K. PADMA Vs. K. RAMACHANDRA

JUDGEMENT

(1.) Petitioner has filed this writ petition under Articles 226 and 227 of the Constitution of India challenging order dated 30.6.2008 passed in M.A. No.167/2007 by the Debt Recovery Appellate Tribunal at Chennai (Annexure-V). The petitioner claims that she is auction purchaser of the property in question in the auction sale conducted by the recovery officer.

(2.) Brief facts leading to filing of this petition and as averred in the petition are that the respondent No. 3 M/s. Tubeman Private Limited, a company having two persons as directors, viz., Shankarlal Agarwal and his wife Smt. Laxmi Agarwal, i.e., the respondent No. 4 herein, sought and obtained, on 16.1.1999, certain credit facilities aggregating to Rs.70.00 lakh from respondent No.2-bank on the personal guarantee of the directors. As the said borrowers were in arrears in a sum of Rs.34,94,040.44ps., respondent No.2-bank initiated proceedings in O.A. No.256/2000 before the Debt Recovery Tribunal at Bengaluru (for short 'DRT') for recovery of the said amount with interest and cost. In spite of notice from the DRT, defendants therein remained absent and they were placed ex-parte. Apprehending that respondent No. 4 and her husband would alienate the property and render recovery of decretal amount impossible, respondent No.2-bank made an application for injunction under Section 19(12) of the Recovery of Debts due to the Banks and Financial Institutions Act, 1993 (for short 'RDDBFI Act') which was granted by the DRT by order dated 21.9.2000 as per Annexure-A. The said order of injunction was given large publicity in the press and thereafter, the original application was allowed by DRT by order dated 8.1.2001 as per Annexure-B. When the proceedings initiated by respondent No.2-bank were in progress before the DRT, Bank of Baroda initiated recovery proceedings against the very same parties in O.A. No.6/2001 complaining that after availing huge credit facility in the name of respondent No. 3-M/s. Tubeman Private Limited along with Smt. Laxmi Agarwal and her husband Sri Shankarlal Agarwal as directors, the company had failed to repay dues to the bank and the directors of the company had diverted the bank finance and huge sums were due to the said bank. The DRT issued a certificate of recovery dated 25.2.2003 in favour of Bank of Baroda for an aggregate sum of Rs.44,21,771/-. In respect of the said recovery certificate, on 10.7.2003, Bank of Baroda obtained an order of attachment of immovable properties including the property in question, as per Annexure-C. The said order of attachment was also given wide publicity.

(3.) Ultimately, certificate of recovery was issued in favour of respondent No.2-bank by the DRT in DCP No.2549 dated 16.1.2003 as per Annexure-D. The DRT had also issued an order of attachment in respect of the property in question on 28.5.2004 as per Annexure-E. After notice to parties, when respondent No.4 and her husband Shankarlal Agarwal failed to satisfy the certificate, a notification was published by the DRT in the news paper fixing date of auction of the property as 9.12.2004. Even before the auction sale was fixed in respect of the property in question, respondent No. 3 - company, respondent No.4 and her husband Shankarlal Agarwal filed objections as per Annexure-G to the attachment order dated 28.5.2004 contending that the property in question had already been attached by the DRT in respect of the claim of Bank of Baroda in DCP No.2583 in O.A. No.6/2001. The objections of respondent No.4 and her husband were rejected by the DRT and thereafter, auction sale was fixed and notified to be held on 9.12.2004. This order of DRT rejecting objections of respondent No. 4 and her husband against attachment and sale of property had become final and had not been challenged by anybody including Respondent No.1. In the auction sale conducted on 9.12.2004, petitioner was the successful auction purchaser for a valuable consideration of Rs.32,50,000/-. She had deposited 25% of the bid amount aggregating to Rs.8,12,500/- and paid the balance amount of Rs.24,37,500/- on the very day of auction. It was averred that petitioner was a wage earner and she had invested in the property her life time savings apart from money borrowed from banks, friends and relatives. However, possession of the property was being denied to her by Respondent No. 4 by resorting to one or the other proceeding.