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2023 DIGILAW 451 (UTT)

Mohd. Khawja v. State of Uttarakhand

2023-08-08

RAVINDRA MAITHANI

body2023
JUDGMENT : The challenge in this petition is made to sale notice issued by the respondent no.6, the State Bank of India (“the bank”) under the provisions of The Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (“the Act”). The petitioners have also sought related reliefs. 2. Heard learned counsel for the parties and perused the record. 3. The case in brief is as follows. According to the petitioners, their father Ali Ahmad was one of the partners in M/S Bilal Rice Mill, situated in Bilaspur, District Rampur (“the mill”). The bank proceeded against the father of the petitioners for delivery of possession. A notice was issued on 05.07.2023. According to the petitioners, their father Ali Ahmed had died long back on 24.05.2021. One of the partners, Navi Ahmed filed proceedings under the provisions of the Act before Debt Recovery Tribunal, Dehradun (“the Tribunal”), in which, on 12.12.2022, the Tribunal passed certain order directing the respondent bank not to take any action with regard to taking possession of the property subject to certain conditions requiring the mill to deposit amount in phased manner, as specified in the order. The order dated 12.12.2022, passed by the Tribunal was further challenged by the bank in WPMB No.121 of 2023, State Bank of India vs. M/S Bilal Rice Mill and others (“the petition”), by which, the operation of the order dated 12.12.2022, passed by the Tribunal was stayed. 4. It is the case of the petitioners that they were not party in the petition. The respondent no.6, the bank had sent a notice to the father of the petitioners, who had died long back. The respondent no.6, the bank auctioned the property of the mill on 20.07.2023, pursuant to the sale notice dated 28.06.2023. 5. Learned counsel for the petitioners would submit that the petitioners’ father was partner in the mill. The petitioners have never been served with any notice by the respondent no.6, the bank before proceeding under the provisions of the Act with regard to the property of the mill. 6. Learned counsel also raised the following points in his submissions:- (i) The petitioners have an interest in the property of the mill. (ii) The property of the mill is charged property. 6. Learned counsel also raised the following points in his submissions:- (i) The petitioners have an interest in the property of the mill. (ii) The property of the mill is charged property. (iii) The petitioners have share in the property and until their share is bifurcated or they are heard, the property, as such may not be auctioned. (iv) The petitioners subsequently came to know about the notice dated 05.07.2023, issued by the respondent no.6, the bank, by which, physical possession was required. This notice was duly replied by the petitioners on 01.08.2023, but yet, no action has been taken by the respondent no.6, the bank on it. (v) In the petition the Division Bench of this Court made critical observation with regard to the working of the Tribunal and had stopped the Tribunal to proceed further in the case. Therefore, the petitioners have no other alternate remedy to ventilate their grievance except to file the petition before this Court. (vi) The petitioners cannot approach this Court in the petition because they are not party in that petition. The petition is preferred by the bank against the order dated 12.12.2022, passed by the Tribunal. (vii) Learned counsel for the petitioners would submit that, in case, the physical possession of the property is taken by the respondent no.6, the bank, the petitioners would be divested of their valuable rights to property. Therefore, indulgence of this Court is required. 7. Learned counsel for the respondent no.6, the bank would submit that the petitioners are well aware of the proceedings under the provision of the Act since inception. He would raise following points in his submissions:- (i) The notice dated 05.07.2023 was issued to father of the petitioners, Ali Ahmad as well as Navi Ahmad, who is brother of Ali Ahmad. (ii) Loan was taken by the mill. (iii) The proceedings under the provisions of the Act have been initiated by the bank for recovery of unpaid loan. (iv) This Court did not stop the Tribunal from functioning. After the order dated 22.06.2023, passed in the petition. Navi Ahmad filed a recall application, which has been rejected on 05.07.2023, thereafter Navi Ahmed challenged the order dated 05.07.2023, in the Special Leave Petition before the Hon’ble Supreme Court, which was subsequently withdrawn by the Navi Ahmad on 28.07.2023 with certain liberty. 8. After the order dated 22.06.2023, passed in the petition. Navi Ahmad filed a recall application, which has been rejected on 05.07.2023, thereafter Navi Ahmed challenged the order dated 05.07.2023, in the Special Leave Petition before the Hon’ble Supreme Court, which was subsequently withdrawn by the Navi Ahmad on 28.07.2023 with certain liberty. 8. The Court at the very outset, wanted to know from the learned counsel for the petitioners, as to which order of this Court stopped the Tribunal from working? Where is that order, which according to the learned counsel for the petitioners, have been passed by this Court in the petition? 9. After a while learned counsel for the petitioners would submit that there is no such written order, but the Court had made the oral observation to it. He would submit that the Tribunal has been restrained by this Court from passing any order in this matter. 10. Learned counsel for the respondent no.6, the bank would submit that the Court did not restrain the Tribunal from its functioning. 11. The respondent no.6, the bank is proceeding against the mill for recovery of his dues under the provisions of the Act. The Act has been enacted so as to regulate securitisation and reconstruction of financial assets and enforcement of security interest, etc. The Act provides a procedure for recovery of unpaid dues. It includes the proceedings against the secured assets. There is a procedure for it. If the petitioners are aggrieved by any order, passed under the Act, they could very well ventilate their grievance under Section 17 of the Act. It has not been done. 12. Navi Ahmad is admittedly the brother of Ali Ahmad, the father of the petitioners. Navi Ahmad has been pursuing his claim before the Tribunal. In fact, learned counsel for the petitioners would submit that he has filed an application under Section 17 of the Act before the Tribunal, which was rejected. 13. Learned counsel for the respondent no.6, the bank during the course of hearing would submit that the respondent no.6, the bank had filed a claim before the Tribunal, in which, the petitioners were also the parties, they did not appear. The claim of the petitioners was decreed ex parte. 14. 13. Learned counsel for the respondent no.6, the bank during the course of hearing would submit that the respondent no.6, the bank had filed a claim before the Tribunal, in which, the petitioners were also the parties, they did not appear. The claim of the petitioners was decreed ex parte. 14. Even during the course of hearing, learned counsel for the respondent no.6, the bank would submit that petitioners are very powerful when the authorized officer of the bank reached at the spot to get physical possession of the property of the mill, it is the petitioners, who approached the Commissioner of the area, who telephoned the Sub Divisional Magistrate and for the whole day the possession could not be taken. 15. The petitioners know that the order of the Tribunal dated 12.12.2022 has been stayed by this Court on 22.06.2023, by the order passed in the petition. The petitioners also know that earlier the Tribunal on 22.12.2022 had permitted Navi Ahmad to deposit certain amount in the phased manner and the respondent no.6, the bank was stopped to proceed further. The fact remains that Navi Ahmad could not succeed in the petition by way of filing a recall application, which admittedly was rejected on 05.07.2022. The fact remains that Navi Ahmad did not stop here. He filed a special writ petition before the Hon’ble Supreme Court, which subsequently he withdrew. Does not it mean that this petition is nothing, but an attempt to thwart those proceedings taken under the provisions of the Act against the mill. It is another attempt when Navi Ahmad could not succeed. 16. This Court has no doubt that this is another way that was devised to stifle the proceeding under the Act, but it should not be permitted. If this petition is entertained it would be nothing, but perpetuating the abuse of process of law. As stated, if the petitioners have any grievance against any action taken under the provisions of the Act, they have ever been free to ventilate their grievance in accordance with the mechanism provided under the provisions of the Act. 17. In view of foregoing discussions, this Court does not see any reason to make any intervention in the instant petition. Accordingly, the petition deserves to be dismissed at the stage of admission itself. 18. The petition is dismissed in limine.