The main legal point established in the judgment is that the time limit for selling attached property under Rule 68B of the Income Tax Act does not apply to recovery proceedings under the Debts Recovery Tribunal Act, and that the recovery proceedings should be conducted in a fair and transparent manner, with due consideration for the right to property.

K.K. Sasidharan, J.

1. The challenge in these writ petitions relates to the Recovery Certificate issued by the Debts Recovery Tribunal on 11 December 2001 to recover the debt from M/s. Navilkal Estate Tea Factory, Kothagiri and the consequential sale proclamation issued by the Recovery Officer on 23 December 2009 proposing to auction the property to realize the decree amount.

2. The prayer in writ petitions in W.P.No.1609 and 6341/2010 are one and the same. The issue in W.P.No.6740/2010 pertains to the invalidity of sale proclamation.

3. The petitioners are the partners of M/s.Navilkal Tea Estate and Factory, Nilgiris at Kothagiri in the District of Nilgiris [hereinafter referred to as ‘the firm’]. The Firm took loan from the Aravenu Branch of Canara Bank and as security for sanctioning the loan, joint family property of the partners were given as security. Since the firm defaulted in making payments, the Bank instituted proceedings before the Debts Recovery Tribunal Coimbatore in T.A.No.85/1998 and the firm as well as its partners were made parties to the proceeding. Ultimately, the Tribunal passed a decree directing the firm and its partners jointly and severally to pay a sum of Rs.18,33,975.50 with future interest at 15%. The Bank was permitted to sell the mortgaged property and to adjust the sale proceeds towards the amount due. The Debts Recovery Tribunal on the basis of the decree dated 29 October 2011 issued a Recovery Certificate dated 11 December 2001 authorizing the Recovery Officer to recover the amount. The Recovery Officer passed an order of attachment on 2 December 2002.

4. The Recovery Officer thereafter issued a proclamation of sale on 23 December 2009 to auction the property shown in the order of attachment. The proclamation was challenged in W.P.No.1609/2010 and the Division Bench of this Court as per order dated 29 January 2010, restrained the Recovery Officer from confirming the sale in respect of items 2(i), (ii) and (iii) mentioned in the proclamation of sale, subject to the condition that the writ petitioner deposits a sum of Rs.10,00,000/-. The said order was duly complied with.

5. The Recovery action is challenged on the following grounds:-

(i) The decree passed by the Debts Recovery Tribunal was on 29 October 2001. However, proclamation was issued only on 23 December 2009. Therefore, it is barred by limitation;

(ii) The order of attachment was made on 2 December 2002. The proclamation in question was issued three years thereafter. Therefore, the sale is barred under Rule 68B of II Schedule to the Income Tax Act read with Section 29 of the Recovery of Debts due to Banks and Financial Institutions Act, 1993.

(iii) The proclamation was issued in the name of Thiru.J.N.Durai, in spite of the fact that the said Durai died long back. The legal representatives were not impleaded and no notice was issued to them. Therefore, the proclamation issued in the name of a dead person is bad in law.

6. The petitioner is the son of J.N.Durai, who was also a partner of the firm M/s. Navilkal Tea Estate and Factory. The said Durai was a party to the proceedings in T.A.No.85/1998. The order of attachment was issued against the firm and its partners, including Mr.J.N.Durai. The said Durai died on 30 May 2006. However, no action was taken by the Recovery Officer to bring the legal representatives of the deceased Durai as party to the recovery proceedings. The proclamation of sale was issued on 23 December 2009. It was issued in the name of a dead person inasmuch as the deceased Durai was shown as second respondent in the proclamation of sale. The proclamation issued in the name of a dead person is liable to be set aside. The auction was scheduled to be held on 29 January 2010. It was adjourned to 1 February 2010 due to administrative reasons. It was once again postponed to 26 February 2010. There was no fresh proclamation or notice to the parties, intimating them of such postponement. The notice was published only i