High Court of Judicature at Madras
N. PAUL VASANTHAKUMAR & P.R. SHIVAKUMAR, JJ.
R. Kandasamy
Versus
The Chief Manager-cum-Authorised Officer Andhra Bank & Another
Writ Petition No. 25848 of 2014 & M.P. No. 1 of 2014
Decided on: 28-10-2014
SARFAESI Act, 2002 - Agricultural Property - The court dismissed the writ petition challenging the action initiated under the SARFAESI Act, 2002, contending that the property given as guarantee was an agricultural property, stating that disputed facts shall not be decided in writ proceedings. The court relied on the legal principle that the nature of the property as agricultural or not is a question of fact and cannot be determined in a writ petition.
Fact of the Case:
The petitioner challenged the action initiated under the SARFAESI Act, 2002, contending that the property given as guarantee was an agricultural property.
Finding of the Court:
The court dismissed the writ petition, stating that disputed facts shall not be decided in writ proceedings and granted liberty to the petitioner to approach the Debts Recovery Tribunal to establish the fact.
Issues: Dispute over the nature of the property given as guarantee under the SARFAESI Act, 2002.
Ratio Decidendi: The nature of the property as agricultural or not is a question of fact and cannot be determined in a writ petition.
Final Decision: The writ petition is dismissed, granting liberty to the petitioner to approach before the Debts Recovery Tribunal to establish the said fact. No costs. Connected miscellaneous petition is closed.
N. Paul Vasanthakumar, J.
1. Heard Mr.A.Kalaivanan, learned counsel appearing for the petitioner as well as Mr.R.Gowthama Narayanan, learned counsel appearing for the first respondent.
2. This writ petition is filed challenging the action initiated under the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, (hereinafter referred to as "SARFAESI Act, 2002) contending that the property, which was given as guarantee by the petitioner, is an agricultural property.
3. The learned counsel for the petitioner is relying upon certain documents to show that the property, which was given as guarantee, is the agricultural property, which is exempted under Section 31 (i) of the SARFAESI Act, 2002.
4. The said factual aspect is disputed by the first respondent by filing a counter affidavit stating that the lands are not agricultural lands, as alleged by the petitioner, but they are residential sites. It is also stated in the counter affidavit that the petitioner has produced a certificate dated 6.10.2009 issued by the Village Administrative Officer certifying that no agricultural operation took place in the said property for the past five years. The petitioner got the property valued as residential land by the bank's valuer on 8.8.2009. It is also stated that having declared the property as non-agricultural property and got the property valued as such by the bank and obtained credit facilities sanctioned by the bank, the petitioner is estopped from contending that the property is an agricultural property.
5. Since the nature of property as to whether it is an agricultural property or not itself is in dispute, this Court sitting under Article 226 of the Constitution of India cannot decide the factual issue. It is well settled in law that disputed facts shall not be decided in writ proceedings.
6. The Honourable Supreme Court in the decision reported in (1993) Supp 4 SCC 707 (Sarif Abibi Mohmed Ibrahim vs. CIT) has considered the very same issue and in paragraph-12, it is held thus:
"12. Whether a land is an agricultural land or not is essentially a question of fact. Several tests have been evolved in the decisions of this Court and the High Courts, but all of them are more in the nature of guidelines. The question has to be answered in each case having regard to the facts and circumstances of that case. There may be factors both for and against a particular point of view. The Court has to answer the question on a consideration of all of them - a process of evaluation. The inference has to be drawn on a cumulative consideration of all the relevant facts."
7. The said judgment was followed by the Division Bench of this Court in the decision reported in (2010) 3 MLJ 849 (Kalpesh P.C.Surana vs. Indian Bank). In the said case also, writ petition was filed praying for issuance of Writ of Mandamus forbearing the Bank from bringing the agricultural land for sale by invoking the provisions of SARFAESI Act, 2002 and considering the factual disputes, the Division Bench held that question of fact whether the secured asset is an agricultural land or otherwise cannot be gone into in a writ petition. The Division Bench ultimately dismissed the writ petition with liberty to the petitioner therein to avail the remedy provided under Section 17 of the SARFAESI Act, 2002 on any of the measures taken by the Bank under Section 13(4) of the SARFAESI Act, 2002.
8. Applying to the said judgments to the facts of this case, the writ petition is dismissed, granting liberty to the petitioner to approach before the Debts Recovery Tribunal to establish the said fact. No costs. Connected miscellaneous petition is closed.
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