DR. DIPANKAR CHAKRABORTY Vs. ALLAHABAD BANK

JUDGEMENT

(1.) The petitioner has assailed the invocation of the provisions of Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act) by the bank on the ground that at the time of invocation, the same was barred by the laws of limitation.

(2.) The petitioner appearing in person has submitted that, the petitioner had enjoyed credit facilities from the bank. The bank not having acted in terms of its obligations, the petitioner was obliged to file a suit for damages being Money Suit No. 120 of 2000 before the learned City Civil Court at Calcutta against the bank. The bank had filed a proceeding under Section 19 of Recovery of Debts Due to Banks and Financial Institutions Act, 1993 against the petitioner being O.A. No. 137 of 2001 before the Debts Recovery Tribunal-1, Kolkata. The Civil Suit was also transferred to the Debts Recovery Tribunal-1. Both the proceedings are pending adjudication. The bank has, thereafter, issued the impugned notice dated March 3, 2016 purportedly under the Act of 2002. The petitioner had replied thereto by a writing dated March 21, 2016. The bank is now proceeding wrongfully under the Act of 2002 as on the date of issuance of the notice under Section 13(2) of the Act of 2002, the claim of the bank was barred by the laws of limitation. He has referred to Section 36 of the Act of 2002 and submitted that, the claim of the bank has to be within the period of limitation at the time of initiation of the proceedings under the Act of 2002. He has submitted that, the mortgage of the immovable property concerned was created in 1995. In terms of the provisions of the Limitation Act, 1963, a suit for mortgage could have been instituted by 2007. The petitioner had paid the last installment in respect of the loan account in October 1995. Taking such fact into consideration the notice under the provisions of the Act of 2002 cannot be said to be within the period of limitation. In support of his contention that, when a claim of a bank or a financial institution is barred by the laws of limitation, such bank or financial institution is not entitled to invoke the provisions of the Act of 2002, the petitioner has relied upon 2014 Volume 135 All India Cases page 550 (Abhay Ram v. Mahant Rambali Das and Anr.), All India Reporter 2014 Supreme Court page 1612 (Brijesh Kumar v. State of Haryana and Ors.), 2005 Volume 7 Supreme Court Cases page 510 (Popat and Kotecha Property v. State Bank of India Staff Association) and 2010 Volume 5 Supreme Court Cases page 459 (Oriental Aroma Chemical Industries Ltd. v. Gujarat Industrial Development Corporation and Anr.).

(3.) Referring to 2012 Volume 129 DRJ page 654 (Somnath Manocha v. Punjab and Sindh Bank and Anr.), the petitioner has submitted that, since the proceedings under Section 19 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 are not a proceeding for mortgage, therefore, a period of 12 years is not available to the bank for the purpose of invoking the provisions of the Act of 2002. In any event, a period in excess of 12 years has elapsed prior to the invocation of Section 13(2) of the Act of 2002, in the facts of the present case. Consequently, the Authorized Officer of the bank has exercised a jurisdiction not vested upon it by law. The proceedings initiated by the Authorized Officer of the bank under the Act of 2002 commencing from the issuance of the notice under Section 13(2) of the Act of 2002 should be quashed.