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IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 7TH DAY OF SEPTEMBER 2015
BEFORE
THE HON’BLE MR. JUSTICE A S BOPANNA
WRIT PETITION No.15523/2015 (GM-DRT) c/w WRIT PETITION No.16800/2015 (GM-DRT)
W.P.NO.15523/2015
BETWEEN:
SATHISH KAMATH S/O M ACHUTHA KAMATH AGED ABOUT 65 YEARS R/AT ANANTHA SHAYANA KARKALA KASABA VILLAGE KARKALA TALUK-574104
SMT. SHANTHA KAMATH W/O SRI SATHISH KAMATH R/AT ANANTHA SHAYANA KARKALA KASABA VILLAGE KARKALA TALUK-574104 ... PETITIONERS
(BY SRI. SAMPAT ANAND SHETTY, ADV.)
AND:
THE RECOVERY OFFICER DEBTS RECOVERY TRIBUNAL KRISHI BHAVAN, HUDSON CIRCLE BANGALORE-560001
SYNDICATE BANK REP. BY ITS AUTHORIZED OFFICER CATHOLICK BRANCH, UDUPI UDUPI DISTRICT-574101 ... RESPONDENTS
(BY SRI. K RADHESH PRABHU, ADV. FOR R2)
W.P.NO.16800/2015
BETWEEN:
MURALIDHAR KAMATH S/O M ACHUTHA KAMATH AGED ABOUT 59 YEARS R/AT ANANTHA SHAYANA KARKALA KASABA VILLAGE KARKALA TALUK 574 104 ... PETITIONER
(BY SRI. SAMPAT ANAND SHETTY, ADV.)
AND:
THE RECOVERY OFFICER DEBTS RECOVERY TRIBUNAL KRISHI BHAVAN HUDSON CIRCLE BANGALORE-560001
SYNDICATE BANK REP. BY ITS AUTHORIZED OFFICER CATHOLICK BRANCH UDUPI UDUPI DISTRICT 574 101 ... RESPONDENTS
(BY SRI. K RADHESH PRABHU, ADV. FOR R2)
THESE WRIT PETITIONS ARE FILED UNDER ARTICLES 226 & 227 OF THE CONSTITUTION OF INDIA, WITH A PRAYER TO DIRECT AGAINST THE RECOVERY OFFICER OF THE DEBT. RECOVERY TRIBUNAL OF KARNATAKA AT BANGALORE TO CONSIDER AND DISPOSE OF THE OBJECTIONS FILED BY THE PETITIONERS HEREIN AS BACK AS IN THE YEAR 2007 VIDE OBJECTION DATED 11.9.2007 VIDE ANN-A, IN VIEW OF THE PROVISION 11 OF 2ND SCHEDULE OF THE INCOME TAX ACT, 1961 AS AMENDED ON THE GROUND THAT THE SAME IS A QUESTION ARISING BETWEEN THE RECOVERY OFFICER ON THE ONE HAND AND THE PETITIONERS ON THE OTHER RELATING TO DISCHARGE OR SATISFACTION OF THE RECOVERY CERTIFICATE IN QUESTION TO BE INVESTIGATED BY THE RECOVERY OFFICER AS CONTEMPLATED UNDER PROVISION 9 OF THE SECOND SCHEDULE UNDER THE INCOME TAX ACT 1961 IN SO FAR AS IT RELATES TO BRINGING
THE PROPERTY COMPRISED IN SY.NO. 83/2 OF KARKALA KASABA VILLAGE FOR SALE AS MORE FULLY INDICATED IN FORM NO. 16, NOTWITHSTANDING THE FACT THAT THE PETITIONERS ARE ADMITTEDLY NOT THE DEFENDANTS MUCH LESS THE DEFAULTERS OF DUES TO THE R-2 BANK ON THE GROUND THAT THE PETITIONERS BECOME THE ABSOLUTE OWNERS IN POSSESSION OF THE SAID PROPERTY AS BACK AS IN THE YEAR 1996, FREE FROM ANY KIND OF ATTACHMENT, CHARGE, LIEN OR ANY KIND OF ENCUMBRANCE WHATSOEVER AND ETC.
THESE WRIT PETITIONS HAVING BEEN RESERVED FOR ORDERS, COMING ON FOR PRONOUNCEMENT THIS DAY, THE COURT PRONOUNCED THE FOLLOWING :
ORDER
The petitioners in these petitions are before this Court seeking for issue of mandamus or such other direction to the Recovery Officer of the Debt Recovery Tribunal ('DRT' for short), Bangalore to consider the objections dated 11.09.2007 in terms of the provision contained in II schedule to the Income Tax Act,1961. In that regard, the petitioners are seeking that the order dated 11.06.2014 passed by the DRT refusing to entertain the claim of the petitioners on merits without recalling the earlier order dated 06.03.2012, on the ground of delay is redundant. Therefore, it is claimed that such order shall not act as an estoppel as against the petitioners.
The case of the petitioners is that they have purchased a portion of the property each in Sy.No.83/2, Karkala, Kasaba Village under the sale deeds dated 30.07.1996 and 12.07.1996 respectively. The manner in which the property was improved and is being enjoyed by the petitioners is stated in the petition in detail. The said property is now being brought to sale by the Recovery Officer of the DRT in DCP No.2554 pursuant to the recovery certificate issued by the DRT in O.A.No.394/1995 at the instance of the respondent Bank. The respondent Bank in that regard had advanced loan to one Sri S.Bhaskar Somayaji to which the vendor of the petitioners Sri. E.Murari Rao is the guarantor.
The gist of the contention raised by the petitioners by way of objection before the Recovery Officer is, though the respondent may have the right to recover the amount from the borrower and the guarantor pursuant to the recovery certificate, the property purchased by the petitioners cannot be sold
since no charge existed over the property nor was it the subject matter of the recovery suit which was later transferred to the DRT in O.A.No.394/1995. The petitioners contend that the encumbrance certificate did not indicate such charge nor was the original of the title documents deposited with the Bank. In that regard, it is contended that the suit refers only to the certified copies of the documents in the schedule. It is therefore not a valid mortgage by way of deposit of title deeds is the stand. The further contention is, if that be the position, the purchase though made by the petitioners in the year 1996 despite the suit in O.S.No.3/1992 being filed on 10.11.1992 is not hit by lis pendens under Section 52 of the Transfer of Property Act. It is also contended that the public notice issued by the respondent Bank claiming that the property was mortgaged was also published for the first time on 28.01.1999 after purchase of the property by the petitioners. Even in that regard one of the family members of the Vendor of the petitioners has issued a reply public notice on 10.03.1999. In that view, the petitioners claiming
independent right, title and interest over the property are seeking such determination of their right by the Recovery Officer on adverting to all these aspects. Hence, it is contended that the order dated 03.09.2010 passed without determining all these issues is not sustainable and the objection dated 11.09.2007 is to be considered.
The learned counsel for the petitioners in order to contend that the objection filed by the petitioners before the Recovery Officer required detailed consideration with regard to the right as claimed, akin to execution proceedings, has relied on the decision in the case of Mayadevi vs. Laltha Prasad (AIR 2014 SC 1356) wherein the scope of consideration required under Order XXI Rule 97 to 101 of CPC was taken note and it was held that the determination of all questions is to be done in the execution proceedings and not by way of an independent suit. The executing Court is held to have a duty to consider and decide the objections with complete care and circumspection. In
the facts therein, the error committed in not considering the actual ownership of the property; having purchased it for valuable consideration, being a third party not connected in any malafide manner with the judgment debtor and not having received prior notice of any action leading to miscarriage of justice was pointed out. The case in Sameer Singh and another vs. Abdul Rab and others (2014 AIR SCW 6552) is also relied, wherein while considering a similar position under Order XXI Rule 97 to 103 of CPC it was held that the Executing Court has the authority to adjudicate all questions pertaining to right, title or interest in the property arising between the parties which would also include the claim of a stranger so as to avoid multiplicity of proceedings.
Having noticed the decisions, on the legal aspect relating to the nature of adjudication required to be made when right is claimed to the property which is subject matter of the Execution proceedings including the recovery proceedings of the present nature, as also
the requirement under the schedule to the Income Tax Act, there can be no second opinion. However, such consideration would arise keeping in view the circumstances obtaining in each case. In the instant case, though the petitioners are praying that their objection dated 11.09.2007 filed before the Recovery Officer in DCP No.2554 be considered keeping in view the nature of right claimed by the petitioners to the property in question, there is no dispute to the fact that subsequent to the objections dated 11.09.2007, on taking note of the same, the order dated 03.09.2010 (Annexure-M) has been passed by the Recovery Officer. Whether the petitioners are satisfied or not with the consideration is another matter. The said order dated 03.09.2010 is not assailed in these petitions but, no doubt that the order dated 11.06.2014 passed by the DRT is assailed. In that regard, the prayer in these petitions will indicate that it is couched in a language to make it appear as if it is sought for the first time. 6. In that light, what is also to be kept in view is that in relation to the very same subject matter,
whereby the petitioners claim independent right, title and interest to the property which is sought to be sold for recovery of the amount, the petitioners were before this Court on two earlier occasions. The scope and purport of the said proceedings is also necessary to be kept in view before coming to a conclusion as to whether this Court in the background of the earlier decisions in the case between the same parties can make an independent consideration about the objections dated 11.09.2007 or direct the reconsideration by the Recovery officer in its correct perspective.
In that regard, it is noticed that the petitioners herein were before this Court for the first time in W.P.Nos.34478/1999 and 1632-33/2000 seeking a declaration that there has been no valid charge created insofar as the schedule land or in the alternative, to direct the DRT to receive the objection statement in the shape of impleading petition and decide the same in accordance with law by providing opportunity. This Court after taking note of the contentions, by its order dated 14.08.2000 though made an observation that the
transaction between the petitioners and Sri Murari Rao was hit by Section 52 of the T.P.Act, has further clarified that no opinion is expressed on the same at that stage. It was indicated that a stage may come when the Recovery Officer proceeds against the property to recover the money from the petitioners and at that stage, if the law permits, the petitioners can always raise the objection which would be examined by the Recovery Officer and take appropriate decision. No doubt, if the matter had rested at that, no further consideration was required except to state that the objection needs to be considered by the Recovery Officer notwithstanding the said writ petition being dismissed.
However, the position is that the petitioner in W.P.No.16800/2015 herein was subsequently before this Court in W.P.No.38207/2010 (GM DRT) seeking that the order dated 03.09.2010 passed by the Recovery Officer-DRT be quashed. This Court by order dated 06.09.2011 (Annexure-M in W.P.No.16800/2015) on taking note of the order passed in W.P.Nos.34478/1999
and 1632-33/2000 and making further observations has dismissed the petition. The learned counsel for the petitioner would however contend that the dismissal of the said petition was only due to the fact that the learned counsel who appeared for the petitioner had not placed before this Court the objections filed before the Recovery Officer for consideration in the said writ petition. Hence he contends that such concession made by the learned counsel or any passing observations made in the earlier proceedings cannot either be treated as res judicata nor can the same defeat the right of a litigant to secure proper adjudication.
To fortify such contention, the learned counsel for the petitioners has relied on the following decisions: i) The case of Pawan Kumar Gupta vs. Rochiran Nagdeo (JT 1999(3) SC 191) wherein it is held that the rule of res-judicata incorporated in Section 11 of CPC prohibits the Court from trying an issue which has been directly and substantially in issue in a former suit between the same parties and has been heard and
finally decided by that Court. But, it is the decision on an issue and not mere finding on any other incidental question to reach such decision which operates as res-judicata. It is held that it is not correct to say that the party has no right of appeal against the suit which was ultimately recorded as dismissed.
ii) The case of Union of India and others vs. Mohanlal Likumal Punjabi and others (AIR 2004 SC 1704) wherein it is held that the concession if any made by the learned counsel would be of no consequence when wrong concession is made by the counsel, which would not bind the parties when statutory provisions clearly provided otherwise. The applicability of the statute or otherwise to a given situation or liability of a person would invariably depend upon the scope of the provisions concerned and has to be adjudged not on any concession made. Any such concessions would have no acceptability or relevance while determining the rights and liabilities incurred or acquired.
iii) The case of Tukaram Kana Joshi and others vs. MIDC and others (2012 AIR SCW 6343) wherein it is held that the question of condonation of delay is one of discretion and has to be decided on the basis of the facts of the case on hand as the same vary from case to case. There may be a case where the demand for justice is so compelling that the High Court would be inclined to interfere inspite of delay ultimately it would be a matter within the discretion of the Court and such discretion must be exercised fairly and justly so as to come out with justice and not to defeat it. In the event the claim made by the applicant is legally sustainable, delay should be condoned. When substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserves to be preferred, for the other side cannot claim to have a vested right for injustice being done because of non- deliberate delay.
The third of the above noticed decisions cited is in the context of the DRT dismissing IA
No.3469/2012 filed by the petitioners in W.P.No. 15523/2015 herein on the ground of delay in filing the said application for recall of the order dated 06.03.2012 in IR No.3018/2010. With regard to the liberal manner in which the delay is to be dealt with so as to consider the matter on merits and such consideration to be in the ends of justice, the law no doubt is well established not only from the decision cited above, but is also the view taken in that circumstance in several cases. However, in the instant case, what is to be noticed is that though such order on IA was passed on the ground of delay on 11.06.2014, the petitioners had chosen to file the instant petition only on 13.04.2015, once again being unmindful of the delay and laches, despite the application itself being dismissed on the ground of delay. Apart from the diligence not being exhibited by the petitioners in exercising their legal right, what is also to be kept in view is that even if the delay was condoned by the DRT and if the recall of the order dated 06.03.2012 was made and the matter was considered, what would have arisen for consideration in
fact would have been the validity of the order dated 03.09.2010 passed in DCP No.2554 in OA No.394/1995.
If that be the position, keeping in view the similar nature of prayer which is presently made in both these petitions viz., in W.P.No.15523/2015 and 16800/2015, it is seen that the petitioner in W.P.No.16800/2015 who has a similar grievance against the order dated 03.09.2010 passed by the Recovery Officer had already assailed the same before this Court in W.P.No.38207/2010 and the petition was dismissed by this Court through the order dated 06.09.2011. Therefore, when this Court had already considered the same order on merits, the consideration of the said order dated 03.09.2010 once over again by the DRT on merits would lose its relevance as it was in any event required to take note of the order passed by this Court on the same subject matter.
To that extent, the question would also be as to whether this Court, at this point, in these petitions,
can once again take note of the correctness or otherwise of the order dated 03.09.2010 passed by the Recovery Officer so as to direct the Recovery Officer to consider the objection dated 11.09.2007 as prayed in these petitions. Firstly, as already noticed, the order dated 03.09.2010 has not been assailed herein. Without the said order being set aside, a direction to consider the objections which according to the petitioners had not been appropriately considered would not be possible. Further what is also to be considered is whether the earlier order dated 06.09.2011 passed in W.P.No.38207/2010 is to be considered as without effect and a consideration be made herein on merits in view of the reliance placed by the learned counsel for the petitioner on the decisions in the case of Pawan Kumar Gupta and in the case of Mohanlal Likumal Punjabi and others noticed supra.
Having perused the order dated 06.09.2011 in W.P.No.38207/2010, it is clear that though the prayer in the instant petition is formulated in the manner as if
to seek the consideration of the objection statement dated 11.09.2007 by the Recovery Officer, the grievance put forth in the earlier writ petition being against the order dated 03.09.2010 passed by the Recovery Officer on contending that the property purchased by the petitioner was not the subject matter of the mortgage, it would be clear that the very same issue had been considered by this Court. Though the petitioners in W.P.No.15523/2015 were not parties to the earlier petition, when a similar issue is raised by them before this Court in this petition while this Court is exercising a similar jurisdiction, it would have to be considered as a bar to take note of the same issue in a different form and readjudicate the matter.
That apart the observation made by the learned Judge in para-4 of the order dated 06.09.2011 in W.P.No.38207/2010 on the face of it would indicate that the concession by the counsel is not against any statutory provisions. In fact what is recorded therein would not qualify as a concession in its strict sense, but
is the inability to bring on record the relevant material in that regard. Even otherwise, the perusal of the order would disclose that the petition has not been dismissed only for that reason, but the learned Judge was convinced that the Recovery Officer has examined the objections said to have been filed by the petitioner and thereafter the impugned order was passed. It has also been observed that no error is found in the order passed by the Tribunal.
In such situation, even if a contention is urged at this stage that the counsel who represented the petitioner in the earlier petition had not effectively put forth the contentions by bringing on record the objection statement, such contention cannot be countenanced and a different view cannot be taken simply because in a subsequent petition relating to the same subject matter more exhaustive contentions are urged by another counsel. Judicial propriety does not permit such exercise. If at all the petitioner was of the opinion that the earlier petition was dismissed because
the objection statement was not pointed out to the Court, there were avenues, either to seek review at that stage or even to assail the said order, if the petitioner was not satisfied. On the other hand the petitioner has allowed the said order to become final and has on the same subject matter approached this Court once over again. In such proceedings, neither will this Court be competent to examine the objections nor would it be justified in law to direct the Recovery Officer to re-examine the objections.
Therefore, the decisions relied on would not assist the case of the petitioner. In such circumstance, the contention of the learned counsel for the respondent that the petitioners having availed the remedy before this Court earlier and having failed, cannot reagitate the matter in another petition in a different form is to be accepted. In such event, when the merits of the objection raised is not required to be examined at this juncture, it is also not necessary to refer in detail to the decisions in the case of Nagubai Ammal and others
vs. B.Shama Rao and others (AIR 1956 SC 593) and to the case of Mohammed Ali Abdul Chanimomin vs Bisahemi Kom Abdulla Saheb Momin and another (AIR 1973 Mys. 131) with regard to the transactions which are hit by Section 52 of the T.P. Act relied on by the learned counsel for the respondent.
For all the aforestated reasons, I see no reason to grant the prayer made in these petitions. The petitions are accordingly dismissed with no order as to costs.
Sd/-
JUDGE
akc/bms