ASHWATH Vs. CORPORATION BANK

JUDGEMENT

(1.) PETITIONER has invoked articles 226 and 227 of the Constitution with the prayers to quash the order dated 23.1.2014 of Debt Recovery Appellate Tribunal, Chennai in appeal No. RA(SA) 136/2008 filed by the 1st respondent -bank, as also the even dated order in RA(SA) 126/2008 filed by the 2nd respondent. It is also prayed that the original order dated 15.2.2008 of Debt Recovery Tribunal ('DRT' for short), Bangalore in ASA No. 136/2007 may be restored.

(2.) THERE is no dispute about the basic facts that petitioner had received notice under Section 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 ('SARFAESI' for short) and possession was taken on 13.5.2006, even as the petitioner's immovable properties were mortgaged to the respondent No. 1 -bank and the outstanding balance due to the bank was to the tune of Rs. 3,27,797/ -. The petitioner had approached the DRT, Bangalore with ASA 136/2007, wherein by order dated 15.2.2008, the DRT gave time of six months to the petitioner for regularization of his account. If the petitioner were to fail in regularizing his account, the bank was declared to be at liberty to initiate fresh proceedings for recovery of its debt. If in the meantime possession of the mortgaged property were already delivered to the auction purchaser, it was directed to be returned to the petitioner herein. That order was carried in appeal before the Debt Recovery Appellate Tribunal (DRAT for short), Chennai in RA(SA) 126/2008, which was disposed on 23.1.2014 by the impugned order, declaring that the order in appeal of the DRT was in excess of jurisdiction and liable to be set aside. Thus, in short, appeal was allowed by the impugned order and the order of DRT was set aside.

(3.) THE facts stated in the Memo are not denied or controverted on behalf of the respondents. The limited consensus among the parties is to the effect that even as the petitioner herein is absolved of the liability and responsibility towards the respondent No. 1 -bank, the respondent No. 2 having been the auction purchaser and having incurred loss on account of purchase of property at the hands of the bank and also having incurred interest on the loan taken for the purpose of purchasing the property, he has an actionable claim against the respondent No. 1 -bank. In view of the other fact that respondent No. 2 happens to be an officer of the respondent No. 1 -bank and has retired by now, it would be open for respondent Nos. 1 and 2 to either settle their accounts amicably in accordance with the policy of the bank or work out the remedy against each other without bringing into question the right, title and interest of the petitioner in the property, which was mortgaged to the bank.