P. Kameshwari vs State Bank Of India

Anil Kumar Srivastava, Chairperson

THE APPELLATE TRIBUNAL :

Instant appeal has been preferred against the order passed by the learned DRT – 1, Hyderabad dated 05.09.2019 in I.A. 3703 of 2018 arising out of O.A. 248 of 2015 filed by the respondent bank. Feeling aggrieved appellants have preferred this appeal.

As per pleadings of the parties respondent bank has filed O.A. 248 of 2015 on 02.03.2015 for adjudication of debt for a sum of Rs. 99,29,76,364.37 against the appellants amongst other reliefs. In the relief clause it is stated that the loan availed by the appellants were duly secured by hypothecation of plant and machinery and 25 immovable properties and shares. Aforesaid O.A. is still pending. Two interlocutory applications being Nos. I.A. 3702 of 2018 and 3703 of 2018 were filed by the respondent bank praying for injunction restraining the appellants from dealing with scheduled properties and seeking conditional attachment of the scheduled properties and deposit of security before the learned Tribunal. It was alleged that appellants are owners of six immovable properties and holders of shares. Secured properties are insufficient to meet the alleged dues of the bank. Appellants are trying to dispose of immovable properties. These applications were ultimately allowed by the learned DRT vide order dated 14.03.2019. Feeling aggrieved the Appeal Dy No. 79 of 2019 [P. Prabhakar Reddy & Ors Vs. State Bank of India & Anr.] was preferred before the DRAT Kolkata which was decided on 27.06.2019 setting aside the order dated 14.03.2019 and appellant was directed to produce relevant documents before the learned Tribunal. Learned Tribunal was directed to decide the application expeditiously.

In compliance of the order of DRAT Kolkata matter was taken up by the learned DRT and impugned order was passed wherein learned DRT has held that transfer of scheduled property no. 6 by the respondent no.4 is not a valid transfer as per the provision of Section 53 of the Transfer of Property Act, 1882. Further directed to respondent no. 2 to 4 to deposit sufficient security towards the O.A. claim before the learned DRT failing which properties described under petition schedule no. 1 and 6 shall be attached.

Learned counsel appearing for the appellants submits that impugned order is bad in law. It is submitted that the trust was created on 13.05.2013 and deed was executed. Property in dispute which is at schedule No.6 was not a secured asset. It is further submitted that there was no injunction against the appellants from alienating or transferring the property as described at schedule no.6. Appellant was at liberty to dispose of the same as per his wish and will. Further it is submitted that nothing is brought on record to show that it was a fraudulent transfer and was made to frustrate the loan recovery proceeding, as such Section 53 of the Transfer of Property Act, 1882 would not be applicable in this case.

Per contra, learned counsel for the respondent submits that transfer itself is violative of Section 53 of the Transfer of Property Act, 1882. Transfer was made in order to frustrate loan recovery proceeding. It is provided in the trust deed that it was created in favour of minor grand children, when they attain majority they would be able to transfer the property. Interest of the bank would be jeopardized if such transfer remains in force.

Having gone through the records and hearing the submissions made by the parties I am of the view that learned Tribunal has erred in passing the impugned order.

Admittedly, property described at schedule no.6 is not a secured asset. O.A. was filed in the year 2015. There was no injunction against the appellants restraining transferring or alienating the property in dispute. When the property was neither a secured asset nor any injunction was passed against the appellants restraining them to transfer the property, how can appellants be restrained from alienating or transferring the property in dispute applying the provisions of Section 53 of the Transfer of Property Act, 1882. Section

53 of the Transfer of Properties Act, 1882 provides that every transfer of immovable property made with intent to defeat or delay the creditors of the transferor shall be voidable at the option of any creditor so defeated or delayed. Hence, Section 53 would only be applicable if transfer is made with the intent to defeat or delay the creditors of the transferor. Further such transfer would be voidable at the option of the creditor. Learned Tribunal has recorded finding in the impugned order without giving any reasoning regarding applicability of the provision of the provision of Section 53 of the Transfer of Property Act, 1882. No reasoning is given as to how the transfer is fraudulent or it is made with the intent to defeat the interest of the creditors from realizing the loan amount. So far as jurisdiction of the Tribunal is concerned it has limited jurisdiction.

On the basis of discussion made above I am of the view that learned Tribunal has erred in recording finding and arriving at a conclusion that transfer is not valid u/s 53 of the Transfer of Property Act, 1882. Accordingly, the impugned order is liable to be set aside.

ORDER

Appeal is allowed. Order dated 05.09.2019 passed by the learned DRT-1, Hyderabad in I.A. 3703 of 2018 arising out of O.A. 248 of 2015 is set aside. No order as to costs.

File be consigned to record room.

Copy of the order be supplied to the appellants and the respondents and a copy be also forwarded to the concerned DRT.

Copy of the judgement/Final Order be uploaded in the Tribunal’s website.

Order dictated, signed and pronounced by me in the open Court on this the 16th day of November, 2022.