M.GOVINDARAJ, J.
The petitioner has filed these two writ petitions challenging the order dated 04.12.2012 passed in I.A.No.1556 of 2010 and I.A.No.1557 of 2010 respectively, in AIR (SA) 937/2010 in SA 153/2008, by the Debts Recovery Appellate Tribunal, Chennai, the seventh respondent herein and for a consequential direction to the seventh respondent to entertain the application seeking leave to sue, as well as for condonation of delay in filing the appeal and to entertain the appeal on merits and dispose the same in accordance with law.
2. The petitioner is a third party auction purchaser in respect of the property of vacant land measuring 1,36,401 sq.ft situated at Valayankulam Village, Madurai District, in an auction conducted by the respondents 5 and 6 on 07.05.2009. The respondents 1 to 4, who are the borrowers / guarantors, challenged the sale notice dated 04.10.2008, in S.A.No.153 of 2008, before the Debts Recovery Tribunal – 3, Chennai. By an order dated 18.06.2010, the auction sale was set aside, against which, the petitioner preferred an appeal before the Debts Recovery Appellate Tribunal, Chennai, the seventh respondent herein.
3. The petitioner, being the highest bidder for Rs.71 Lakhs, in the auction conducted by the fifth respondent on 07.05.2009, in respect of item no.3 of the sale notice, has paid 25% of the sale consideration, in compliance of the conditions of sale. But thereafter, no information was coming forward from the fifth respondent. Therefore, the petitioner contacted the fifth respondent on 15.09.2010, wherein he was advised to take back the advance amount, thereby he came to know that the auction sale was set aside by the Debts Recovery Tribunal.
4. The petitioner has requested the fifth respondent Bank to file an appeal. But he had informed that another sale notice will be published on 17.09.2010. Thereafter, the petitioner has contacted his lawyer and obtained the certified copies of the order and other documents and filed an appeal. However, there was a delay of 72 days in filing the appeal.
5. The petitioner has filed an application in I.A.No.1557 of 2012 in AIR (SA) 937/2010 against the order dated 18.06.2010 passed in SA No.153/2008, before the Debts Recovery Appellate Tribunal. He has also filed another application in I.A.No.1556 of 2012 in AIR (SA) 937/2010 seeking leave to prefer a third party appeal against the order dated 18.06.2010 passed in S.A.No.153/2008. Furthermore, the petitioner has filed another application in I.A.No.1558 of 2012 in I.A. No.862 of 2011 in AIR (SA) 937/2010 seeking interim stay.
6. The Debts Recovery Appellate Tribunal by its order dated 04.12.2012 dismissed all the applications with an observation that there is no power to condone the delay, in view of the orders passed by this Court in W.P.Nos.13456 of 2012, 8381 of 2012 and 12970 of 2012 dated 28.08.2012 [Dr. ZUBIDA BEGUM AND ANOTHER VS. INDIAN BANK REP.BY ITS MANAGER GUIDY BRANCH CHENNAI (2012 (5) CTC 369)]. However, the same was not communicated to the petitioner by his counsel. When the petitioner contacted his counsel, he was informed that he misplaced the bundle during shifting of his office. Thereafter, the petitioner has applied for a certified copy of the order on 17.04.2013 and obtained the same on 23.04.2013.
7. The petitioner did not prefer any appeal at that point of time, as he was advised that he had no case in view of the judgment of this Court and he was facing so many other civil and criminal litigations before this Court. Thereafter, in the second week of December 2015 only, he came to know about the judgment reported in AIR 2015 (SC) 2881 dated 05.08.2015 that the Tribunal can condone the delay. In view of this judgment, the writ petitioner had found that his right is still alive and not remediless. Therefore, he has come up with the present writ petitions challenging the common order passed by the Debts Recovery Appellate Tribunal.
8. The petitioner would further state that the fifth respondent, in collusion with the respondent Nos.1 to 4, had intentionally released the property even though the borrower has not settled the entire outstanding.
9. The respondent Nos.1 to 4 have filed a typed set narrating the dates and events which are taken place after the sale was set aside.
10. According to respondent Nos.1 to 4, the Bank has issued demand notice under Section 13(2) of the SARFAESI Act, on 16.05.2008 and possession notice under Section 13(4) of the SARFAESI Act was issued on 27/ 28 / 29th of August 2008, pursuant to which, sale notice was issued on 04.10.2008. The respondent Nos.1 to 4 have challenged the sale notice in S.A.No.153 of 2008, before the Debts Recovery Tribunal – 3, Chennai. By an order dated 07.11.2008, the Tribunal has stayed the sale notice for a period of six weeks, on condition that the borrower remits 10% of the claim amount. Further, the Tribunal directed the Bank to accept the conditional payment. The petitioner was directed to pay the unpaid balance amount within 15 days and so also expenditure incurred by the Bank towards publication of sale notice. On 28.04.2009, the respondent Nos.1 to 4 have tendered a sum of Rs.2,35,00,000/- and also the conditional payment of Rs.25,00,000/- and a sum of Rs.2,00,000/- towards auction charges. All these amounts were received and acknowledged by the Bank.
11. In the meanwhile, the Bank has filed a writ petition in W.P.No.9058 of 2009 seeking to set aside the direction issued by the Debts Recovery Tribunal in I.A.No.124 of 2009 in S.A.No.153 of 2009 dated 28.04.2009 granting time to deposit the conditional payment and a further direction to accept the payment of balance amount. This Court has passed an interim order on 05.05.2009 in the above said writ petition stating that the sale proceedings may go on, but shall not be confirmed. The said writ petition was dismissed by a Division Bench of this Court, by its order dated 28.08.2009, with a cost of Rs.50,000/-.
12. Thereafter, final order in S.A.No.153 of 2008 came to be passed on 18.06.2010, quashing the possession notice received under Section 13(4) of the SARFAESI Act, as well as the sale notice.
13. After the order of the Tribunal, the fifth respondent has initiated further action and issued possession notice on 06.08.2010, 09.08.2010 and 10.08.2010 and a fresh sale notice on 09.09.2010. Challenging the sale notice, respondent Nos.1 to 4 have filed S.A.No.238 of 2010 and sought interim stay. The Tribunal, instead of granting interim stay, has passed an order dated 20.10.2010 and posted the matter on 29.10.2010.
14. The crucial date for auction was scheduled on 22.10.2010.
Since the Tribunal has failed to pass orders, respondent Nos.1 to 4 have preferred a writ petition in W.P.No.23889 of 2010 before this Court. After hearing the parties, a Division Bench of this Court, by an order dated 09.12.2010, directed the Debts Recovery Tribunal – 3, Chennai, to dispose of S.A.No.238 of 2010, on merits, on or before January 2011. This order came to be passed taking into account that the respondent Nos.1 to 4 had shown their bonafides by paying Rs.50,00,000/- out of the principal outstanding of Rs.1,13,57,804/-.
15. Thereafter, the Debts Recovery Tribunal has taken up the appeal in S.A.No.238 of 2010, for disposal on 10.06.2011, by which date, the respondent Nos.1 to 4 / borrowers have cleared the entire dues by full and final settlement. Therefore, the Tribunal has held that the possession notices have become infructuous and directed the fifth respondent Bank to release all the original title deeds to the respondent Nos.1 to 4. But the respondent Bank filed an application for modification of the direction to return the title deeds, as another charge is pending in respect of the loan amount, wherein respondent Nos.1 to 4 stood as guarantors. The Debts Recovery Tribunal has dismissed the application filed by the Bank.
16. Subsequently, respondent Nos.1 to 4 have filed a contempt petition before this Court, in Cont.P.No.330 of 2012. Thereafter, as per the directions of this Court in the above contempt petition dated 24.04.2012, the title deeds in respect of item nos.2 and 3 of the Schedule in the SARFAESI proceedings were released in favour of respondent Nos.1 to 4 and item no.1 was retained by the Bank.
17. Thus, the entire proceedings in respect of the subject property was over by 24.04.2012, pursuant to several litigations before the Debts Recovery Tribunal as well as before this Court.
18. While the matter stood thus, the petitioner has filed the present writ petitions challenging the order dated 04.12.2012. According to the respondents, the petitioner has no locus standi to challenge this order, as it is consequential to the judicial orders passed by the Division Bench of this Court.
19. The sixth respondent has filed a counter stating that the writ petition is not maintainable, as the impugned order was passed on 04.12.2012 and the writ petition was filed on 18.01.2016 and that therefore, it is hit by latches. Further, the reasons adduced for delay have not been sufficiently explained and the reasons adduced for condoning the delay also does not merit consideration and it lacks credibility. The writ petitioner has paid only 25% of the sale consideration. Merely depositing 25% of the sale price, he cannot be construed as an auction purchaser and therefore, he has no locus standi to maintain the writ petition. The intervening events and directions given by the Debts Recovery Tribunal as well as by this Court, the fifth respondent Bank had to release the documents.
20. The learned counsel appearing for the petitioner would submit that the petitioner has deposited 25% of the sale consideration and was ready to deposit the balance sale consideration and therefore, he approached the fifth respondent for the same. Whereas the fifth respondent, in collusion with respondent Nos.1 to 4, has released the property in favour of them. Therefore, the petitioner has right to maintain the writ petition and the order passed by the appellate authority is liable to be set aside.
21. Per contra, learned counsel appearing for the respondents would submit that the petitioner has failed to pursue his remedies within limited period and in the meanwhile, the matter has attained finality. Since there was inordinate and unexplained delay and the rights of the parties have not created pursuant to the orders of the High Court, the writ petition is not maintainable.
22. In support of his claim, learned counsel for the respondent Nos.1 to 4 has relied on a judgment of the Hon'ble Supreme Court in SHANKARA COOPERATIVE HOUSING SOCIETY LIMITED VS. M.PRABHAKAR AND OTHERS [2011 (5) SCC 607] wherein it has been held that the writ petition is not maintainable in view of inordinate and unexplained delay in approaching the Court and that the matter has attained finality between the parties, in respect of an issue between the parties in the earlier litigations.
23. In another judgment of the Supreme Court in STATE OF KARNATAKA AND OTHERS VS. S.M.KOTRAYYA AND OTHERS [1996 (6) SCC 267] it has been held as follows:
“4.These appeals by special leave arise from the common order of the Karnataka Administrative Tribunal, dated August 14, 1989 made in Application Nos. 4134-45/89. The admitted facts are that the respondents, while working as teachers in the Department of Education, availed of Leave Travel Concession during the year 1981-82. But later it transpired that they had never utilised the benefit of LTC but drew the amount and used it. Consequently, recovery came to be made in the year 1984-86. Some of the persons filed applications in the Tribunal questioning the power of the Government to recover the same. It would appear that thereafter in August 1989 the Tribunal allowed similar claims and had held that the appellant- Government could not recover the same from the respondents, On coming to know of it, the respondents filed applications in August 1989 before the Tribunal with an application to condone the delay. The Tribunal has condoned the delay by the impugned order. Thus these appeals by special leave. “ That on coming to know of the judgment, the litigant has filed an application to redress his grievances, as the delay on account of some other reason cannot be condoned.
24. Therefore, from the factual matrix of this case, it is very clear that the borrower, pursuant to the possession notice, has right to approach the Debts Recovery Tribunal under SARFAESI Act. Accordingly, respondent Nos. 1 to 4 have approached the Tribunal and have secured the property in possession, pursuant to the notice issued under Section 13(4). The sale notice issued by the Bank has been set aside by the competent Court. If at all the petitioner has any right over the property, as a person aggrieved, he should have approach the Court in time, by complying with the requirement for filing an appeal. Instead, he has waited for a long under the pretext that his counsel on record has not communicated the same and on the advice of the respondent Bank that a fresh sale notice could not be issued and so also, he was facing various litigations both Civil and Criminal before this Court.
25. The reasons adduced by the petitioner cannot be accepted by this Court and the right of the petitioner had came to an end when the sale notice was set aside and fresh sale notice was issued by the fifth respondent and further proceedings had also taken place. Once second sale notice was issued and the previous sale notice was set aside, the matter has become infructuous. In the present case on hand, the petitioner has allowed the next to proceed without any auction, at a belated stage, where the second sale notice was also not challenged. Pursuant to the orders passed by the Debts Recovery Tribunal as well as this Court, the respondent Nos.1 to 4 have exercised their statutory right and secured the property and hence, the petitioner now cannot complain that there was a collusion between the respondent Nos.1 to 4 and 5. Having failed to exercise all the statutory rights by filing proper application and allowing the matter as settled as early as in 2012, the petitioner cannot now come up in 2016 to unsettle the matter, which was rightfully accrued in favour of the respondent Nos.1 to 4, in accordance with the provisions contained under the SARFAESI Act.
26. Therefore, we find no reasons to countenance the claim of the petitioner and the order passed by the Debts Recovery Appellate Tribunal does not require any interference. Accordingly, both the writ petitions are dismissed. No costs. Consequently, connected miscellaneous petition is closed.
[S.M.K., J] [M.G.R., J] 05.09.2019
Index : Yes/No Internet : Yes/No TK To
1. The Authorised Officer Indian Overseas Bank Regional Office No.69 & 70, Sheipet Nadu Street, Kancheepuram – 631 501.
2. The Senior Manager Indian Overseas Bank MCC Campus Branch No.295, Velacherry Main Road, East Tambaram, Chennai – 600 059.
3. The Debts Recovery Appellate Tribunal Spencer Plaza Chennai – 2.
S.MANIKUMAR, J.
AND
M.GOVINDARAJ, J.
TK
W.P.NOS.3556 AND 3557 OF 2016
05.09.2019