

"c. to direct the D.R.T. Dehradun to nullity its judgment of January 25, 2019, obtained by Bank officials by fraudulently and stop further process of issuing recovery certificate and illegal Auctions of the flat No. A-402 Doon Paradise apartment 111 Rajpur road Dehradun and the applicant/petitioner is ready to pay and clear any lawful dues of loan if any remained un-paid against property mentioned in the above noted writ petition."

It seems that there had been some proceedings which has been drawn in relation to auctioning of the property in question for which the petitioner has expressed his willingness to pay and clear the dues of the loan, if at all any amount remains unpaid by the principal borrower, this amounts that he admits the liability of loan, sought to be recovered by Respondent No. 1 in pursuance to the judgement of DRT dated 25.01.2019, as against respondent No. 2, with whom he has entered into an agreement for sale. Thus as against the judgement of DRT there is statutory appeal provided under the Act of 2002.

Admittedly, according to petitioner's own case, the learned Debt Recovery Tribunal has already culminated the proceedings vide its judgement dated 25.01.2019 and as per the provisions contained under Section 18 of the Act, the remedy would lie to approach before the learned DART under Section 18 of the SARFAESI Act, 2002. At this stage, the petitioner expresses his apprehension that the limitation period, as prescribed therein under the Act, particularly, as contained under Section 18 has already expired and he apprehends that his appeal may not be entertained on the ground of limitation.

While dismissing this writ petition on the ground of availability of statutory remedy available to the petitioner under Section 18 of the Act. It is argued by the learned counsel for the respondent/bank that the provisions of Limitation Act, since not having made applicable is not barred from its applicability on the proceedings before the DART, hence the provisions of the same would continue to apply. Consequently, if at all, the petitioner approaches before the DART by filing the Appeal under Section 18 of the Act, the learned DART will consider the application for condonation of delay in the light of the provisions contained under Section 5 to be read with Section 14 of the Limitation Act which admittedly as per the learned Senior Counsel for the Bank the provisions of Limitation Act is applicable over the proceedings under the SARFAESI Act, 2002, as the same has not been excluded in its applicability by the SARFAESI Act, 2002.

As far as the continuance of the present writ petition is concerned, which is being sought to be pressed by the petitioner in view of the subsequent judgement of DRT dated 25.01.2019, no cause as against Section 13(2) of the SARFAESI Act, 2002, survives as of now to be adjudicated by this Court. Apart from it, there had been number of judgements rendered by the Hon'ble Apex Court that the writ Courts ought not to exercise its discretionary jurisdiction under Article 226 of the Constitution of India and that has been specifically barred until and unless there is some extraordinary condition prevails for determination of exclusive question of law. A reference may be had to the judgement as reported in 2010 (8) SCC 110, United Bank of India v. Satyawati Tondon and others in its para 55 which is quoted hereunder:-

"55. It is a matter of serious concern that despite repeated pronouncement of this Court, the High Court continue to ignore the availability of statutory remedies under the DRT Act and the SARFAESI Act and exercise jurisdiction under Article 226 for passing orders which have serious adverse impact on the right of banks and other financial institutions to recover their dues. We hope and trust that in future the High Courts will exercise their discretion in such matters with greater caution, care and circumspection."

While holding that the writ petition was not maintainable as against the order passed under Section 13(2) of the Act and subsequent order under Section 13(4), this Court directs the petitioner to seek an appropriate statutory remedy available to him under Section 18 of the Act, and if he does so by preferring of an appeal within a period of 30 days from the date of receipt of certified copy of this order, the learned DART is directed to consider the question of limitation liberally. So far as the question of limitation is concerned, considering the provisions contained under Section 5 to be read with Section 14 of the Limitation Act, which admittedly according to respondents, since it is not being barred on being made applicable before the learned DRT would apply.

Subject to above observation, the writ petition stands dismissed.