Madhya Pradesh High Court
Manish Sharma vs Bank Of India on 22 June, 2022
Author: Sujoy Paul
1
W.P. No.2285/2022
IN THE HIGH COURT OF MADHYA PRADESH, JABALPUR
BEFORE
SHRI JUSTICE SUJOY PAUL
&
SHRI JUSTICE PRAKASH CHANDRA GUPTA
ON THE 22nd JUNE, 2022
WRIT PETITION No. 2285/2022
BETWEEN :-
MANISH SHARMA S/O LATE
SHRI J.D. SHARMA AGE-49
R/O SHRI SHUBHAM
HOSPITAL AND RESEARCH
CENTRE SITUATED AT
HOUSE NO.360 NAGPUR
ROAD JABALPUR.
.......PETITIONER
(BY SHRI AMIT KHATRI, ADVOCATE.)
AND
1. BANK OF INDIA, THROUGH
ITS AUTHORIZED OFFICERS
MAIN BRANCH ASHIRWAD
MARKET JABALPUR.
2. CHIEF MANAGER BANK OF
INDIA, MAIN BRANCH
JABALPUR
......RESPONDENTS
(BY RAJESH MAINDIRETTA, ADVOCATE FOR THE
RESPONDENT/BANK)
-----------------------------------------------------------------------------------------
2
W.P. No.2285/2022
This writ petition coming on for hearing this day, Shri Justice
Sujoy Paul, passed the following :
O R D E R (Oral)
In this petition, the petitioner has prayed for following reliefs :-
(i) To issue a writ in the nature of
mandamus directing the Respondents to
issue the no dues certificate and release the
title deed of the mortgaged property in the
interest of justice.
(ii) To issue a writ in the nature of
certiorari to quash the order dted 27.09.2019
(Annexue P-1) in the interest of justice.
(iii) To issue a writ in the nature of
mandamus to quash proceedings in OAEX
46/2011 pending before the Recovery officer
DRT Jabalpur in this petition.
(iv) To issue a writ in the nature of
mandamus to quash the letter dated
06.02.2013 (Annexure P-6) in this petition.
(v) To issue any other suitable
directions/orders along with cost of the
petition.
2. This matter has a chequered history. The parties have fought a long
drawn battle in the corridors of the Courts. This is also the second visit of
the petitioner for almost claiming the same relief from this Court which
was claimed in W.P. No.21167/2019 which was dismissed as withdrawn
W.P. No.2285/2022
on 22.11.2021 with liberty to the petitioner to approach the
respondent/Bank.
3. In turn, the petitioner approached the respondent/Bank and being
aggrieved with the inaction of respondent/Bank to settle the amount again
approached this Court.
4. Draped in brevity, the relevant facts are that the petitioner's wife
took a loan for establishing a Hospital. The loan was secured by
mortgaging the immovable property belonging to the petitioner. Since
borrower did not maintain the financial discipline, the Bank invoked
Section 13(2) of the Securitisation and Reconstruction of Financial
Assets and Enforcement of Security Interest Act, 2002 (SARFAESI
ACT) and issued demand notice dated 23.07.2007 seeking a demand of
Rs.1,31,42,423/- followed by another notice issued under Section 13(4) of
the Act issued on 30.10.2007 for taking symbolic possession of the
property.
5. The notice under Section 13(4) of SARFAESI ACT was called in
question before Debts Recovery Tribunal (DRT) in S.A.No.57/2007.
During the pendency of said S.A., the respondent/Bank proceeded to fix
the date of auction of mortgaged property.
6. On 21.09.2010, respondent/Bank published a fresh Auction Sale
notice fixing the auction on 21.09.2010. The property was sold and a sale
W.P. No.2285/2022
certificate was also issued. Aggrieved, petitioner filed Miscellaneous
Application No.85/2010 in pending S.A.No.57/2007 questioning the
Auction Sale held on 21.09.2010. The DRT by order dated 22.11.2010
(Annexure P/15) allowed the application and set aside the Auction Sale.
7. The S.A.No.57/2007 was ultimately dismissed by DRT on
16.08.2010 (Annexure P/16 with rejoinder). The petitioner feeling
aggrieved by said order of DRT, filed a statutory appeal before Debts
Recovery Appellate Tribunal (DRATs) Allahabad.
8. The said appeal was registered as Case No.R-12/2011 by Appellate
Tribunal and was heard on the question of admission on 21.01.2011.
While admitting the appeal, the petitioner was directed to deposit Rs.50
Lacs with respondent/ Bank in the form of FDR with further observation
that if amount is deposited, the Bank shall not take any coercive steps
against the petitioner.
9. Shri Amit Khatri, learned counsel for the petitioner submits that in
obedience of DRAT's order dated 21.1.2011, the petitioner deposited
Rs.50,00,000/- with the Bank and further Rs.8,00,000/- were deposited
prior to filing of appeal before the DRAT. Thus, in total amount of
Rs.58,00,000/- was already deposited by the petitioner when matter came
up before DRAT on 6.1.2012. The DRAT on 6.1.2012 opined that the case
stands settled/compromise for a sum of Rs.65,00,000/- further to be paid
W.P. No.2285/2022
by the appellant in fifteen equal installments. The first installment shall
fall due on 15.2.2012 and next installment will fall due on 15th of each
month. It was made clear by DRAT that in case the appellant fails to
deposit any of the installments then the Bank shall be free to proceed with
the auction of the property and recover the complete original amount as
per agreement entered into between the parties while securing the loan.
10. Since representative of the Bank was not present before the DRAT
on 6.1.2012, it was observed that it will be open to the Bank to apply for
review, if they are not satisfied with the order and conditions mentioned
in the order dated 6.1.2012.
11. The DRAT in its aforesaid order dated 6.1.2012 further opined that
if appellant pays the amount even before the fifteen installments were
fixed, the Bank shall issue no dues certificate, if it receive its full dues as
per settlement. The appeal was accordingly disposed off.
12. The respondent-Bank filed a review petition No.26/2012 feeling
dissatisfied by order dated 6.1.2012 passed in Appeal No. R-12/2011.
After hearing both the parties, the DRAT decided the review petition on
28th February, 2012. The DRAT allowed the Bank to charge interest at
the rate of 10% per annum on the reducing balance of Rs.65,00,000/-.
W.P. No.2285/2022
13. The Bank cancelled the compromise proposal by issuing order
dated 6th February, 2013 (Annexure P/6). The petitioner filed a Review
Petition No.158/2013 before the DRAT which was allowed on 4.4.2013
(Annexure P/7) whereby rescheduling the earlier installments fixed. In
furtherance of DRAT's order dated 4.4.2013 passed in the said review, the
petitioner deposited Rs.15,00,000 + 5,00,000= 20,00,000/- on 9.4.2013
and 24.4.2013 respectively. The petitioner also deposited Rs.6,00,000/- on
3.5.2013 thereby deposited in total 70.25 Lakhs.
14. Shri Amit Khatri, learned counsel for the petitioner place heavy
reliance on para-5.8 and 5.9 of the writ petition wherein petitioner has
pleaded about the dates and amounts paid to the Bank by the petitioner. It
is urged that while filing return, the Bank has not refuted the aforesaid
pleadings. In addition, reliance is placed on RTI information furnished by
the Bank on 7th January, 2022 wherein it is averred that within 15 months
from 28.2.2012, the petitioner had to pay remaining Rs.40,354/- (Forty
thousand three hundred fifty four).
15. The respondent-Bank filed W.P. No.8579/2013 before this Court
assailing the review order of DRAT dated 4.4.2013 and this Court by
order dated 12.2.2015 (Annexure P/8) set aside the said review order
dated 4.4.2013.
W.P. No.2285/2022
16. The petitioner, in turn filed M.A. No.284/2014 before the DRAT
for seeking return of original title deed and issuance of no dues
certificate. The DRAT by impugned order dated 27.9.2019 (Annexure
P/1) dismissed the M.A.
17. As noticed, petitioner filed W.P. No.21167/2019 assailing the said
order dated 27.9.2019 which was allowed to be withdrawn with liberty to
approach the Bank by preferring representation dated 9.12.2021
(Annexure P/11) followed by reminders dated 10.1.2022 and 22.1.2022.
18. Shri Khatri contended that the said representation and reminders
went in vain. Thus, petitioner filed an application seeking certain
information under the Right To Information Act, 2005 (RTI Act). The
bank by a communication dated 07.01.2022 (Annexure P/12) furnished
the relevant information which shows that petitioner deposited
Rs.70,24,922/- within 15 months from 28.02.2012.
19. Shri Amit Khatri has taken pains to contend that petitioner has
deposited the entire requisite amount within stipulated time of 15 months,
although there is irregularity in making such payments in terms of
installments. Putting it differently, the desired amount was indeed paid,
but it could not be paid in 15 equal installments. Once bank has received
the desired amount, it should not have taken a hyper technical approach
W.P. No.2285/2022
and cancelled the offer by contending that amount has not been paid in
equal installments.
20. Reliance is also placed on the documents dated 03.12.2020 and
03.09.2021 (Annexure P/13) whereby the bank itself informed the
petitioner that petitioner is required to pay only Rs.16,587/-. If the
petitioner settles that amount in the National Lok Adalat scheduled on
12.12.2020 and on another date, the settlement will take place. However,
the said notices (Annexure P/13) were cancelled by the Bank for the
reasons best known to it.
21. The Bank, in turn issued an a sale proclamation dated 16.03.2022
(Annexure P/14). The DRT in OAEX No.46/11 invoked power under
Rule 53 of the relevant rules and published proclamation in local
newspaper on 20.11.2021. The auction proceedings were scheduled to be
taken up on 16.03.2022. These proceedings, as well as Execution
proceedings are called in question in this petition.
22. Learned counsel for the petitioner placed reliance on (2018) 14
SCC 735 (P. Vijayakumari and another vs. Indian Bank) and urged
that this matter has tremendous similarity with that of P. VijayaKumari's
case. In the said case also the amount was settled in the Lok Adalat but it
was paid with a delay of 320 days. In the instant case, there is not delay in
making the payment, there is only an irregularity in following the
W.P. No.2285/2022
financial discipline of making payment in equal installment. In this back-
drop, as decided by the Supreme Court in the said case, it will be
unreasonable to deny relief to the petitioner when the amount directed by
DRAT stood paid. The interest rate as directed by the Supreme Court can
clinch the issue. The Supreme Court directed to pay Simple interest
@24% p.a. on the amount agreed to in the Lok Adalat. Thus, following
the said principle, this matter can be settled.
23. Another reliance is made on (2020) 11 SCC 399 (Sudhakar
Baburao Nangnure vs. Noreshwar Raghunathrao Shende and others)
and (2005) 5 SCC 91 (Haryana State Coop. Land Development Bank
vs. Neelam). Both the judgments are pressed into service to bolster the
contention that the principles of Res Judicata or public policy will not be
a hurdle for maintaining the present petition. In the previous round, no
view was expressed on merits and petitioner was given opportunity to
approach the bank. The petitioner indeed approached the bank but his
grievances were not settled and therefore, approached this Court. Thus no
technicality comes in the way of the petitioner.
24. The doctrine of legitimate expectation will hold the field submits
Shri Amit Khatri. Reliance is placed on a recent Division Bench judgment
of this court passed in W.P. No. 22127/2021 (Mohanlal Patidar Vs.
Bank of Maharasthra) decided on 21st February, 2022. It is submitted
W.P. No.2285/2022
that the petitioner has fulfilled his part of obligation within stipulated time
and therefore had a legitimate expectation that his offer will be accepted.
Petitioner also expressed his willingness to pay if anything further is
remaining but bank did not furnish him the necessary information about
said payment promptly. In this backdrop, the said doctrine should be
made applicable on the instant case.
25. Furthermore, reference is made to Union of India v. N.
Murugesan, (2022) 2 SCC 25 to submit that conduct of bank shows
approbate and reprobate or in other words blowing hot and cold in the
same breathe. The said conduct cannot sustain judicial scrutiny. Thus, it
is argued that the petition may be allowed and desired benefits may be
given to the petitioner.
26. Contesting the aforesaid contentions, Shri Rajesh Maindiretta,
learned counsel for the Bank submits that this writ petition is not
maintainable. The only difference in this petition and the previous petition
is that petitioner has assailed the sale proclamation order in the relief
clause of the present petition. Otherwise, both the petitions if examined
in juxtaposition are verbatim same.
27. Shri Maindiretta further submits that against the sale proclamation
order issued by the Recovery Officer of DRT, petitioner has a statutory
remedy of appeal under Section 30 of the Recovery of Debts and
W.P. No.2285/2022
Bankruptcy Act, 1993 (Act of 1993). As per Section 30-A of 1993 Act
the petitioner is required to deposit 50% of the amount of debt due. In
order to wriggle out of said statutory requirement of deposit, the
petitioner made an effort to short-circuit the proceedings and directly
approached this Court. The petitioner may be relegated to avail the
remedy before the DRT.
28. The next contention of learned counsel for the bank is that in this
petition which assails the order of DRAT dated 27.09.2019 (Annexure-
P/1), this court is obliged to examine the legality, validity and propriety of
said judgment dated 27.09.2019. In the said judgment there is no
illegality which warrants interference by this Court.
29. It is strenuously contended by the learned counsel for the Bank that
petitioner has neither deposited the entire amount within 15 months nor
deposited the amount in 15 equal installments within stipulated time as
per DRAT's order dated 06.01.2012. Thus, no fault can be found in the
impugned judgment dated 27.09.1999. Moreso, when the subsequent
order of review dated 04.04.2013 was set aside by this Court on
12.02.2015 in W.P No. 8579/2013.
30. Interestingly, Shri Maindiretta also placed reliance on the same RTI
information dated 07-01-2022 and urged that Column-9 of said
information, makes it clear that in irregular installments, the petitioner
W.P. No.2285/2022
had deposited Rs.70,33,605/- upto 31-03-2020. The information in
Clause-10 makes it clear that the petitioner did not pay the original
amount of Rs. 40,354/- within stipulated time. Apart from the aforesaid,
the petitioner was required to pay the interest from the date petitioner's
account became NPA. The parties informed the Court that the petitioner
account became NPA on 23.07.2007. Therefore, Shri Maindiretta, learned
counsel for respondent/Bank submits that after counting the interest, the
Bank has quantified the amount of Rs.4,13,48,716/- which is required to
be paid by the petitioner. Thus, neither law nor equity is in favour of the
petitioner.
31. The parties confined their arguments to the extent indicated above.
32. We have heard the parties at length and perused the record.
Maintainability :
33. The Bank has raised two fold objections regarding maintainability
of this petition. Firstly, it is argued that previous petition W.P.
No.22167/2019 was dismissed as withdrawn with the liberty to approach
the Bank. No liberty was given to the petitioner to approach this Court
again. Thus, second petition is not maintainable. The previous order of
this Court dated 22.11.2021 shows that petitioner prayed for withdrawal
of the petition with the liberty to approach the respondent/Bank. While
granting aforesaid liberty, petition was dismissed as withdrawn. It was
W.P. No.2285/2022
made clear that Court has not passed any order on merits regarding claim
of the petitioner. Thus, the question is whether such an order passed will
preclude the petitioner to file this petition. In our opinion, the petitioner
as per liberty granted in the previous round approached the Bank by filing
umpteen number of representations for his grievance but none could fetch
any result. The representation dated 09.12.2021 (Annexure P/11) and
reminders dated 10.1.2022 and 22.01.2022 leaves no room for any doubt
that petitioner made repeated efforts to know the amount due (if any) so
that in obedience of DRAT's aforesaid order, it can be paid and account
can be closed. We find substance in the argument of Shri Amit Khatri,
learned counsel for the petitioner that preferring of previous petition and
repeated representations/reminders aforesaid shows keenness and
willingness of the petitioner to pay the amount due to the Bank. In this
backdrop, whether principle of res judicata or public policy will be a
hurdle or not for a second petition is the first question about
maintainability.
34. In our judgment, neither res judicata nor public policy is an
impediment for the petitioner to approach this Court again. In the case of
Neelam (supra) the Apex Court considered its previous judgment in
Sarguja Transport Service vs. STAT (1987) 1 SCC 5 and opined that a
writ petition could have been dismissed on the ground of availability of
W.P. No.2285/2022
alternative remedy. The alternative remedy, in turn, can be availed.
Thereafter, writ petition can be filed. As noticed above, in furtherance of
previous order of this Court, petitioner availed the remedy of approaching
the Bank and when his efforts could not produce any result, he filed this
petition. In Sudhakar Baburao Nangnure (supra), the Apex Court held
as under :-
"28. In the present case, we find, for the
reasons which we have indicated above, a
clear distinction on facts. While disposing of
the earlier special leave petition to enable the
appellant to pursue his remedies on the
contention that the issue of catch-up though
raised was not considered by the High Court,
this Court expressly clarified that it had not
considered the matter on merits. In the
absence of such a clarification, the
withdrawal of the special leave petition
would have led to the inference that the
appellant had not been granted liberty to
move this Court afresh. On the other hand,
the clear purpose and intent of the
observation that this Court had not considered
the matter on merits was to keep open all the
remedies of the appellant before the High
Court in the first instance and thereafter
before this Court on the issue of the catch-up
rule."
(Emphasis Supplied)
35. In the previous round, this Court did not express any opinion on
W.P. No.2285/2022
merits and merely left it open to the petitioner to approach the Bank.
Thus, this petition cannot be thrown to the wind by holding it is not
maintainable. Second ground of maintainability is limited to one relief
only i.e. whether petitioner can challenge the order of recovery officer of
DRT in this writ petition against which indisputably, a statutory appeal is
available. This aspect relating to this limited and singular relief will be
considered by us in the later portion of this order.
Directions of DRAT :
36. The relevant portion of order of DRAT dated 06.01.2012 reads as
under :-
In view of the aforesaid, the case stands
settled/compromised for a sum of Rs. 65.00
lacs further to be paid by the appellant in 15
equal installments. The first installment shall
fall due on 15.02.2012 and the next
installments will fall due on 15th of the each
month. It is made clear that in case, the
appellant fails to deposit any of the
installments then the Bank shall be free to
proceed with the auction of the property and
recover the complete original amount as per
the agreement entered into between the
parties while securing the loan. However, It
is further directed that since the
representative of the Bank is not present,
therefore, if the Bank has any objection to
this settlement then it will be open for the
Bank to apply for review of this order.
W.P. No.2285/2022
However, it does not mean that the
installments as directed to be paid by the
appellant shall be stopped under the garb of
review application. However, it is also made
clear that if the appellant pays of the amount
as per settlement even before the 15
installments then the Bank shall issue no
dues certificate, if it receives its full debts as
per this settlement and accordingly, the
present appeal stands disposed off.
(Emphasis Supplied)
37. Another relevant order of DRAT dated 28.02.2012 reads thus :-
An application for review is moved to
review the order dated 06.01.2012 passed by
this Tribunal. By the said order, the appeal
has been disposed of on the basis of the
compromise. The Bank has accepted the
receivable amount for a sum of Rs. 65.00
lacs.
It is contended that the review petitioner
has no objection to the amount, but he
submits that since this Tribunal has given a
considerable long period for the purpose of
depositing the amount by the original
appellant and this Tribunal has not given any
direction for charging the interest on the
reducing balance. It is contended that since a
considerable long period has been given by
this Tribunal to deposit the amount of Rs.
65.00 and the schedule for the same has been
given that the total amount of Rs. 65.00 lacs
is to be deposited in 15 equal installments
therefore a direction for charging the interest
W.P. No.2285/2022
on the reducing balance is necessary.
While passing the order of
compromising this Tribunal has also given
liberty to the Bank to apply for the review
because on the date when the compromise
was recorded the representatives of the Bank
was not present.
Keeping in view of the facts and
circumstances of the case it is directed that
the Bank shall charge the interest on the
reducing balance of Rupees 65 lacs @ 10%
per annum.
In view of the aforesaid the application
for review stands disposed of.
(Emphasis Supplied)
Other findings :-
38. A plain reading of both the orders aforesaid shows that the
petitioner was directed to pay a sum of Rs.65 lacs to the Bank in 15 equal
installments beginning with 15.2.2012. By order dated 28.2.2012, the
DRAT permitted the Bank to charge interest on the reducing balance of
Rs.65 lacs @ 10% per annum.
39. In para- 5.8 of the writ petition, the petitioner has reproduced a chart which
contains the dates and the amount paid in installment to the Bank. The chart reads as
under :-
Sl. No. Dates Amount
1. 21.02.2012 4,35,000.00
2. 25.04.2012 4,35,000.00
3. 07.05.2012 4,35,000.00
W.P. No.2285/2022
4. 01.06.2012 4,35,000.00
5. 30.06.2012 4,35,000.00
6. 31.07.2012 4,35,000.00
7. 15.09.2012 450000.00
8. 28.09.2012 175000.00
9. 31.10.2012 140000.00
10. 24.12.2012 420500.00
11. 24.12.2012 129500.00
Total 3925000.00
12. 09.04.2013 20,00,000
13. 24.04.2013 5.00,000
14. 03.05.2013 6,00,000
Total 70,25000.00
40. Further, in para-5.9, petitioner averred as under :-
"Also in compliance of order dated
04.04.2013 passed in Modification/Review
Application for Extension of Time deposited
Rs.15 lacs + 5 lacs = Rs.20 lacs on
09.04.2013 & Rs. 5 lacs (24.04.2013) and
Rs.6 lacs (03.05.2013) total deposits is
Rs.39.25 lacs + 31 lacs = 70.25 lacs."
41. Pertinently, the Bank in its reply has not chosen to deny the
W.P. No.2285/2022
aforesaid factual averments. Thus, in view of the judgment of Supreme
Court in Naseem Bano (SMT) vs. State of U.P. and others reported in
1993 Suppl. (4) SCC 46, the facts pleaded but not denied by the
respondent must be treated as admitted. Apart from the above, the RTI
information given by the Bank on 07.01.2022 shows that petitioner had
deposited Rs.70,33,605/-.
42. Thus, petitioner has admittedly deposited the amount of more than
70 lacs between 06.01.2012 to 31.03.2020. The DRAT by order dated
06.01.2012 and 28.02.2012 directed to deposit Rs.65 lacs with interest at
reducing balance @ 10% per annum.
43. The petitioner admittedly deposited much more than the principal
amount of Rs.65 lacs. About interest, no amount was quantified and
informed by the Bank. In other words, petitioner's repeated request to
inform about the remaining amount/interest went unreplied by the Bank.
In this backdrop, the petitioner filed M.A. No.284/2014 before DRAT to
direct the Bank to return the original title deed and issue 'No Dues
Certificate'.
44. The DRAT dismissed the said M.A. by impugned judgment dated
27.09.2019. The DRAT considered that amount paid by the petitioner
was not paid in 15 equal installments. In para-13 of the impugned
judgment, it is recorded "It is apparent from the above condition that the
W.P. No.2285/2022
Bank was given liberty to proceed with the auction even on default of one
installment."
45. It is important to note that argument of Shri Amit Khatri repeatedly
advanced during the course of hearing was that in the peculiar facts of
instant case, there is no delay in making the payment of Rs.65,00,000/- by
the petitioner. There is only an irregularity in not adhering to the
procedure of payment of equal amount of installments which is not
disputed by learned counsel for the Bank. The Bank, ultimately, received
more than principal amount of Rs.65 lacs within 15 months.
46. Parties have not chosen to file their pleadings i.e. claim and reply
filed before the learned DRAT on the basis of which the impugned
judgment dated 27.9.2019 (Annexure P/1) was passed. However, a
minute reading of the impugned judgment shows that parties were at
loggerheads on the question of payment of original amount of
Rs.65,00,000/- only. The stand of petitioner was not disbelieved by
DRAT that the said amount was indeed paid but the Appellate Tribunal
considered that financial discipline and schedule fixed by Appellate
Tribunal was not followed by the petitioner in letter and spirit. The
amount was although paid within time, but it was not paid in fifteen equal
installments. Interestingly, there is no whisper in the entire judgment
dated 27.9.2019 regarding non-payment of interest by the petitioner. The
W.P. No.2285/2022
Bank's defence is reproduced/reflected in the body of judgment but it
does not show that the Bank claimed any such interest or expressed it
grievance for non-payment of or less payment of interest.
47. Certainly, it was legitimate expectation of a borrower and litigant in
a case of this nature where he had paid more than Rs. 65,00,000/- within
stipulated time, showed his bonafides and expected that since over and
above said amount of Rs. 65,00,000/- he paid more than Rs.5,00,000/-
also, Bank will clarify as to whether said Rs.5,00,000/- satisfied the
requirement of payment of interest. If not, what is the amount of unpaid
interest and calculation thereof.
Since Bank did not mention about amount of interest before the
Appellate Tribunal, in our view, Bank can claim interest only upto
27.9.2019 i.e. date of judgment of Appellate Tribunal. Thereafter, as
taken note of, the Bank despite repeated request of the petitioner did not
inform him about the remaining amount and interest. The principle about
legitimate expectation was laid down by this Court in Mohan Lal
Patidar (supra) (an SLP preferred against this order before the Supreme
Court i.e. SLP No.8088-8089/2022 was dismissed by the Supreme Court
on 13.5.2022). The principle of legitimate expectation is attracted in
favour of petitioner inasmuch as he was entitled to get the correct
information regarding unpaid amount and if he paid the entire amount, he
W.P. No.2285/2022
had a valuable legitimate expectation to get back the original
deed/documents etc. If the Bank has not taken the objection regarding
unpaid amount of interest before the DRAT in the impugned proceedings,
it cannot be permitted to rise from its deep slumber now and fasten a huge
interest for the period beyond/after the judgment of DRAT dated
27.8.1999 on the petition.
48. It is also noteworthy that by communication dated 12.12.2020
(Annexure P/13), the National Lok Adalat pursuant to information given
by Bank informed the petitioner that he is only required to pay
Rs.16,250/-. The notice is reproduced for ready perusal :-
"us'kuy yksd vnkyr] fnukad [email protected]@2020
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MADAN MAHAL CHOWK NAGPUR ROAD, JABALPUR M.P.
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ekeyk lqyg&le>kbZ'k ds vk/kkj ij yksd&vnkyr esa fujkd`r fd;k tkuk
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W.P. No.2285/2022
vki ij mDr cSad ds _.k dh] orZeku esa O;kt lfgr :- 32837-
[email protected]& /kujkf'k cdk;k gSA ;fn vki yksd vnkyr esa jkf'k :- [email protected]&
vnk djrs gS] rks vkidk ekeyk iw.kZ :i ls fujkd`r fd;k tk ldsxk vkSj
vki O;kt lfgr iw.kZ cdk;k jkf'k nsus ds _.k ls eqDr gks tk;saxsA
yksd vnkyr esa feyus okyh NkwV dk ykHk ysus gsrq fnukad
[email protected]@2020 dks ftyk& U;k;ky;] tcyiqj esa ekeys ds fujkdju gsrq
le>kSrk jkf'k :- [email protected]& ysdj mifLFkr jg s] ;k yksd vnkyr dh frfFk
ls iwoZ 'kk[kk esa laidZ djsaA
fMQkYVj_.k [kkrs esa Yksd vnkyr varxZr nh x;h fujkdju gsrq tek dh tkus
ekax jkf'k NwV dh jkf'k okyh le>kSrk jkf'k
32837.35/- 16587.35/- 16250/-
[kkrk dza- 940065201190049
Asset Code : 33 ¼nsonRr½
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This notice is withdrawn tcyiqj ¼e-iz-½
by Bank for Other reasons
LFkku% tcyiqj ihBklhu vf/kdkjh
Uks'kuy yksd vnkyr
fnukad %[email protected]@2020 ftyk& tcyiqj ¼e-iz-½""""""
49. Learned counsel for the respondent has not given any justifiable
explanation for cancelling/withdrawing the notice of Lok Adalat.
50. In view of foregoing analysis, it is clear that in obedience of
DRAT's direction, the petitioner had deposited more than Rs.65 lacs
within 15 months although not deposited in 15 equal installments. In our
view, the purpose of fixing 15 equal installments by the DRAT was to
ensure that amount of Rs.65 lacs is paid with proper convenience to the
petitioner within 15 months. What was material and essential was the
repayment of amount and not the number of installments. Since,
petitioner has repaid the principal amount of Rs.65 lacs within time, non-
W.P. No.2285/2022
payment of the same in equal installments or any irregularity of that
nature will not bestow any right to the Bank to auction the property. The
learned DRAT in its impugned judgment dated 27.09.2019 to this extent
has taken a hyper-technical view.
51. Supreme Court in the case of Aurangabad Electricals (P) Ltd.
vs. CCE Customs, (2011) 1 SCC 121 in para-14, has held thus :-
"Technicalities should not defeat rendering
of complete justice to a litigant."
52. Supreme Court in the case of Kulwant Kaur v. Gurdial Singh
Man (2001) 4 SCC 262 in para-33, has also held as under :-
"Technicality alone by itself ought to
permit the High Court to decide the issue
since justice-oriented approach is the call
of the day presently."
53. It is apposite to quote relevant paragraphs of judgment of Apex
Court in the case of P.Vijayakumari (supra) on which heavy reliance is
placed by the petitioner. The relevant paras are reads as under :-
"3. In the Lok Adalat held on 10/09/2004, the
parties had agreed on an amount of Rs.34.5
lakhs payable within three months. The
appellants defaulted and paid a sum of Rs. 3
lakhs on 08/02/2005 and a further sum of Rs.35
lakhs on 17/10/2006 in terms of a conditional
order passed by DRAT staying the sale/auction
of the mortgaged property. Finally, on
29/10/2006, a further payment of Rs.3 lakhs
was made. In the above manner, a sum of Rs.41
W.P. No.2285/2022
lakhs stood paid by the appellants to the
respondent Bank as on 29/10/2006.
5. By order dated 07/12/2017 which is in the
terms extracted below, we had directed as
follows :
"Having heard the learned counsel for the
parties we direct the appellants to indicate to
us the amount which the appellants would be in
a position to offer to finally close the matter.
The respondent Indian Bank will also indicate
the amount that the Bank expects to be offered.
The said decision of the Bank will be taken at
the appropriate level and will be placed before
the Court in a sealed cover."
7. The respondent Bank has not come up
with any concrete offer and has placed before
the Court an extract of the statement of
account of the appellants as on date which
goes to show that the total dues as per the
Bank's statement of account is Rs.8,17,65,148
(Rupees eight crore seventeen lakhs sixty-five
thousand one hundred forty-eight only).
8. We have considered that matter. There
was undoubtedly some delay in payment of
the amount due as per the terms of the
settlement reached in the Lok Adalat. It was
also agreed by and between the parties that if
the terms of payment including the time
schedule of payment is not adhered to, the
respondent Bank will be at liberty to recover
the entire amount due. DRAT in the
impugned order had considered the matter
and had taken the view that even on the face
of express terms between the parties that the
bank would have a right to recover the full
amount due in the event of default on the part
of the appellants, the same was not the only
course of action or the sole option and that on
W.P. No.2285/2022
the grounds shown for the delay the same is
liable to be understood in favour of the
borrower. Accordingly, the matter was closed.
In the writ petition filed by the Bank the
position was reversed.
9. In the facts of the present case, the view
taken by the learned Appellate Tribunal
(DRAT), as noted above, cannot be said to be
so wholly unreasonable or unsustainable so as
to justify interference by the High Court. If the
agreed amount stood paid though with some
delay, condonation of the delay is a possible
course of action, if the grounds for delay
justified a departure from what was also
agreed upon i.e. the right of a Bank to recover
the entire dues. All would depend on the facts
of each case. Having regard to the totality of
the facts of the present case, we are of the view
that the ends of justice would be met if for the
delay that had occurred, the appellants are
made liable to pay simple interest @ 24% p.a.
on the amount of Rs.34.5 lakhs (as agreed to in
the Lok Adalat) for the period from the date of
the award of Lok Adalat i.e. 10/09/2004 to the
date of last payment i.e. 29/10/2006. In
addition, a further amount of Rs. 10 lakhs to be
paid by the appellants to the respondent Bank
as compensation and costs.
10. The above amounts will be paid by the
appellants to the respondent Bank within a
period of 45 days from today failing which the
respondent Bank may understand the present
order to be recalled and the mortgaged
property to be open for auction/disposal in
accordance with law."
W.P. No.2285/2022
54. We find substantial force in the argument of learned counsel for the
petitioner that present case has glaring similarity to great extent with that
of P. Vijayakumari (supra). In the case before Apex Court in P.
Vijayakumari (supra), the parties agreed on an amount of Rs.34.5 lakhs
payable within three months before Lok Adalat. The appellant defaulted
and could not pay the entire amount within stipulated time. The appellants
therein made certain payment in installments. In total, a sum of Rs.41 lacs
was paid by the appellants to the respondent/Bank as on 29/10/2006. The
appellants approached the DRT and sought extension of time for payment
and condonation of delay as per the order of Lok Adalat. The DRT
dismissed the application but its decision was reversed in appeal by
DRAT. The DRAT's order was questioned by the Bank in a Writ Petition
before the High Court. The Writ Petition was allowed by the High Court
which became subject matter of challenge and adjudication before Apex
Court in P. Vijayakumari (supra).
55. The Apex Court noted that admittedly there was some delay in
payment of amount as per terms of settlement reached in the Lok Adalat.
However, fact remains that the original amount was paid with some delay
by the appellants therein. In a case of this nature, the Apex Court opined
that the DRAT had taken a view that even on the face of express terms
between the parties that the Bank had a right to recover the full amount
W.P. No.2285/2022
due in the event of default on the part of the appellants, the said course
was not the only option with the Bank. The grounds of delay shown by
the borrower must be considered. The Apex Court further opined that if
the agreed amount stood paid though with some delay, condonation of
delay is a permissible course of action. If grounds for delay justified a
departure from what was also agreed upon i.e. the right of a Bank to
recover the entire dues.
56. No doubt, in the aforesaid judgment, the Apex Court made it clear
that it depends on the facts of each case but if the facts of present case are
also examined, at the cost of repetition, in our considered opinion, the
petitioner without their being any delay deposited more than the principle
amount of Rs.65 lacks as per directions of DRAT. The entire amount of
interest despite willingness and intention of petitioner could not be
deposited for the reason attributable to the non response of Bank also.
57. It is pertinent to mention here that for the first time by
communication dated 12.12.2020 and by an application dated 3.9.2021,
the Bank informed that petitioner had to pay a small amount of
Rs.16,250/- as against the main loan and an amount of interest for which
no basis/calculation was furnished.
58. The parties fought a series of litigation in various courts including
before D.R.T., D.R.A.T. and this court. Once the orders dated 6.1.2012
W.P. No.2285/2022
and 28.2.2012 were passed which attained finality, it was expected that
the parties will adhere to the terms and conditions so that unnecessary
litigation comes to an end. The petitioner deposited much more than the
amount of Rs.65 lacs within the stipulated time but account was not
closed and his original documents were not returned by the bank perhaps
under the impression that the petitioner was required to pay further
interest.
59. In order to finally draw the curtains on this litigation, we deem it
proper to invoke our power to do complete justice between the parties
flowing from Article 226 of the Constitution.
60. In (1965) 3 SCR, 536 (Dwarka Nath Vs. ITO), the Apex Court
held that Article 226 of the Constitution is couched in comprehensive
phraseology and confers a wide power on the High Court to reach
injustice wherever it is found. The scope of writ jurisdiction in India is
wider than the writ jurisdiction available to country like England
functioning with a unitary form of Government.
61. In (1995) 6 SCC 749 (B.C. Chaturvedi Vs. Union of India),
Justice B.L. Hansaria in his concurring judgment opined that High
Court has power to do "complete justice". As per Article 142 of the
Constitution, the Apex Court was conferred with the power of doing
W.P. No.2285/2022
complete justice that does not mean that other courts are not to do
complete justice between the parties.
62. In B.C. Chaturvedi Vs. Union of India, (supra), it was further
held as under:-
"23. It deserves to be pointed out that the mere
fact that there is no provision parallel to
Article 142 relating to the High Courts, can be
no ground to think that they have not to do
complete justice, ....................................
Absence of provision like Article 142 is not
material, according to me. This may be
illustrated by pointing out that despite there
being no provision in the Constitution parallel
to Article 137 conferring power of review on
the High Court, this Court held as early as
1961 in Shivdeo Singh case [Shivdeo Singh v.
State of Punjab, AIR 1963 SC 1909] that the
High Courts too can exercise power of review,
which inheres in every court of plenary
jurisdiction. I would say that power to do
complete justice also inheres in every court,
not to speak of a court of plenary jurisdiction
like a High Court. Of course, this power is not
as wide as which this Court has under Article
142. That, however, is a different matter."
63. The Judgment of Dwarka Nath Vs. ITO (supra) was again
followed by the Supreme Court in (2000) 8 SCC 395 (Badrinath Vs.
Govt. of T.N.).
64. A five Judges Bench of Supreme Court in (2004) 8 SCC 788, (M.P.
Special Police Establishment Vs. State of M.P.) has held as under:-
W.P. No.2285/2022
"31. ......the writ court while exercising its
jurisdiction under Article 226 of the
Constitution as also this Court under Articles
136 and 142 of the Constitution can pass an
appropriate order which would do complete
justice to the parties."
65. The aforesaid legal journey leaves no room for any doubt that
Article 226 of the Constitution gives wide powers to this court to reach
injustice wherever it is found. For this purpose, the High can mould the
reliefs to meet the peculiar and extraordinary circumstances of the
peculiar case (see also (2010) 3 SCC 571, (State of W.B. Vs. Committee
for Protection of Democratic Rights). This view is consistently
followed by the Supreme Court in various judgments including (2013) 14
SCC 737 (Bangalore Development Authority Vs. Vijaya Leasing
Ltd.). This Court in (2016) 1 M.P. LJ 474 (Little Angels Shiksha
Samiti Vs. State of M.P.) has followed the aforesaid ratio decidendi.
66. In order to curtail and minimize unnecessary litigation and heart
burning, in the peculiar facts of this case, we deem it proper to exercise
the powers to do complete justice and pass appropriate orders so that
litigation comes to and end and parties can get an opportunity to settle
their dispute.
67. We, therefore, deem it proper to follow the course adopted by the
Supreme Court in the case of P. Vijayakumari and another Vs. Indian
W.P. No.2285/2022
Bank (supra). We are of the view that ends of justice would be met if we
hold and direct that :-
(i) Principle amount of Rs.65 lacs stood paid by the petitioner
within stipulated time as per order of DRAT, dated 6.1.2012, r/w
order dated 28.2.2012.
(ii) In the order dated 28.2.2012, the bank was permitted to
charge the interest on the reducing balance of Rs.65 lacs @ 10%
per annum. It will not be proper for us to re-write or re-fix the
percentage of interest because the order dated 28.2.2012 has
attained finality.
(iii) Accordingly, the bank shall furnish the information and basis
of calculation of 10% per annum interest on reducing balance of
Rs.65 lacs to the petitioner till the date of impugned judgment of
DRAT dated 27.9.2019 within fifteen days from the date of
production of copy of this order.
(iv) In turn, the petitioner shall pay the said amount of interest to
the bank within sixty days from the date information regarding
interest is furnished to the petitioner.
(v) If aforesaid amount of interest is not paid by the petitioner to
the bank within sixty days aforesaid, this order shall be treated as
recalled/cancelled and it will be open to the bank to auction the
mortgaged property in accordance with law.
(vi) The impugned judgment dated 27.09.2019 passed in M.A.
No.284/2014 is set aside.
W.P. No.2285/2022
68. The aforesaid directions, in our judgment, will take care of interest
of both the sides and will do complete justice between the parties.
69. In view of foregoing analysis and the wholesome exercise
undertaken by us to do complete justice between the parties, in the
peculiar facts of this case, it will not be proper to dismiss the petition on
the second objection of maintainability taken by the Bank. If petitioner
fulfills the conditions mentioned in para-67 clause (i) to (vi) within the
stipulated time, the account of petitioner shall be treated to be settled for
all purposes and it will have an effect of closure of execution proceedings
and recovery proceedings pending before DRT. However, if petitioner
fails to comply with conditions mentioned in (i) to (vi) aforesaid within
the time fixed, the Bank and DRT will be at liberty to proceed against the
petitioner in accordance with law. In other words, failure to comply with
conditions mentioned in para-67 above, this order shall be treated to be
cancelled.
70. The petition is disposed off.
(SUJOY PAUL) (PRAKASH CHANDRA GUPTA)
JUDGE JUDGE
vai/ahd
/DevS/akm
/Gope/pk
Signature Not Verified
SAN /manju/bks
Digitally signed by MOHD AHMAD
Date: 2022.06.22 15:18:04 IST
