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2020 Supreme(Telangana) 254
IN THE HIGH COURT OF FOR THE STATE OF TELANGANA
M.S. Ramachandra Rao, K. Lakshman, JJ.
Vivek Sehgal - Appellant
Versus
J.M. Financial Asset Reconstruction Company Limited - Respondent
Writ Petition No. 21598 of 2019
Decided On : 06-03-2020
Bajrang Singh Thakur, Advocate, Rubaina S Khatoon, Advocate
Headnote:
Limitation Act, 1963 - Section 5 - SARFAESI Act, 2002 - Credit facilities - Auction notice - Challenged - UCO Bank/the 1st respondent filed an Appeal in Appeal No. before Debts Recovery Appellate Tribunal as against order of Debts Recovery Tribunal - By an order dt. Debts Recovery Appellate Tribunal allowed appeal and remanded matter back to the Debts Recovery Tribunal on short ground that there was no shred of evidence produced by borrower company to prove that land was an agricultural land and that therefore Debts Recovery Tribunal should have a fresh look at issue - 1st respondent filed a Certificate from Village Revenue Officer to effect that no agricultural operations are carried on in lands for past several years - Based upon the said Certificate, Debts Recovery Tribunal dismissed S.A.No. by an order dt. holding that lands are not agricultural lands – Held, petitioners had questioned auction conducted on pursuant to sale notice dt. issued by 1st respondent on various grounds - Cause of action for filing the said S.A. is distinct and separate and it cannot be said that delay of 15 days or 10 days which occurred in filing the S.A. challenging sale notice dt or auction held on cannot be condoned - Counsel for 1st respondent stated that no valid reason for condoning the period of delay of 15 days in filing the S.A. is explained, delay being very short cannot be said to be so unreasonable as to warrant dismissal of delay condonation petition particularly when valuable properties belonging to petitioners are sought to be sold in auction - Tribunal had totally misdirected itself in refusing to condone even the short period of delay of 15 days / 10 days in filing S.A. on basis of a subsequent cause of action, i.e., auction held on pursuant to the sale notice issued and it ought to have condoned said period of delay - Accordingly, Writ Petition is allowed - Pending miscellaneous petitions, if any, shall stand closed.
JUDGMENT
K. Lakshman, J. - This Writ Petition is filed by the petitioners seeking a Writ of Certiorari to call for the records pertaining to the order dt.27.08.2019 in I.A.No.2090 of 2019 in SAIR No.977 of 2019 of the Debts Recovery Tribunal-I, Hyderabad and to quash the same.
2. M/S.Sehgal Motors Private Limited, of which petitioner No.2 is Managing Director, availed credit facilities from the UCO Bank way back in the year 2003.
3. The account became a Non-Performing Asset in the year 2010 and the bank issued a demand notice dt.29.01.2011 under Section 13(2) of the Act.
4. It was followed by a possession notice dt.28.11.2011 under Section 13(4) of the Act.
5. An auction notice was issued on 04.02.2012 fixing the date of auction as 12.03.2012.
6. Challenging the auction notice, the borrower company alone filed S.A.No.134 of 2012. In the meantime, the debt was assigned by the UCO Bank in favour of the 1st respondent.
7. The main ground of challenge in S.A.No.134 of 2012 to the measures taken under Section 13(4) of the Act was that the property brought to sale was an agricultural land and that therefore there was a bar under Section 31(i) of the Act.
8. By a final order dt.12.07.2013, the Debts Recovery Tribunal allowed S.A.No.134 of 2012 on the short ground that the lands in question are agricultural lands exempt under Section 31(i) of the Act.
9. The UCO Bank/the 1st respondent filed an Appeal in Appeal No.282 of 2013 before the Debts Recovery Appellate Tribunal, Kolkata as against the order of Debts Recovery Tribunal. By an order dt.07.07.2014, the Debts Recovery Appellate Tribunal allowed the appeal and remanded the matter back to the Debts Recovery Tribunal on the short ground that there was no shred of evidence produced by the borrower company to prove that the land was an agricultural land and that therefore the Debts Recovery Tribunal should have a fresh look at the issue.
10. After remand, the 1st respondent filed a Certificate from the Village Revenue Officer to the effect that no agricultural operations are carried on in the lands for the past several years. Based upon the said Certificate, the Debts Recovery Tribunal dismissed S.A.No.134 of 2012 by an order dt.16.04.2018 holding that the lands are not agricultural lands.
11. Immediately thereafter, the 1st respondent secured an order from the Chief Judicial Magistrate on 26.04.2018 under Section 14 of the Act.
12. Challenging the order of the Debts Recovery Tribunal dt.16.04.2018 and the order of the Chief Judicial Magistrate dt.26.04.2018, the borrower company filed two Writ Petitions and one of the Directors of the company who is the owner of the land filed one Writ Petition. All these three Writ Petitions, W.P.Nos.16494, 18108 and 28301 of 2018, were disposed of by a Bench of this Court by a final order dt.04.09.2018. The effect of this order was to set aside the order of the Debts Recovery Tribunal dt.16.04.2018 and to remit the matter back to the Debts Recovery Tribunal with liberty to the parties to file documents. However, the order of the Chief Judicial Magistrate was not interfered with by this Court by order dt.04.09.2018.
13. The Debts Recovery Tribunal again took up S.A.No.134 of 2012 for hearing and the parties filed certain documents. Thereafter, the Tribunal passed final order dt.15.03.2019 dismissing S.A.No.134 of 2012 holding that the lands are not agricultural lands and that therefore the protection under Section 31(i) of the Act was not available.
14. It is against the said order of the Debts Recovery Tribunal dt.15.03.2019 that the borrower company has come up with W.P.No.8237 of 2019 and the owner of the land, who is also a Director of the borrower company and a guarantor of the loan, has come up with W.P.No.8234 of 2019 before this Court.
15. Both these Writ Petitions were dismissed by this Court by order dt.10.06.2019 stating as under:
"It is made clear that we have not pronounced any opinion on the merits of the case and hence, it will be open
