- (1.) THE common question mooted in the above batch of writ petitions relates to agricultural loan advanced by different banks and therefore, all the petitions have been heard and are disposed of by a composite judgment. 1]. Civil Misc. Writ Petition No. 4177 of 2007 : A brief resume of necessary facts in this writ petition is that the State Bank of india Meja Branch District Allahabad sanctioned a sum of Rs. 2,98000/- to the petitioner against purchase of Tractor on 30-7-2004 and in connection with the aforesaid loan, agricultural and admeasuring 1. 232 hectuares situated in village Banwari Khas pot Shukulpur P. S. Manda Tahsil Koraon district Allahabad and also land admeasuring. 560 situated in village Unchdah was pledged to the Bank. The total land pledged to the Bank admeasures 1. 792 hectares. It would appear from the record that the petitioner repaid certain amount details of which are enumerated in the writ petition. It would further appear that Bhola Singh Patel and dharmendra Singh arrayed as Opp. parties 3 and 4 who claimed themselves to be Recovery Agent appointed by the Bank, forcibly took away the Tractor on 26-10-2005. Thereafter, a notice was served to the petitioner cautioning that in case, petitioner failed to repay the loan, the tractor seized by the Bank will be put to auction on 24-12-2006 followed by publication of auction sale notice appearing in newspaper on 15-12-2006 and 16-12-2006. 2]. Civil Misc. Writ Petititon No. 4052 of 2007 : In this case, the petitioner was sanctioned loan to the tune of Rs. 3 lac against purchase of tractor on 13-3-2004. He paid certain amount and thereafter, there occurred default in payment account of natural calamities. It would further appear that one R. B. S. Associates arrayed as Opp. party no. 4 claiming himself to be recovery Agent appointed by the Bank forcibly took away tractor on 4-1-2007. 3]. Civil Misc. Writ Petition No. 4758 of 2007 : In this case, loan granted to the petitioner was to the tune of Rs. 3,25000/-against purchase a tractor payable in 7 years. It would appear that the petitioner deposited the 1st installment, and thereafter, unforeseen calamity befell him and his entire house and crops were engulfed in the raging fire. In this case, M/s. Gorakhpur financial Services, Gorakhpur which was appointed as recovery agent by the Bank took forcible possession of the Tractor to force recovery of the loaned amount. 4]. Civil Misc. Writ Petititon No. 4584 of 2007 : In this case, the petitioner was granted loan to the extent of Rs. 1,65000/-to purchase tractor by U. P. Sahkari Gram vikas Bank Ltd. , Etawah in the month of jan, 1996 and as a security, the land admeasuring 1. 109 hectare was mortgaged. It is urged that petitioner repaid a sum to the tune of Rs. 2,70,536/- and still notice was issued for recovery of Rs. 1,58,225/ -. 5. Civil Misc. Writ Petition No. 3463 of 2007 : In this case it would appear that the petitioner was sanctioned loan of Rs. 2,50,000/- on 31-12-2000 for purchase of a tractor and to secure the loaned amount, agricultural land belonging to the petitioner was pledged to the Bank. It would further appear that the amount was agreed to be payable in nine year and the first installment of Rs. 80000/- was deposited in August, 2003 while second installment of Rs. 13,490/- was paid on 18-12-2000. Again, it would appear, a third installment of Rs. 95000/- was paid in June, 2004. A total sum of Rs. 1,88000/- is indicated to have been paid and yet the Bank issued citation demanding Rs. 2,50,000/- failing which it was postulated, the amount would be recovered as arrears of land revenue.
(2.) IN Writ Petition No. 3463 of 2007 and also in Writ Petition No. 4585 of 2007, Reserve Bank of India was impleaded and notices were issued. Sri Yashwant Verma, learned counsel appearing for Reserve Bank of India, assisted the Court by placing certain material facts relating to agricultural land. It has been submitted by Sri Yashwant verma that so far as rate of interest is concerned, the same is covered by the guide-lines in the matter of loan up to the extent of Rs. 2 lac in the priority sector issued by the Reserve Bank of India and the same cannot exceed Bench Mark Prime Lending Rate (B. P. L. R.) and for the loaned amount above rs. 2 lacs, it is stated, the Banks are free to determine rate of interest. In the matter of short term production Credit to farmers up to Rs. 3 lac, it is stated that rate of interest was fixed at 7% with 2% interest subvention to be provided by the Government of india. He has also placed graphs by which it is sought to be indicated that so far as state Bank and other Associates are concerned, the agricultural land is provided at the rate of Rs. 11. 7%, Regional Rural Bank at the rate of 50. 4%, Foreign Bank at the rate of 0. 7%, Nationalised Bank at the rate of 12%, and other Scheduled Commercial banks at the rate of 4. 5% and all scheduled commercial Banks 10. 8%. So far as agricultural sector is concerned, it is submitted that so far as agricultural sector is concerned, except the Banks mentioned above, the banks are free to fix their respective interest rate.
(3.) IN the matter of recovery, the question involved is whether the Bank could get the recovery made of agricultural could vehicles seized and possession of vehicles taken through persons within the legitimate parametes or by engaging private individuals or agencies not recognized by any provision of law as the agency for recovery and further whether such persons could seize the property at any time and Bank could fix for auction privately without taking recourse to the law as envisaged under the U. P. Agricutural Credit Act. The second question is whether any recovery of interest could be made beyond the principal amount and whether principle of Damdupat will be applicable to loans in which certain immovable properties are mortgaged. The third question that begs consideration is whether in case mortgage of agricultural property against loaned amount what would be the effect of such mortgage regard being had to prohibition contained in Section 155 of the u. P. Z. A. and L. R. Act if any such mortgage is impermissible and if agreement is entered between the Bank and tenure holder after mortgaging land to secure loaned amount.;