Heard Mr. P.K.Khare, learned counsel for the petitioners, Vinay Shanker, learned counsel for the bank as well as Mr. Umesh Chandra Senior Advocate assisted by the Sudeep Kumar, learned counsel for the opposite party no.4. Through the instant writ petition the petitioners have challenged the order dated 20.12.2006 passed by the Recovery Officer, Debts Recovery Tribunal Lucknow , whereby the objection against the auction sale filed by the petitioner has been rejected as having no force.
Mr. Vinay Shanker, learned counsel for the Bank as well as Mr.Umesh Chandra, learned Senior Advocate appearing for the auction purchaser raised objection against the maintainability of the writ petition on the ground that the order passed by the Debts Tribunal Tribunal, Lucknow is appealable under section 20 of Recovery of Debts Due to Banks and Financial Institutions Act, 1993. Therefore, the writ petition is barred by alternative remedy and deserves to be dismissed on this very ground .
In support of his submissions he cited the following cases:- AIR 2001 Supreme Court 3208 Punjab National Bank Vs. Krishnan and others, 1(2006) BC 341 (SC) State Bank of India Vs. Allied Chemical Laboratories and another. He further submitted that when the statutory remedy is available under the particular Act unless exceptional circumstances are made out, the writ petition should not be entertained.
In support of his contentions he cited the following case:- (2006) 5 Supreme Court Cases 469, A.P.Food Vs. S.Samuel and others, para 6 of which is reproduced hereinunder:-
6. "In a catena of decisions it has been held that a writ petition under Article 226 of the constitution of India should not be entertained when the statutory remedy is available under the Act, unless exceptional circumstances are made out."
In reply, Mr. P.K.Khare, learned counsel for the petitioners submitted that on event of alternative remedy filing of writ petition under Article 226 of the Constitution is not absolute bar.
In support of his contentions he cited the following cases:- M/s Hindustan Ferro and Industries Ltd. and another Vs Debt. Recovery Tribunal, Allahabad and another, AIR 2001 Allahabad 155, Mariamma Roy Vs. Indian Bank and others, 2009 AIR SCW 654 and Mohan Lal Bagla Vs. Board of Revenue, U.P. Lko and others, 2005 (23) LCD 86. He cited another case i.e Industrial Credit and Investment Corporation of India Ltd. Vs. Grapco Industries Ltd. and others, AIR 1999 Supreme Court 1975, paragraph of 14 of which is reproduced hereinunder:-
"14. High Court also said that on merits as well the Tribunal was wrong in granting an ex parte order. It is not that High Court itself considered the merits of the case. Objection of the High court was two fold: )1) the Tribunal did not give any reasons and (2) it was an omnibus order and that there was no reference even to prayers in the application and that the prayers stood allowed "in terms of entire hog." Criticism of the High court appears to be correct on that account. Judgment of the High Court, however er, does not refer at all to the facts of the case and it proceeds more on abstract principles of law . There was no bar on the High court to itself ex amine the merits of the case in the exercise of its jurisdiction under Article 227 of the constitution if the circumstances so require. There is not doubt that High court can even interfere with interim orders of the Courts and tribunals under Article 227 of the constitution if the order is made without jurisdiction. But e then a too technical approach is to be avoided. When facts of the case brought before the High court are such that High court can itself correct the error, then it should pass appropriate orders instead of merely setting aside the impugned order of the Tribunal and leaving everything in vacuum." He submits that in the present case, prima facie illegality in the proceeding of auction appears to have been done which can be corrected by this court by exercising extra ordinary power under Article 226 of the Constitution of India, therefore, he may not be relegated to file an appeal. He further submits that the petitioners had been attending proceeding continuously before the Recovery Officer. The Recovery Officer on 27th September, 2006 directed the bank to file Form 13 by the next date fixing as 3.10.2006. On 3.10.2006 the Bank submitted form 13 before the Recovery Officer, who listed the case on 14.12.2006 but in between on 3.11.2006 the Recovery Officer issued the sale proclamation for public auction of the mortgage property on 22.12.2006 but, he claims that no notice of sale proclamation was sent to the petitioners. He further submitted that sale proclamation was required to be pub published in three daily news papers i.e. First one in Hindi, second one in English and third one in any vernacular language, but it has not been done so. It is stated that the publication was made on 14.12.2006 for auction sale on 22.12.2006 , which establishes that 30 days' time was not given between date of notice and date of sale. The petitioners also filed an application for recall of the order dated 3.11.2006 , but their request was not acceded by the Tribunal and the application was rejected. He also submits that proposal of One Time Settlement was pending consideration with the bank but at one point of time it has been stated by that bank that the same was rejected by means of order dated 26.8.2006 Through supplementary counter affidavit filed by opposite party no.1 the commissioner report dated 20.11.2006 has been brought on record, which indicates that one Sri Shiv Narain Advocate was appointed as commissioner for execution of sale, who conducted the proceeding proclamation of sale in its presence after identifying the property mortgaged. It has been stated that the counsel for the petitioners inspected the record of D.R.C. Case No. 24 of 2002 available in Debts Recovery Tribunal, Lucknow on 20.11.2008. On inspection he found that the order-sheet reveals that an order was passed on 3rd November 2006 for issuance of Form No. 13.Thereafter another order was passed on 2012.2006, whereby the petitioners' application was disposed of and then another order was passed on 28.12.2006 after the auction sale of the property but nowhere it is mentioned that Mr. Shiv Narain was appointed as Advocate Commissioner for carrying out the proclamation of sale nor any separate order is present in the order sheets for appointment of Mr Shiv Narain as an Advocate Commissioner. There is also no endorsement in the order-sheets that Mr. Narain has filed the report which has been taken on record. He further submits that appointment of an Advocate Commissioner should have been published to the public and only after the report submitted by him for successfully carrying out the proclamation of sale and the Recovery Officer being fully satisfied by the said proclamation the auction sale could have taken place , but the order-sheet of the case does not speak so that any such step had been taken nor does it indicate that the Recovery Officer was fully satisfied by proclamation of sale and only thereafter auction sale took place.
Rule 16 of the Debts Recovery Tribunal (Procedure) Rules, 1993 speaks that every order should be communicated to the applicant as well as to the defendant either in person or by registered post.
In this case, the petitioners were not communicated regarding the aforesaid proceedings. He further points out that in the proclamation of sale the reserve price has been quoted only Rs. 12,000,00/-; whereas earlier when the order had been passed on 15.3.2004 by the Recovery Officer for issuance of Form No. 13 the reserve price of the property in question had been specified as Rs. 28,000,00/-. Normally by lapse of time, valuation of the property increases but in this case, the same has been shown to have been decreased from Rs. 28 lac to Rs. 12 lac. It has further been submitted that only the land of plot no. G-4 measuring 838 Sq. meter and the plant and machinery of menthol unit had been mortgaged to the applicant bank at the time of taking the loan, but by means of the auction sale dated 22.12.2006 not only the land but also the entire plant and machinery of the Cold Storage of the value of approximately Rs. 15,00000/- and the entire constructed Cold Storage building of the valuation of approximately Rs. 50,000,00/- have been auctioned by the applicant bank, which is absolutely illegal.
The aforesaid submissions of the learned counsel for the petitioners have not been controverted by the opposite parties. Mr. Vinay Shanker, learned counsel for the bank submitted that it is the duty of the judgment debtor as well as decree holder to see that the sale proclamation is prepared correctly and on the ground of inadequacy of price sale cannot be held as illegal. In support of his contentions he cited the case i.e. Vidya Bhan Prakash Vs. the Second Additional District Judge, Mathura and others, 1988 AWC 465 and Punjab National Bank Vs. O.C. Krishnan and others, AIR 2001 supreme Court,3208.
He placed two orders dated 13.11.2006 and 21.12.2006 before this Court which disclose that Mr. Shiv Narain Advocate was appointed as an Advocate Commissioner for execution of order of proclamation of sale of immovable property at Lucknow on or before 20.11.2006. Mr. D.S. Bora, was appointed as Advocate Commissioner for conduct of auction of immovable property at Lucknow on 22.12.2006, which is disputed by the learned counsel for the petitioners that no such order is on record. He submits that these orders are absolutely fabricated to create a defence in favour of the opposite parties.
Leaned counsel for the opposite party no.4 (auction purchaser) submitted that the opposite party no.4 has purchased the property for a good consideration and has deposited the whole amount of auction, therefore, he is entitled to enjoy the property and in any manner the auction is not liable to be interfered with by this court.
Mr. P.K.Khare, learned counsel for the petitioners submits that the auction purchaser has been able to deposit the bid amount only with the help of the respondent bank. He further submits that against the outstanding the petitioners had already deposited Rs. 2.10 lac with the Recovery Officer, DRT, Lucknow.
So far as the appointment of advocate commissioner as well proceeding of sale conducted by the Advocate Commissioner is concerned, it has been doubted by the petitioners. The opposite parties have not controverted the allegations raised by the petitioners. Thus, prima facie the auction proceeding appears to be illegal being in violation of the provisions of the Debts Recovery Tribunal (Procedure) Rules, 1993 as well as Recovery of Debts Due to Bank and Financial Institutions Act, 1993.
Therefore, I hereby over rule the objection of the learned counsel for the opposite parties on the maintainability of writ petition and quash the order dated 20.12.2006 passed by the Recovery Officer, Debts Recovery Tribunal Lucknow on its merit. However, the bank concerned is at liberty to initiate fresh proceeding of recovery of amount from the petitioners in accordance with law. So far as the bid amount deposited by the auction purchaser is concerned, that shall be refunded to him within fifteen days along with interest prevalent on date. In the result, the writ petition is allowed.
Order Date :- 6.1.2010 GSY