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SCR.A/464/2010 8/ 8 JUDGMENT
IN
THE HIGH COURT OF GUJARAT AT AHMEDABAD
SPECIAL
CRIMINAL APPLICATION No. 464 of 2010
For
Approval and Signature:
HONOURABLE
THE CHIEF JUSTICE MR. S.J. MUKHOPADHAYA
HONOURABLE
MR.JUSTICE AKIL KURESHI
=========================================================
1
Whether
Reporters of Local Papers may be allowed to see the judgment ?
2
To be
referred to the Reporter or not ?
3
Whether
their Lordships wish to see the fair copy of the judgment ?
4
Whether
this case involves a substantial question of law as to the
interpretation of the constitution of India, 1950 or any order
made thereunder ?
5
Whether
it is to be circulated to the civil judge ?
=========================================================
VAISHALI
DINESHBHAI TRIVEDI - Applicant(s)
Versus
MANAGER
(H.D.F.C) & 6 - Respondent(s)
=========================================================
Appearance
:
MR
ASIT M MEHTA for
Applicant(s) : 1,
MR SANJAY A MEHTA for Respondent(s) : 1,
NOTICE
SERVED for Respondent(s) : 2 - 4.
MR SHIRISH R PATEL for
Respondent(s) : 5,
None for Respondent(s) : 6,
MS KRINA KALLA,
APP for Respondent(s) :
7,
=========================================================
CORAM
:
HONOURABLE
THE CHIEF JUSTICE MR. S.J. MUKHOPADHAYA
and
HONOURABLE
MR.JUSTICE AKIL KURESHI
Date
: / /2010
CAV
JUDGMENT
(Per
: HONOURABLE MR.JUSTICE AKIL KURESHI)
Petitioner
claims to be tenant of a residential property situated at plot no.
53/P in revenue survey no. 56/1 paikee of Sarvodaynagar, Behind
Ayurvedic Pharmacy, Joshipura, Junagadh(here-in-after referred to as
the said property ).
According
to her, she was given the said property on rent about three years
ago by respondent no.5 on a monthly rent of Rs.1150/-.
2.1 Though
the petitioner contends that she was previously not aware about any
loan transaction, it is an undisputed position that respondent no.5
had borrowed the sum of Rs. 1,40,000/- from HDFC bank ( the bank
for short) on or around 29.10.2003 by mortgaging said property in
favour of bank.
2.2 Since
respondent no.5 borrower did not repay the loan with interest at
agreed rate, bank issued notice dated 15.1.2009 under Section 13(2)
of the Securitisation and Reconstruction of Financial Assets and
Enforcement of Security Interest Act, 2002 (here-in-after referred
to as the Act ) calling upon him to repay entire outstanding
within 60 days failing which the bank would take recourse to one or
more measures envisaged under sub-section (4) of Section 13 of the
Act.
2.3 Since
the borrower did not repay the outstanding dues bank proceeded
further by making application under Section 14 of the Act dated
4.8.2009 seeking police assistance for taking possession of the
property in question. Bank obtained order from the Magistrate and
as per the say of the bank with police assistance took actual vacant
possession of the property in question in January 2010.
2.4 It
is however the case of the petitioner that on 20.12010, respondents
entered the property forcibly and physically threw out the
petitioner and her family members. They were humiliated and
insulted. Their belongings were thrown out. She was thus illegally
dispossessed of the property of which she was entitled to retain
possession.
2.5 It
is the case of the petitioner that though she complained to the
police authorities about such illegal action, no steps are being
taken.
2.6 In
this background, the petitioner has come to this Court making
following prayers :
(a)
Your Lordships may be pleased to admit and allow this petition and
issue appropriate writ, order or direction in the nature of writ and
the quash the illegal proceedings of the H.D.F.C. Authority as on
20-1-2010, and direct the respondents to give the peaceful
possession of the alleged property which is forcefully and illegal
disposed by H.D.F.C. and cost Rs. 3,00,000/- on respondents
(b)
Your Lordships may kindly give interim relief by directing the
respondents that not to stop remove the immovable property of the
petitioner from the house and give re-possession to the petitioner
during the pendency of this petition.
ALTERNATIVELY
Your
Lordships may kindly be pleased to order the respondent authorities
to make the alternative arrangement of house for the petitioner
during the pendency of this petition.
(c)
Your Lordships may kindly be pleased to pass the necessary order
and direction to the respondent authorities, those are not ready
to take the Criminal Complaint of the present petitioner.
(d)
Your Lordship may kindly be pleased to grant such other and further
relief as the nature and circumstances of the present petition in
the interest of justice;
Counsel
for the petitioner submitted that petitioner was a lawful tenant of
the property in question. Such tenancy could not have been
terminated by the respondents by unilateral action. She was entitled
to retain possession of the property till her tenancy was lawfully
terminated. He further submitted that respondents acted highhandedly
and illegally by physically throwing out the petitioner and her
family members. Petitioner’s criminal complaint is not being
registered by the police. No investigation has been undertaken. In
support of the contention he relied on the decision of Learned
Single Judge of this court in case of Dena Bank v. Shri Sihor
Nagarik Sahakari Bank Ltd & ors reported in AIR 2008
Gujarat 110. He also relied on the decision of the Apex court in
case of Manager, ICICI Bank Ltd. v. Prakash Kaur & ors.
reported in AIR 2007 Supreme Court 1349. He therefore, contended
that action should be initiated against respondents and petitioner
should be restored her possession of the property.
On
the other hand, counsel for the bank opposed the petition contending
that respondent no.5 owner of the property had taken loan from the
bank by creating security interest in the property. After following
necessary steps envisaged under the Act, possession of the property
was legally taken over. He pointed out that notice under Section
13(2) of the Act was served on the borrower. Such notice was neither
replied to, nor objections raised. Outstanding dues were not paid.
Bank therefore, proceeded further in terms of sub-section(4) of
Section 13 of the Act for which purpose it required police
assistance. No illegality was thus committed. In particular, he
contended that even going by the statement of the petitioner, the
tenancy was created about three years back. The borrower had taken
loan from the bank in the year 2003. Loan agreement contained
following negative covenants :
5.4
Negative Covenants
Unless
HDFC shall otherwise agree:
(a)
Possession : The borrower shall not let out or otherwise
howsoever part with the possession of the property or any part
thereof.
(b)
Alienation : The borrower shall not sell, mortgage, lease,
surrender or otherwise howsoever alienate the property or any part
thereof.
(c)
Agreements and Arrangements : The borrower shall not enter into any
Agreement or Arrangement with any person, institution or local or
Government body for the use,occupation or disposal of
the said property or any part thereof during the
pendency of the loan.
4.1 Counsel
for the bank relied on the affidavit filed by the bank and contended
that bank does not admit any lawful tenancy over the property in
question. In fact tenancy was only an eyewash to defeat the claim of
the bank.
4.2 He
contended that even as per the petitioner, tenancy was created long
after the owner mortgaged the property with the bank, despite
above-noted negative covenants. The bank was therefore, within its
rights to take over the possession of the property, even evicting
the tenant if need be. He relied on the decision of Business
India Builders & Developers Ltd. v. Union Bank of India &
ors. reported in AIR 2007 Kerala 114.
Having
thus heard learned advocates for the parties and perused the
documents and pleadings on record, it clearly emerges that even as
per the petitioner, she was put in possession of the property in
question as tenant by respondent no.5 about three years back.
Documents on record clearly suggest that respondent no.5 owner of
the property had taken loan from the bank in the year 2003. Property
was mortgaged. Security interest was thus created in favour of the
bank. Negative covenants as already noticed precluded owner from
creating any tenancy, despite which, even accepting the version of
the petitioner, borrower rented out the property which legally could
not have been done. Under the circumstances, we are of the view
that it was well within the powers of the bank to take over the
possession of the property and even evict the tenant if any found.
In the present case bank after issuing notice under section 13(2) of
the Act to the borrower and waiting for his objection or repayment
of outstanding dues during statutory period, proceeded further to
take possession with assistance of the police as provided by the
Magistrate.
In
case of Dena Bank (supra),
part of the property was in possession of the tenants even before
the property was mortgaged to the bank and this fact was disclosed
to the bank before obtaining loan and mortgaging the property in
favour of the bank. It was in background of this pre-existing
admitted tenancy that it was held that such tenant cannot be evicted
by the bank under the Act. Decision of Kerala High Court in case of
Business India Builders & Developers Ltd
(supra) was noticed but
distinguished on fact.
On
the other hand in case of Business India Builders &
Developers Ltd.(supra),
Division Bench interpreting the words free from encumbrances
appearing in Rule 9(9) of Security Interest (Enforcements) Rules
2002 held that even tenants can be evicted by the authorised officer
while delivering property tot he purchaser. It was held that even
the bank can take physical possession of the property by following
procedure laid down under Section 14 of the Act.
In
the present case, we are clearly of the opinion that bank committed
no illegality to the extent it tried to take actual vacant
possession of the property in question since we find that tenancy
was admittedly created when the property was mortgaged to the bank
against negative covenants contained in the loan agreement.
We
should however not be understood to have authorised any police
access or unnecessary or impermissible use of force for securing
such vacant possession. If therefore the case of the petitioner is
that excessive force was used or that either the bank
officers/employees or the police caused any violence, it is always
open for the petitioner to seek redress in accordance with law. This
however, would not entitle the petitioner to seek repossession of
the property. If the police is not recording the complaint of the
petitioner and undertaking investigation, as per the settled law, it
is always open for the petitioner to approach competent Magistrate
by filing complaint in writing.
Subject
to above observations, the petition is disposed of.
(S.J.Mujkhopadhaya,C.J.)
(Akil
Kureshi,J.)
(raghu)
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