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2007 DIGILAW 1132 (ALL)

VEENA KHANNA v. CANARA BANK

2007-04-24

R.P.MISRA, SHISHIR KUMAR

body2007
( 1 ) THE present writ petition has been filed for quashing the order dated 30. 5. 2001 (Annexure-2 to the writ petition) and appellate order dated 28. 5. 2002 (Annexure-3 to the writ petition) and the order of attachment of the house of the petitioner passed on 30. 9. 2002 (Anneuxre -6 to the writ petition) and notice of arrest dated 22. 1. 2003. ( 2 ) THE facts arising out of the writ petition are that the husband of the petitioner No. 1 took cash credit limit and loan from respondent No. 1 i. e. Canara Bank. It appears that the loan was not paid and he became defaulter, as such, the Bank filed a mortgage suit against the firm and late Kaushal Chandra Khanna. The case was transferred to Debt Recovery Tribunal and ultimately decided by the Tribunal. During the pendency of the suit in the year 1989, Sri Kaushal Chandra Khanna husband of petitioner No. 1 died and petitioners Nos. 1 and 2 have been substituted in his place. During his life time all the moveable assets were disposed of by late Kaushal Chandra Khanna. Only two plots in Kareli Colony remained under the mortgage of the Bank. The suit was decreed ex-parte on 31. 5. 2001. The petitioner applied for restoration of the case and by order dated 28. 5. 2002 the case was restored imposing a condition of depositing Rs. 3 lacs for restoration of the suit. The petitioner filed an appeal against aforesaid order but the same has also been dismissed vide its order dated 19. 8. 2002. Then the Recovery Officer has issued a notice dated 9. 9. 2002 to the petitioners. Aggrieved by the aforesaid order, the petitioners have approached this Court. ( 3 ) IT has been submitted on behalf of the petitioners that Section 22 of the Act provides that Civil Procedure Code will be applicable in the proceeding before the Debt Recovery Tribunal, therefore, under the law while allowing the application for restoration the Court cannot put a condition to deposit any part of the decretal amount. The appellate Tribunal has wrongly held that Tribunal has jurisdiction to pass such an order which is contrary to law. The appellate Tribunal has wrongly held that Tribunal has jurisdiction to pass such an order which is contrary to law. The amount which has been taken by the husband of the petitioner No. 1 can be recovered only by sale of the mortgaged and hypothecated property with the Bank and no decree can be passed against the heirs. The Bank can only recover the amount due from the assets of the borrower, mortgaged with the Bank. Now the respondent No. 2 has started recovery which is in the nature of execution proceedings. A notice dated 21. 8. 2002 has been sent in Form No. 16 attaching the immoveable property mortgaged naming the two plots in the Kareli Colony in which the date of attachment is shown as 9. 9. 2002 and 12. 9. 2002 was fixed as the date for settling the terms of sale. The respondents have not taken any step for sale of these two plots but on 18. 2. 2002 issued another notice attaching Flat No. 29, Block No. 12, Alkapuri Colony, Hastings Road, Allahabad which is owned by the petitioner No. 1 as she purchased it from the Allahabad Development Authority, Allahabad. Further a notice has been issued to recover the said amount by arrest and imprisonment of petitioner No. 2 calling upon him to appear before him on 5. 2. 2002. Petitioner No. 2 appeared before respondent No. 2 and requested that the Tribunal cannot proceed against the house of his mother and cannot arrest him. ( 4 ) IT has been submitted on behalf of the petitioners that the whole action of the respondents is arbitrary and without jurisdiction. As the decree passed is very clear that money may be recovered only from the property mortgaged with the Bank, Respondent No. 2 has got no authority under the law to attach the personal house of the petitioners which is neither a subject matter of mortgage or in any manner she has not inherited it from late Sri Kaushal Chandra Khanna. The recovery can be made from the property of Late Sri Kaushal Chandra Khanna and not from the property of the petitioners. Further submission has been made that the executing court cannot go behind the decree and cannot enforce the decree in any manner except as mentioned in the judgement. The recovery can be made from the property of Late Sri Kaushal Chandra Khanna and not from the property of the petitioners. Further submission has been made that the executing court cannot go behind the decree and cannot enforce the decree in any manner except as mentioned in the judgement. ( 5 ) THE writ petition was entertained and an interim order was granted and the respondents were granted time to file counter affidavit. ( 6 ) SRI Tarun Varma who appeared for the Respondent-Bank has raised a preliminary objection to the effect that the present writ petition is not maintainable as the petitioners have got an alternative remedy by way of filing an appeal under Section 30 of Recovery of Debts Due to Banks and Financial Institutions Act, 1993. Further it has been submitted that in view of (vi) of Sub-clause 3 of Section 28 there is a provision that "where a person to whom a notice under this sub-section is sent objects to it by a statement on oath that the sum demanded or the part thereof is not due to the defendant or that he does not hold any money for or on account of the defendant, then, nothing contained in this sub-section shall be deemed to require such person to pay any such sum or part thereof, as the case may be, but if it is discovered that such statement was false in any material particular, such persons shall be personally liable to the Recovery Officer to the extent of his own liability to the defendant on the date of the notice, or to the extent of the defendants liability for any sum due under this Act, whichever is less. " Section 30 of the Act provides that aggrieved by any order passed by the Recovery Officer under this Act, the aggrieved person may prefer an appeal to the Tribunal. In such a way, the respondents submit that the petitioners can file an appeal as provided under the Rules. It has further been submitted by the respondents that the mortgaged property has already been sold and the property which has been attached by the Recovery Officer has rightly been attached as the balance sheet submitted by the husband of the petitioner No. 1 from 31. 3. 1982 to 31. 3. 1986 i. e. Flat No. 19 Alkapuri Colony has been shown as asset of M/s Farmac. 3. 1982 to 31. 3. 1986 i. e. Flat No. 19 Alkapuri Colony has been shown as asset of M/s Farmac. The principal borrower late Sri Kaushal Chandra Khanna was residing in the property in question before 8th September, 1981 which was shown in the audited balance sheet submitted to the Bank, as such, it cannot be denied in any manner by the petitioners that attachment is bad. ( 7 ) WE have heard Sri A. B. Saran, learned Senior Advocate, assisted by Sri Parmatma Singh for the petitioner and Sri Tarun Varma for the respondents and have perused the record. ( 8 ) IT appears that the Bank filed a suit before the Debt Recovery Tribunal as Suit No. 183 of 1989 which was decreed. In spite of service of notice by publication, the principal borrower has not appeared. The suit was decreed vide its order dated 30. 5. 2001 and an application was filed by the petitioners under Section 22 (2) (g) which was allowed by order dated 28. 5. 2002 by the presiding officer putting an condition that the defendant shall deposit an amount of Rs. 3 lacs within a period of two months from the date of order. A further condition was put that in case the amount is not deposited, then this order shall not be given effect to and the recovery certificate issued against the defendants shall be executed. A further condition was also imposed that if the condition is complied with the case be restored to its original number and shall be heard from the stage at which the case was received by the transfer from Civil Court, Allahabad. The petitioners filed an appeal against the aforesaid order, and the appeal was dismissed vide its order dated 3. 10. 2002 holding therein that as the condition has not been complied with and the order passed by the presiding officer has not been complied with, therefore, the application is rejected. ( 9 ) THEN the Recovery Officer on 9. 9. 2002 has attached the property and issued a notice to the petitioners to appear before the Recovery Officer on 12. 9. 2002. The petitioners have not submitted any reply and have not appeared on the said date. ( 9 ) THEN the Recovery Officer on 9. 9. 2002 has attached the property and issued a notice to the petitioners to appear before the Recovery Officer on 12. 9. 2002. The petitioners have not submitted any reply and have not appeared on the said date. Then the Recovery Officer issued another notice of attachment of immoveable property as Flat No. 19 Block No. 12 Alkapuri Colony, Hastings Road, Allahabad and directed to appear before the Recovery Officer on 30th September, 2002. Again a show cause notice was issued to petitioner No. 2 that in spite of notice nobody has appeared, as such, why the warrant of arrest be not issued and was directed to appear on 5. 2. 2003. ( 10 ) IN spite of the aforesaid notice for appearance petitioners have not appeared before the Tribunal. From the perusal of the counter affidavit filed on behalf of the respondents, it is clear that the flat which has been attached that has been shown as property of the firm in the balance sheet filed by the petitioners husband on 30. 3. 1983. The contention of the petitioners to this effect that the amount can be recovered only from the property mortgaged and not from the property belongs to the petitioners, the loan amount cannot be recovered. It can only be recovered from the property which was acquired by the petitioner No. 1s husband and it cannot be recovered from the property which has been purchased by the petitioners. But from the record it appears that the flat which is alleged to be the property of the petitioners has been shown in the balance sheet dated 31. 3. 1982 and balance sheet dated 31. 3. 1983. ( 11 ) IT is up to the petitioners to prove before the Tribunal on the basis of documents that the flat in question which has been attached is not the property and has not been purchased from the fund of the firm and it is an exclusive property purchased by the petitioners from their own private funds. These are the questions of facts to be decided on the basis of relevant document by the Tribunal. These are the questions of facts to be decided on the basis of relevant document by the Tribunal. As mentioned above in view of Section 28 of the Act the petitioners have a right to approach the Tribunal showing therein that the flat does not belong to the petitioner No. 1s husband and the money cannot be recovered from the petitioners. ( 12 ) AS the petitioners can file an appeal under Section 30 of the Act before the Tribunal stating all the facts by way of filing the supporting documents that it is not the property of the firm which was being run by the petitioner No. 1s husband, the Tribunal can decide the said issue on the basis of relevant documents. ( 13 ) THE contention raised by the petitioners that the petition should not be dismissed on the ground of alternative remedy as about four years have already elapsed and the counter and rejoinder affidavits have already been exchanged, as such, the matter be decided on merits. As observed above, there are various questions involved in the present writ petition are of consideration of various documents to this effect whether the liability is of the petitioners or not. Whether the residential flat of the petitioners belongs to the firm or it was purchased exclusively by the petitioners. These factual aspects have to be decided only by the Tribunal. The Apex Court in the case reported in 2005 AIR SCW 3149 U. P. State Bridge Corporation Ltd. Vs. U. P. Rajya Setu Nigam Karmachari Sangh has held that the question of alternative remedy plea as to has to be upheld though raised belatedly if petition involves factual controversy. In paragraph 7 of the said judgement the Apex Court has observed as follows:- "7. The appellants appeal was rejected by the Division Bench. The Division Bench has given brief reasons for upholding the decision of the learned single Judge. In addition, not was taken of the appellants submission that the project being completed, there was no question of appointing the respondents in any other project. This submission was however rejected on the ground that there was no specific pleading to this effect and no details had been given of the project nor of the employees engaged therein nor were the appointment letters of the respondents produced. This submission was however rejected on the ground that there was no specific pleading to this effect and no details had been given of the project nor of the employees engaged therein nor were the appointment letters of the respondents produced. " ( 14 ) IN view of the aforesaid fact, the argument raised on behalf of the petitioners has got no force. We are of the opinion, that the proper remedy to the petitioners is by way of filing an appeal under Section 30 of the Act. ( 15 ) IN the result, the writ petition is hereby dismissed on the ground of alternative remedy. No order as to costs. .