BHARAT BEEDI WORKS LTD Vs. KUNHAMBU K

JUDGEMENT

(1.) THESE Writ Appeals are filed by M/s Bharat Beedi Works Ltd.- auction purchaser and the Vijaya Bank respectively against the order dated 5/ 6-7-2001, passed in W. P. No. 12994/1999, wherein the learned single Judge has set aside the public auction held on 30-3-1999, quashed the confirmation of sale of the property in question in favour of the auction purchaser made on 4-2-2000 and directed the auction purchaser to deliver the possession of the property back to Mrs. Laxmi Kutty - Respondent No. 2 - Petitioner No. 2.

(2.) THE necessary facts in W. A. Nos. 4623-25/2001 are that at the instance of the first Respondent, the 5th Resopondent-Vijaya Bank had issued bank guarantees to the tune of Rs. 15 lakhs to three different financiers in order to purchase some timber. The said financiers though invoked the said bank guarantee did not ensure supply of timber, which made the 1st respondent liable to pay the entire amount covered by the bank guarantees. The 2nd Respondent owner of property No. TS 666/100 R. S. No. 95/100, Mangalore, stood as a guarantor to the said transactions. Since Respondent No. 1 did not repay the debt, the Bank moved the Court and got a judgment and decree on 22-4-1989. Pursuant to the decree, the Bank filed Execution Petition No. 94/1992 before the Additional Civil Judge, Mangalore. Pending execution of the decree, a special enactment called Recovery of Debts due to Banks and Financial Institutions Act, 1993 (for short the 'act") came into force and by virtue of S. 31 of the said Act, the Execution Petition stood transferred to the 3rd Respondent-Debt Recovery Tribunal. The cumulative liability of Respondents 1 and 2 was Rs. 60,70,562/- as per the Order of the Tribunal dated 8-5-1998. The Tribunal issued a certificate to its Recovery Officer to execute the decree. The 4th Respondent took steps in terms of Second Schedule to the Income-tax Act, 1961 and recovery proceedings were initiated under S. 29 of the Act to recover the entire amount by sale of property. Respondent No. 4 issued proclamation for sale of the property on 18-2-1999 fixing the date of auction on 30-3-1999, on which date auction was held and M/s Bharat Beedi Works Ltd. was declared as the highest bidder. The same was challenged in W. P. No. 12944/99, which was allowed in the aforesaid terms. Against the order of the learned single Judge, the above two Writ Appeals are filed.

(3.) SINCE the point in issue is common, the two Appeals were heard together and a common order is passed.