HARPAL SINGH ETC Vs. NEW BANK OF INDIA

JUDGEMENT

(1.) THE petitioners have impugned the order dated August 22, 1989 passed by respondent No. 2 under Section 8 of the Haryana Agricultural Credit Operations and Miscellaneous Provisions (Banks) Act, 1973 (for short, the Act) in this petition under Articles 226/227 of the Constitution of India.

(2.) FACTS first: The petitioners were advanced loan of Rs. 4 lacs by respondent No. 1 for the purchase of Harvestor Combine on August 4, 1984. The loan was advanced by respondent No. 1 on the terms and conditions mentioned in its letter dated June 29, 1984. The essential terms and conditions read thus : -

(3.) THE Indebtedness Act provides that the State Government may for the settlement between the debtors and their creditors establish Debt Conciliation Boards. A debtor or any of his creditors may apply to the Board appointed for the area in which the debtor reside to effect a settlement between the debtor and the creditor. The Board has to adjudicate the application for settlement of the dispute as provided under Section 12 of the Indebtedness Act. Section 2 (b) of the Indebtedness Act defines "agriculturist" and it means whose land and whose principal means of livelihood is income from cultivation of such land or partly by income from cultivation of such land and partly by income he gets as wages in cash or kind or partly in cash and partly in kind, in connection with agricultural occupation he performs. The petitioners have not placed any material on record to prima facie establish that their principal means of livelihood is income from cultivation of land owned by them. The Indebtedness Act which is prospective in operation enables a debtor, which includes an agricultural labourer and an agriculturist to move the Debt Conciliation Board for settlement of their dispute with the creditor. In the absence of any material that the petitioners are agriculturists as defined in the Indebtedness Act, the same is inapplicable to the facts of the instant case. The loan was advanced on August 4, 1984 for purchase of a Harvestor Combine. The Harvestor Combine which was duly hypothecated with respondent-Bank could not be sold without the prior permission of the bank, but the petitioners sold the same for Rs. 4. 00 lacs and they did not deposit the sale proceeds with the bank for discharging the debt. The petitioners violated the terms of the loan agreement. The respondent-Bank rightly initiated the proceedings under Section 8 of the Act against them. The order dated August 22, 1988 passed under the Act by the competent authority authorising the respondent-Bank to sell the property under mortgage with the Bank as additional security is unexceptional. It is not pointed out that the order under the Act is any was vitiated. The only ground urged that in view of the fact that the petitioners are agriculturists are defined under the Indebtedness Act, the remedy for the creditor lay under the said Act is devoid of any merit for the reasons stated supra.