Karnataka High Court
Smt. Mariya vs Chief Manager on 27 May, 2024
Author: Chief Justice
Bench: Chief Justice
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NC: 2024:KHC:18138-DB
WA No. 1007 of 2023
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 27TH DAY OF MAY, 2024
PRESENT
THE HON'BLE MR N. V. ANJARIA, CHIEF JUSTICE
AND
THE HON'BLE MR JUSTICE K V ARAVIND
WRIT APPEAL NO. 1007 OF 2023 (GM-DRT)
BETWEEN:
1. SMT. MARIYA
W/O LATE AZHAR NADEEM
AGED ABOUT 38 YEARS
RESIDING AT
FLAT NO 42263
TYPE K, PRESTIGE FALCON CITY
KANAKAPURA ROAD
ANJANADRI LAYOUT
KONANAKUNTE
BENGALURU - 560062
...APPELLANT
Digitally
signed by (BY SRI. MURALIDHAR S R.,ADVOCATE)
AMBIKA H B
AND:
Location:
High Court of 1. CHIEF MANAGER
Karnataka
BANK OF INDIA
HASSAN BRANCH
KAVERI COMPLEX
P B NO 53
B M ROAD
RACE COURSE CIRCLE
VADODARA - 390007
2. THE AUTHORISED SIGNATORY
REPRESENTED BY
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NC: 2024:KHC:18138-DB
WA No. 1007 of 2023
CHIEF MANAGER
BANK OF INDIA
BENGALURU DIVISION
NO 11, KEMPEGOWDA ROAD
BENGALURU - 560009
3. THE REGISTRAR
THE DEBTS RECOVERY TRIBUNAL-II
BSNL BUILDING
TELEPHONE HOUSE
RAJABHAVAN ROAD
BENGALURU - 560001
...RESPONDENTS
(BY SRI. JEEVAN KUMAR B S, ADVOCATE FOR R1 AND R2;
SRI. JEEVAN K, ADVOCATE FOR R3)
THIS WRIT APPEAL IS FILED UNDER SECTION 4 OF
THE KARNATAKA HIGH COURT ACT PRAYING TO CF
INSUFFICIENT/SUFFICIENT APPEAL IS IN TIME/BARRED BY
TIMETHE COUNSEL FOR THE APPELLANT HAS NOT
COMPLIED OFFICE OBJECTIONS 1. DELAY DAYS TO BE
CORRECTLY STATED AT IA FOR CD IN FILING 2. WRIT
PETITION IMPUGNED ORDER AND WP COPY NOT TO BE
MARKED AS ANNEXURE A AND B TO BE REMOVED ETC.
THIS APPEAL, COMING ON FOR PRELIMNARY
HEARING, THIS DAY, CHIEF JUSTICE DELIVERED THE
FOLLOWING:
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NC: 2024:KHC:18138-DB
WA No. 1007 of 2023
JUDGMENT
Heard learned advocate Mr.S.R.Muralidhar for the
appellant, learned advocate Mr.B.S.Jeevan Kumar for
respondent Nos.1 and 2 as well as learned advocate
Mr.K.Jeevan for respondent No.3.
2. The challenge in this appeal by the original petitioner is
addressed to judgment and order dated 12.06.2023 of learned
Single Judge, whereby the petition of the appellant-petitioner
came to be dismissed.
2.1 The writ petition was filed seeking a prayer to set aside
the order dated 14.03.2023 passed by the Debts Recovery
Tribunal-II, Bengaluru in Securitization Application No.30 of
2023, which was disposed of in terms of the memo for
settlement and by vacating the interim order. It was next
prayed to direct the respondent-Bank to defer the confirmation
of auction sale and further to defer the issuance of sale
certificate in respect of the properties in question. Further
prayer was advanced to direct the Debts Recovery Tribunal-II
to restore the Securitization Application No.30 of 2023, to
consider the memo of settlement of the petitioner and also to
allow the petitioner to settle the loan amount as per the memo.
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A consequential prayer was made to direct the respondent-
Bank to hand over the possession of the properties.
3. Noticing the basic facts, the petitioner happens to be the
wife of the borrower-husband and also the guarantor. The
husband had taken loan from the respondent-Bank mortgaging
three properties as described in the Schedule, situated at Azad
Road, Kuvempunagar and Sadashivanagara respectively. As the
default was committed in repayment of the loan, the Bank
initiated the measures under the Securitization and
Reconstruction of Financial Assets and Enforcement of Security
Interest Act, 2002 after classifying the account as Non-
Performing Asset on 15.07.2021. A demand notice was issued
on 02.07.2022 subsequently. Since neither the borrower nor
the guarantor did not liquidate the liability, possession notice
was issued on 05.11.2022.
3.1 Auction was conducted in respect of all the three
properties, however, property No.1 could not be sold in auction
as no bids were issued. Property No.2 came to be sold fetching
the price of Rs.142.47 lakhs, whereas the third property was
sold for a sum of Rs.50.04 lakhs to the respective successful
bidders who also deposited the amount. It appears that the
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tribunal had granted interim stay in the said securitization
application preferred by the borrower. Therefore, the
respondent - Bank could not issue the sale certificate.
3.2 The outstanding amount of loan was Rs.1,23,19,862/-
which was proposed to be paid in five instalments before the
Debts Recovery Tribunal. The advocate for the applicant filed a
memo of settlement as the properties were already auctioned.
Submission was made that there was no question of arguing
the case before the tribunal and that the Securitization
Application was required to be disposed of. The submission of
the advocate for the applicant was recorded and the applicant
was given liberty to approach the respondent-bank for arriving
at settlement. On the other hand, the respondent - Bank was
also given liberty to proceed to confirm the sale and for
registration of sale certificate.
3.3 When the aforesaid order of the Debts Recovery Tribunal
dated 14.03.2023 was challenged before learned Single Judge
by the applicant who was the guarantor-wife of the
borrower-husband, indulgence was declined by learned Single
Judge upholding the reasoning supplied by the tribunal.
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3.4 Learned Single Judge noted that the loan amount was not
repaid and that the same was secured by the immovable
properties which were auctioned in terms of the order of the
tribunal on 09.02.2023. It was also noted that the advocate for
the applicant before the Debts Recovery Tribunal refused to
argue the matter stating that the applicant would settle the
liability. As noted above, a settlement memo was submitted
before the tribunal and on that basis, the tribunal disposed of
the Securitization Application.
3.5 The observations made by the tribunal in para 8 of its
order were extracted by learned Single Judge in support of the
reasoning in his order, which is reproduced with relevance
herein as well,
"As the applicant and the counsel
submits that they intend to settle the
liability, nothing survives for arguments.
Hence, SA may be disposed of, recorded
the submission of the applicant.
Accordingly, SA disposed of. The
submissions of the Ld. Counsel for the
applicant is recorded and the applicant is
at liberty to approach the bank for any
settlement in accordance with law. The
liberty given to applicant is not be
construed as a right, as the applicant has
already waived her right to redemption
available under S.13(8). Interim order
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dated 09.02.2023 stands vacated. The
respondent bank is at liberty to proceed
in confirming the sale and Registration of
the Sale Certificate in accordance with
law."
4. In the present proceedings of appeal, statement of
objections came to be filed on behalf of respondent Nos.1 and
2, in which details were given in respect of the financial
facilities borrowed by the appellant from respondent - Bank.
The details of the three properties mortgaged were also
mentioned. The statement of objections spoke about the
demand notice under Section 13(2) of the 2002 Act having
been issued on 02.07.2022 against all the legal heirs of the
deceased - borrower to further highlight that the amounts due
were not paid.
4.1 Notice for sale of the properties by the respondent - Bank
issued on 03.01.2023 was challenged before the tribunal in
Securitization Application No.30 of 2023. The auction was
scheduled on 09.02.2023. While the Bank was permitted to
continue the auction, the sale confirmation thereof was
deferred. The respondents further highlighted that in this
securitization application before the Debts Recovery Tribunal,
the borrower took a stand to settle the matter and did not
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argue. It was contended that in view of a judgment of the
Supreme Court, appeal under Section 18 of the 2002 Act was
available and the writ petition was not maintainable.
4.2 The figures given by the respondents in respect of the
sale proceeds received in the auction indicated that item No.1
property was not sold, whereas item Nos.2 and 3 properties
fetched of Rs.1,42,47,000/- and Rs.50,04,000 respectively,
totalling Rs.1,92,51,000/- as against the pending amount being
unpaid of Rs.49,67,774/- aggregated from two accounts of
vehicle loan and cash credit as noted above. The total dues
were Rs.1,23,19,842.85/- and further dues as stated above
were as Rs.49,67,774/-. Those amount were adjusted from the
sale proceeds of the auction.
5. Thus from the above facts in the main aspects that
surface are that the borrower did not pursue its securitization
application before the Debts Recovery Tribunal wanting to
settle the dispute and that still the amount is due to be paid to
the Bank even after auction proceeds. In addition to the above
important aspects, yet another weighty aspect is that the
appellant claims to be the second wife of the borrower named
as Mr.Azhar Nadeem. The first wife of the said borrower has
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also filed another Securitization Application No.90 of 2023
which is pending before the Debts Recovery Tribunal-II for
adjudication.
5.1 Not only that between the parties inter se the first wife
and the appellant-the second wife, civil suit proceedings in
O.S.No.216 of 2022 are pending in relation to the claim over
the properties. Thus, the parties have been litigating for
adjudication of their civil rights in relation to the properties
before the civil Court.
6. In view of all the above aspects and in view of what is
held as well as the reasons supplied herein above, no case is
made out to interfere with the order of learned Single Judge.
7. The present appeal is meritless and is liable to be
dismissed and the same is dismissed.
Sd/-
CHIEF JUSTICE
Sd/-
JUDGE
THM
