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2016 DIGILAW 581 (GAU)

VIJAYA BANK v. KAITLUANGA

2016-06-22

MICHAEL ZOTHANKHUMA

body2016
JUDGMENT : MICHAEL ZOTHANKHUMA, J. 1. Heard Mr. Zochhuana, counsel for the appellants. Also heard Mr. B. Lalramenga, counsel for the respondent No. 1. None appears for the respondent No. 2. 2. The present appeal has been filed against the Judgment and Order dated 23.05.2012 passed in Civil Suit No. 86/2010, wherein the Court of the Senior Civil Judge-I, Aizawl has decreed that the appellants are to return the original and duplicate copy of LSC's No. 36/1976 to the respondent No. 1. 3. The facts leading to the present case is that the respondent No. 1 is the father of the respondent No. 2. The respondent No. 1 and 2 have both taken loans from the appellants and they have both acted as Guarantors for each others loans. 4. Due to non re-payment of the loan by the respondent No. 2, the appellants gave a notice to the respondent No. 2 under Section 13 of The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. The copy of the notice was also served to the respondent No. 1. 5. The respondent No. 1 thereafter filed Civil Suit No. 86/2010 in the Court of the Senior Civil Judge-I, Aizawl stating that on receipt of the notice, the respondent No. 1 came to learn that his daughter, respondent No. 2 had taken a loan from the appellants and that the respondent No. 1 was made a Guarantor to the said loan. The respondent No. 1 also stated that his daughter, respondent No. 2 had informed him that she had mortgaged the land covered by LSC No. 36/1976 with the appellants as security for the loan. This had been done without the consent of the respondent No. 1. The respondent No. 1 in Civil Suit No. 86/2010 thereafter prayed for a decree for return of the LSC No. 36/1976, as the mortgage of the same with the appellants, had been made by the respondent No. 2, without the knowledge and consent of the respondent No. 1. 6. The Court of the Senior Civil Judge-I, Aizawl District vide Judgment and Order dated 23.05.2012 passed in Civil Suit No. 86/2010 came to a finding that the respondent No. 1 was entitled to get back the land covered by LSC AZL No. 36/1976. 7. 6. The Court of the Senior Civil Judge-I, Aizawl District vide Judgment and Order dated 23.05.2012 passed in Civil Suit No. 86/2010 came to a finding that the respondent No. 1 was entitled to get back the land covered by LSC AZL No. 36/1976. 7. Accordingly, the learned Trial Court had directed for return of the LSC No. 36/1976 to the respondent No. 1 by the appellants. 8. Mr. Zochhuana, counsel for the appellants submits that the counter-claim made by the appellants was also dismissed by the impugned Judgment and Order dated 23.05.2012 passed in Civil Suit No. 86/2010. He also submits that in view of Section 34 of The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, the Trial Court should not have passed any order in respect of the mortgaged property. 9. I have heard the learned counsel for the parties. I find that the Trial Court had come to a finding that in view of Section 17, 34 & 35 of The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, the liabilities of the respondent No. 1 in connection with the loan taken by the respondent No. 2 from the appellants would have to be decided by the appropriate Debts Recovery Tribunal. However, in the same breath, the learned Trial Court had directed the appellants to hand over the land covered under LSC No. 36/1976 to the respondent No. 1. Section 17, 34 & 35 of The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 are reproduced below:- "17. Right to appeal.-(1) Any person (including borrower), aggrieved by any of the measures referred to in sub-section (4) of section 13 taken by the secured creditor or his authorised officer under this Chapter, [may make an application along with such fee, as may be prescribed] to the Debts Recovery Tribunal having jurisdiction in the matter within forty-five days from the date on which such measures had been taken: Provided that different fees may be prescribed for making the application by the borrower and the person other than the borrower. Explanation.-For the removal of doubts it is hereby declared that the communication of the reasons to the borrower by the secured creditor for not having accepted his representation or objection or the likely action of the secured creditor at the stage of communication of reasons to the borrower shall not entitle the person (including borrower) to make an application to the Debts Recovery Tribunal under sub-section (1) of section 17. The Debts Recovery Tribunal shall consider whether any of the measures referred to in sub-section (4) of section 13 taken by the secured creditor for enforcement of security are in accordance with the provisions of this Act and the rules made thereunder. (3) If, the Debts Recovery Tribunal, after examining the facts and circumstances of the case and evidence produced by the parties, comes to the conclusion that any of the measures referred to in sub-section (4) of section 13, taken by the secured creditor are not in accordance with the provisions of this Act and the rules made thereunder, and require restoration of the management of the secured assets to the borrower or restoration of possession of the secured assets to the borrower, it may be order, declare the recourse to any one or more measures referred to in sub-section (4) of section 13 taken by the secured assets as invalid and restore the possession of the secured assets to the borrower or restore the management of the secured assets to the borrower, as the case may be, and pass such order as it may consider appropriate and necessary in relation to any of the recourse taken by the secured creditor under sub-section (4) of section 13. (4) If, the Debts Recovery Tribunal declares the recourse taken by a secured creditor under sub-section (4) of section 13, is in accordance with the provisions of this Act and the rules made thereunder, then, notwithstanding anything contained in any other law for the time being in force, the secured creditor shall be entitled to take recourse to one or more of the measures specified under sub-section (4) of section 13 to recover his secured debt. (5) Any application made under sub-section (1) shall be dealt with by the Debts Recovery Tribunal as expeditiously as possible and disposed of within sixty days from the date of such application: Provided that the Debts Recovery Tribunal may, from time to time, extend the said period for reasons to be recorded in writing, so, however, that the total period of pendency of the application with the Debts Recovery Tribunal, shall not exceed four months from the date of making of such application made under sub-section (1). (6) If the application is not disposed of by the Debts Recovery Tribunal within the period of four months as specified in sub-section (5), any party to the application may make an application, in such form as may be prescribed, to the Appellate Tribunal for directing the Debts Recovery Tribunal for expeditious disposal of the application pending before the Debts Recovery Tribunal and the Appellate Tribunal may, on such application, make an order for expeditious disposal of the pending application by the Debts Recovery Tribunal. (7) Save as otherwise provided in this Act, the Debts Recovery Tribunal shall, as far as may be, dispose of application in accordance with the provisions of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (51 of 1993) and the rules made thereunder. 17A. Making of application to Court of District Judge in certain cases.- In the case of a borrower residing in the State of Jammu and Kashmir, the application under section 17 shall be made to the Court of District Judge in that State having jurisdiction over the borrower which shall pass an order on such application. Explanation. - For the removal of doubts, it is hereby declared that the communication of the reasons to the borrower by the secured creditor for not having accepted his representation or objection or the likely action of the secured creditor at the stage of communication of reasons shall not entitle the person (including borrower) to make an application to the Court of District Jude under this section. 34. Civil court not to have jurisdiction. 34. Civil court not to have jurisdiction. - No civil court shall have jurisdiction to entertain any suit or proceeding in respect of any matter which a Debts Recovery Tribunal or the Appellate Tribunal is empowered by or under this Act to determine and no injunction shall be granted by any court or other authority in respect of any action taken or to be taken in pursuance of any power conferred by or under this Act or under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (51 of 1993). 35. The provisions of this Act to override other laws. - The provisions of this Act shall have effect, notwithstanding anything inconsistent therewith contained in any other law for the time being in force or any instrument having effect by the virtue of any such law." 10. In view of the fact that the Civil Courts do not have jurisdiction to entertain any suit or proceeding in respect of matters which are to be adjudicated by a Debts Recovery Tribunal, the Trial Court could not have decided the question of whether the mortgage of the property, i.e. LSC No. 36/1976, was done with the knowledge and consent of the respondent No. 1. The question of whether the LSC No. 36/1976 was mortgaged with the appellant with the knowledge of the respondent No. 1 can be decided by the Debts Recovery Tribunal. It is further submitted at the bar that the appellants have filed a case in the Debts Recovery tribunal, Guwahati in respect of the loan taken by the respondent No. 2. 11. In view of the fact that there is alternative remedy available and as the jurisdiction of the Civil Courts is barred, the Judgment and Order & Decree dated 23.05.2012 passed by the senior Civil Judge-I, Aizawl in Civil Suit No. 86/2010 is set aside. The issues raised by the respondent No. 1 in Civil Suit No. 86/2010 may be agitated by him in the appropriate Debt Recovery Tribunal, if so advised. 12. Appeal is accordingly allowed. Send back the LCRs.