Sikkim High Court
Umesh Prasad Sharma And Anr vs Allahabad Bank And Ors on 30 September, 2021
Bench: Bhaskar Raj Pradhan
THE HIGH COURT OF SIKKIM : GANGTOK
(Civil Extra Ordinary Jurisdiction)
S.B: THE HON'BLE MR. JUSTICE BHASKAR RAJ PRADHAN, JUDGE
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W.P. (C) No.40 of 2019
1. Shri. Umesh Prasad Sharma,
S/o Shri Dadhi Ram Sharma,
R/o Padamchey, East Pendam,
P/o Pachak, P.S. Pakyong,
East Sikkim-737132.
2. Shri Madan Sharma,
S/o Shri Dadhi Ram Sharma,
R/o Padamchey, East Pendam,
P/o Pachak, P.S. Pakyong,
East Sikkim-737132. ..... Petitioners
Versus
1. Allahabad Bank,
Represented by and through
the Chief Manager,
Gangtok Branch,
Sikkim Trader International Building,
Metro Point, NH-31A,
Gangtok, East Sikkim.
2. Shri Duk Nath Nepal,
S/o D.R. Nepal,
R/o Daragaon, Tadong,
East Sikkim.
3. Smt. Rekha Nepal,
W/o Duk Nath Nepal,
R/o Daragaon, Tadong,
East Sikkim.
4. Shri Dadi Ram Sharma,
S/o Late H.P. Sharma,
R/o Padamchey, East Pendam,
P/o Pachek, P.S. Pakyong,
East Sikkim 737132.
5. Recovery Officer-I
DRT Siliguri, M/O Finance,
Siliguri-1, 2nd Mile, Sevoke Road,
2
W.P. (C) No. 40 of 2019
Umesh Prasad Sharma & Anr. Vs. Allahabad Bank & Ors.
PCM Tower 2nd Floor, Siliguri,
West Bengal-734001. .....Respondents
Application under Article 227 of the Constitution of
India.
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Appearance:
Mr. A. Moulik, Senior Advocate with Ms.
K. D. Bhutia, Advocate for the petitioners.
Mr. Sudesh Joshi, Advocate for Respondent
no.1,
Mr. Pratap Khati, Advocate for Respondent Nos.
2 & 3.
None appears for respondent Nos. 4 and 5.
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Date of Hearing: 02.09.2021 & 03.09.2021
Date of Judgment: 30.09.2021
JUDGMENT
Bhaskar Raj Pradhan, J.
1. The petitioners were not parties before the Debts
Recovery Tribunal (the Tribunal). They are adult sons of the
respondent no.4 who was proceeded against before the
Tribunal having stood as guarantor for the loan taken by
the respondent no.2 from the respondent no.1 in Case
No.TRC /127/2018 in re: Allahabad Bank vs. M/s Majestic
Printers and Publishers and Ors. The respondent no.4 had
for that purpose mortgaged the landed property in dispute
(the property) to the respondent no.1 as a guarantor. The
respondent no.3 wife of respondent no.2 was also a
W.P. (C) No. 40 of 2019
Umesh Prasad Sharma & Anr. Vs. Allahabad Bank & Ors.
guarantor. The respondent no.2 was the Certificate Debtor
no.2 and the respondent no.4 was Certificate Debtor no.3.
2. They have approached this court under Article 227 of
the Constitution of India seeking for quashing of the order
dated 13.11.2019 (impugned order) purportedly passed by
the Tribunal. They seek a declaration that the property
involved in the auction sale shall not be sold in auction to
realize the dues of the respondent no.1; a declaration that
the other landed properties of respondent no.2 first be
proceeded against to realize the dues of respondent no.1;
and a direction that the loan shall be realized from the
respondent no.3 from her employer duly adjusting the
considerable amount towards recovery of loan.
3. The petitioners state that the property was originally
acquired by the father of respondent no.4, late Hari Prasad
Sharma and the respondent no.4 got this property as his
share from his father on partition and as such it is an
ancestral property of the petitioners. It is the petitioner's
case that there is an old „ekra‟ house in the property where
the petitioners along with their father-the respondent no.4
and other family members used to reside. It is stated that
the petitioners and the respondent no.4 jointly cultivate the
W.P. (C) No. 40 of 2019
Umesh Prasad Sharma & Anr. Vs. Allahabad Bank & Ors.
land appurtenant to the old „ekra‟ house. It is the
petitioners' case that if they are removed from the „ekra‟
house and the land appurtenant thereto they would be
rendered homeless.
4. It is stated that the petitioners as well as respondent
no.4 are Hindus governed by Mitakshara School of Hindu
Law and that by virtue of their birth; they have become
owners of the property along with respondent no.4 as
coparceners.
5. According to the petitioners the respondent no.2 owns
and possesses various landed properties bearing plot nos.
396 (area .2420), 405 (area .0240), 1191 (area .1680), 1489
(area .0600), 1489/1789 (area .2460), 1248/1790 (area
.1840) and 1249/1791 (area .2320). The petitioners have
relied upon a communication bearing memo no. 63/DCE
dated 12.10.2017 issued by the Sub-Divisional Magistrate,
East District Collectorate of the Government of Sikkim
which states so. It is asserted that these properties which
are recorded in the name of respondent no.2 are apart from
land bearing plot no.1487/1789 at Tintek Block, East
Sikkim which has been attached for sale by auction by the
respondent no.1.
W.P. (C) No. 40 of 2019
Umesh Prasad Sharma & Anr. Vs. Allahabad Bank & Ors.
6. The petitioners further assert that the respondent
no.3-wife of respondent no.2 who was also a guarantor of
the loan taken by respondent no.2 is a regular employee of
the Government of Sikkim in the Energy and Power
Department, Gangtok in the rank of ARS. Her gross
monthly salary is Rs.49,000/- and net amount received by
her per month is Rs.33,669/-.
7. Although the respondent no.4 was arrayed as a party
in the present writ petition and served, he has chosen not
to appear and file his say.
8. The respondent no.1 challenges the locus standi of
the writ petition. The respondent no.1 also contests the
claim of the petitioners that the property is ancestral
property. According to the respondent no.1 the property
was gifted to respondent no.4 by his father late Hari Prasad
Sharma by a gift deed dated 21.03.2001 duly registered
before the sub-registrar. According to the respondent no.1
the gift deed and „parcha khaityan‟ made from the original
title deeds were deposited by the respondent no.4 as the
mortgager for creating a mortgage with the respondent
no.1. The respondent no.1 further pleads that the
provisions of the Recovery of Debts Due to Banks and
W.P. (C) No. 40 of 2019
Umesh Prasad Sharma & Anr. Vs. Allahabad Bank & Ors.
Financial Institutions Act, 1993 (the DRT Act) provides an
efficacious remedy to any person who may have grievances
against the order/judgment of the Tribunal and the
aggrieved person may preferred an appeal to the Debts
Recovery Appellate Tribunal (the Appellate Tribunal). It is
thus contended that in view of the availability of efficacious
statutory remedy the petitioners ought to have exhausted it
before invoking the jurisdiction of this court.
9. The respondent no.1 does not dispute the assertion of
the petitioners about their humble background; that the
petitioners live with the respondent no.4 in the „ekra‟ house
and their livelihood being dependent upon the property.
10. The respondent no.2 states that he was running a
printing press in the name and style of M/s Majestic
Printers and Publishers. He was earlier banking with UCO
Bank when in the year 2006 the respondent no.1
approached him to be a customer and assured him of
granting a loan. Although he had sought a loan of Rs.25
lakhs only, Rs.18 lakhs was sanctioned and finally an
amount of Rs.15 lakhs was lent to him. The respondent
no.3, his wife, stood as his guarantor. The respondent no.1
asked the respondent no.2 to ensure another guarantor. He
W.P. (C) No. 40 of 2019
Umesh Prasad Sharma & Anr. Vs. Allahabad Bank & Ors.
requested respondent no.4, who then stood as a guarantor
for the loan. On 14.03.2006 the respondent no.4 applied to
withdraw as a guarantor. After receiving the respondent
no.4's request for discharge as a guarantor the respondent
no.1 started pressurising respondent no.2 to pay the entire
loan and as a result he could not concentrate on his
business which ultimately led to the downfall. The
respondent no.2 has not denied the assertion made by the
petitioners that he is owner of various other properties
besides the one secured with the respondent no.1.
11. The respondent no.3 also accepted that she had stood
as a guarantor on behalf of respondent no.2, her husband.
The respondent no.3 has stated in her counter-affidavit
that she had informed the respondent no.1 at the time
when respondent no.2 took the loan that she was not a
regular employee and could not be able to submit any
salary certificate. However, the respondent no.3 has not
disputed the petitioners' assertion that she was now a
regular employee earning a salary of Rs.49,000/- per
month.
12. Rejoinders to the counter-affidavits filed by
respondent nos.1 and respondent nos. 2 and 3 were also
W.P. (C) No. 40 of 2019
Umesh Prasad Sharma & Anr. Vs. Allahabad Bank & Ors.
filed by the petitioners. The petitioners took the plea of the
factum of the Appellate Tribunal being outside the State of
Sikkim and their inability to approach it; the financial
burden on them to deposit 50% of the debt to prefer an
appeal; the respondent no.2 having extensive property yet
not attached from where the respondent no.1 could realize
their dues; and the protection guaranteed by the Old Laws
of Sikkim against auction sale of properties if on such sale
the holding would become less than 5 acres. It was also
pleaded that the respondent no.3 who was also a guarantor
was a government servant and therefore, in a position to
repay the loan taken by her husband the respondent no.2.
13. Mr. A. Moulik, learned Senior Advocate for the
petitioners submitted that when the property was gifted by
the father of respondent no.4 the petitioners were already
born and thus had acquired a right over the coparcenary
property. He insisted that the property was ancestor
property. To explain what is ancestral property and the
effect thereof he relied upon State Bank of India vs.
Ghamandi Ram (Dead) Through Gurbax Rai1; Lakkireddi Chinna
Venkata Reddi & Ors. vs. Lakkireddi Lakshmama2; Vineeta
1 AIR 1969 SC 1330
2 AIR 1963 SC 1601
W.P. (C) No. 40 of 2019
Umesh Prasad Sharma & Anr. Vs. Allahabad Bank & Ors.
Sharma vs. Rakesh Sharma & Ors.3. To contest the plea of
the respondent no.1 of not having availed the efficacious
alternative remedy Mr. A. Moulik relied upon Bharati Reddy
vs. State of Karnataka & Ors.4 and Harshad Govardhan
Sondagar vs. International Assets Reconstruction Company
Limited & Ors.5.
14. Mr Sudesh Joshi, learned counsel for respondent no.1
on the other hand drew the attention of this court to
paragraph 5 of the writ petition which according to him
clearly explains the nature of the property. The learned
counsel submits that on these pleadings it is evident that
the property was not an ancestral property. He submitted
that what is ancestral property has been crystallized by the
Supreme Court in Shyam Narayan Prasad vs. Krishna Prasad
& Ors.6; Govindbhai Chhotabhai Patel & Ors. vs. Patel
Ramanbhai Mathurbhai7 and Maktul vs. MST. Manbhari & Ors.8
He further submitted that the petitioner could have availed
of the alternative remedy and having not done so, the writ
petition was not maintainable.
3 (2020) 9 SCC 1
4 (2018) 12 SCC 61
5 (2014) 6 SCC 1
6 (2018) 7 SCC 646
7 (2020) 16 SCC 255
8 AIR 1958 SC 918
W.P. (C) No. 40 of 2019
Umesh Prasad Sharma & Anr. Vs. Allahabad Bank & Ors.
15. A reading of the judgments of the Supreme Court
cited by the petitioners makes it clear that a party who
applies for issuance of a writ should, before he approached
the court, have exhausted other remedies open to him
under the law. However, this is not a bar to the jurisdiction
of the High Court to entertain the petition or to deal with it.
It is rather a rule which courts have laid down for the
exercise of their discretion.
16. In Harshad Govardhand Sondagar (supra) the Supreme
Court examined a case of the appellants who claimed to be
tenants of different premises in Mumbai mortgaged to
different banks as securities for loan advanced by the
banks. The Supreme Court examined the various
provisions of the Transfer of Property Act, 1882, the
Securitization and Reconstruction of Financial Assets and
Enforcement of Security Interest Act, 2002 (for short "the
SARFAESI Act") and it was held that before the mortgage
was created, the borrower had already leased out the same
in favour of the lessee and thus the lessee would have the
right to enjoy the property in accordance with the terms
and conditions of the lease. It was further held that there
was no remedy available to a lessee of the borrower under
Section 17 of the SARFAESI Act before the Tribunal, in
W.P. (C) No. 40 of 2019
Umesh Prasad Sharma & Anr. Vs. Allahabad Bank & Ors.
case of dispossession by the secured creditor and therefore,
the remedy would lie under Article 226 and 227 of the
Constitution of India.
17. In Assistant Commissioner of State Tax & Ors. Vs. M/s
Commercial Steel Limited9 held:
"11. The respondent had a statutory remedy
under section 107. Instead of availing of the
remedy, the respondent instituted a petition under
Article 226. The existence of an alternate remedy is
not an absolute bar to the maintainability of a writ
petition under Article 226 of the Constitution. But a
writ petition can be entertained in exceptional
circumstances where there is:
(i) a breach of fundamental rights;
(ii) a violation of the principles of natural
justice;
(iii) an excess of jurisdiction; or
(iv) a challenge to the vires of the statute or
delegated legislation."
18. The writ petition is contested by the respondent no.1
on the ground of availability of an efficacious alternative
remedy. The respondent no.1 submits that Section 20 of
the RDB Act provides an appeal against the order of the
Tribunal to any person aggrieved by an order made, or
deemed to have been made by a Tribunal.
19. The petitioners have challenged the impugned order.
The impugned order was passed by the respondent no.5
the Recovery Officer-I of the Tribunal (the Recovery Officer)
9 Civil Appeal No. 5121 of 2021 (decided on 03.09.2021)
W.P. (C) No. 40 of 2019
Umesh Prasad Sharma & Anr. Vs. Allahabad Bank & Ors.
under Section 25 of the RDB Act. It is not an order passed
by the Tribunal. Section 20 of the RDB Act provides for an
appeal to the Appellate Tribunal to any person aggrieved by
an order made, or deemed to have been made by a Tribunal
only and not against any order passed by the Recovery
Officer under Section 25 thereof. As such this court is of
the view that against the impugned order passed by the
Recovery Officer of the Tribunal no appeal could have been
preferred under Section 20.
20. A proceeding under Section 25 of the Act is appealable
under Section 30. Section 30 provides that notwithstanding
anything contained in Section 29, any person aggrieved by
an order of the Recovery Officer made under the Act may,
within thirty days from the date of which a copy of the
order is issued to him, prefer an appeal to the Tribunal. On
receipt of an appeal the Tribunal may, after giving an
opportunity to the appellant to be heard, and after making
such inquiry as it deems fit, confirm, modify or set aside
the order made by the Recovery Officer in exercise of his
powers under Section 25 to 28.
21. The proceeding was at the stage of Section 25 of the
Act. Section 25, as seen above, relates to the mode of
W.P. (C) No. 40 of 2019
Umesh Prasad Sharma & Anr. Vs. Allahabad Bank & Ors.
recovery of debts. Section 26 deals with the validity of
certificate and amendment thereof and provides that it
shall not be open to the defendant to dispute before the
Recovery Officer the correctness of the amount specified in
the certificate, and no objection to the certificate on any
other ground shall also be entertained by the Recovery
Officer. The Presiding Officer however, would have the
power to withdraw the certificate or correct any clerical or
arithmetical mistake in the certificate by sending
intimation to the Recovery Officer. Section 27 deals with
stay of proceedings under certificate and amendment or
withdrawal thereof. The Presiding Officer has power to
grant time for payment of the amount provided the
defendants makes a down payment of not less than 25% of
the amount specified in the recovery certificate and gives
an unconditional undertaking to pay the balance within a
reasonable time acceptable to the applicant bank or
financial institution holding recovery certificate. Section 28
deals with other modes of recovery other than as provided
in Section 25. Thus it is clear that the scope of Section 30
appeal is limited to confirm, modify or set aside the order
made by the Recovery Officer in exercise of his powers
under Section 25 to 28.
W.P. (C) No. 40 of 2019
Umesh Prasad Sharma & Anr. Vs. Allahabad Bank & Ors.
22. Although both Sections 20 and 30 of the RDB Act
uses the expression "any person aggrieved" the scope of the
two provisions is materially different. Whereas an appeal
under Section 20 is preferred against an order of the
Tribunal the appeal under Section 20 is against the order
made by the Recovery Officer. The issues sought to be
raised in the present petition by the petitioners, who are
not parties before the Tribunal are not determinable by the
Recovery Officer who is concerned only for recovering the
amount specified by the Tribunal in the recovery certificate.
The respondent no.4 in an appeal under Section 20 of the
RDB Act could have raised those issues while challenging
the final order passed by the Tribunal under Section 19
(20) of the RDB Act. This court is not examining whether
the petitioners could have challenged the final order passed
by the Tribunal in the facts of the case as it is only
academic.
23. This court shall now examine if the property is an
ancestral property of the petitioners or if they had any
enforceable right on the property mortgaged by the
respondent no.4 in favour of the respondent no.1 as a
guarantor.
W.P. (C) No. 40 of 2019
Umesh Prasad Sharma & Anr. Vs. Allahabad Bank & Ors.
24. According to Hindu Law by Sir Dinshaw Fardunji
Mulla 23rd Edition "all property inherited by a male hindu
from his father, father‟s father or father‟s father father, is
ancestral property." A property of a Hindu male devolves on
his death. This was reiterated by the Supreme Court in
Shyam Narayan Prasad (supra).
25. A three-Judge Bench decision of the Supreme Court
in C. N. Arunachala Mudaliar vs. C.A. Muruganatha Mudaliar10
held that father of a Joint Hindu family governed by
Mitakshara law has full and uncontrolled powers of
disposition over his self-acquired immovable property and
his male issue could not interfere with these rights in any
way. The Supreme Court while examining the question as
to what kind of interest a son would take in the self-
acquired property of his father which he receives by gift or
testamentary bequest from him, it was held that
Mitakshara father has absolute right of disposition over his
self-acquired property to which no exception can be taken
by his male descendants. It was held that it was not
possible to hold that such property bequeathed or gifted to
a son must necessarily rank as ancestral property. It was
10 AIR 1953 SC 495
W.P. (C) No. 40 of 2019
Umesh Prasad Sharma & Anr. Vs. Allahabad Bank & Ors.
further held that a property gifted by a father to his son
could not become ancestral property in the hands of the
donee simply by reason of the fact that the donee got it
from his father or ancestor.
26. On their pleadings, evidently, the petitioners have not
inherited the disputed property. Their father, the
respondent no.4, is still alive. The petitioners state that the
respondent no.4 got the property as his share from his
father late H.P. Sharma on partition. However, the
petitioners have not filed any partition deed to substantiate
their claim. The respondent no.1 has however, pleaded that
the property was gifted to respondent no.4 by his late
father Hari Prasad Sharma vide gift deed dated 21.03.2001
duly registered in the office of the sub-registrar. The
respondent No.1 has also filed the gift deed and the „parcha
khatiyan‟ by which the property was mortgaged by
respondent no.4 with the respondent no.1 as the
guarantor. Without examining whether this document
purporting to be a gift deed is in fact a gift deed or a sale
deed as sought to be argued by Mr. A. Moulik it is quite
evident that respondent no.4 had not got the disputed
property as his share on partition as claimed by the
W.P. (C) No. 40 of 2019
Umesh Prasad Sharma & Anr. Vs. Allahabad Bank & Ors.
petitioners. It is also evident that the respondent no.4
acquired the property on transfer by his father who had
originally acquired it. These facts make the property self
acquired property of late Hari Prasad Sharma and
thereafter, of the respondent no.4 and consequently not the
ancestral property of the petitioners. As such the
respondent no.4 has a right to deal and dispose of the
property as he desires.
27. It is not in dispute that the respondent no.4 had
mortgaged the property in favour of the respondent no.1.
Section 58 (a) of the Transfer of Property Act, 1882 states
that a mortgage is the transfer of an interest in specific
immovable property for the purpose of securing the
payment of money advanced or to be advanced by way of
loan, an existing or future debt, or the performance of an
engagement which may give rise to a pecuniary liability.
The respondent no.4 had the right to do so and the
petitioners who are his adult sons could not have any right
to stop him in dealing with his self acquired property in the
manner he chose. Evidently no attempt was also made by
the petitioners to do so. The mortgage on the property does
create rights in favour of the respondent no.1.
W.P. (C) No. 40 of 2019
Umesh Prasad Sharma & Anr. Vs. Allahabad Bank & Ors.
28. In view of the aforesaid this court is of the considered
view that the present case is not a fit case for interference
with the recovery proceedings. More so when the
respondent no.4 himself doesn't seem to have any
grievance and the petitioners have no right over the
property.
29. The writ petition is dismissed. Consequently, the
interim order dated 20.12.2019 stands vacated. Pending
application, if any, is also disposed. In the circumstances,
no order as to cost.
( Bhaskar Raj Pradhan )
Judge
Approved for reporting : Yes
Internet : Yes
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