The Recovery Officer lacks jurisdiction to sell property not belonging to the defaulter, and aggrieved parties must pursue statutory remedies to assert their claims.

ORDER
The subject-matter of these writ petitions is the entire first floor of property bearing No. 73/3, situated at Nandidurga Crescent Road, Bangalore-46, measuring 1500 sq. feet. The Recovery Officer has brought this property for sale as per Annexure-A for recovery of a sum of Rs. 1,33,61,383/- in pursuance of a Recovery Certificate issued by the Debt Recovery Tribunal in terms of a decree passed against M/s. ABN Granites Ltd. The petitioner contends that the said property never belonged to M/s. ABN Granites Ltd., and it was never mortgaged to the Bank as a security for payment of loan account. In fact, before purchasing this property the petitioner got a paper publication issued calling upon any person who has interest to come forward and state so. When there was no claim from any quarter he proceeded to purchase the property under a registered sale deed dated 8-8-1996 as per Annexure-H from its Vendor, for a valuable consideration. The Katha has been made out in the name of the petitioners and they have been paying the tax. The petitioner is in possession of the property and therefore it is contended that the Sale Certificate issued by the Recovery Officer is one without jurisdiction as the petitioner is not a party to the proceedings and the aforesaid property is not the subject-matter of the proceedings. This Court after entertaining the writ petitions granted an interim order of stay of Annexure-A for a period of two weeks on 23-3-2004 and it is subsequently continued until further orders. By virtue of the interim order granted by this Court the property is not yet sold.

2. Learned Counsel appearing for the petitioners contends, when the property which is brought to sale belongs absolutely to the petitioner-Company and there is no decree against the petitioner-Company passed by the Debt Recovery Tribunal as the said property is not the subject-matter of the proceedings before the DRT nor this property was mortgaged in favour of the bank, the Recovery Officer has committed an illegality in bringing the property in question for sale, that too, without notice to the petitioners and therefore, the sale proclamation at Annexure-A is liable to be quashed.

3. The Recovery of Debts Due to Banks and Financial Institutions Act, 1993, at Chapter-V, provides a comprehensive machinery for recovery of debts determined by the Tribunal. Section 25 deals with the modes of recovery of debts. It reads as follows :
"The Recovery Officer shall, on receipt of the copy of the certificate under sub-section (7) of Section 19, proceed to recover the amount of debt specified in the certificate by one or more of the following modes, namely :-
(a) attachment and sale of the movable or immovable property of the defendant;
(b) arrest of the defendant and his detention in prison;
(c) appointing a receiver for the management of the movable or immovable properties of the defendant."
Further, the party who has suffered the decree is precluded from disputing the correctness of the amount specified in the Certificate before the Recovery Officer as is clear from Sec. 26 of the Act.

4. Section 29 of the Act stipulates that the provisions of Second and Third Schedule to the Income-tax Act, 1961 and the Income-tax (Certificate Proceedings) Rules, 1962, as in force from time to time shall, as far as possible, apply with necessary modifications as if the said provisions and the rules referred to the amount of debt due under this Act instead of to the income-tax.

5. The Schedule II to the Income-tax Act provides for procedure for recovery of tax. Clause 11 of the Second Schedule deals with the Investigation by Tax Recovery Offic