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2016 Supreme(Guj) 309
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
Akil Abdul Hamid Kureshi and Z.K. Saiyed, JJ.
Ritesh Oil Mills P. Ltd. and Ors.- Appellants
Vs.
Dena Bank and Ors.- Respondent
Special Civil Application No. 18446 of 2013
Decided On: 17.02.2016
For Appellant/Petitioner/Plaintiff:Masoom K. Shah and Vishwas K. Shah, Advocates
For Respondents/Defendant:S.S. Panesar, Advocate
Headnote:
Constitution of India, 1950 - Articles 226 and 227 - Guardians and Wards Act, - Section 19(5) - Income Tax (Certificate Proceedings) Rules - Rule 63(1) and 63 (2) - Recovery of Debts Due to Banks and Financial Institution Act, 1993 - Sections 3,8,17,28,29,30 - Income-tax Act, 1961 - 2nd Schedule - Petitioners are borrowers - - Bank therefore filed Original Application before Debt Recovery Tribunal for recovery interest - Original Application DRT passed decree - On basis of such decree recovery certificate was also issued by DRT - Recovery Officer thereupon initiated recovery proceedings against petitioners - One of properties of petitioner alongwith factory building thereon came to be attached by Recovery Officer - Recovery Officer thereafter put property to auction- Earlier auction attempts having failed, fresh attempt was made - Recovery Officer noted that auction was fixed only one bidder respondent had submitted his bid for amount against reserved price - Held, Order passed by Recovery Officer has vital bearing on rights of the petitioners - Order that Recovery Officer may pass in exercise of powers under Sections 25 to 28 of the RDDB Act and which acts prejudicially or is injurious to person, such person would be person aggrieved - An appeal at hands of such person would be maintainable - DRT had dismissed appeal after taking into account objections of petitioners - Since it is pointed out that bank is attempting to recover dues of defaulters since long without success, instead of relegating proceedings to DRT, place it before DRAT for decision on appeal of petitioners on merits - Request DRAT to give priority consideration to such appeal and dispose of same - Interim formula granted by Court earlier shall inure - If appeal is not disposed of, it would be open to petitioners to apply before DRAT for further relief - Petition Disposed.
Akil Abdul Hamid Kureshi, J.
1. The petitioners have challenged the judgment dated 29.11.2013 passed by the Debts Recovery Appellate Tribunal, Mumbai ('DRAT' for short) in following background;
2. The petitioners are borrowers. Having taken loan from the respondent No. 1 Dena Bank, they failed to repay the same. Dena Bank therefore filed Original Application No. 319 of 1998 before he Debt Recovery Tribunal, Ahmedabad ('DRT' for short) for recovery of such unpaid dues with interest. In such Original Application the DRT passed a decree for a sum of Rs. 56,39,015.51 ps. On the basis of such decree a recovery certificate was also issued by DRT in favour of the bank. The Recovery Officer thereupon initiated recovery proceedings against the petitioners. One of the properties of the petitioner, namely, land bearing block No. 278-paiki admeasuring 3631 sq.mtrs., of Village : Gadhoda, Taluka : Himmatnagar, alongwith factory building thereon came to be attached by the Recovery Officer on 9.9.2003. The Recovery Officer thereafter put the property to auction. Earlier auction attempts having failed, a fresh attempt was made in September, 2009. On 22.9.2009, the Recovery Officer noted that the auction was fixed on that day, only one bidder, namely, one Shri Gopalkrishnan Dahyabhai Patel, the respondent No. 2 herein had submitted his bid for an amount of Rs. 21 lacs against the reserved price of Rs. 21 lacs. He had also attached the demand draft for a sum of Rs. 5.25 lacs. He was persuaded to raise his bid to Rs. 21.05 lacs. In view of such developments the Recovery Officer on 22.9.2009 passed the following order:--
"In view of the above the following order is passed:
1. The offer received for the above mentioned immovable property from Shri Gopalkrishna D. Patel for an amount of Rs. 21.05 lacs against the reserve price of Rs. 21.00 lacs is hereby accepted.
2. Successful auction purchaser is hereby directed to deposit the balance amount of 25% on or before 23.09.09 by Demand Draft/Pay Order in favour of the Recovery Officer, DRT-I, Ahmedabad.
3. The successful bidder is further directed to deposit the remaining 75% of the offered amount on or before 06.10.09 by Demand Draft/Pay Order in favour of the Recovery Officer, DRT-I, Ahmedabad. The sale shall be confirmed in due course in accordance with the prescribed terms & conditions.
4. Further, the successful purchaser is directed to deposit the Poundage Fee 1% of the bid amount plus Rs. 10) as per sub-rule (1) of the Income Tax (Certificate Proceedings) Rules, 1962, Appendix 28 in favour of the Registrar, Debts Recovery Tribunal, Ahmedabad.
5. CH Bank is hereby directed to file FIR regarding the theft of the movable property. Further CH Bank is also directed to depute security with immediate effect and ensure that no further theft takes place till confirmation of sale.
The matter is adjourned till 23.09.09. Copy of this order be given to all concerned free of cost."
3. On 23.9.2009, the Recovery Officer passed following order:--
"Present proxy advocate for the CH Bank and the successful auction purchaser.
The successful purchaser has deposited a DD No. 640500 dated 23.9.2009 an amount of Rs. 5000 towards 25% of the bid amount for the immoveable property at Lot No. 1. Successful auction purchaser is directed to deposit the remaining amount of Rs. 15,75,000 towards 75% of the bid amount and amount of Rs. 21,060 towards the Poundage fees auctioned by 22.9.2009.
The matter is adjourned to 6.10.2009."
4. The said order dated 22.9.2009 was challenged by the petitioners before the DRT, Ahmedabad, by filing appeal under Section 30 of the Recovery of Debts Due to Banks and Financial Institution Act, 1993 ('RDDB Act' for short). The petitioners raised three contentions before DRT in such appeal, (1) that the proclamation notice for auction was affixed on 2.9.2009 and the auction was conducted on 22.9.2009 which was less than 30 days of statutory period provided under the rules; (2) that the valuation report
