1. This Securitisation Application (for short - 'the SA') is filed on 01.12.2017 seeking to declare that the defendants have no right whatsoever to proceed against the properties described in Annexure – A1 demand notice dated 21.08.2017 demanding Rs.1,27,01,083/- (Rupees One Crore Twenty Seven Lakhs One Thousand Eighty Three only) as on that date, to set - aside Annexure – A4 possession notice dated 28.11.2017 whereunder the 'secured asset' is subjected to the charge of the 2nd defendant bank for an amount of Rs.1,27,01,083/- (Rupees One Crore Twenty Seven Lakhs One Thousand Eighty Three only) as on 21.08.2017 – the dues then payable being Rs.1,32,70,433/- (Rupees One Crore Thirty Two Lakhs Seventy Thousand Four Hundred Thirty Three only) with future interest and costs and for other incidental reliefs.2.1.The admitted factual matrix in this case would be the applicant’s availment of working capital facility of Rs.75 Lakhs from the 2nd defendant for running his proprietary business under the name and style ‘M/s. Sasi Petroleum Agencies’; his inability to repay the loan in time as agreed on account of the heavy loss suffered in the business due to demonetization; the 1st defendant’s issuance of Annexure – A1 demand notice dated 21.08.2017; the applicant’s issuance of Annexure – B1 objection dated 17.10.2017 to the demand notice as the Annexure – A2 objection of the even date appended in this SA is the one sent to Annexure – A1 demand notice impugned in the connected SA 257/2017; and the 1st defendant’s issuance of Annexure – A3/Annexure – B2 reply dated 30.10.2017 followed by Annexure – A4 possession notice dated 28.11.2017.
2.2. Mr. Shrihari P. Ld. counsel for the applicant ushered in his threefold contentions seeking to declare as illegal the defendants’ assuming of the constructive/ symbolic possession of the secured asset vide Annexure – A4 possession notice. Firstly Annexure – A1 demand notice was pointed out to be falling short of the legal mandate envisaged under Section 13(3) of the Act. According to him what is required to be provided in terms of the said provision is the progressive total of the debit and credit balances in the applicant’s loan account and not merely the total amount otherwise payable to the 2nd defendant bank.2.3. To succor strength for his aforementioned submission, the learned counsel for the applicant would cite reference to a judgment of the Hon'ble High Court of Calcutta rendered in the case of Madhu Sudan Ghosh and Ors. v. The Bank of Baroda and Ors. (MANU/WB/0349/2010) which reads thus :
“7. For the purpose of deciding merit of this writ petition the relevant provisions of Section 13 of the SRFAESI Act, 2002 are quoted below:
13(2). Where any borrower, who is under a liability to a secured creditor under a security agreement, makes any default in repayment of secured debt or any instalment thereof, and his account in respect of such debt is classified by the secured creditor as non-performing asset, then, the secured creditor may require the borrower by notice in writing to discharge in full his liabilities to the secured creditor within sixty days from the date of notice failing which the secured creditor shall be entitled to exercise all or any of the rights under Sub-section (4).
13(3). The notice referred to in Sub-section (2) shall give details of the amount payable by the borrower and the secured assets intended to be enforced by the secured creditor in the event of non-payment of secured debts by the borrower.
13(3A). If, on receipt of the notice under Sub-section (2), the borrower makes any representation or raises any objection, the secured creditor shall consider such representation or objection and if the secured creditor comes to the conclusion that such representation or objection is not acceptable or tenable, he shall communicate within one week of receipt of such representation or objection the reasons for non-acceptance of the representation or objection to the borrower:
Provided that the reasons so communicated or the likely action of the secured creditor at the stage of communication of reasons shall not confer any right upon the borrower to prefer an application to the Debts Recovery Tribunal Under Section 17 or the Court of District Judge Under Section 17A.
From a plain reading of the aforesaid provisions it will appear from sub-Section 3 of Section 13 of the Act that the notice to be issued by the secured creditor under Section 13(2) of the Act shall give details of the amount payable by the borrower on the secured assets intended to be enforced by the secured creditor in the event of non-payment of secured debts by the borrower. Unfortunately while serving notice under Section 13(2) dated 03.03.2006 no details of the amount payable by the borrower has been supplied to the borrowers. Only a total amount of Rs. 3,16,824/- was demanded inclusive of interest up to 30.11.2005 (Annexure - B to the affidavit-in-opposition) which does not indicate the amount paid by instalments by the borrower in details showing progressive total of debit and credit balance resulting therein the total demand of Rs. 3,16,824/-. This is a serious infirmity in issuing statutory notice under Section 13(2) of the SRFAESI Act, 2002 which vitiates the entire procedure adopted for realisation of non-performing assets by auction sale of the mortgaged property.”(emphasis supplied by the applicant)
2.4 Adverting to Annexure – B3 copy of paper publication of ‘possession notice’ effected in ‘Kerala Kaumudi’ dated 02.12.2017, the learned counsel for the applicant would pursue his second contention that seeks to hold Annexure – A4 possession notice illegal for the reason of publishing it in such a vernacular newspaper not having sufficient circulation in the State of Kerala. Emphatic submission came to be made by him on the lines that ‘Kerala Kaumudi’ not being a leading newspaper and one having not an adequate circulation in any part of Kerala, the defendant’s assuming of dejure possession of the 'secured asset' is only to be held as invalid and ineffectual.2.5 The third contention urged by the learned counsel for the applicant is this. In as much as Annexure – A5 Petrol/HSD Pump Dealer Agreement entered into by the applicant with Indian Oil Corporation precludes the former from mortgaging or charging or parting with or otherwise transferring the premises or any part thereof, his interest in the dealership or any right or interest or benefit conferred by the said agreement, the mortgage by deposit of title deeds obtained by the 2nd defendant bank from the applicant is necessarily to be held as unenforceable. Clause 35 of Annexure – A5 memorandum of agreement dated 30.03.1984 read out by him is excerpted hereunder:
“35. The Dealer shall not sell, assign, sub-let, mortgage, charge or part with or otherwise transfer the premises or any part thereof his interest in the dealership or any right or interest or benefit conferred by this Agreement or grant any licence in connection with the said premises and/or outfit or any part thereof to any person, firm or company not allow any other person, firm or company to use the premises or the outfit or any part thereof except to the extent necessary under the terms of this Agreement and specifically permitted in writing by the Corporation”.
2.6. Contending that the true copies of purchase invoices / inspection chart relating to the unloading of truck between the period 29.12.2016 and 28.03.2017 as also the daily sales record for the financial years 2016 – 2017 and 2017 – 2018 are since produced by the applicant alongwith a memo dated 09.01.2019 to be received in evidence on his side as Annexure – A6 series, the said documents are sought to be read conjointly with Annexure – A5 to appreciate the subsistence of the applicant’s dealership of the Indian Oil Corporation till this time. The defendants having produced CERSAI registration particulars of the concerned secured asset, the contention raised otherwise in this SA as regards the non registration of the security interest is not pursued with, would be the parting submission on the side of the applicant. For the foregoing three definitive reasons, the Annexure – A4 possession notice is sought to be set-aside.
3.1. Mr. Sunil Shankar Ld. counsel for the defendants emphatically contended that the SARFAESIA measures and actions taken by the bank uptil now does not suffer from any illegality or legal infirmity and the three contentions ushered in vain by the applicants are only to be rejected for the following reasons. Advertence was made to Annexure – A1 demand notice clearly setting out the details of the credit facility availed by the applicant as also the total outstanding amount payable as on the date of its issuance by the borrowers arraigned therein. He thereupon took this Tribunal through the relevant portion of Annexure – A3 reply dated 30.10.2017 which readth thus:
“The demand notice provides the details of the amount payable as well as the details of the secured assets. The demand notice is issued in accordance with the provisions of the SARFAESI Act, 2002 and the Rules thereunder. The demand notice clearly states the interest applicable to the loan account. The borrower is always entitled to apply for and obtain the statement of account from the branch on paying the applicable charges. All payments made by the borrower have been given effect to. The statement that the borrower is unable to give a proper and effective reply is only a dilatory tactic. The statement of account was enclosed alongwith the demand notice.”(emphasis supplied by the defendants)
Adverting to the above, the learned counsel for the bank would seek to repel the applicant’s unfounded contention raised as regards the legal infirmity attendant to Annexure – A1 demand notice.3.2. The other contention urged by the applicant as regards the sufficiency or otherwise of the circulation of ‘Kerala Kaumudi’- Malayalam daily is sought to be disdained considering the fact that the said newspaper has sufficient circulation in the locality in which the 'secured asset' is situated and cannot be held to be one not having adequate readership among the general public.3.3 The third contention raised by the applicant in reference to Annexure – A5 dealership agreement entered by him with IOC should be of no consequence at all in the matter of their enforcement of security interest as Clause 35 of the said agreement referred to supra only appears to be inhibiting the applicant from selling, assigning, mortgaging or parting with his interest in the dealership of the Petrol Pump or any other right or benefit conferred thereunder and not beyond, would be the further forceful submission of the learned counsel for the defendants. He adverted to the description of property provided in the Schedule – I of Annexure – A5 to impress upon his submission that the premises more fully set apart for the aforementioned purpose is limited only to 875 Sq. meters and added that the said agreement of the year 1984 which was valid only for 10 years therefrom is since rendered redundant and unenforceable after efflux of such period. The contentions raised fruitlessly on the strength of such an invalid document is therefore sought to be brushed aside. Contending that the defendants have proceeded with their SARFAESIA measures only in accordance with law, the SA was insisted to be dismissed with costs.4.1. Considering the pleadings, evidence and the oral submissions of the parties hereto it is but obvious that there is no denying the fact on the part of the applicant as regards his availment of loan, creation of security interest and the resultant liabilities towards the 2nd defendant bank. Taking a close look at Annexure – A1 demand notice dated 21.08.2017 it could be discerned that the said notice is reflective of the details of the credit facility with its corresponding outstanding dues as on the date of its such issuance. A working capital loan of Rs.75 Lakhs is stated to have been accommodated by the 2nd defendant to the borrowers on the applicant’s hypothecation of stock of petrol/diesel and lubricants stored at the premises of M/s. Sasi Petroleum Agencies and creation of mortgage over his 51 cents of land with building and structure in Sy. No. 864/2, Kaniyaracode Village, Talappilly Taluk, Thrissur District covered under Assignment Deed No. 1384/1993 of Pazhayannur SRO as also the guarantee offered by his wife Girija on 24.02.2012. The total due payable by the borrowers as on the date of issuance of notice is stated to be Rs.1,27,01,083/- (Rupees One Crore Twenty Seven Lakhs One Thousand Eighty Three only) with future interest and costs – the then interest rate being 12.90%.
4.2. Be it noted that unlike the formats prescribed for taking of possession, issuance of sale notice, the sale certificate and the like, there is not any statutory format for issuance of a demand notice in terms of Section 13(2) of the Act read with Rule 3 of the relevant Rules. Sub-section (3) of Section 13 of the Act of course requires the secured creditor to give in his demand notice the details of the amount payable by the borrower and the 'secured asset' intended to be enforced by him in the event of non-payment of the 'secured debts' by the concerned borrower. The expression ‘details’ contained in the said sub-section being synonymous with the expression ‘particulars’ would have to be given its plain, ordinary meaning as contained in the English dictionary and is not to be stretched too far so as to say or construe that it had been the legislative intendment to require the secured creditor to give in the demand notice the summation of all transactions that had taken place from the date of accommodation of credit facility till the date of issuance of such notice by setting out thereunder the entire debit and credit entries thereof.
4.3. The judgement penned by His Lordship Justice Allah Raham of the Hon’ble DRAT, Mumbai in the case titled Kotak Mahindra Bank Ltd. vs. Marvel Industries Ltd. and Anr. (MANU/DM/0004/2010) giving a purposive interpretation of Section 13(3) of the Act reads as follows:
“19. These Reports go to show that the respondent No. 1 is aware of the outstandings. The appellant being the Assignee has furnished the necessary details available with it. The purpose of Sec. 13(3) is to provide details of the amount payable by the Borrower and the details of the amount have been mentioned in the Notice. The DRT was of the view that since facility-wise details have not been provided, therefore, the Notice is bad. I am afraid this is not the requirement of law. In the first place, the respondent No. 1 has not been misled or prejudiced by the Notice given by the appellant. The necessary details containing the principal and the interest components have been given in the Notice. We may also note that the appellant is not continuing to provide facilities to the respondent No. 1 nor the respondent No. 1 is doing its business with the appellant. The appellant is not expected to be maintaining facility-wise account of the debt of respondent No. 1. The respondent No. 1 has nowhere challenged the accuracy of the component of principal and/or of the interest mentioned in the Notice. For these reasons I am of the considered view that the notice under Sec. 13(2) cannot be termed as bad for want of facility-wise details of the account. It is sufficient that the components of principal and interest have been segregated and mentioned in paras 8 and 9 of the notice. The Notice under Sec. 13(2) is, therefore, legal and valid. The finding recorded by the DRT on the point is reversed. (emphasis is mine)
4.4. The applicant in this case had enured to himself the benefit and advantage of the services of a lawyer conversant with the nuances and niceties of the Act 54 of 2002 to cause in his behalf an objection/representation in terms of Section 13(3A). Notwithstanding the assertion made by the 1st defendant in Annexure – A3 reply notice dated 30.10.2017 as to his enclosing of a statement of account alongwith the demand notice as has been extracted out supra, the applicant would not controvert or refute it by way of any further notice or otherwise. As rightly pointed out by the learned counsel for the defendants, the applicant has no case or contention by way of pleadings in his SA even as regards the defendants’ non-issuance of the statement of account alongwith the impugned demand notice which concededly is served on him.4.5. Palpably the impugned Annexure – A1 demand notice in all certainty sets out the details of the amount payable which is inclusive of the nature of facility availed, the borrowers’ execution of security / guarantee documents, the then total outstanding amount due and payable as on the date of its issuance as also the details of 'secured asset' intended to be enforced in terms of Section 13(3) and the defendants’ Annexure – A3 reply fortifies their case of supplying the applicant the statement of account as an enclosure to Annexure – A1 demand notice. The applicant who would not deny or dispute the defendants’ issuance of statement of account cannot be heard to have suffered any prejudice for the reason of their non-disclosure of the progressive total of the outstanding amounts otherwise payable by him. The Tribunal is afraid and of the humble view that Madhu Sudan Ghosh case excerpted supra could at best be held applicable only to the fact situation of the case decided and not to all cases invariably or indiscriminately. The said judgment cited reference to by the applicant, in view of the forgoing discussion, should be of no avail at all to him.
4.6. The applicant’s other contention raised as regards the non-sustenance of Annexure – A4 possession notice dated 28.11.2017 for the reason of the 1st defendant’s effectuation of its publication in ‘Kerala Kaumudi’ not coming anywhere in the list of leading newspapers of this country going by its ‘A’, ‘B’,‘C’ rating received the Tribunal’s further consideration. It pondered over as to whether the applicant’s contention as to the publishing of possession notice in Kerala Kaumudi by itself would vitiate the S.13(4) measures otherwise lawfully proceeded with by the bank. The applicant has no objection whatsoever as regards Annexure-B3 possession notice dated 28.11.2017 published on 02.12.2017 in the New Indian Express, Thrissur Edition.4.7.The applicant could neither convincingly say or show how he stood to suffer prejudice by the publishing of ‘possession notice’ in Kerala Kaumudi. Except vaguely alleging Annexure – B3 possession notice published in Kerala Kaumudi dated 02.12.2017 to be bad and illegal for the reason of it not being a leading newspaper having wide circulation in the State of Kerala , the applicant would not prove its inadequate circulation in the locality in which the secured asset is situated. Trite law it is, the person who asserts or alleges a fact is required to prove the same. The said principle of law stood reaffirmed in the judgment rendered by the Hon'ble High Court of Kerala in the case titled Krishnan v. Govindan reported in 1988 (1) KLT 687 and the judgment of the Hon'ble High Court of Calcutta rendered in the case titled Bhagchand Jain v. P.F. Inspector reported in MANU/WB/0285/1998 : CDJ 1998 Cal HC 112. The Hon'ble Supreme Court in the case titled Parimal v. Veena alias Beena reported in MANU/SC/0105/2011 : 2011 (1) KLT SN 84 (C. No. 114) SC: 2011 (3) SCC 545 held as follows:
"The provisions of S. 101 of the Evidence Act provide that the burden of proof of the facts rests on the party who substantially asserts it and not on the party who denies it. In fact, burden of proof means that a party has to prove an allegation before he is entitled to a judgment in his favour. S. 103 provides that burden of proof as to any particular fact lies on that person who wishes the court to believe in its existence, unless it is provided by any special law that the proof of that fact shall lie on any particular person. The provision of S. 103 amplifies the general rule of S. 101 that the burden of proof lies on the person who asserts the affirmative of the facts in issue."
4.8. Per contra, the learned counsel for the defendants would claim and contend Kerala Kaumudi to be a newspaper having sufficient circulation in the locality of the secured asset and most other parts of the State of Kerala. Be as it may, there is no denying the fact as regards delivery of Annexure-A4 possession notice dated 28.11.2017 on the applicant and its affixture on the secured asset as is evincible from Annexure – B4 photograph in compliance of Rule 8(1) legal mandate as also the effectuation of publication of Annexure B-3 possession notices dated 28.11.2017 evidencing taking of possession on that day in the New Indian Express (English Daily) and Kerala Kaumudi (Malayalam daily) both dated 02.12.2017 that is to say within seven days from the date of taking possession as envisaged under R.8(2) of the relevant Rules. 4.9. The Tribunal is conscious that the need to publish notices in two leading newspapers, one in vernacular language having ‘sufficient circulation’ is envisaged at three stages vide different provisions contemplated under the Security Interest (Enforcement) Rules, 2002. One is at the stage of issuing demand notice to the borrower provided the said demand notice is not served on him as envisaged under the proviso to R.3(1). This notice sought to be published is by way of substituted service for putting the borrower alone to notice of such issuance of S.13(2) demand notice either on his own or through the information about it received by him from anybody else known to him from and out of the general public who happened to notice such publication of the demand notice, which he has by then otherwise either not received, evaded or avoided to receive. The second notice envisaged under R. 8 (2) is at the stage of taking possession under R.8(1), to put the borrower as well as the general public to notice of the factum of taking of such possession by the secured creditor and to caution either of them not to deal with the said property. Where the possession notice in terms of R.8(1) is delivered to the borrower and affixed on the secured asset as it is so done in the present case, the borrower/property owner gets sufficient notice as regards the bank’s assuming of legal or physical possession of the secured asset as the case may be and the paper publication envisaged in R.8(2) is then intended only to serve as ‘public notice’ to the general public cautioning them to refrain from in any manner dealing with the property of the borrower to the detriment of their interests. The third notice envisaged under proviso to R. 8(6) is at the stage of putting the property for sale by way of public auction or tender, for the general public to have knowledge of the intended sale to ensure their maximum participation for the purpose of selling the secured asset for a fabulous price and to maximize recovery of dues, thereby consequently reducing the liability of the borrower.
4.10. Whether it be a demand notice, possession notice or sale notice, service of such notice individually and separately to the borrower is contemplated under R.3(1), R.8(1) and R.8(6) of the Security Interest (Enforcement) Rules, 2002. It is to be pointed out here that the need to publish sale notice in two leading newspapers is envisaged under the proviso to R.8(6) only if the sale of such secured asset is by inviting tenders from the public or holding public auction and not for the other modes of sale contemplated under R.8(5) in which case, a mere service of 30 days notice of sale on the borrower should suffice. Therefore, the Tribunal is driven to the view and conclusion that in cases where the borrower like that of the applicant’s sort had been concededly served with individual notices of possession or sale as the case may be, the further requirement for publishing the notices of possession and sale in newspapers having ‘sufficient circulation’ is intended predominantly only for the notice and knowledge of general public, in the first case of possession for cautioning them not to deal with the property and in the second case of sale for inviting them to participate in large numbers to purchase the property. At the cost of repetition, the Tribunal reiterates its view that if there is due service of individual/separate notice on the borrower as envisaged under R.3(1) and R.8(1) of the Security Interest (Enforcement) Rules, the possession notice that is required to be published under R.8(2) of the relevant Rules is without any room for doubt intended only for the notice and knowledge of the general public and that is sought to be achieved in all fairness and transparency by the legislature by mandating to publish the same in two leading newspapers one in vernacular language having ‘sufficient circulation’ in that locality.
4.11. The Tribunal is of the view that at every stage of the SARFAESIA measures and proceedings, there is an imperative need to give purposive interpretation to the legislative intendment of each of its provisions and Rules. The golden rule of interpretation postulates harmonious construction and interpretation of each and every provision of an enactment aiming at furthering and achieving the well intentioned objects and goals of the Act and not otherwise. The Hon’ble High Court of Madras in its judgement rendered in the case of R. Sridharan v. Presiding Officer reported in MANU/TN/2291/2008 : 2008-4-L.W. 451 : 2008 (6) MLJ 1181 observed thus :
“40. Interpretation of a Statutory provision should be to find out the intention of the legislature and that has to be understood with due regard that the object of the legislation also. The word employed in the Statute will acquire meaning and content depending upon the context in which they are used. The word should not be torn out by the context and by interpretation, it would make another provision Otiose/redundant and such interpretation should not be adopted. The interpretation to the words employed in Section 1(2) of the Hindu Marriage Act should be consistent with the working of the enactment, keeping in mind the object of the Act. Reference can be made to the decision in Marya Teresa Martin v. E.Martin, Madras reported in AIR 1994 Kerala 264.
41. In Anwar Hasan Khan v. Mohd. Shaft reported in 2001(8) SCC 540, the Supreme Court, at Paragraph 8, held as follows:
"For interpreting a particular provision of an Act, the import and effect of the meaning of the words and phrases used in the statute have to be gathered from the text, the nature of the subject-matter and the purpose and intention of the statute. It is a cardinal principle of construction of a statute that effort should be made in construing its provisions by avoiding a conflict and adopting a harmonious construction. The statute or rules made thereunder should be read as a whole and one provision should be construed with reference to the other provision to make the provision consistent with the object sought to be achieved. The well-known principle of harmonious construction is that effect should be given to all the provisions and a construction that reduces one of the provisions to a "dead letter" is not harmonious construction."
4.12. While attempting to understand the purport and purpose for which such a requirement is prescribed by law, the Tribunal endeavoured to understand the meaning for the word/expression ‘sufficient’, ‘wide’ and ‘circulation’. The Hon'ble High Court of Punjab in the case titled Benarsi Das Saraf and Ors. vs. Dalmia Dadri Cement Ltd. and Anr, reported in AIR 1959 P&H 232 defined the word ‘sufficient’ as follows:-
“22. The word "sufficient" means "adequate", "enough", "as much as may be necessary to answer the purpose intended." It embraces no more than, that which provides a plenitude which, when done, suffices to accomplish the purpose intended in the light of existing circumstances and when viewed from reasonable standard of practical and cautious men.”
The word/expression ‘circulation’ used in the said Rule would mean to signify that the said newspaper is circulated or has movement in that locality. The Tribunal did find that the plain meaning given to the word ‘wide’ in Webster’s Collegiate Thesaurus does include the words ‘extensive’, ‘expansive’, ‘broad’ and so on.
4.13. In the present case, the Tribunal is convinced about due service of possession notice dated 28.11.2017 on the applicant as also regards the affixture of it on the secured asset and as such Rule.8(1) requirement is duly complied with. One newspaper which might have wide circulation in one area would not have even a ‘sufficient circulation’ in some other area and what is to be weighed is as to whether the publication carried out makes out a ‘sufficient compliance/substantial compliance’ of the requirement of the Rule having in mind the purpose for which the concerned word/expression is employed by the Legislature. The applicant who had been duly served with possession notice could neither demonstrate the prejudice suffered by him nor could he prove any ‘malafides’ on the part of the defendant in having published the possession notice in Kerala Kaumudi. The Tribunal therefore holds that Annexure-B3 is a notice published in substantial/sufficient compliance of the Rule to serve as an ‘adequate’ notice to the general public with regard to the possession taken by the defendant and is thus not bad in law. In coming to such a view, the Tribunal is also fortified by the following judgments rendered by the Hon'ble Supreme Court of India and the Hon'ble High Courts of Madras and Karnataka in relation to the acquisition of properties and sale thereof wherein the Hon'ble Courts had an occasion to deal with and decide on the pleas put forth by the respective parties before it with regard to ‘sufficient circulation’ of newspapers.
(a). The Hon'ble Supreme Court of India in the case titled The Special Deputy Collector, Land Acquisition, C.M.D.A v. J.Sivaprakasam & others, reported in AIR 2011 SC 922 held as follows:-
“6............. The Appellate Bench of the High Court held that the appellants had failed to establish that "Kadiravan" and "Madurai Mani" had sufficient circulation in the City of Chennai, where the acquired lands were situated and therefore the publication of the preliminary notification in the said newspapers did not comply with the mandatory requirements of notification under Section 4(1) of the Act. The said order is challenged in this appeal by special leave.
18. ………….. if the words 'newspapers circulating in that locality' are to be interpreted in a purely literal and normal sense, they would mean newspapers having a regular and steady circulation among the general public in the locality, irrespective of the number. In that sense even a newspaper having 2% to 3% market share out of the total circulation figures for regional newspapers sold in the locality, can be considered as a newspaper "circulating in the locality". Therefore, where there is compliance with the requirement relating to publication in two daily newspapers circulating in that locality (one which at least should be in the regional language) in a technical or literal sense, but it is found that those newspapers have only a circulation share of 2% to 3% of the total number of newspaper sold in the locality, it may not be possible to mechanically invalidate the entire acquisition, on the ground that the two regional newspapers in which the notification was published were not "circulating in that locality". (Emphasis is mine)
19. We have held that the object and purpose of the amended Section 4(1) of the Act is to provide for publication of the preliminary notification in two daily newspapers having reasonably wide circulation in the locality so that people (persons interested) in that locality may become aware of the proposals for acquisition. We have also held that publications in two newspapers having regular and steady circulation, but having a market share of only 2% to 3% of the total newspapers can not invalidate the acquisition proceedings automatically, on the ground that such publication violates the requirement of Section 4(1) relating to newspaper publication. As the said two findings are slightly contradictory, it is necessary to harmonize the consequences.
20. This leads us next to the consequences of publication of the notification in two newspapers having reasonably wide circulation and consequences of bonafide publication of the notification in two newspapers which do not have a wide circulation in the locality.
20.1. If there is failure to publish in two daily newspapers or if the publication is in two newspapers that have no circulation at all in the locality, without anything more, the notification under Section 4(1) of the Act and the consequential acquisition proceedings will be vitiated, on the ground of non-compliance with an essential condition of Section 4(1) of the Act.
20.2. If the two newspapers carrying the publication of the notification have reasonably wide circulation in the locality, (apart from the publication of the notification in the Gazette and causing public notice of the substance of the notification to be given at convenient places in the locality), then the requirements of Section 4(1) are complied with and all persons concerned in the locality shall be deemed to have notice of the notification. (For this purpose, the publication need not be in newspapers having the widest or largest circulation, but it is sufficient if the publication is in newspapers having reasonably wide circulation). In that event, neither the notification under Section 4(1), nor the consequential acquisition proceedings would be open to challenge, on the ground of violation of Section 4 of the Act.
20.3. If the newspapers in which the notification is published were circulating in the locality, but did not have a reasonably wide circulation in the locality, then neither the notification under Section 4(1) nor the consequential acquisition proceedings, will become vitiated automatically. If the person aggrieved, apart from demonstrating that the two newspapers did not have reasonably wide circulation in the locality, also asserts that as a consequence, he did not have notice of the proposed acquisition that was provided for in Section 4(1) of the Act, in the absence of evidence to the contrary, the acquisition to the extent of the land of such person will be vitiated. But if such assertion is rebutted by the acquiring authority by placing evidence to show that the person concerned had in fact notice (as for example where he participated in the enquiry under Section 5A of the Act), the acquisition will not be vitiated on the ground of violation of Section 4A of the Act.
20.4. If the person challenging the acquisition is able to establish that the notifications were deliberately and with malafides, published in newspapers having negligible circulation, to avoid notice to the persons concerned, then Section 4(1) will be violated.
22. The copy of the communication dated 31.3.2004 sent by the Director of Information and Tourism (Advertisement) Department in Tamil Nadu shows that between 1998 to 2000 "Madurai Mani" had a circulation of 6200, 4675, 5200 and 3100 in Central Madras, South Madras, North Madras and Tambaram areas and "Kadiravan" had a circulation of 42,000 to 48,000 in Chennai area. On the other hand the material produced by the respondents show that the total circulation of regional newspapers in Chennai was around a million, that several regional newspapers had circulations varying between 80,000 to 2,00,000 in Chennai, and the Madurai Mani with a Chennai circulation of 28465, had a market share of 3% out of the total circulation of regional newspapers. 'Kadiravan' also apparently had a market share of 4; before its closure. The two newspapers were not therefore newspapers having no circulation in the locality. (Emphasis is mine) We however agree, having regard to the circulation figures, with the finding of the High Court that the newspapers did not have a reasonably wide circulation in the locality.
23. As both Madurai Mani and Kadiravan were sold and circulated in Chennai and as a good chunk of their total circulations was in Chennai, it may not be possible to hold that the said newspapers were not 'regional daily newspapers circulating in the locality'. Nor will it be possible to invalidate the entire acquisition on the ground that the publication in the said two newspapers did not fulfill requirement of publication in 'newspapers circulating in that locality'. But if the respondents are able to assert and demonstrate that as a consequence, they were denied the opportunity of participating in the enquiry under Section 5A, or show any other disadvantage, they may be able to achieve the object of showing that the acquisition proceedings were vitiated in so far as their lands were concerned.
24. In this case respondents 1 to 11 have challenged the acquisition. Respondents 5 to 11 specifically admitted that they received a notice dated 9.6.1999 from the appellant herein calling upon them to appear before him in the Section 5A enquiry under the Land Acquisition Act. Respondents 5 to 11 further admitted that they enquired and found that the lands were notified and immediately thereafter filed their objections to the acquisition proposals. Therefore, the publication of the notification under Section 4(1) of the Act, in two newspapers which did not have wide circulation in the locality, did not affect respondents 5 to 11 in any manner as they had notice of the proposals for acquisition and participated in the enquiry under Section 5A of the Act.”
(b). The Hon'ble High Court of Madras in the case titled Thanga Krishnan & Ors., v. State of Tamil Nadu rep. by its Secretary Housing and Urban Development Dept. and Another reported in CDJ 2003 MHC 229 held as follows:-
“30. The last of the contentions advanced being that the publication of Section 4(1) Notification was made in two Tamil dailies having no circulation and this renders the acquisition illegal. In the affidavit filed in support of the writ petitions in para 5 in a passing manner it is set out thus:
"The same has said to have been published in Newspaper in "Kathiravan" and "Madurai Mani" which are not in circulation in our area."
Except this passing reference, no specific grounds have been raised. It is pointed out by the Government Advocate that the two dailies are Registered Newspapers having sufficient circulation in the locality. (Emphasis is mine) It is further stated that the two dailies are published from Madras only and have circulation in the city and suburbs. Though one of the news dailies is known as "Madurai Mani", it is being published at No.2, Thanapppa Chetty Street, Triplicane, Madras 5. So also, the other Tami daily, namely, "Kathiravan" is published at Madras and both the dailies are having circulation in the City of Madras and suburbs.
31. The two newspapers are having circulation in the locality and there is no doubt. No material at all has been placed by way of affidavit of the News Agency or other competent person in the field to hold that the said dailies have no circulation in the locality. Therefore, this Court is of the considered view that Section 4(1), which prescribes the publication in two dailies having circulation in the locality is satisfied. (Emphasis is mine) Hence, the fifth contention also fails.”
(c). The Hon'ble High Court of Karnataka in the case titled M.G. Raju vs. City Municipal Council, Mandya, reported in CDJ 1998 KAR HC 403 held as follows:-
“2. In this court what is urged is that there is no strict compliance with R.39, as the publication made is in a newspaper which is locally published and does not have sufficient circulation in the city (Emphasis is mine). ………… I do not find force in either of the contentions. R.39 does not specify a particular paper in which the intended sale or lease hold be advertised. Therefore as long as it is published in a paper which is printed, published and sold locally, this court has no hesitation to hold that there is a ‘substantial compliance’ with the requirement of the Rule.” (Emphasis is mine)
4.14. Analogy which anyone could respectfully draw from the judgments referred to above is that the Hon'ble Supreme Court and High Courts while dealing cases relating to acquisition of properties and sale thereof under the relevant Central/State Acts (of course, not under SARFAESI Act) have held that where the landlord whose property is to be acquired or other persons interested in the property had been served with notice (actual, constructive or implied), it is not then open for them to seek to vitiate the proceedings unless they could demonstrate of having suffered any prejudice, of having been denied any opportunity to question the action and as to the deliberate and malafide act of the authority in publishing the notices in newspapers having negligible circulation to affect their interest. What is emphasized in the aforesaid judgments is to give a ‘purposive’, meaningful interpretation to the requirement of the Rule and provisions of the Act. The Tribunal therefore has no hesitation to hold that Annexure-A4 possession notice and Annexure-B3 possession notices are issued/published in substantial/sufficient compliance of the legal mandate envisaged under R.8(1) & R.8(2) of the Security Interest (Enforcement) Rules and sees no reason to hold the possession taken by the 1st defendant vide such notices as illegal or improper.
4.15. The Tribunal now proceeds to consider whether it would be open for the applicant to seek interdiction of the defendants’ SARFAESIA measures for the reason of the subsistence of Annexure – A5 pump dealership agreement dated 30.03.1984 with Indian Oil Corporation and the covenants contained therein precluding the dealer from assigning, mortgaging, charging or parting with or otherwise transferring the premises or any part or his interest in the dealership or the benefits conferred under the agreement. Annexure – A5 memorandum of agreement could at best be a binding agreement inter-se the applicant and the Indian Oil Corporation setting out reciprocal promises to be adhered to by either of them and certainly has no bearing on the 2nd defendant bank which is neither a privy or party to it at any point of time. Non-adherence to any of the clauses or covenants contained therein should entail termination of the agreement or the parties’ entitlement to sue each other pressing for its performance, damages, losses and the like. The applicant has no case or contention of mortgaging or charging the 'secured asset' to Indian Oil Corporation pursuant to his entering of Annexure – A5 agreement with it.4.16. The applicant had admittedly created ‘security interest’ over the secured asset favouring the 2nd defendant bank and his creation of it as early on 24.02.2012 is evincible from the CERSAI security interest details computer generated statement made available by the defendants on 05.01.2019 in substantiation of their registration of charges therewith. The defendants said additional document is since received in evidence as Annexure – B5 series. Having created the security inter
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est over the 'secured asset' favouring the 2nd defendant bank and deriving the benefit therefrom by way of ‘financial assistance’ got accommodated to his proprietary concern M/s. Sasi Petroleum Agencies, it is now not open to the applicant to deny or dispute the defendants’ right and entitlement to enforce the same. The Tribunal inevitably holds so, fortified by the following authoritative judicial pronouncements: (a) The Hon'ble Supreme Court of India in the case titled M/s. Cauvery Coffee Traders, Mangalore Vs. M/s. Hornor Resources (International) Co. Ltd. reported in CDJ 2011 SC 904: 2011(10) SCC 420 held as follows: “25……….In R.N.Gosain Vs. Yashpal Dhir, AIR 1993 SC 352, this Court has observed as under:- “Law does not permit a person to both approbate and reprobate. This principle is based on the doctrine of election which postulates that no party can accept and reject the same instrument and that “a person cannot say at one time that a transaction is valid and thereby obtain some advantage, to which he could only be entitled on the footing that it is valid, and then turn round and say it is void for the purpose of securing some other advantage.” 26……..A party cannot be permitted to “blow hot and cold”, “fast and loose”or“approbate and reprobate”. Where one knowingly accepts the benefits of a contract or conveyance or an order, is estopped to deny the validity or binding effect on him of such contract or conveyance or order”. (emphasis is mine) (b) The Hon’ble High Court of Allahabad in the case of M/s. Al-Habib Food Processing vs. Punjab National Bank reported in MANU/UP/0433/2013 held as follows: “15. The plaint case set up by petitioner does not allege any fraudulent act on the part of respondent-defendant Bank or that it has not taken loan and is not liable to pay the same or the property in dispute has not been mortgaged or placed as security. Having obtained the loan after placing the property in question as security, now plaintiff cannot be allowed to turn back and to raise dispute whether the property was liable to be made a security or not etc……..” 4.17. The Tribunal is as well unappreciative of the contention ushered in by the applicant as regards the non-enforceability of mortgage for the reason of the pre-existence of Annexure – A5 dealership agreement with Indian Oil Corporation which is alleged to be in vogue, valid and effective till this date. The applicant – mortgagor who is deemed to have impliedly contracted and covenanted with the 2nd defendant in terms of Section 65 (a) of the Transfer of Property Act to be transferring an interest that certainly subsisted pursuant to the powers possessed in him, cannot now turn around and contend it otherwise. That apart the applicant is obligated to defend his title, right and interest over the secured asset to the advantage and benefit of the 2nd defendant bank – mortgagee in the event of there being any claim as regards the non enforceability of the mortgage by anyone including Indian Oil Corporation if it be, which however is not the case here. The Tribunal ineffably holds so respectfully reminiscing the judgment rendered by the Hon'ble High Court of Kerala in the case titled State Bank of India v. Shytez Joseph and Ors. (MANU/KE/1276/2016) which is excerpted hereunder : “28. In fact, if a registered sale deed is to be declared as null and void, a suit has to be filed under Section 31 of the Specific Relief Act and it is for the Court in its discretion adjudge and order whether the document is to be cancelled. It is settled law that such a decree in which a document is declared to be void is a decree in personam and though it binds the parties to the suit, it will not be binding to each and every person and no note of such a decree can be made in the Sub Registrar's register. Such document may give rise to various transactions and litigations. Therefore, unless the Court, in its discretion cancels a sale deed, a compromise settlement between the parties cannot be utilised to declare a document void. Further, the mortgagor has an obligation under Section 65 of the Transfer of Properties Act to defend the mortgagor's title. Section 65(b) reads as under: 65. Implied contracts by mortgagor-In the absence of a contract to the contrary, the mortgagor shall be deemed to contract with the mortgagee,- (a). xxxx (b). that the mortgagor will defend, or, if the mortgagee be in possession of the mortgaged property, enable him to defend, the mortgagor's title thereto” 5. Finding no merit in the factual/legal submissions that came forth from the applicant, the SA is only to be dismissed and the Tribunal wherefore dismisses it accordingly. Consequently IAs 3003/2017, 799/2018 & 2694/2018 stand closed. No order as to costs.