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Judgment
R. S. Kulhari, Chairperson
The present appeal has been directed against the order dated 04.07.2016 passed by the Tribunal below whereby, the Securitization Application filed by the respondents was allowed.
The essential facts of the matter in brief are that; the respondents availed certain credit facilities from the appellant-Bank. They failed to maintain the financial discipline, hence, their account was declared NPA and Demand Notice dated 15.07.2015 for Rs. 60.51 lacs was issued under section 13 (2) of the SARFAESI Act, 2002. Thereafter, the possession notice under section 13 (4) was issued on 28.09.2015. The physical possession of the property was also taken on 04.06.2016.
The borrowers challenged the proceedings by filing S. A. alleging that the Demand Notice and the Possession Notice were not served. The Tribunal below vide impugned order observed that the Demand Notice and the Possession Notice were duly served and published but in the possession notice, the Bank has referred term "ordinance 2002" instead of "Act 2002". Hence, the possession notice was quashed by the Tribunal below and the Bank was directed to restore the physical possession of the property to the borrower. Hence, the present appeal.
Learned counsel for the appellant-Bank submitted that the Demand Notice was issued under section 13 (2) of the SARFAESI Act, 2002 and the Possession Notice was also issued under the provisions of SARFAESI Act, 2002 and Rule 9 of the Security Interest (Enforcement) Rules, 2002 but inadvertently, due to typing mistake, the word "Ordinance" was also typed along with Act, 2002. Thus, it was a mere typographical error which had not caused any prejudice to the borrower. Even otherwise, wrong mentioning or not mentioning the provision of law is excusable as laid down by the Hon'ble Supreme Court in M/s Shree Hari Chemicals Export Vs. Union of India And Anr, Appeal (Civil) 7534 of 2005 decided on 16.12.2005 and T. Nagappa Vs. Y. R. Muralidhar, Appeal (Crl.) 707 of 2008 decided on 24.04.2008. The learned counsel for the appellant has also referred the judgment of Hon'ble Calcutta High Court passed in Dr. Sujit Kumar Roy Vs. Union of India & Ors. Writ Petition No. 5472 (W) of 2007 decided on 02.03.2009 to contend that in a similar matter the term "ordinance" was mentioned in Demand Notice instead of "Act" and the Hon'ble High Court had treated the said notice as valid one.
The next contention of the learned counsel for the appellant-Bank was that even mentioning of wrong provision was the irregularity of minor nature which was liable to be ignored by the Tribunal below as held by the Hon'ble Supreme Court in the matter of M/s L & T Housing Finance Limited Vs. M/s Trishul Developers and Anr., Civil Appeal No. (s) 3413 of 2020 arising out of SLP (C) No(s). 18360 of 2019 decided on 27.10.2020.
On the contrary, the learned counsels for the respondents while supporting the impugned order contended that since ordinance 2002 has lost its significance after issuance of Act, 2002 and the possession notice was not issued under correct provisions of the statute therefore, the Tribunal below has rightly quashed the possession notice. In support of their contention, the learned counsels have referred the judgment of Andhra Predesh High Court passed in Sri Yarnala Leela Krishna Prasad and others Vs. Central Bank of India 2007 0 Supreme (AP) 886 decided on 10.09.2007 and the judgment passed by the Hon'ble Allahabad High Court in Rajesh Pal Vs. Chief Manager/Authorized Officer, Allahabad Bank Zonal Office, Kanpur Nagar and Another 2011 87 AIILR 728 decided on 11.04.2011.
Having heard the counsels for the parties and considering the material available on record, it is apparent that the Tribunal below has allowed the S. A. only on the ground that the term "ordinance 2002" was used in possession notice. It is worthwhile to note that before issuance of the possession notice, the demand notice was issued under section 13 (2) of the SARFAESI Act, 2002 on 15.07.2015 wherein, the SARFAESI Act, 2002 was clearly mentioned and there was no whisper of any term "ordinance". In possession notice dated 28.09.2015, the term "Ordinance" was typed mentioning as under:-
"The undersigned being the authorized officer of the BANK OF BARODA under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest (Second) Ordinance Act, 2002 (Ord. 3 of 2002) and in exercise of powers conferred under section 13(12) read with rule 9 of the Security Interest (Enforcement) Rules, 2002 issued a demand notice dated 22.07.2015....."
It is clear that the above reference was with regard to the Demand Notice issued on 22.07.2015 which was correctly issued under the Act of 2002. Thus, it goes to show that the term "ordinance" was inadvertently, typed because the term "Act" also finds place in the said possession notice. For the purpose of section 13 (4) again the term ordinance Act was used as "in exercise of powers conferred on him/her under section 13(4) of the said Ordinance Act read with rule 9 of the said rules on this 4th, Day of November, of the year 2015."
Thus, it cannot be said that the Act 2002 was not referred at all. Hence, the term "ordinance" appears to be a typographical error. The intention of the issuing authorities was to issue notice under section 13 (4) of the SARFAESI Act, 2002 and not under "ordinance, 2002".
The Hon'ble Supreme Court has laid down in M/s Shree Hari Chemicals Export Vs. Union of India & Anr (Supra) and T. Nagappa Vs. Y. R. Muralidhar (Supra) that even wrong mentioning of the provision does not vitiate the proceedings if it is preferable to known source of law. In recent judgment of M/s L & T Housing Finance Limited Vs. M/s Trishul Developers and Anr. (Supra), the Hon'ble Supreme Court has held that such type of technical irregularity of trivial nature are liable to be ignored unless it causes any substantial prejudice to the borrower.
In the instant case, the Demand Notice was issued under correct provisions. In the possession notice the term "ordinance" was used superfluously along with word "Act". Thus, no prejudice was caused to the borrowers by mentioning the term "ordinance". The principles laid down in the above judgments are squarely applicable in the present case. The Hon'ble Calcutta High Court in Dr. Sujit Kumar Roy Vs. Union of India & Ors. (Supra) has also held that the use of term "ordinance" was not fatal to the proceedings of the Bank.
I respectfully agree with the principles laid down in the judgment referred by the learned counsel for the respondents but those are distinguishable on the facts. In the judgment passed in the case of Sri Yarnala Leela Krishna Prasad and others Vs. Central Bank of India (Supra), the term "ordinance" was issued in the Demand Notice itself and at that time, the provision of section 13 (3A) for filing the representation by the borrower was not there under the ordinance whereas, it was amended in the year 2004. Thus, it was observed that the opportunity for filing of representation under section 13 (3A) was lost because of issuance of demand notice under the ordinance, 2002. Whereas, in the present case, the demand notice was properly issued and no right of the borrower was curtailed and no prejudice whatsoever was caused to the borrower.
In Rajesh Pal Vs. Chief Manager/Authorized Officer, Allahabad Bank Zonal Office, Kanpur Nagar and Another (Supra), on the basis of the judgment passed in United Bank of India Vs. Satyavati Tandon and others 2010 (8) SCC 110, the Hon'ble Allahabad High Court was pleased to dismiss the writ petition, relegating the petitioner to avail remedy of filing application under section 17 of the SARFAESI Act, 2002 before the DRT which is not the situation in present case.
In view of above, the Tribunal below has not considered the facts of the matter in right prospective. Therefore, the impugned order is liable to be quashed. Accordingly, the appeal is allowed. The impugned order is set aside. Consequently, the SA No. 693/2015 filed by the borrower stands dismissed. No orders as to costs.
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