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Madhya Pradesh High Court · body

2015 DIGILAW 1074 (MP)

Harpreet Kaur v. State of M. P.

2015-10-07

ROHIT ARYA

body2015
ORDER 1. This writ petition under Article 226 of the Constitution of India is directed against the Revenue Recovery Certificate (RRC) dated 25.5.2015 (Annexure P-2) for Rs.5,37,776/- under section 3(1) Madhya Pradesh Lok Dhan (Shodhya Rashiyon Ki Vasuli) Adhiniyam, 1987 (hereinafter referred to as the 'Adhiniyam, 1987'). 2. Facts relevant for disposal of this writ petition in nutshell are to the effect that according to the petitioner, she is running a Boutique in the name and style, M/s Harman Punjabi Suit Collection at Gwalior. The petitioner has obtained loan from the Central Bank of India for purchase of motor vehicle; Fiat Punto, Chasis No.MCA11814E07055587 DJZ. On 20.11.2014, the Central Bank of India (respondent No.5) had sanctioned loan of Rs.5,00,000/- which was to be repaid with equal monthly installments of Rs.8,600/-. According to the petitioner, she has paid Rs.2,100/- on 21.11.2014, Rs.6,000/- on 2.3.2015 and Rs.50,000/- on 26.5.2015. Thereafter, the proceedings for issuance of RRC have been initiated vide Annexure P-1 by the respondent No.5/Bank purportedly for not having paid monthly installments regularly. Thereafter, the Revenue Recovery proceedings by the Tahsildar, District Gwalior (respondent No.3) were initiated by issuance of notice dated 25.5.2015 (Annexure P-2) for payment of Rs.5,54,009/- (Rs.5,37,776/- + 16,133/-) and fixed the date 2.6.2015 for appearance of the petitioner. It appears that the petitioner did not appear before the said authority. As such, the petitioner's Boutique shop was seized on 31.7.2015. Again, a notice was issued on 18.8.2015 (Annexure P-4) by the respondent No.5. It appears that the petitioner did not respond and has filed the instant writ petition. 3. According to the petitioner, the recovery proceedings so initiated are without jurisdiction as the car loan advanced to the petitioner is not covered under the provisions of the Adhiniyam, 1987 and, therefore, the RRC issued by the respondent No.3 at the instance of the respondents No.4 and 5/Bank and the proceedings pursuant to RRC for recovery of the loan as arrears of land revenue deserves to be quashed. 4. Per contra, respondents No.4 and 5/Bank have filed a detailed affidavit and documents. It is contended that in exercise of the powers under clause (b)(i) of section 2 of the Adhiniyam, 1987, the State Government has declared number of schemes as “Socially Desirable Schemes” vide notification dated 13.9.2000 (Annexure R-5). In the “Socially Desirable Schemes”, 'Personal Consumer Loans' is also included. It is contended that in exercise of the powers under clause (b)(i) of section 2 of the Adhiniyam, 1987, the State Government has declared number of schemes as “Socially Desirable Schemes” vide notification dated 13.9.2000 (Annexure R-5). In the “Socially Desirable Schemes”, 'Personal Consumer Loans' is also included. The Central Bank of India has also formulated a detailed Retail Lending Policy (Annexure R-6) which includes 'Personal Loan Schemes' details whereof are provided for in clause 6.2 thereunder which covers the 'loans for vehicles' as also the Master Circular issued by the Bank dated 20.12.2013 (Annexure R-7). As such, it is incorrect to say that the car loan advanced to the petitioner is not covered under the provisions of the Adhiniyam, 1987. It is further contended that the machinery provided under the Adhiniyam, 1987 can always be galvanized for recovery of the loan as arrears of the land revenue as per the provisions of the Madhya Pradesh Land Revenue Code, 1959 (hereinafter referred to as the Code, 1959) in the event of default or non-payment of installments of loan. The respondents/Bank is entitled to request for issuance of RRC to the revenue authorities under section 3(1)(B) of the Adhiniyam, 1987. The competent authority under the Code, 1959 can execute the RRC for recovery of the loan as arrears of land revenue. As a matter of fact, any other mode for recovery of loan is barred under section 3(5) of the Adhiniyam, 1987. On merits, the respondents No.4 and 5/Bank have denied the averments made in the writ petition and it is contended that though as per terms and conditions of the loan advanced on 20.11.2014, the petitioner was required to get the vehicle registered with the Regional Transport Authority and also ensure inspection of the vehicle by the Bank authorities but uptill date, neither the vehicle is registered nor the same is made available to the Bank authorities for inspection. It is a clear violation of the terms and conditions of the loan agreement. Besides, non-registration of the vehicle also makes the petitioner liable for penal action under the Motor Vehicles Act as plying of vehicle without registration is an offence thereunder. Petitioner has failed to pay regular monthly installments of the loan. Number of notices were issued affording opportunity to make good the default but is of no avail. Besides, non-registration of the vehicle also makes the petitioner liable for penal action under the Motor Vehicles Act as plying of vehicle without registration is an offence thereunder. Petitioner has failed to pay regular monthly installments of the loan. Number of notices were issued affording opportunity to make good the default but is of no avail. Under the circumstances, the loan account was declared as Non Performance Asset (NPA). On 15.4.2015, last notice was issued to the petitioner (Annexure R-1) giving her to understand that the loan was advanced in December, 2014. Petitioner has not paid regular installments at the rate of Rs.8,539/- per month. The loan account is rendered NPA. The cheque issued by the petitioner for a value of Rs.21,000/- was bounced. Under circumstances, the petitioner was called upon to pay the entire outstanding loan and on failure of which, the Bank shall be constrained to initiate the process for recovery. On 27.4.2015, the petitioner had issued a cheque in favour of the Bank for a sum of Rs.5,16,740/-. The same was returned back with remark memo of 'insufficient funds' (Annexure R-2 and Annexure R-3). Again, a notice on 5.5.2015 (Annexure R-4) was issued for recovery of Rs.5,17,957/-. Petitioner refused to receive the same. Under such facts and circumstances of the case, respondent/Bank has issued a letter to the Collector, District Gwalior (Annexure P/1) for issuance of RRC under section 3(1)(B) of the Adhiniyam, 1987. Accordingly, RRC has been issued on 25.5.2015 (Annexure P-2) and the date of appearance of the petitioner was fixed as 2.6.2015 before the Tahsildar. Instead of appearing before the Tahsildar in the recovery proceedings, the petitioner has rushed to this Court by filing the instant writ petition which is not maintainable and even otherwise deserves dismissal on merits. 5. Heard learned counsel for parties. 6. Respondent/Central Bank of India had advanced loan in question to the petitioner falling in the category of “Personal Loan Scheme” as detailed in the Retail Lending Policy of the Bank (Annexure R-6), the details whereof are provided for in clause 6.2 which is covered under “Cent Vehicle” as well as under the Master Circular issued by the Bank on 20.12.2013 (Annexure R-7). The nature of loan transaction is within the scheme of “Socially Desirable Scheme” formulated by the State Government vide notification dated 13.9.2000 (Annexure R-5) wherein “Personal Consumer Loans” are included. The nature of loan transaction is within the scheme of “Socially Desirable Scheme” formulated by the State Government vide notification dated 13.9.2000 (Annexure R-5) wherein “Personal Consumer Loans” are included. For the recovery of such loan, the Bank is held to be fully competent to write to the revenue authorities for issuance of RRC for recovery of the loan amount due as arrears of the land revenue under section 146 of the Code, 1959 in terms of section 3(1)B) of the Adhiniyam, 1987. The contention of the petitioner that RRC under the Code, 1959 is applicable only in relation to agricultural loans, therefore, the RRC issued by the Tahsildar for recovery of car loan is without jurisdiction, in the opinion of this Court is totally misconceived and misdirected. Such contention runs de hors the scheme of the State Government by notification dated 13.9.2000 (Annexure R-5), the provisions of the Adhiniyam, 1987 and Retail Lending Policy (Annexure R-6) as well as Master Circular dated 20.12.2013 (Annexure R-7) of the respondent/Bank as detailed in the preceding paragraphs. Hence, the contention so advanced is rejected. 7. Looking to the conduct of the petitioner ever since the loan was sanctioned by the Bank on 20.11.2014 and from the date of purchase of the vehicle uptill now, the vehicle has not been registered with Regional Transport Authority. This by itself is a serious offence under the Motor Vehicles Act. Besides, non-payment of regular monthly installments by the petitioner is contrary to the terms and conditions of the loan agreement and the notice dated 15.4.2015 (Annexure R-1) issued by the Bank. Petitioner has been proved to be chronic defaulter having not paid regular monthly installments. So much so, the Cheque No.107714 dated 27.4.2015 for an amount of Rs.5,16,740/- issued by the petitioner for repayment of loan was dishonoured for the reason 'insufficient funds'. The petitioner did not respondent to the notice dated 5.5.2015 (Annexure R-4) issued by the Bank and refused to receive the same. Under such circumstances, in the opinion of this Court, the avoidance of the petitioner to pay regular monthly installments has provided sufficient ground for the Bank to declare the loan account as Non-Performance Account (NPA). The petitioner did not respondent to the notice dated 5.5.2015 (Annexure R-4) issued by the Bank and refused to receive the same. Under such circumstances, in the opinion of this Court, the avoidance of the petitioner to pay regular monthly installments has provided sufficient ground for the Bank to declare the loan account as Non-Performance Account (NPA). Even by the last notice, Annexure R-1 dated 15.4.2015 the petitioner was called upon to re-pay the entire outstanding loan within seven days failing which the mode of recovery through coercive measures directed to be resorted to. In the said notice, the Bank has specified that though the petitioner was required to pay monthly installments at the rate of Rs.8,539/- from the month of December, 2014 but except one installment, no further installment has been deposited and, hence, committed default in repayment of loan. Thereafter vide Annexure R-4 dated 5.5.2015, a notice was issued to the petitioner to which there was no response as she refused to receive the same. Under such circumstances, in the opinion of this Court, issuance of RRC under section 3(1)(B) of the Adhiniyam, 1987 (Annexure P-2) is held to be justified for realizing the outstanding loan amount as arrears of land revenue in terms of section 146 of the Code, 1959. Accordingly, no interference is warranted in this writ petition and the same is hereby dismissed.