SURENDRA KISHORE KELA Vs. UNION BANK OF INDIA

JUDGEMENT

(1.) Heard learned counsel for the parties. The admitted facts are that the appellant had taken a loan from the respondent-bank, Union Bank of India. When the appellant failed to repay the loan, respondent No. 1 issued a recovery certificate to the Revenue authorities to recover the amount as arrears of land revenue.

(2.) The contention, of the appellant is that the matter is governed by the U. P. Public Moneys (Recovery of Dues) Act, 1972 (for short, "the Act of 1972"), and, therefore, in view of Section 4(2)(b) of the Act of 1972, the respondent-bank is under a legal obligation to proceed first against the mortgaged/hypothecated properties and that no recovery certificate could be issued to the Revenue authorities for making the recovery straightaway.

(3.) Considering the provisions of Section 4(2)(b) of the Act of 1972, we are in complete agreement with the submission made by learned counsel for the appellant. Section 4(2)(b) enjoins upon the respondent-bank to proceed first against the property hypothecated, mortgaged, encumbered, etc., and if some amount remains outstanding after exhausting the remedy against the aforesaid property, then alone a recovery certificate could be issued to the revenue authority to make recovery from other properties.