Parmaram @ Parmanaram vs Prescribed Authority Cum Sub ...
2023 Latest Caselaw 7821 Raj

[2023:RJ-JD:32072]

        HIGH COURT OF JUDICATURE FOR RAJASTHAN AT
                         JODHPUR
                      S.B. Civil Writ Petition No. 9986/2021

Parmaram @ Parmanaram S/o Ramnarayan Jat, Aged About 60
Years, Tejarasar, Tehsil And District Bikaner.
                                                                                    ----Petitioner
                                               Versus
1.         Prescribed Authority Cum Sub Divisional Officer, Bikaner,
           Bikaner.
2.         Punjab National Bank, University Branch, Bikaner Through
           Its Manager.
3.         Tehsildar (Revenue), Bikaner.
4.         Manish Kumar S/o Mangi Lal Jat, Tejarasar, Tehsil And
           District Bikaner.
                                                                               ----Respondents


For Petitioner(s)                   :     Mr. CS Kotwani
For Respondent(s)                   :     Mr. AR Godara
                                          Mr. RD Bhadu
                                          Mr. Dhanesh Saraswat



                    HON'BLE DR. JUSTICE NUPUR BHATI

                                        JUDGMENT

Reserved on:                                  <      >                            26/09/2023
Pronounced on:                                <      >                            04/10/2023

1. Though the matter is listed under 'Orders' category but with the

joint consent of the counsels for both the parties, the matter is

being finally heard and decided today itself.

2. The instant writ petition is preferred under Article 226 of the

Constitution of India, claiming following reliefs:

(D.B. SAW/556/2021 and 1 more have been filed in this matter. Please refer the same for further orders)

[2023:RJ-JD:32072] (2 of 23) [CW-9986/2021]

"It is, therefore, most humbly and respectfully prayed that the writ petition may kindly be allowed and by issuing an appropriate writ, order or direction

i. The impugned sale declaration dated 10.3.2021 (Annex.8) and impugned order dated 10.3.2021 (Annex.3) may kindly be quashed and set aside;

ii. The entire proceedings initiated against the humble petitioner may kindly be ordered to be dropped;

iii. The respondents may kindly be directed to grant time to the humble petitioner to deposit the debt amount as per the provisions of the Act of 1974 and the auction proceedings which have been undertaken by the respondents may kindly be ordered to be quashed and set aside;

iv. Any other order or direction, which this Hon'ble Court deems fit and proper in the facts and circumstances of the present case may kindly be passed in the favour of humble petitioner."

3. The brief facts which gave emergance to the instant writ

petition are that the petitioner took agricultural loan amounting

Rs. 27 Lakhs in the year 2012 from Punjab National Bank, Bikaner

(hereinafter referred to as 'Respondent No. 2'), while mortgaging

his land situated at Khasra No. 647, 885/1, 888 admeasuring

10.40 hectares in total.

4. The petitioner could not repay the loan amount within time, due

to which the Respondent No. 2 preferred an application dated

06.09.2018 (Annexure-1) under Section 13 (1) of the Rajasthan

Agricultural Credit Operations (Removal of Difficulties) Act, 1974

(hereinafter referred to as 'the Act of 1974') for recovery of the

amount of Rs.31,21,847/-.

(D.B. SAW/556/2021 and 1 more have been filed in this matter. Please refer the same for further orders)

[2023:RJ-JD:32072] (3 of 23) [CW-9986/2021]

5. Then the petitioner submitted an application dated 22.09.2020

(Annexure-2) for depositing the loan amount.

6. The attachment warrant dated 30.12.2019 (Annexure-4) was

issued by the Sub-Divisional Officer, Bikaner (hereinafter referred

to as 'Respondent No. 1'), in which, the measurement of land was

mentioned as 10.40 hectares and thereafter, in pursuance of the

attachment warrant dated 30.12.2019 issued by Respondent No.

1, the Tehsildar, Revenue, Bikaner (hereinafter referred to as

'Respondent No. 3'), submitted the report dated 05.03.2020

(Annexure-5) which showed the measurement of land as 16.28

hectares.

7. The Respondent No. 1 vide order dated 07.09.2020 (Annexure-

6) issued a sale declaration of land measuring 10.40 hectares.

Subsequently, an application dated 02.03.2021 (Annexure-7) was

submitted by Respondent No.2 to Respondent No. 1, requesting

the change in land measurement as 16.28 hectares instead of

10.40 hectares, upon which the Respondent No. 1 vide order

dated 10.03.2021 (Annexure-8) issued a sale declaration of land

measuring 16.28 hectares.

8. The petitioner thereafter submitted a legal notice dated

16.06.2021 (Annexure-9) after he came to know about this

development of increasing the measurement of land.

9. The land was auctioned by Respondent No. 3 on 26.03.2021 in

pursuance of the sale declaration dated 10.03.2021 (Annexure-8)

and the report of auction proceedings (Annexure-10) was

submitted by Respondent No. 3.

(D.B. SAW/556/2021 and 1 more have been filed in this matter. Please refer the same for further orders)

[2023:RJ-JD:32072] (4 of 23) [CW-9986/2021]

10. Hence aggrieved by the sale declaration dated 10.03.2021,

the petitioner has preferred the instant writ petition.

11. The learned counsel for the private respondent - Respondent

No.4 raised preliminary objection that the petitioner has an

efficacious statutory alternate remedy available under Section 13

(2) of the Act of 1974, which reads as under:

"13. Recovery of dues of a bank through a prescribed authority-- (1) Notwithstanding anything contained in any law for the time being in force, an official of the State Government notified by the State Government as the prescribed authority for the purpose of this section may, on the application of a bank, make an order on or any agriculturist or his heir or legal representative, directing the payment of any sum due to the bank on account of financial assistance availed of by the agriculturist, by the sale of any land or interest therein or any other immovable property, upon which the payment of such money is charged or mortgaged:

Provided that no order shall be made by the prescribed authority under this sub-section for the sale of any interest therein or any other immovable property upon which the payment of money is charged or mortgaged as the case may be, unless the agriculturist or the heir or legal representative of the agriculturist, as the case may be, has been given an opportunity of being heard and has been served with a notice by the prescribed authority calling upon him to pay the amount due and default has been made in payment thereof for three months after the determination of liabilities by such authority.

(2) Every order passed the prescribed authority in terms so sub-section (1) shall be deemed to be a decree of a Civil Court and shall be executed by him in the same manner as a decree of such court.

(D.B. SAW/556/2021 and 1 more have been filed in this matter. Please refer the same for further orders)

[2023:RJ-JD:32072] (5 of 23) [CW-9986/2021]

Explanation.-- For the purpose of exercising powers conferred by this sub-section the prescribed authority shall be deemed to be a Civil Court.

(3) Nothing in this section shall debar a bank from seeking to enforce its rights in any other manner under any other law for the time being in force."

12. The learned counsel for the Respondent No. 2 also raised

preliminary objection that the petitioner has an efficacious

statutory alternate remedy under Section 247 of the Rajasthan

Land Revenue Act, 1956 (hereinafter referred to as 'the Act of

1956'), which reads as under:

"247. Application to set aside the sale for irregularity etc. - At any time within thirty days from the date of the sale, an application may be made to the Collector to set aside the sale on the mound of some material Irregularity or mistake in publishing or conductinng It. But no sale shall be set aside on such ground unless the applicant proves the satisfaction of the Collector that he has substantial injury by reason of such irregularlity or mistake."

13. The learned counsel for the Respondent No. 2 while raising

the preliminary objections also submitted that the petitioners have

challenged the auction notice through this petition and not the

auction proceedings and therefore, the relief claimed would not

serve any purpose to the petitioner.

14. The learned counsels for the respondents while raising the

preliminary objections jointly placed reliance on the judgement

dated 23.09.2023 passed by Hon'ble Apex Court in Civil Appeal

(D.B. SAW/556/2021 and 1 more have been filed in this matter. Please refer the same for further orders)

[2023:RJ-JD:32072] (6 of 23) [CW-9986/2021]

No. 5920-5923/2021, S. Karthik & Ors. v. N. Subhash

Chand Jain & Ors., wherein the Court held that:

"68. It could thus be seen that the appellants had more than one opportunity for redemption of the mortgage. However, from their conduct, it appears that they were only interested in protracting the litigation. It is the appellants at whose intervention and on whose incorrect representation, the sale, which was scheduled to be held on 27.2.2012 in pursuance of the notice dated 21.1.2012, could not be held. Even after the dismissal of S.A. No.69 of 2012 on 2.7.2012, the respondent-Bank again issued a Second Sale Notice on 9.7.2012 scheduling the sale on 20.7.2012 in which the auction purchaser emerged as a successful bidder. It is thus clear that the appellants had enough time from 21.1.2012 till 2.7.2012 for redemption of their mortgaged properties. However, they did not avail of that opportunity. Even after the auction purchaser emerged successful in the bid and had paid the bid money, an opportunity was given by the DRT. Chennai, vide order dated 7.8.2012, to the appellants to deposit the amount of Rs.4.80 crore within one month. However, without complying with the same, the appellants continued with their dilatory tactics by filing an application being I.A. No.437 of 2012 in S.A. No.227 of 2012. Even thereafter. they continued with the proceedings before the High Court, wherein certain interim orders were passed, and finally, the High Court, finding that in view of the sale being confirmed and the sale being registered no interference could be warranted, dismissed the Civil Revision Petitions. Thereafter again, they approached this Court by way of Special Leave Petitions, which were subsequently withdrawn. Ideally. the litigation ought to have stopped at least at that stage.

70. As we have already discussed hereinabove, the facts in the case of Mathew Varghese (supra) and the facts in the present case are totally different. In any case, in view of the observations made in paragraph 53 of the judgment of this Court in the case of Mathew Varghese (supra), we are of

(D.B. SAW/556/2021 and 1 more have been filed in this matter. Please refer the same for further orders)

[2023:RJ-JD:32072] (7 of 23) [CW-9986/2021]

the view that since the sale scheduled on 27.2.2012 in pursuance to the notice dated 21.1.2012 could not be held on account of the reasons solely attributable to the appellants/guarantors, there was no necessity to provide 30 days' period in the Second Sale Notice dated 9.7.2012. which was in continuation of the First Sale Notice dated 21.1.2012."

15. The learned counsel for the respondents while raising

preliminary objection further placed reliance upon the judgement

dated 21.09.2023 in Civil Appeal No. 5542-5543/2023, Celir

LLP v. Bafna Motors (Mumbai) Pvt. Ltd. & Ors., wherein the

court held that:

"83. This Court in Valji Khimji (supra) held that once an auction is confirmed the same can be interfered on very limited grounds as otherwise no auction would ever be complete, with the following relevant observations, being reproduced hereunder: -

"11. It may be noted that the auction-sale was done after adequate publicity in well-known newspapers. Hence, if any one wanted to make a bid in the auction he should have participated in the said auction and made his bid. Moreover, even after the auction the sale was confirmed by the High Court only on 30-7- 2003, and any objection to the sale could have been filed prior to that date. However, in our opinion, entertaining objections after the sale is confirmed should not ordinarily be allowed, except on very limited grounds like fraud, otherwise no auction-sale will ever be complete.

29... It may be mentioned that auctions are of two types - (1) where the auction is not subject to subsequent confirmation, and (2) where the auction is

(D.B. SAW/556/2021 and 1 more have been filed in this matter. Please refer the same for further orders)

[2023:RJ-JD:32072] (8 of 23) [CW-9986/2021]

subject to subsequent confirmation by some authority after the auction is held.

30. In the first case mentioned above, i.e. where the auction is not subject to confirmation by any authority, the auction is complete on the fall of the hammer, and certain rights accrue in favour of the auction-purchaser. However, where the auction is subject to subsequent confirmation by some authority (under a statute or terms of the auction) the auction is not complete and no rights accrue until the sale is confirmed by the said authority. Once,however, the sale is confirmed by that authority, certain rights accrue in favour of the auction-purchaser, and these rights cannot be extinguished except in exceptional cases such as fraud."

84. In another decision by this Court in K. Kumara Gupta v. Sri Markendaya and Sri Omkareswara Swamy Temple & Ors. reported in (2022) 5 SCC 710, it was held that repeated interferences with public auction would frustrate the sanctity and purpose of holding auctions. The relevant observations made in it are given below:-

"14. Once the appellant was found to be the highest bidder in a public auction in which 45 persons had participated and thereafter when the sale was confirmed in his favour and even the sale deed was executed, unless and until it was found that there was any material irregularity and/or illegality in holding the public auction and/or auction-sale was vitiated by any fraud or collusion, it is not open to set aside the auction or sale in favour of a highest bidder on the basis of some representations made by third parties, who did not even participate in the auction proceedings and did not make any offer.

xxx xxx

(D.B. SAW/556/2021 and 1 more have been filed in this matter. Please refer the same for further orders)

[2023:RJ-JD:32072] (9 of 23) [CW-9986/2021]

16. It is also required to be noted that the sale was confirmed in favour of the appellant by the Commissioner, Endowments Department after obtaining the report of the Assistant Commissioner.

Therefore, we are of the opinion that in the aforesaid facts and circumstances of the case, the High Court ought not to have ordered re-auction of the land in question after a period of 23 years of confirmation of the sale and execution of the sale deed in favour of the auction-purchaser by observing that the value of the property might have been much more, otherwise, the object and purpose of holding the public auction and the sanctity of the public auction will be frustrated. Unless there is concrete material and it is established that there was any fraud and/or collusion or the land in question was sold at a throwaway price, the sale pursuant to the public auction cannot be set aside at the instance of strangers to the auction proceeding.The sale pursuant to the public auction can be set aside in an eventuality where it is found on the basis of material on record that the property had been sold away at a throwaway price and/or on a wholly inadequate consideration because of the fraud and/or collusion and/or after any material irregularity and/or illegality is found in conducing/holding the public auction. After the public auction is held and the highest bid is received and the property is sold in a public auction in favour of a highest bidder, such a sale cannot be set aside on the basis of some offer made by third parties subsequently and that too when they did not participate in the auction proceedings and made any offer and/or the offer is made only for the sake of making it and without any serious intent. In the present case, as observed hereinabove, though Shri Jagat Kumar immediately after finalising the auction stated that he is ready and willing to pay a higher price, however, subsequently, he backed out. If the auction-sale pursuant to the public auction is set aside on the basis of such frivolous and irresponsible

(D.B. SAW/556/2021 and 1 more have been filed in this matter. Please refer the same for further orders)

[2023:RJ-JD:32072] (10 of 23) [CW-9986/2021]

representations made by such persons then the sanctity of a public auction would be frustrated and the rights of a genuine bidder would be adversely affected." (Emphasis supplied)

85. In a recent decision by this Court in Eva Agro Feeds Private Limited v. Punjab National Bank & Anr.

reported in 2023 SCC OnLine SC 1138, the following relevant observations were made, being reproduced as under: -

"84. mere expectation of the Liquidator that a still higher price may be obtained can be no good ground to cancel an otherwise valid auction and go for another round of auction. Such a cause of action would not only lead to incurring of avoidable expenses but also erode credibility of the auction process itself. That apart. post auction it is not open to the Liquidator to act on third party communication and cancel an auction, unless it is found that fraud or collusion had vitiated the auction. The necessary corollary that follows therefrom is that there can be no absolute or unfettered discretion on the part of the Liquidator to cancel an auction which is otherwise valid. As it is in an administrative framework governed by the rule of law there can be no absolute or unfettered discretion of the Liquidator. Further, upon a thorough analysis ofall the provisions concerning the Liquidator it is evident that the Liquidator is vested with a host of duties, functions and powers to oversee the liquidation process in which he is not to act in any adversarial manner while ensuring that the auction process is carried out in accordance with law and to the benefit of all the stakeholders, Merely because the Liquidator has the discretion of carrying out multiple auction it does not necessarily imply that he would abandon or cancel a valid auction fetching a reasonable price and opt for another round of auction process with the expectation of a better price.

Tribunal had rightly held that there were no objective

(D.B. SAW/556/2021 and 1 more have been filed in this matter. Please refer the same for further orders)

[2023:RJ-JD:32072] (11 of 23) [CW-9986/2021]

materials before the Liquidator to cancel the auction process and to opt for another round of auction. (Emphasis supplied)

86. Thus, what is discernible from above is that, it is the duty of the courts to zealously protect the sanctity of any auction conducted. The courts ought to be loath in interfering with auctions, otherwise it would frustrate the very object and purpose behind auctions and deter public confidence and participation in the same.

87. Any other interpretation of the amended Section 13(8) will lead to a situation where multiple redemption offers would be encouraged by a mischievous borrower, the members of the public would be dissuaded and discouraged from in participating in the auction process and the overall sanctity of the auction process would be frustrated thereby defeating the very purpose of the SARFAESI Act. Thus, it is in the larger public interest to maintain the sanctity of the auction process under the SARFAESI Act.

88. In view of the aforesaid discussion, we hold that as per the amended Section 13(8) of the SARFAESI Act, once the borrower fails to tender the entire amount of dues with all cost & charges to the secured creditor before the publication of auction notice, his right of redemption of mortgage shall stand extinguished/waived on the date of publication of the auction notice in the newspaper in accordance with Rule 8 of the Rules of 2002."

16. The learned counsel for the petitioner while replying to the

preliminary objections submitted that the judgements upon which

the respondents have placed reliance does not apply to this case

as those judgements are related to Securitisation and

Reconstruction of Financial Assets and Enforcement of Security

Interest Act, 2002 (hereinafter referred to as 'the Act of 2002')

and the instant case is not related to SARFAESI Act, 2002, and

(D.B. SAW/556/2021 and 1 more have been filed in this matter. Please refer the same for further orders)

[2023:RJ-JD:32072] (12 of 23) [CW-9986/2021]

also, there is no alternate remedy available under Section 13 (2)

or any other provisions of the Act of 1974 and it merely provides

for the way of execution.

17. The learned counsel for the petitioner while replying to the

preliminary objections placed reliance upon the judgement dated

01.02.2023 passed by Hon'ble Apex Court in Civil Appeal No.

5393/2010, M/S Godrej Sara Lee Ltd. v. The Excise and

Taxation Officer-Cum-Assessing Authority & Ors., wherein

the Hon'ble Apex Court held that the availability of alternate

remedy would not oust the writ jurisdiction of the High Court, if

there is non-compliance of statutory provisions.

18. The learned counsel for the petitioner submitted that:

A) The petitioner have always remained ready and willing to

deposit the loan amount but it was due to the actions of

Respondent No. 2, the petitioner was not able to deposit the loan

amount. The learned counsel further submitted that the petitioner

is ready to deposit entire amount in installments of Rs. 10 Lakhs

every month and within three months, the petitioner will clear all

dues to the Respondent No. 2 - Bank.

B) The entire procedure has been prescribed under Rule 5 of the

Rajasthan Agricultural Credit Operations (Removal of Difficulties)

Rules, 1976 (hereinafter referred to as 'the Rules of 1976') and

the respondents have completely ignored the procedure laid down

under Rule 5 of the Rules of 1976, and have deprived the

petitioner from his land which is his only source of livelihood as

Girdawari of the land in question shows.

(D.B. SAW/556/2021 and 1 more have been filed in this matter. Please refer the same for further orders)

[2023:RJ-JD:32072] (13 of 23) [CW-9986/2021]

C) There is a clear provision of the Act of 1974 that no order shall

be made by the prescribed authority after determination of the

debt unless an opportunity of hearing and payment of debt is

given to the borrower within a period of three months after the

determination of liability by such authority, but the petitioner was

given no opportunity of being heard and hence, the entire

proceedings have been conducted against the provisions of the Act

of 1974 and the Rules of 1976.

D) The Respondent No. 2 - Bank first mentioned the land

measuring 10.40 hectares which was to be put under auction, but

later on the bank changed the measurement of land stating that

entire land has to be auctioned as the whole land was mortgaged

and the Respondent No. 1 changed the measurement of land and

vide declaration dated 10.03.2021 (Annexure-8) issued sale

declaration.

19. The learned counsel for the Respondent No. 4 submitted that:

A) The petitioner has challenged the sale declaration dated

10.03.2021 (Annexure-3) and sale declaration dated 25.03.2021

(Annexure-8), which was passed by the Respondent No. 1 and the

Respondent No. 4 has purchased the property through public

auction and the Certificate of Purchase is also issued in favour of

the Respondent No. 4 after he deposited the entire amount of sale

and therefore, the sale is complete and the same cannot be

challenged.

B) After the sale of the land in question was complete, the

concerned authority has proceeded to change the Revenue

(D.B. SAW/556/2021 and 1 more have been filed in this matter. Please refer the same for further orders)

[2023:RJ-JD:32072] (14 of 23) [CW-9986/2021]

Records vide mutation entry no. 2732/26.07.2021 and the land

was declared un-mortgaged.

C) The records of the case clearly shows that the petitioner was

given ample opportunity to repay the loan amount but the

petitioner choose not to repay the loan and due to which, the

auction proceedings were initiated against the petitioner.

D) The auction proceedings were instituted in the year 2018 and

the petitioner through his son filed an application dated

22.09.2020 stating to repay the loan within two months but the

petitioner did not do so.

E) The action taken by the respondent authority is legal and valid

and also well within the jurisdictional limits and do not suffer from

any illegality and irregularity.

20. The learned counsel for the petitioner in rejoinder to the reply

of Respondent No. 4 submitted that:

A) The issuing of declaration of sale dated 10.03.2021 and fixing

the date of sale as 25.03.2021 is illegal. The learned counsel

further submitted that as per the Rule 6 (1) of the Rules of 1976,

all notices, summons and proclamation/declaration required to be

issued for the purpose of this Act (Act of 1974) shall be issued in

the manner laid down under Section 238 and 239 of the Act of

1956, which reads as under:

"238. Proclamation of sale- (1) When the sale of any land or other immovable property has been sanctioned under section 235 or section 237, the Collector shall issue a proclamation of the intended sale, specifying the land to be sold, the revenue (if any) assessed thereon, the arrears for which it is to be sold, the time and place of sales, whether

(D.B. SAW/556/2021 and 1 more have been filed in this matter. Please refer the same for further orders)

[2023:RJ-JD:32072] (15 of 23) [CW-9986/2021]

or not the land is to be sold free of encumbrances and any other particulars, the Collector may think necessary. (2) A copy of the proclamation issued under sub-section (1) shall be served on the defaulter.

239. Sale when and by whom to be made- (1) Every sale under this Chapter shall be made either by the Collector in person or by an Assistant Collector or Tehsildar specially appointed by him in this behalf.

(2) No such sale shall take place on a Sunday or other authorised holiday or until after the expiration of at least thirty days from the date on which the proclamation thereof was issued.

(3) The Collector, may from time to time, postpone the sale."

The conjoint reading of Section 238 and 239 suggests that the

copy of the proclamation/declaration is mandatory to be given to

the defaulter and no sale shall take place at least 30 days from

the date on which the proclamation/declaration was issued, but

the petitioner was not served with such proclamation/declaration.

The learned counsel while submitting further placed reliance upon

the Judgment of the Division Bench of this Court in the case of

Ganesh Ram v. Collectore, Pali, reported in 1985 RLW (36)

329; wherein the Court observed that Section 239 of the Act of

1956 is a mandatory provision and thus, any order passed de-hors

the said section is null and void.

B) The land has been freed from all the encumbrances but that

does not mean that the name of Respondent No. 4 has been

incorporated in the mutation entry, and also, recently a letter

dated 23.07.2021 (Annexure-12) was written by concerned SHO

to Respondent No. 1 stating that the petitioner and his son only

(D.B. SAW/556/2021 and 1 more have been filed in this matter. Please refer the same for further orders)

[2023:RJ-JD:32072] (16 of 23) [CW-9986/2021]

has this one land and if the possession is taken from the

petitioner, then the petitioner would suffer an irreparable losses.

21. The learned counsel for the Respondent No. 2 submitted that:

A) This matter was listed before this Hon'ble Court on 03.09.2021

wherein the Court granted interim relief to the petitioner with a

direction to deposit the entire amount with the

respondent/applicant bank within a period of 15 days from the

date of interim order, but the petitioner failed to make the

repayment of the outstanding amount of loan.

B) This Hon'ble Court while passing the order dated 03.09.2021

has viewed that thirty days time was not given for auction as

prescribed under the Rules of 1976, the learned counsel further

submitted that the land was sold through auction following the

procedure laid down under the Act of 1956 and rules laid down

thereunder, and the learned counsel also submitted that the Rules

governing the sale of land in this case nowhere prescribe the

mandatory requirement of thirty days notice period for

proclamation/declaration, which otherwise has become the basis

of granting interim relief in favour of the petitioner.

C) The land in question has already been sold in public auction in

favour of Respondent No. 4, who was the highest bidder.

D) The banking system of extending financial assistance by

accecpting security in terms of mortgage is widely prevailed and

established phenomenon and the law of the land affirms the

method by empowering the banks to enforce the security interest

in order to realize the public money in the event of asset turning

(D.B. SAW/556/2021 and 1 more have been filed in this matter. Please refer the same for further orders)

[2023:RJ-JD:32072] (17 of 23) [CW-9986/2021]

to be a non-performing asset. The learned counsel further

submitted that the legal tools which are available under the

statute are required to be dealt with sternly to maintain the

financial discipline. The learned counsel also submitted that he

Hon'ble Apex Court in the case of State Bank of Travancore &

Anr. v. Mathew KC, Civil Appeal No. 1281 of 2018, has held

that the loans given by financial institutions are granted from

public money generated at the tax payers expense and such loan

does not become the property of the borrower, but remains it's

character of public money given in fiduciary capacity as

entrustment by the public.

D) The petitioner did a default in repaying the loan amount and

due to which the interest in that land was created in favour of

Respondent No. 4 through public auction and hence, allowing the

petitioner to repay the loan at this belated stage will vitiate the

lawful process undertaken for recovery and shall set a negative

inference among the prospective buyers of properties put to

auction.

22. The learned counsel for the private respondent Respondent

No. 4, in reply to the rejoinder to the petitioner submitted that:

A) No rights have accrued in favour of the peitioner as on the

count that the sale in question has already been completed by

authority concern prior to filing this writ petition and not only this,

the petitioner has neither put in challenge the Certificate of

Purchase.

(D.B. SAW/556/2021 and 1 more have been filed in this matter. Please refer the same for further orders)

[2023:RJ-JD:32072] (18 of 23) [CW-9986/2021]

B) The petitioner has filed the writ petition against the order

passed by the prescribed authority cum Sub Divisional Officer,

Bikaner whereby, the proceedings instituted under the Act of 1974

and Rules made there under concluded and therefore, the writ

petition of the petitioner falls under the category of article 227 of

the Constitution of India instead of under article 226 of the

constitution of India and therefore, the writ petition of the

petitioner is deserves to be dismissed on this count alone.

C) The Respondent No. 4 purchased the land in question by way

of public auction conducted by the authority concern while paying

required consideration of land and resultantly, on being depositing

entire amount of auction, the authority concerned has issued the

sale certificate of the land in question in favour of Respondent No.

4, and there is no evidence in relation to collusion between the

answering respondent as well as authority concern and therefore,

in this view of matter, the allegations levelled by the petitioner

against the Respondent No. 4 is wholly baseless and without any

foundation of facts.

D) The summons of the auction proceedings were served upon the

petitioner on dated 18.07.2019 and despite having been served

upon summons of the proceedings, the petitioner did not choose

to proceed further to repay loan amount as well to participate in

aforesaid proceedings and resultantly, the authority concern has

issued proclamation/declaration of sale on dated 07.09.2020

(Annexure-R/4/3) and date was fixed for concluding the auction

proceedings was 05.10.2020 and on being issued

(D.B. SAW/556/2021 and 1 more have been filed in this matter. Please refer the same for further orders)

[2023:RJ-JD:32072] (19 of 23) [CW-9986/2021]

proclamation/declaration of sale on dated 07.09.2020 and same

served upon the petitioner, he approached to the concern bank by

way of filing application on dated 22.09.2020 while submitting

therein that the petitioner is ready to deposit required amount of

the loan within two months. However, on being filing aforesaid

application behalf of the petitioner, the concern authority has

postpone the auction proceedings of the land in question as

assurance was undertaken by the petitioner to repay the loan

amount in writing but the petitioner did not choose to repay the

loan amount despite having been filing application for the same

purpose and therefore, the authority concern has proceeded

further while issuing subsequent proclamation/declaration dated

07.01.2021 and 10.03.2021 (Annexure-R/4/4) of sale to recover

the due loan amount. The learned counsel further submitted that

the proceedings of proclamation/declaration of sale was kept in

abeyance by the authority concern as on count that the petitioner

has assured to repay the loan amount within time but the

petitioner not choose to repay the amount of loan as per

assurance undertaken by him and resultantly, the subsequent

proclamation/declaration of sale was issued by the authority

concerned.

23. Heard learned counsels for the parties and perused the record

of the case as well as the judgements cited at bar.

24. The preliminary objections raised by learned counsel for the

respondents that the present writ petition is not maintainable on

the ground of alternative remedy being available to the petitioner

(D.B. SAW/556/2021 and 1 more have been filed in this matter. Please refer the same for further orders)

[2023:RJ-JD:32072] (20 of 23) [CW-9986/2021]

under Section 13 (2) of the Act of 1974 and under Section 247 of

the Act of 1956 is not sustainable as apparently the respondents

while selling the property of the petitioner have not adhered to the

mandatory provisions of the Act of 1956. The respondents issued

the declaration/proclamation of the sale dated 10.03.2021

(Annexure-8) while fixing the date of sale as 25.03.2021

(Annexure-8) as per Rue 6 of the Rules of 1976. The provisions of

law which have to be adhered while issuing the notices, summons

and proclamations have to be in accordance with Section 238 and

239 of the Act of 1956 and the same is reproduced hereunder:-

"238. Proclamation of sale- (1) When the sale of any land or other immovable property has been sanctioned under section 235 or section 237, the Collector shall issue a proclamation of the intended sale, specifying the land to be sold, the revenue (if any) assessed thereon, the arrears for which it is to be sold, the time and place of sales, whether or not the land is to be sold free of encumbrances and any other particulars, the Collector may think necessary.

(2) A copy of the proclamation issued under sub- section (1) shall be served on the defaulter.

239. Sale when and by whom to be made- (1) Every sale under this Chapter shall be made either by the Collector in person or by an Assistant Collector or Tehsildar specially appointed by him in this behalf.

(2) No such sale shall take place on a Sunday or other authorised holiday or until after the expiration of at least thirty days from the date on which the proclamation thereof was issued.

(3) The Collector, may from time to time, postpone the sale."

(D.B. SAW/556/2021 and 1 more have been filed in this matter. Please refer the same for further orders)

[2023:RJ-JD:32072] (21 of 23) [CW-9986/2021]

25. A bare reading of sub-section (2) of Section 239 reflects that

the authority concerned who is enshrined with the duty of sale of

the property has to make the sale after the expiration of at least

30 days from the date on which the proclamation/declaration

thereof shall be issued. In the present case, the respondent-State

proceeded with the sale of the properly in question without

expiration of at least 30 days from the date of

proclamation/declaration issued as the first sale declaration was

issued on 07.09.2020 and thereafter the second sale declaration

was issued on 10.03.2021 and the auction proceedings took place

on 26.03.2021. The respondents conducted auction proceedings

after expiration of 15 days only. It is also seen from the sub-

Section (2) of Section 239 of the Act of 1956 that there is no

ambiguity in the provision and the sale has undoubtedly to be

made after the expiration of at least 30 days from the date on

which the proclamation/declaration is issued, thus, without

entering into further merits of the case, this Court is of firm

opinion that the respondents have utterly failed to comply with the

mandatory provisions of the Act of 1956, thus, in view of the clear

and unambiguous provision of Section 239 of the Act of 1956, the

sale declaration dated 10.03.2021 (Annexure-8) and the

impugned order dated 10.03.2021 (Annexure-3) are quashed and

set aside and all other consequential proceedings initiated in light

of such sale declaration dated 10.03.2021 and the order dated

10.03.2021 are also quashed and set aside. The writ petition is

therefore, allowed.

(D.B. SAW/556/2021 and 1 more have been filed in this matter. Please refer the same for further orders)

[2023:RJ-JD:32072] (22 of 23) [CW-9986/2021]

27. Stay petition and all pending applications, if any, stand

disposed of.

28. It is also noted that despite an interim order dated

03.09.2021 passed by this Court, the petitioner chose not to repay

the loan amount. The order dated 03.09.2021 is reproduced

hereunder:

"Learned counsel for the petitioner submits that the respondents have auctioned the land of the petitioner without following the procedure under the Land Revenue Act as well as Rule 6 of the Rajasthan Agricultural Credit Operations (Removal of Difficulties) Rules, 1976. Counsel further submits that petitioner is ready to deposit the entire outstanding amount of loan with the respondent/bank.

Counsel appearing on behalf of respondent No.4 submits that he has purchased the land in auction and he has deposited the entire amount with the bank.

Heard counsel for the parties and perused the record.

In my considered view, while issuing proclamation of sale dated 10.03.2021, the time of thirty days was not given for auction as prescribed under the Rules of 1976.

Issue notice to the respondent Nos.2 and 3, returnable on04.10.2021 and be given 'dasti' to learned counsel for the petitioner.

In that view of the matter, parties are directed to maintain status quo with regard to land in dispute.

Respondents are at liberty to file application for vacation of this order after filing of the reply.

The petitioner is directed to deposit the entire outstanding amount with the respondent/bank within a period of fifteen days from today.

It is made clear that if the petitioner fails to deposit the entire outstanding amount with the

(D.B. SAW/556/2021 and 1 more have been filed in this matter. Please refer the same for further orders)

[2023:RJ-JD:32072] (23 of 23) [CW-9986/2021]

respondent/bank then this stay order will automatically vacated.

List this matter again on 04.10.2021 for admission."

29. The Respondent No. 2- Bank, in the application filed under

Article 226 (3) of the Constitution of India has specifically

submitted that the petitioner has failed to repay the loan amount

despite a conditional interim order granted in his favour.

30. Needless to observe that the respondents would be at liberty

to initiate appropriate action against the petitioner if required

strictly in accordance with law.

(DR. NUPUR BHATI),J 180-/devesh/-

(D.B. SAW/556/2021 and 1 more have been filed in this matter. Please refer the same for further orders)

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