IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 11TH DAY OF APRIL 2019 BEFORE THE HON’BLE MR.JUSTICE ALOK ARADHE WRIT PETITION NO.35842 OF 2013 (GM-DRT) BETWEEN:
SRI. BHAGAVATHI BHAGAVAN RICE INDUSTRIES REPRESENTED BY ITS PROPRIETOR RAMESH BABU S/O. R. LAKSHMINARAYANA SHETTY AGED ABOUT 51 YEARS ANTHARASANAHALLI INDUSTRIAL AREA TUMKUR-572 101. ... PETITIONER (BY SRI G. NATARAJ, ADV.) AND:
1. AUTHORISED OFFICER THE SENIOR MANAGER VYSYA CO-OPERATIVE BANK LTD. VIVEKANANDA ROAD TUMKUR-572 101.
2. T.P. INDRA KUMAR S/O. LATE PUTTASWAMAIAH AGED ABOUT 61 YEARS PROPRIETOR OF M/S. SREEPRABHA RICE MILLS NEAR GUBBI GATE CHECK POST B.H. ROAD, TUMKUR.
RESIDING AT VENKATE SWAMY NILAYA BEHIND HIGH SCHOOL TUMKUR-572 101.
3. SHRI. MAHAVEERA PRASAD S/O. T.P. INDRA KUMAR AGED ABOUT 42 YEARS PROPRIETOR OF M/S. MAHAVEERA TRADERS APMC YARD TUMKUR-572 101.
4. SRIPATHI. N S/O. LATE S. NARAYANACHAR AGED ABOUT 58 YEARS CEO OF M/S. VYSYA CO-OPERATIVE BANK LTD. VIVEKANANDA ROAD TUMKUR-572 101. … RESPONDENTS (BY SRI DEVI PRASAD SHETTY, ADV. FOR R1 AND R4 NOTICE TO R2 & R3 IS HELD SUFFICIENT V/O.DT:13.04.2016) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE ORDER DATED 09.08.2012 BEING PASSED IN M.A.NO.49/2010 PASSED BY THE DEBTS RECOVERY TRIBUNAL, KARNATAKA, AT BANGALORE VIDE ANNEX-E.
THIS WRIT PETITION COMING ON FOR PRELIMINARY HEARING IN ‘B’ GROUP, THIS DAY, THE COURT MADE THE FOLLOWING:
O R D E R Sri G. Nataraj, learned counsel for petitioner.
Sri Devi Prasad Shetty, learned counsel for respondent Nos.1 and 4.
2. The writ petition is admitted for hearing.
With the consent of learned counsel for the parties, the matter is heard finally.
3. In this petition under Articles 226 and 227 of the Constitution of India, the petitioner inter alia seeks a writ of certiorari for quashment of the order dated 09.08.2012 in M.A.No.49/2010 passed by the Debts Recovery Tribunal (hereinafter referred to as ‘the DRT’ for short).
4. Facts giving rise to filing of the writ petition briefly stated are that, on 30.01.2004, respondent No.1- Bank issued a notice under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as ‘the Act’ for short). Thereafter, on 30.03.2004, the respondent No.1-Bank took possession of the property in question. An auction was held and the petitioner purchased the property in question on 17.11.2006.
Being aggrieved by the process of sale, the respondent No.2 challenged the same before the DRT in A.S.A. No.351/2006 and the DRT directed the respondent No.2 to make payment of the entire amount within a period of two months. It is further directed that in case, the amount due and payable to the respondent No.1-Bank is not paid within a period of two months, the benefit of the order passed by the DRT shall not be available to the borrower namely, respondent No.2. However, the respondent No.2 did not make payment of the amount to the respondent No.1-Bank and filed an application in M.A. No.49/2010 before the DRT on the ground that, even though he had visited the Bank for payment requesting the Bank to receive the amount due and payable to it, however, the aforesaid amount was not received by the Bank. Thereupon, the DRT passed an order on 09.08.2012 and disposed of the application in M.A.No.49/2010 preferred by the respondent No.2- borrower on the ground that since, he has produced the photocopy of the Demand Draft, he shall be entitled to the benefit of the interim order passed by the DRT. In the aforesaid factual background, the petitioner has approached this Court.
5. Learned counsel for the petitioner submitted that the DRT ought to have appreciated the fact that the respondent No.2 had not made payment of the amount to the respondent No.1-Bank and therefore, no fault could be found with the process of auction.
6. On the other hand, learned counsel for respondent No.1-Bank has also submitted that respondent No.2 never paid the amount as directed by the DRT to the respondent No.1-Bank and therefore, the process of auction has rightly been held, which does not call for any interference.
7. I have considered the submission made by the parties. Despite notice being served, the respondent No.2 has not chosen to appear before this Court to defend this proceeding.
8. There is no material on record to show that respondent No.2 has paid the amount by way of Demand Draft which was due and payable to the respondent No.1-Bank. Therefore, the respondent No.1- Bank was well within its right to auction the property belonging to respondent No.2. However, the aforesaid aspect of the matter has not been appreciated by the DRT while passing the impugned order dated 09.08.2012 and merely on the basis of photocopy of the Demand Draft produced by the respondent No.2, which were never deposited with the respondent No.1-Bank, the respondent No.2 was granted the benefit of interim order. Therefore, the impugned order suffers from error apparent on the face of record as well as vice of non- application of mind.
9. Accordingly, the impugned order dated 09.08.2012 is hereby quashed. In the result, the petition is allowed.
Sd/- JUDGE ST