1. This appeal is directed against the order passed by DRT-II, Chandigarh on 31st July, 2013. Grievance against the order is that the impugned order is passed vacating the stay of dispossession from residential house earlier granted in favour of the appellants. The house is mortgaged with the Bank by the appellant. As per the Counsel for the appellants, the Tribunal below has passed this order exceeding its jurisdiction while issuing directions for police help in taking possession of the residential house on the asking of the Bank that the appellant may offer resistance at the time of taking possession. This appeal emanates from the following facts which may need notice here.
2. The appellant No. 2 is a proprietorship concern. It is running a business of seller. The appellant availed cash credit limit from the respondent Bank and appellant No. 2 stood guarantor for the said loan. As per details given in the appeal, different properties were mortgaged to secure the loan amount availed by the appellant. Residential house measuring 13 Marlas 2 Sarsai is shown to have been mortgaged in the loan account of M/s. P.K. Industries where demand raised by the Bank is of Rs. 2,06,61,482/-. In the other two loan accounts of M/s. Kailash Industries and M/s. Chhabra Agro Industries, the outstanding amount demanded was Rs. 2,66,78,070/- and Rs. 1,48,16,392/- respectively.
3. Apparently, the appellant could not maintain the financial discipline, which resulted in notice under Section 13(2) of the SARFAESI Act. This is also followed by notice under Section 13(4) of the SARFAESI Act. The total properties mortgaged with the Bank were nine in number. As per the Counsel for the Bank, one mortgaged property has been sold for Rs. 73 lacs which is referred to in this appeal also as the tripartite agreement was entered into between the Bank, borrower and the purchaser.
4. The measures initiated by the Bank were put to challenge by filing three SAs. When these SAs came up for hearing before the Tribunal below, it passed a detailed order dated January 23, 2013 permitting the Bank to take possession of the commercial properties mortgaged with it but stayed the dispossession of appellant from their residential house. The Bank, thereafter has made three attempts on 26th February 2013, 4th April, 2013 and 10th May, 2013 to put these commercial properties to sale to recover its dues, but has failed to sell the properties as no buyer has come forward to give bid for the properties.
5. When these three SAs came up for hearing before the Tribunal below on July 31, 2013 the Tribunal apparently has taken serious view of the inaction by Bank is not succeeding in putting the properties to sale. During one of the auction conducted by the Bank, Registrar of the Tribunal was also appointed as observer. The Tribunal below noticed that the amount recoverable is Rs. 7 crores and the Bank could not succeed in selling the property even after their attempts.
6. None appeared for the appellant on the date before the Tribunal.
7. The Tribunal below, however, was not satisfied with the explanation given by the Counsel for the Bank and the Officer of the Bank. The Tribunal has observed that it had taken a lenient view while passing the order on 23rd January, 2013, but still the commercial property has not been sold to recover the amount dues. The Tribunal below was of the view that these were delaying tactics which could not be permitted in the interest of justice. The Tribunal below, therefore, decided to vacate the stay of dispossession of house as earlier granted so that the residential property could also be put to sale
8. Besides, the Tribunal below has given further directions to the effect that the General Manager and the Assistant General Manager would assist the A.O. in taking physical possession of the property within fifteen days of the order. In case of noncompliance of the order, both were directed to remain present before the Tribunal. It was pointed on behalf of the Bank that the appellant may resist the taking over it physical possession of the property and prayed for providing police help. The Tribunal below decided to send the copy of the order to the District Magistrate and SHO to provide police help to the Bank in taking physical possession of the property. It is this part of the order against which the Counsel for the appellant has made a serious grievance and has termed it beyond the jurisdiction of the Tribunal. The operative part is as under:
"After passing the above order the Counsel for the respondent Bank has shown the apprehension that the applicant will try to thwart the proceedings and obstruct in taking physical possession of the property and seeks indulgence of this Court to issue necessary directions to the concerned police authorities for necessary help.
Let the copy of this order be sent to the concerned District Magistrate and SHO to provide necessary help to the concerned officer of the Bank for taking possession of the property. Order Dasti.
Be listed on 17.9.2013."
9. Aggrieved against this order, the appellant has filed the present appeal in the case of M/s. Chhabra Agro Industries and another. As already noticed above, three separate SAs were filed in the cases of M/s. P.K. Industries, M/s. Kailash Industries and M/s. Chhabra Agro Industries.
10. During the course of arguments, it transpires that the appellants had also filed two more appeals as three separate but identical orders in three SAs were passed by the Tribunal below. The appellant has however not prosecuted the two appeals except the present one and has made submission only in the Case of M/s. Chhabra Agro Industries, which is the present appeal.
11. To maintain the present appeal, it was stated before this Tribunal that a sum of Rs. 73 lacs had been realized and accordingly requirement of pre-deposit would stand satisfied. This Tribunal accepted this submission made by the Counsel for the appellants and held that 49% of the amount claimed had been deposited with the Bank subsequent to the issuance of demand notice and thus requirement of Section 18(1) of the SARFAESI Act stood satisfied and complied with.
12. I have heard the Counsel for the parties. Counsel for the appellant has made three fold submissions before me. He would first contend that the directions issued by the Tribunal below in vacating the stay order and then passing direction for providing police help would be in excess of the jurisdiction of the Tribunal below and accordingly could not have been passed being beyond the jurisdiction of the Tribunal. The second submission made against the order is that the same has been passed without affording any opportunity of hearing to the appellant. Counsel pleads that the order standing in favour of the appellant was withdrawn when none was present on behalf of the appellant. As per the Counsel, this would be in violation of the principles of natural justice. The Counsel would then make allegations against the Bank that it had misled the Tribunal below in passing the impugned order. The Counsel has made reference to tripartite agreement entered into the Bank, borrower and the third party for sale of one of the properties for a sum of Rs. 73 lacs, but this fact, as per the Counsel, was not brought to the notice of the Tribunal below. The Counsel states that if this fact had been brought to the notice of the Tribunal below, it would not have passed the impugned order vacating the stay.
13. To counter the submissions made by the Counsel for the appellants, the Counsel for the Bank states that the appellant has misled this Tribunal in getting notice as well as interim order in its favour. The Counsel would highlight the fact that there were three loan accounts of the appellant and all were declared NPA for which separate notices had been issued to the appellant. The appellant accordingly had filed three SAs to challenge the said notices one of which was in the case of M/s. Chhabra Agro Industries. The other notices were issued in the cases of loan accounts of M/s. P.K. Industries and M/s. Kailash Industries. The tripartite agreement was in the case of M/s. Chhabra Agro Industries, whereas the residential property is mortgaged in the case of M/s. P.K. Industries. To substantiate this, the Counsel for the Bank has referred to the averments made in the appeal itself where this position has been acknowledged by the appellants themselves. The Counsel would also point out that three separate appeals were filed against this common order passed in three separate SAs, but only the appeal filed in the case of M/s. Chhabra Agro Industries has been pursued by the appellants. The reason in this regard is that the appellants in this way were able to obtain stay of impugned order without pointing out that the property is not mortgaged in the present loan account of M/s. Chhabra Agro Industries. After getting stay, the appellants did not prosecute the appeals filed in the cases of M/s. P.K. Industries and M/s. Kailash Industries. The Counsel has also referred to certain orders passed in the appeals filed in cases of M/s. P.K. Industries and M/s. Kailash Industries by this Tribunal dismissing the appeals for non-prosecution. The Counsel would also urge that once the appellants were able to obtain interim order in the present case where this property was not even mortgaged, they very wisely and cleverly did not pursue the said two appeals and got these dismissed in default.
14. The Counsel for the Bank has pointed out the facts which would stand out. Obviously, the residential house has been mortgaged in the loan account of M/s. P.K. Industries, whereas the present appeal is filed by M/s. Chhabra Agro Industries. The tripartite agreement is also in respect of the property which is sold for Rs. 73 lacs which was mortgaged in the case of M/s. Chhabra Agro Industries. These facts ought to have been disclosed before this Tribunal to make an approach in fair manner. This may convey an impression that this was done with purpose and design to obtain the stay orders. The reason which may appear to explain this conduct are that the amount demanded in other accounts is more and to maintain appeal the appellant had to meet the condition of pre-deposit. The appellants therefore appear to choose to press the present appeal where one property was sold and got the order stayed. If a particular property is not mortgaged in the loan account where this appeal is filed, it is not fair for the appellant to suppress such fact obtain stay and then act in manner not to prosecute two appeals which were also filed.
15. Be that as it may, I have considered the submissions made by the Counsel for the appellant. The impugned order seems to have been passed by the Tribunal below when it found that the Bank was not making serious efforts to sell this property and, therefore, the Tribunal below decided to withdraw the earlier order passed whereby the dispossession of residential house was stayed and the commercial property were allowed to be put to sale first.
16. The submission that the impugned order withdrawing the earlier order of stay is beyond jurisdiction of the Tribunal apparently is misplaced. The Tribunal below is well within its jurisdiction to the withdraw any interim order. If the Tribunal had jurisdiction to grant the interim order it will have jurisdiction to withdraw or modify the same. The Counsel of the appellants perhaps has challenged the order on the ground that it is passed without hearing the appellant and hence is bad on that count. The appellant was represented by a Counsel who choose not to appear on the date fixed. The appellant can not be heard to plead violation, of principal justice in this background. If the appellant has a grievance against the action of the Bank in not referring to agreement which was entered into a day before the order, the appellant could have easily gone before the Tribunal instead of coming in appeal. In any event it would not have made any difference as sale was of property not mortgaged in the account of P.K. Industries where this residential property had been mortgaged. The Counsel however may be justified in urging that the part of order issuing directions for police help may be beyond the call of the Tribunal below. The Act has made specific provision where the borrower offers resistances at the time of taking possession by the secured creditor. The Tribunal should have shown that legal course which was open for the Bank. Therefore, that part of the order many call for interference and correction. The impugned order in entirety cannot be invalidated on this count alone. The Bank had a right to take possession of the property itself as well and could have taken police help through DM if any resistance was offered. The Tribunal had sent the copy to the DM which approach could have been made by Bank as well. There is however substance in the submission made by the Counsel for the appellant that the Tribunal below should not have accepted the reque
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st of the Bank merely on the basis of apprehension that the appellant would resist the action of taking physical possession of the property. If the appellants were to obstruct physical possession of the property, the Bank could file an application under Section 14 of the SARFAESI Act before the District Magistrate or other concerned authority. The Tribunal below ought to have restrained itself in conveying directions to the DM or the SHO to provide police help to the Bank. The said part of the order thus is not justified and cannot be sustained. The said part of the order is therefore, set aside. 17. The Bank has already taken possession of the residential house in question September 4, 2013. The impugned order being otherwise legal and appropriate, the prayer for returning the possession cannot now be allowed. No case for return of possession of the residential house to the appellant is otherwise made out. The Counsel also points out that this residential property along with the other commercial property was put to auction on January 15, 2014 and May 14, 2014 but still no bid has been received. In fact, no body came forward to give bid. The property in question is being again put to auction by the Bank. The Bank may proceed against this property in accordance with law. Except for that part of the order which has been set aside, I am not inclined to interfere in the impugned order. The appeal is disposed of in the above terms.