Kerala High Court
Sunitha Menon vs The Bank Manager on 14 September, 2023
OP(DRT) No.62/2023
& WP(C) No.5742/2023 1
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE T.R.RAVI
THURSDAY, THE 14TH DAY OF SEPTEMBER 2023 / 23TH BHADRA, 1945
OP (DRT) NO. 62 OF 2023
PETITIONER:
SUNITHA MENON,
AGED 55 YEARS
W/O AJITH MENON, RESIDING AT U 67,
ASWATHY GARDENS CHITTATTUMUKKU P.O
THIRUVANANTHAPURAM. PIN CODE -695301.,
PIN - 695301
BY ADVS.
SRI B.DIPU SACH DEEV
SRI ARUN BABU
SRI ANEESHRAJ R.
RESPONDENTS:
1 THE BANK MANAGER,
UNION BANK OF INDIA, ATTINGAL BRANCH, AMC 17 921,
SHAMS COMPLEX, OPP. K.S.R.T.C BUS STAND,
V. V. C. RD,
ATTINGAL, DIST. TRIVANDRUM,
KERALA .,
PIN - 695101
2 THE AUTHORIZED OFFICER,
UNION BANK OF INDIA, UNION BANK BHAVAN,
STATUTE, MG ROAD, THIRUVANANTHAPURAM,
KERALA PINCODE- 695001,
3 THE REGIONAL MANAGER,
UNION BANK OF INDIA, UNION BANK BHAVAN,
STATUTE MG ROAD, THIRUVANANTHAPURAM,
KERALA PINCODE- 695001
4 THE CHIEF COMPLIANCE OFFICER,
COMPLIANCE DEPARTMENT, 10TH FLOOR,
UNION BANK BHAVAN, VIDHAN BHAVAN MARG,
NARIMAN POINT, MUMBAI
PINCODE-400 021.
5 THE REGIONAL DIRECTOR,
R.B.I REGIONAL DIRECTOR OFFICE,
BAKERY JUNCTION, P.B NO.6507, THIRUVANANTHAPURAM KERALA
PINCODE -695 033
OP(DRT) No.62/2023
& WP(C) No.5742/2023 2
6 THE REGISTRAR,
DEBT RECOVERY TRIBUNAL -II,
5TH FLOOR, KERALA STATE HOUSING BOARD,
PANAMPILLY NAGAR, ERNAKULAM,
KERALA, PINCODE-682036.
BY ADVS.
SRI ASP.KURUP
SRI SADCHITH.P.KURUP(K/1419/2002)
SRI C.P.ANIL RAJ(K/872/2007)
SRI SIVA SURESH(K/2688/2022)
THIS OP (DEBT RECOVERY TRIBUNAL) HAVING COME UP FOR ADMISSION ON
22.02.2023, ALONG WITH WP(C).5742/2023, THE COURT ON 14.09.2023
DELIVERED THE FOLLOWING:
OP(DRT) No.62/2023
& WP(C) No.5742/2023 3
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE T.R.RAVI
THURSDAY, THE 14TH DAY OF SEPTEMBER 2023 / 23TH BHADRA, 1945
WP(C) NO. 5742 OF 2023
PETITIONER:
SUNITHA MENON,
AGED 55 YEARS
RESIDING AT U 67, ASWATHY GARDENS CHITTATTUMUKKU P.O
THIRUVANANTHAPURAM. PIN CODE -695301.
BY ADVS.
SRI B.DIPU SACH DEEV
SRI ARUN BABU
SRI ANEESHRAJ R.
RESPONDENTS:
1 THE BRANCH MANAGER
UNION BANK OF INDIA, ATTINGAL BRANCH, AMC 17 921, SHAMS
COMPLEX, OPP. K.S.R.T.C BUS STAND, V. V. C. RD, ATTINGAL,
DIST. TRIVANDRUM, KERALA PINCODE- 695 101.
2 THE AUTHORIZED OFFICER
UNION BANK OF INDIA, UNION BANK BHAVAN, STATUTE MG ROAD,
THIRUVANANTHAPURAM, KERALA PINCODE- 695001.
BY ADVS.
SRI ASP.KURUP
SRI SADCHITH.P.KURUP(K/1419/2002)
SRI C.P.ANIL RAJ(K/872/2007)
SRI SIVA SURESH(K/2688/2022)
THIS OP (DEBT RECOVERY TRIBUNAL) HAVING COME UP FOR ADMISSION ON
22.02.2023, ALONG WITH OP (DRT).62/2023, THE COURT ON 14.09.2023
DELIVERED THE FOLLOWING:
OP(DRT) No.62/2023
& WP(C) No.5742/2023 4
T.R.RAVI, J.
----------------------------------------
OP(DRT) No.62 of 2023
&
WP(C) No.5742 of 2023
-------------------------------------------
Dated this the 14th day of September, 2023
JUDGMENT
The above original petition and writ petition have
been filed by the auction purchaser in a sale conducted
under the provisions of the SARFAESI Act by the 1 st
respondent. Since the prayers made are intrinsically
connected, the original petition and the writ petition are
being disposed of together.
2. The 1st respondent had granted a loan to
M/s.Khadeeja Agencies on the security of a mortgage of
a property of 10.10 Ares comprised in old Sy.No.1319
corresponding to Re.Sy.No.298/13 of Block No.3 of
Veiloor Village. When the borrower failed to repay the
loan availed of, the property was brought for sale. The
petitioner is the successful bidder. The sale notice was
published on 19.11.2021. The auction was conducted on
16.12.2021. The petitioner bid the property successfully
OP(DRT) No.62/2023
for a sum of Rs.67,63,300/- and a sum of Rs.6,73,830/-
was initially remitted towards 10% of the bid amount on
20.12.2021. Subsequently, a sum of Rs.10,17,000/- was
paid, being the balance amount towards the 25% of the
bid amount. A total sum of Rs.16,90,830/- was thus
paid. According to the petitioner, when he visited the
property on 03.01.2022, she came to know that the total
extent available was only 9.22 Ares and not 10.10 Ares
which had been advertised. When the matter was
brought to the attention of the respondent, the
respondent is stated to have taken the stand that the
petitioner should have measured the property prior to
participating in the auction. The petitioner submitted
complaints before the superior officers of the Bank. The
petitioner also approached this Court by filing WPC
No.8711 of 2022, which was disposed of by judgment
dated 05.04.2022. This Court observed that the
questions raised in the writ petition are matters which
require an appreciation of disputed facts, and since the
Tribunal had started its functioning, it has to be decided
OP(DRT) No.62/2023
by the Tribunal. Reserving liberty to the petitioner to
pursue her statutory remedies before the DRT, the writ
petition was disposed of. This Court directed that
proceedings for cancellation of the auction shall be kept
in abeyance for a period of 60 days to enable the
petitioner to move the Tribunal. The above judgment
became final. The Bank had no complaints about the
judgment. However, the stand of the Bank is that the
petitioner was to have made the entire payment by
17.03.2022, and since the same was not done, the only
option was to forfeit the entire amount deposited by the
petitioner in terms of Rule 9(5) of the Securitisation Act.
The petitioner filed a securitisation application within two
months from the date of the judgment in WP(C) No.8711
of 2022. When defects were noted in the securitisation
application, that it was filed beyond the period of
limitation, the petitioner filed OP(DRT).No.286 of 2022
before this Court. On 23.06.2022, this Court directed a
joint inspection of the property on 01.07.2022 and
further directed the respondent Bank to hand over to the
OP(DRT) No.62/2023
petitioner the records that show that the actual extent of
the property is 10.10 Ares as advertised. A joint
inspection was conducted thereafter, and it would appear
that on actual measurement, the property had only an
extent of 9.10 acre and not 10.10 Ares. This fact has
also been recorded in the subsequent order dated
31.08.2022 in OP(DRT).No.286 of 2022. This Court
directed the petitioner to remit the amount proportionate
to the amount payable to the extent of 9.10 Ares
provisionally and directed the Bank to retain the said
amount in a non-lien account. OP(DRT).No.286 of 2022
was finally disposed of by judgment dated 15.12.2022,
directing the Registrar, Debts Recovery Tribunal-II,
Ernakulam, to consider the matter in the light of the
observations made in the judgment. The Court had
expressed its view that the period from 11.03.2022 to
05.04.2022, during which time the matter was pending
before this Court, has to be excluded for the purpose of
determining whether the application is filed within time.
It was also observed that the petitioner, who was the
OP(DRT) No.62/2023
auction purchaser, came to know about the fact that
there is a difference in extent only on 03.01.2022, and
the Bank itself had agreed to measure the property by
letter dated 05.03.2022. In fact, the letter dated
05.03.2022 specifically refers to the directions by the
higher-level officers of the Bank to measure out the
property. It is thus evident that there was a mistake in
the extent of the land advertised and that the Bank itself
was willing to measure out the property. OP(DRT)No.62
of 2023 is filed seeking a direction to the Debt Recovery
Tribunal to number the securitisation application dated
03.06.2022 in the light of the judgment in
OP(DRT).No.286 of 2022 without further raising the issue
of limitation. There is also a prayer for the issuance of a
sale certificate for 9.10 Ares of the auction property
instead of the advertised 10.10 Ares and issue a sale
certificate in respect thereof. WP(C) No.5742 of 2023
was filed subsequently when the petitioner was
threatened of forfeiture of the amount deposited. The
prayer in the said writ petition is for a direction not to
OP(DRT) No.62/2023
forfeit the advance bid amount till the final decision in SA
No.7225/2022 (filing number) filed before the Debt
Recovery Tribunal-II, Ernakulam.
3. The respondents have filed a counter affidavit
contending that they are entitled to forfeit the amount
and that the period of limitation cannot be extended.
4. I have heard the counsel for the petitioner and
the respondents.
5. The counsel for the Bank referred to the
judgment in Indian Bank v. George in OP(DRT)No.73
of 2018, wherein this Court held that there is no
provision for extending the period of limitation. Reliance
is placed on a Division Bench judgment of this Court in
Pushpa Diams and Ors v. V.H.Muhamed Basher and
Ors in WA 1045/2022,, wherein this Court held that if
the sale price is not paid as provided for in Rule 9(4),
then the consequence is that the deposit shall be
forfeited and the property will re-sold. Reliance is also
placed on the judgment in Agarwal Tracom Private
Limited v. Panjab National Bank and Others [2018
OP(DRT) No.62/2023
(1) SCC 626], to submit that the petitioner had a
statutory remedy under section 17 of the SARFAESI Act
and this Court cannot interfere in such matters under
Article 226 of the Constitution of India. The counsel for
the petitioner referred to the judgment of a Division
Bench of Madras High Court in V.Sridhar v. The
Authorized Officer, Indian Bank, Guindy Branch in
WP(C) No.16579 of 2016 wherein the Division Bench
had directed the respondent Bank to refund the amount
paid by the auction purchaser, which was sought to be
forfeited. That was a case where the sale was on as is
where is/ as is what is condition, and the authorised
officer was not in a position to deliver possession of the
auction property without any encumbrances and free of
litigations. Another Division Bench judgment of Madras
High Court in P.R.Thangamshiri v. The Chief
Manager, Punjab National Bank in WP(C)
No.20689 of 2022 was also referred to, wherein the
Court had held that the purpose of forfeiture is to protect
the secured creditor from adverse loss and where there
OP(DRT) No.62/2023
is no such loss to the respondent Bank, the forfeited
money has to be refunded. The Court had referred to the
judgment of Hon'ble Supreme Court in Alisha Khan v.
Indian Bank (Allahabad Bank) and Ors (C.A
Nos.7680-7681 of 2021) wherein the Hon'ble
Supreme Court had allowed an appeal against the
forfeiture of 25% of the auction sale consideration and
directed the Bank to refund the same on the ground that
no loss had been caused to the respondent on account of
the subsequent re-auction.
6. I have considered the contentions raised by the
counsel on either side. The petitioner had approached
this Court by filing WP(C)No.8711 of 2022, wherein this
Court had specifically reserved the right of the petitioner
to move the Debt Recovery Tribunal within 60 days,
keeping the cancellation of the auction in abeyance. This
Court was of the firm opinion that since the question
whether the extent was as advertised is a question of
fact which has to be gone into by the Tribunal, the same
cannot be decided by this Court. The respondent, who
OP(DRT) No.62/2023
has a case that the period for deposit was over in March,
2022, did not challenge the judgment of this Court
permitting the petitioner to approach the Debt Recovery
Tribunal. When defects were noted in the securitisation
application, the petitioner again approached this Court by
filing OP(DRT).No.286 of 2022. This Court has specifically
directed a joint inspection, which was also not challenged
by the Bank. On joint inspection, it has come out that the
extent was neither 10.10 Ares nor 9.22 Ares as
contended earlier by the petitioner but was only 9.10
Ares, a reduction of 1 Are from the total extent which
was advertised for sale. It is thereafter that the original
petition was finally disposed of in December 2022,
making observations regarding the question of limitation.
This Court had, in as many words, expressed its opinion
that the issue has to be considered on merits when it
clearly said that the Tribunal has to take into account the
fact that even as on 05.03.2022, the respondent was
willing to measure out the property and that the
petitioner herself came to know about the reduction of
OP(DRT) No.62/2023
extent only much after the auction sale. Going by the
judgment in Alisha Khan (supra), the question of
forfeiture of the deposit of 25% of the auction sale
consideration has to be considered along with the loss if
any, suffered by the Bank. The judgments relied on by
the Bank relating to the limitation cannot be applied in
this case, where the Bank has suffered several orders
from this Court which do not justify the Bank raising the
question of limitation at this stage. If the stand of the
Bank was that the auction stand concluded as early as in
March, 2022 and no further challenge could be made,
such a contention ought to have been raised in the
earlier writ petitions. In fact, this Court had even
permitted the petitioner to pay the proportionate amount
for 9.10 Ares, which order was also not challenged by
the Bank.
7. In such circumstances, I am of the opinion that
the issue should be dealt with on merits by the Debt
Recovery Tribunal and the rights of the petitioner cannot
be taken away on the grounds of limitation.
OP(DRT) No.62/2023
8. In the above circumstances, the original
petition and writ the petition are disposed of. There will
be a direction to the Debt Recovery Tribunal-II,
Ernakulam to accept the securitisation application filed
by the petitioner treating the same as having been filed
within time and consider and dispose of the same on
merits. The question whether any amount is to be
forfeited shall also be considered by the Debt Recovery
Tribunal on the basis of the decisions on the issue with
reference to the loss if any, that the Bank has suffered.
Sd/-
T.R.RAVI
JUDGE
sn
OP(DRT) No.62/2023
APPENDIX OF OP (DRT) 62/2023
PETITIONER EXHIBITS
Exhibit P1 THE COPY OF THE JUDGMENT IN W.P(C) NO.8711 OF
2022 OF THE HON'BLE HIGH COURT OF KERALA DATED
05.04.2022
Exhibit P2 THE COPY OF THE ORIGINAL PETITION IN O.P.(DRT)
NO.286 OF 2022 DATED 16.02.2022
Exhibit P3 THE COPY OF THE INTERIM ORDER IN O.P.(DRT). NO
286 OF 2022 OF HON'BLE HIGH COURT OF KERALA
DATED 23.06.2022
Exhibit P4 THE COPY OF THE COUNTER AFFIDAVIT BY THE
RESPONDENT BANK DATED 14.07.2022
Exhibit P5 THE COPY OF THE INTERIM ORDER IN O.P(DRT)NO.286
OF 2022 OF THE HON'BLE HIGH COURT OF KERALA
DATED 31.08.2022
Exhibit P6 THE COPY OF THE REPLY AFFIDAVIT FILED BY THE
PETITIONER DATED 17.08.2002
Exhibit P7 THE COPY OF THE JUDGMENT IN O.P.(DRT) NO.286 OF
2022 OF HON'BLE HIGH COURT OF KERALA DATED
15.12.2022
Exhibit P8 THE COPY OF THE SECURITISATION APPLICATION IN
S.A.7225 OF 2022 ON THE FILES OF THE DRT-II,
ERNAKULAM DATED 3.06.2022
RESPONDENT EXHIBITS
EXHIBIT R1 A A TRUE COPY OF UNREGISTERED SA FILED BY THE
PETITIONER IN THE DRT 2 AT ERNAKULAM
OP(DRT) No.62/2023
APPENDIX OF WP(C) 5742/2023
PETITIONER EXHIBITS
Exhibit P1 THE COPY OF THE JUDGMENT IN W.P(C) NO.8711 OF
2022 DATED 05.04.2022
Exhibit P2 THE COPY OF THE INTERIM ORDER IN O.P.(DRT). NO
286 OF 2022 DATED 23.06.2022
Exhibit P3 THE COPY OF THE INTERIM ORDER IN O.P(DRT)NO.286
OF 2022 DATED 31.08.2022
Exhibit P4 THE COPY OF THE JUDGMENT IN O.P.(DRT) NO.286 OF
2022 DATED 15.12.2022
Exhibit P5 THE COPY OF THE NOTICE DATED 13.02.2023 IS
PRODUCED HEREWITH AND MAY BE MARKED AS EXHIBIT
P5.
