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2024 Supreme(Cal) 1355

IN THE HIGH COURT AT CALCUTTA
SHAMPA SARKAR, J.
Aarburgreen Estates LLP & Anr. – Petitioners
Versus
Subhas Chowdhury & Anr. – Opp. Parties
C.O. No. 3151 of 2023
Decided On : 21-05-2024

Advocates Appeared:
For the Petitioners: Mr. Abhrajit Mitra, Sr. Adv., Mr. Suddhasatva Banerjee, Mr. Satadip Bhattacharya, Ms. Rituparna Chatterjee, Ms. Khushboo Choudhury, Mr. Aniruddha Chatterjee, Mr. Abirlal Chakraborty.
For the Opp. Parties : Mr. Probal Mukherjee, Sr. Adv., Mr. Nimish Mishra, Mr. Gaurav Singh, Mr. Abir Mondal, Mr. Shamit Sanyal, Ms. Mekhala Kanji.

Recovery Officers must adhere to jurisdictional limits and cannot impose binding interim orders affecting property rights without proper evidentiary basis and due process.

Headnote:(A) Recovery of Debts Due to Banks and Financial Institutions Act, 1993 - Sections 19, 25, and 28 - Interim directions by Recovery Officer regarding land rights and access - Petitioners challenged directions alleging they exceeded jurisdiction - Court found Recovery Officer acted beyond authority without proper evidence or findings regarding land ownership - Total lack of jurisdiction noted. (Paras 60, 62, 67)

(B) Nature of powers vested in Recovery Officer - Recovery Officer cannot unilaterally adjudicate property rights without due process and evidence - Interim orders should not create final prejudicial effects without proper adjudication. (Paras 56, 58, 66)

Facts of the case:
The petitioners, who claimed ownership of multiple plots, faced interim directions from the Recovery Officer regarding access to a landlocked property they had also purchased. The order caused ongoing construction to be halted and imposed costs, which the petitioners contested as jurisdictionally improper. (Paras 1, 60)

Findings of Court:
The court found that the Recovery Officer had exceeded jurisdiction and imposed interim orders lacking appropriate evidence and legal grounding, resulting in the case being remitted for proper hearing following the pending appeal. (Paras 67, 70)

Issues: The court addressed whether the Recovery Officer acted within his jurisdiction and if his orders regarding land access were valid.

Ratio Decidendi: The court ruled the Recovery Officer could not adjudicate on property ownership or access without adhering to due process, emphasizing the need for a proper hearing before issuing interim orders of significant impact.

Result: The order impugned was set aside, allowing for proper adjudication in light of pending appeals.

Table of Content
1. challenge to recovery officer's authority and jurisdiction. (Para 1 , 2 , 6 , 10 , 11)
2. background ownership and allegations of obstruction. (Para 3 , 4 , 12 , 14 , 18)
3. arguments related to recovery officer's powers and scope. (Para 7 , 25 , 28 , 30 , 31)
4. discussion on the legal validity of property transactions. (Para 13 , 15 , 17 , 22 , 24)
5. arguments on the legality of obstruction claims. (Para 21 , 23 , 26)
6. court's observations regarding jurisdiction and procedural fairness. (Para 34 , 35 , 41 , 45 , 48)
7. issues of blocking access and jurisdiction discuss. (Para 56 , 58)
8. court’s determination on jurisdictional limits. (Para 59)
9. final ruling on the jurisdictional overreach and procedural impropriety. (Para 60 , 63 , 67)
10. final closure on the appeal and judgment. (Para 69)

JUDGMENT :

(Shampa Sarkar, J.) :

1. The revisional application arises out of an order dated September 1, 2023 passed by the learned Recovery Officer, Debts Recovery Tribunal-II, Kolkata in TRC No.191 of 2001. The order was passed on an application filed by the auction purchaser/opposite party No.1 alleging obstruction posed by the petitioners, making plot no. 3332 (purchased plot) inaccessible.

2. By the order impugned, the learned Recovery Officer passed certain interim directions, which are under challenge before this Court. The jurisdiction of this Court is invoked on the ground that the order suffers from a lack of inherent jurisdiction. It is alleged that the learned Recovery Officer did not act within the bounds of his authority and also misconstrued the law while passing the mandatory directions at the interim stage.

3. The facts as pleaded in this revisional application were that the petitioner No.1 was the sole and absolute owner of lands measuring about 104.66 satak comprising of R.S. Dag Nos.3325, 3329 and 3334 recorded in R.S. Khatian Nos.832, 697 and 448, in Mouza Jagaddal, J.L. No.71 Ward No.25, Municipal Holding No.408, Dwarir Road, under Rajpur-Sonapur Municipality, Kolkata 700151.

4. The petitioner No.1 acquired right, title and interest in respect of the premises by virtue of seven deeds of conveyance executed between January 8, 2016 and November 28, 2017. The petitioner No.1 entered into a joint development agreement dated August 19, 2022 with the petitioner No.2. On or about December 23, 2022, the petitioner No.1 received a notice dated December 15, 2022, issued by the learned Recovery Officer, requiring personal appearance of the petitioner through its representative or a partner. In the said notice, it was alleged that the petitioner No.1 had obstructed the ingress and egress to and from the property sold to the opposite party No.1 in the auction sale, being land measuring about 22 decimals in R.S. Dag No.3332 of Mouza Jagaddal.

5. Challenging the aforementioned notice, a writ petition was filed before the High Court, being WPA 4260 of 2023. The said writ petition is still pending.

6. By order dated February 20, 2023, notice of the proceeding was issued upon the petitioner No.2. By order dated March 1, 2023, the learned Recovery Officer issued a notice upon the Block Land and Land Reforms Officer, Sonarpur, as also upon the directors of the petitioner No.1 and the petitioner No.2, asking them to be present before the authority. According to the petitioners, till such time, no copy of the application on the basis of which the orders were being passed, had been served. On March 14, 2023, two separate applications were filed before the learned Recovery Officer by the petitioners, praying for service of the copy of the application which had given rise to the proceedings. By order dated March 21, 2023, for the first time, the learned Recovery Officer directed the opposite party No.1 to serve a copy of the application upon the petitioners.

7. In course of hearing of the application on April 11, 2023, the petitioners were served with a copy of the application filed by the opposite party No.1. The application c

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