Given the above narration of facts, we are satisfied that the
action of the Bank touted as a “mistake”, was not a genuine
mistake but was a deliberate act which they have stood by even
after they were put to notice that they had illegally attached the
petitioner’s property. The respondents did not withdraw the
attachment even when the petitioner filed objection on 14th
September, 2015 against the order of attachment before the Debt
Recovery Tribunal, Lucknow. The petitioner attempted follow-up
with the detailed reminder dated 29th September, 2015 to the
Canara Bank as well as the Recovery Officer, Debt Recovery
Tribunal which was of no avail. Even the filing of this writ
petition on the 25th of October 2016 did not persuade the
respondent bank to seek cancellation of the attachment which was
informed by the petitioner as being completely wrongful. The
attachment was withdrawn only on 7th of March 2017 by the
Recovery Officer.
31. It is evident that if the petitioner had not agitated before the
Recovery Officer, the respondents may have very well proceeded
with the attachment and may have even sold the property pursuant
to the recovery certificate.
32. The act of attachment of the property is a serious matter.
This attachment was effected without taking the basic care and
effecting a title search. The attachment remained in force from 14th
September, 2015 to 7th March, 2017. Undoubtedly, the present
case is a fit case where the petitioner deserves to be compensated
for the wrongful act of the respondents and the harassment,
insecurity and the trauma which has been faced by 68 year old
petitioner for over one and a half years.
33. It would appear that the compensation amount at the rate of
Rs.15,000/- per month of the attachment i.e., from 14th September,
2015 to 7th March, 2017 (seventeen and half months) being a total
of Rs.2,62,500/- would be a reasonable compensation for the
petitioner.
34. We may note that the petitioner has been compelled to
contest the attachment in Lucknow and by filing the present writ
petition in this court. The petitioner is entitled to litigation costs as
well which are quantified at Rs.1,00,000/-.
IN THE HIGH COURT OF DELHI AT NEW DELHI
W.P.(C) 10210/2016 & CM No.40335/2016
Date of decision : 20th June, 2017
V.K. BHATNAGAR
v
CANARA BANK & ANR
CORAM:
HON'BLE THE ACTING CHIEF JUSTICE
HON'BLE MR. JUSTICE ANIL KUMAR CHAWLA
Dated:JUNE 20, 2017
1. The instant case reflects an extremely sorry state of affairs
with regard to the manner in which the Canara Bank has conducted
itself. We first set out the factual matrix, to the extent necessary,
and as is discernible from the documentation of the Canara Bankrespondent
no.1 before us.
2. This writ petition has been filed by V.K. Bhatnagar, s/o Dr.
Chander Bhan Bhatnagar a permanent resident of H-26/2, Sainik
Farm, Ward Deoli, Delhi-110062. The writ petitioner claims to be
the owner in possession of this sole residential property.
3. We note the essential facts giving rise to this writ petition
hereafter. A branch of the Canara Bank situated at 4, Sapru Marg,
Lucknow, U.P. appears to have extended financial facilities to the
following, either as principal debtors, or, as guarantors thereof :
(i) M/s Elcee Education Pvt. Ltd.
Registered Office at :
Chitrahar, 3, Naval Kishore Road,
Hazratganj, Lucknow, U.P.
(ii) Shri V.K. Bhatnagar
S/o Shri P.P. Bhatnagar
R/o 2/3, Vishwas Khand, Gomti Nagar
Lucknow, U.P.
(iii) Mrs. Urvashi Malik
W/o Shri S. Malik,
R/o 6D, Shrinagar Nagar,
Alambagh, Lucknow, U.P.
(iv) Mrs. Rekha Bhatnagar
W/o Shri V.K. Bhatnagar
R/o 2/3, Vishwas Khand, Gomti Nagar
Lucknow, U.P.
4. On account of default in payments by these persons with
regard to these facilities, proceedings by way of Original
Application No.2000 were initiated under the Recovery of Debts
Due to Banks and Financial Institutions Act, 1993 (‘the Act’
hereafter) by the Lucknow Branch of the Canara Bank at the Debt
Recovery Tribunal at Lucknow. The above four principal
debtors/guarantors were arrayed as debtors. In these proceedings,
in exercise of jurisdiction under sub-section 22 of Section 19 of the
said Act, a certificate dated 7th March, 2006 was issued ordering
that the applicant’s bank i.e. Canara Bank at its said branch at
Lucknow was entitled to recover Rs.12,00,099.48 together with
pendente lite and future interest @ 19.25% per annum with
quarterly rest from 19th January, 2000 till full realisation from the
debtors. The certificate also permitted the Bank that in case the
debt amount is not recovered from the sale of the “mortgaged and
hypothecated properties”, then the bank would be entitled to
recover the same “by selling the other personal assets/properties
of the debtor nos. 1 to 4”.
5. Having failed to recover the amount, it appears that the
respondent no.1 thereafter sought attachment of the property of the
judgment debtor no.2 i.e. the aforementioned Sh. V.K. Bhatnagar.
We extract hereunder the specification of the property which the
Canara Bank sought to be attached :
“SPECIFICATION OF UNCHARGED PROPERTY
Land & Building being Plot / House No.H-26/2, Single
Portion, Block – H, Plot No.26/2, Sainik Farm, Ward
– Deoli, Delhi, owned by Sri Vinod Kumar Bhatnagar,
the J.D.No.2”
6. Based on this representation of the respondent no.1 - Bank,
the Recovery Officer, DRT, Lucknow issued a warrant of
attachment dated 14th September, 2015 attaching the said property
towards recovery of the above debt of M/s Elcee Education Pvt.
Ltd. and the aforedetailed persons. This warrant of attachment was
executed by affixation at the said scheduled premises.
7. The petitioner has stated that apart from the affixation of the
attachment, the respondent no.1 effected proclamation and
announcement of the attachment using loudspeakers at the subject
property, to the utter consternation and humiliation of the petitioner
and his family who were occupying the said property. The
petitioner learnt of the said attachment from these actions on behalf
of the respondent No.1.
8. The petitioner was thereby compelled to file objections
against the order of attachment before the recovery officer of the
Debt Recovery Tribunal, Lucknow seeking vacation of the
attachment and informing him that he had no connection at all with
M/s Elcee Education Pvt. Ltd. and that he had no financial dealings
and had never been involved in any transactions with the Canara
Bank. The petitioner had declared that he had also no connection
with the said Sh. V.K. Bhatnagar who was the debtor to the
respondent-Bank.
9. In the objections, the petitioner disclosed the parentage and
full details. He also disclosed that the name of his father was
Dr.Chander Bhan Bhatnagar and that his wife's was Mrs. Komal
Bhatnagar. It was made clear that the petitioner had no connection
with the judgment debtor Mr. V.K. Bhatnagar who was son of
Sh.P.P. Bhatnagar and a resident of Gomti Nagar, Lucknow. The
appellant also pointed out that the judgment debtor was married to
Smt.Rekha Bhatnagar who was also JD No.IV.
10. Despite the said objections having admittedly been filed as
back as on 14th September, 2015, no reply thereto was being filed
by the Canara Bank to the utter dismay and difficulties of the
petitioner who was a senior citizen, a resident of Delhi and was
constrained to contest those proceedings in Lucknow from Delhi.
11. The petitioner additionally submitted a detailed
representation dated 29th September, 2015 to the Canara Bank
(respondent no.1 herein) as well as to the Recovery Officer, DRT,
Lucknow (respondent no.2 herein) seeking relief which was also of
no avail.
12. Completely harassed, the petitioner has as a result preferred
the present writ petition arraying the Canara Bank as the
respondent no.1 and the Recovery Officer, DRT Lucknow as
respondent no.2. It was pointed out that the respondent no.2 was
granting unwarranted adjournments to the Canara Bank without
any cogent and plausible explanation and that the petitioner was
being unfairly tormented due to the arbitrary actions of the
respondent. The present writ petition came to be filed on 25th
October, 2016 and seeks the following prayers :
“(i) issue an appropriate writ, order or direction in
the nature of certiorari quashing the order for
attachment dated 14.09.2015 passed by the Respondent
No.2 i.e. the Ld. Recovery Officer, DRT, Lucknow, U.P.
in DRC No.40 of 2006;
(ii) issue an appropriate writ, order or direction in
the nature of mandamus commanding the respondents
to release/discharge the petitioner’s subject property
being House No.H-26/2, Lane W-10, Western Avenue,
Sainik Farms, New Delhi-110062, from the purview of
the Recovery Proceedings in DRC No.40 of 2006, DRT,
Lucknow”
13. Before us, the petitioner has submitted that he is a senior
citizen of 68 years who has suffered unwarranted extreme tension
on account of this harassment. The petitioner has placed on record
details of the treatment which were necessitated and his hospital
admission in the Saket Citi Hospital from 20th January to 29th
February, 2016 during which period he had to be kept in the ICU
even. The discharge summary of the petitioner notes the following
serious ailments for which the petitioner was treated and thereafter
discharged :
“Hospital course (including initial examination) :
Patient was admitted to the hospital with above
mentioned complaints. He was drowsy, tachycardiac,
Tachypaeic at the time of admission for which he kept
in ICU. Patient initially kept on SIPAP and treated with
broad spectrum antibiotics. HRCT Thorax showed
dense bilateral pneumonia with pleural effusion.
Thereafter, after few days patient got incubated and
ventilated in view of prolonged. Respiratory failure
and acute drowsiness and kept on ventilator. Patient
was tracheostomized after 10 to 15 days of prolonged
ventilation and difficult weaning trails. Direct
laryngoscopy and bronchoscopy done for BAL while
patient was on ventilator and routine BAL reports
grows klebsiella pneumonia for which patient treated
with penam group of antibiotics and Colistin for two to
three weeks. 20 ECBO showed normal systolic
function, mild AS, mild PAH and small pericardial
effusion. Patient remained in ICU till the recovery of
acute illness and later on excubated and shifted to the
room after attainment of hemodynamically stable
condition. Patient discharged today with follows up
advise.”
(Emphasis by us)
14. It is the submission of the petitioner before us that the
trauma on account of the attachment of his residential property had
grossly aggravated the stress with which he was suffering
rendering his medical condition extremely fragile.
15. We find that the respondents have been represented before
this court right from the first date. On 31st January, 2017 while
issuing formal notice, in the present writ petition, this court had
observed as follows :
“... It is the case of the petitioner that the
petitioner has never borrowed any money from the
respondent bank nor ever guaranteed any payment to
the respondent bank. It is submitted that there has never
been any transaction between the petitioner and the
respondent bank. The only possible reason for
issuance of the impugned order of attachment is the
name of the petitioner, which is the same as the name
of the Judgment Debtor No.2 in the proceedings
before the Debt Recovery Tribunal, Lucknow.
It is true that the writ petition is directed against
an order issued by the Recovery Officer of the Debt
Recovery Tribunal, Lucknow, from outside the
jurisdiction of this Court. However, the fact remains
that the property sought to be attached is located in
Delhi, within the jurisdiction of this Court. A
substantial part of the cause of action has thus arisen
within the jurisdiction of this Court. If, as contended
by the petitioner, the petitioner has even not transacted
with the respondent bank, the petitioner cannot be
refused the relief and relegated to proceedings in Uttar
Pradesh, when the property under attachment is located
in Delhi within the jurisdiction of this Court.
In answer to the question asked by the Court to
learned counsel appearing on behalf of the
Respondent Bank, Counsel submitted that particulars
of the property had been furnished by the respondent
bank to the Recovery Officer of the concerned Debt
Recovery Tribunal, on the basis of some report of
some private investigating agency/detective agency.
Prima facie, the petitioner has disclosed materials to
show that the order of attachment is the result of
mistaken identity. Prima facie, the petitioner is a
resident of Delhi, whereas the concerned judgment
debtor is a resident of Lucknow. The copies of the
Voter’s Identity Cards and the Aadhar Cards of the
petitioner and his wife reveal that the petitioner’s
father’s name is Chander Bhan Bhatnagar, whereas
the concerned judgment debtor has been described as
the son of one P.P. Bhatnagar. It also appears that the
wife of the concerned judgment debtor, Rekha
Bhatnagar has been impleaded as Defendant No.4,
whereas the name of the petitioner’s wife is Kamal
Bhatnagar.”
(Emphasis supplied)
16. Our attention is drawn by learned counsel for the petitioner
to the counter affidavit which has been filed on behalf of the
Canara Bank (respondent no.1) on 10th April, 2017 wherein the
above narration of facts has been placed before us. So far as
attachment is concerned, the respondent no.1 has stated that its
prayer for attachment was premised on a report dated 4th May,
2017 received by it from M/s Bright Detective Agency who had
been appointed to ascertain the assets of Sh. V.K. Bhatnagar who
was the son of Sh. P.P. Bhatnagar. It is stated that the respondent
no.1 had submitted to the Recovery Officer, DRT, Lucknow that
the house No. H-26/2, Sainik Farms, Ward-Deoli, Delhi belonged
to Sh. V.K. Bhatnagar S/o Sh. P.P. Bhatnagar on the basis of this
report.
17. We are absolutely appalled at the manner in which the
respondent no.1 has proceeded in the matter. Even before us, the
engagement of the private detective agency is being propounded as
if this was ipso facto proof that the bank had taken sufficient care
to ascertain the assets of its debtor or effected due diligence
thereof. It is inconceivable as to how a financial institution could
rely on a bald statement contained in a report without seeking
copies of the title documents. Mere inspection of the records of the
Registrar of Documents (freely available to the public) or the
Municipal Authorities could have enabled verification of the
correct ownership of the said property. These basic steps were
admittedly not undertaken by the Canara Bank.
18. Bare perusal of the inspection of the title documents would
have also disclosed parentage of the petitioner and would have
established that the petitioner was not the 'V.K. Bhatnagar' who
was owing money to the respondent no.1-Bank.
19. This is certainly a serious matter where the residential
property of a senior citizen has been attached. Not only was the
owner of the property which was attached a senior citizen, but he
appears to have been ailing with serious medical ailments as well.
The action of attachment of its property has had extremely drastic
consequences. It is providential that despite his fragile health, he
has been able to fight for his rights.
20. It was not as if the respondent-bank stopped at obtaining the
warrant of attachment or its pasting at the premises. The petitioner
has informed that the same was followed up by declaration of the
proclamation and announcement of the attachment by use of
loudspeaker in the colony. The petitioner and his family must have
suffered extreme mortification and loss of face in the community.
21. Despite the petitioner having filed objections in September,
2015 itself and having made representations to the Canara Bank on
29th September, 2015, no effort has been admittedly made by the
bank, which has huge resources at its command, to have
immediately ascertained the correct position regarding the
property.
22. It is obvious that having obtained the attachment, the bank
exhibited its position of supremacy in taking no action at all to give
some relief or succour to the distressed petitioner, which per se
would have caused extreme insecurity in the mind of the petitioner
as to what would be the possible fate and outcome of the objections
which he had been compelled several hundred miles away in the
city of Lucknow in the state of U.P. as well as the writ petition in
this court.
23. In para 11 of the counter affidavit dated 1st April, 2017, the
respondent No.1 - Bank has stated that it had appointed another
detective agency namely M/s Daredevils which submitted its report
only on 29th September, 2016 wherein it was confirmed that the
petitioner (Sh. V.K. Bhatnagar S/o Sh. Chander Bhan Bhatnagar)
and the judgment debtor no.2 (Sh. V.K. Bhatnagar S/o Sh. P.P.
Bhatnagar) in the proceedings before the Debt Recovery Tribunal,
Lucknow are two different persons who had no association with
each other.
24. The counter affidavit dated 1st April, 2017 further discloses
the callous disregard of the rights and trauma of the petitioner on
the part of the Canara Bank. Despite receipt of the report on 29th
September, 2016, we are informed in para 12 thereby that the
Canara Bank filed an application as late as on 7th March, 2017 for
withdrawal of the attachment order dated 16th September, 2015. It
was only when this application was filed by the Canara Bank that
the Recovery Officer has recorded an order of the same date which
has been also placed by the Canara Bank before us. Unfortunately,
the application which was filed by the Bank before the Recovery
Officer has not been placed before us. However, we deem it
appropriate to extract the order dated 7th March, 2017 which was
recorded by the Recovery Officer and reads as follows :
“Adv. Sh. S.K. Gupta BH of Sh. Vinay Shankar present
for CH Bank and filed application dated 07/03/2017 for
withdrawal of attachment order dated 14/09/2015 copy
whereof supplied to Adv. Sh. Gaurav Bhatnagar who
present on behalf of P.P.O. Sh. V.K. Bhatnagar Ld.
counsel of P.P.O. also filed an application dated
07/03/2017 for disposal of its objection copy whereof
supplied to the Ld. counsel of the CH Bank. CH Bank
in its application dated 07/03/2017 annexed affidavit
dated 07/03/2017 deposed by Alka Verma Mgr Law of
the CH Bank wherein it is admitted that the property
attached vide order dated 14/09/2015 is not concerned
to the JD No.-2 and hence attachment should be
withdrawn.
It is on the record that the CH Bank has filed and
supporting affidavit F-16 relying thereupon
undersigned attached the property vide order dated
14/09/2015 now admitting that was done by mistake.
In view of the above, property attached vide order
dated 14/09/2015 is hereby released. As an innocent
person PPO suffered due to wrong attachment, CH
Bank is directed publish the extract of this order that
the property attached vide order dated 14/09/2015 was
wrongly attached by mistake of facts provided by the
CH Bank and is duly released by the undersigned.
Further publication must contain clear specification of
property attached and also regret to the P.P.O. Ch
Bank is hereby warn to be cautious while filing any
affidavit before the undersigned otherwise it will attract
action as per law. List on 24/03/2017 by strict
compliance by the CH Bank.”
(Emphasis by us)
25. It would, therefore, appear that so far as the prayer made by
the petitioner for quashing of the order of attachment dated 14th
September, 2015 and consequential reliefs/discharge of the
property no. H-26/2, Sainik Farm, Ward-Deoli, Delhi from the
purview of the recovery proceedings in DRC No.40/2006 in the
Debt Recovery Tribunal, Lucknow is concerned, the same stands
satisfied. However, the petitioner has prayed for such further
orders as this court may deem fit and proper in the facts and
circumstances of the case.
26. It has been pointed out that the petitioner’s property has
remained attached from 14th September, 2015 to 7th March, 2017
despite the petitioner having brought all the correct and complete
facts regarding his ownership and occupation of the property to the
Bank in the month of September, 2015 itself. The petitioner’s
submission is that the action of the respondent - Bank and its
omissions were completely illegal and that extreme prejudice has
resulted to the petitioner by this wrongful act of attachment and
that he has been compelled to contest the litigation before the
Recovery Officer attached to the Debt Recovery Tribunal in
Lucknow as well as by way of the present writ petition which was
dragged and delayed by the respondent - Bank despite the filing of
the present writ petition as back as on 25th October, 2016.
27. Learned counsel for the petitioner points out that the action
of the respondents appears to be deliberate and malafide in as much
as they have diverted their entire energy into the attachment of the
present petitioner’s property and thereby avoided recovery of any
amount from the principal debtor and the real defaulters. As a
result of their mala fide and deliberate action, they have enabled
the real debtors to go scot free, thereby causing a huge public loss.
28. The counter affidavit states that in compliance of the order
dated 7th March, 2012 of the Recovery Officer, the Canara Bank
has caused a publication to be effected in the Financial Express
dated 19th March, 2017 wherein it is stated as follows :
“ Canara Bank
ARM Branch Vipin Khand, Gomti Nagar, Lucknow-
226010
PUBLIC NOTICE
It is submitted that property Land & Building
Plot/House No. H-26/2, Single Portion, Block-H, Plot
No. 26/2, Sainik Farm, Ward-Deoli, Delhi owned by
Shri V.K. Bhtnagar S/o Late Chander Bhan Bhatnagar
R/o H-26/2, Lane W-10, Western Avenue, Sainik Farm,
New Delhi-110062 was wrongly attached vide order
dated 14.09.2016 passed by Recovery Officer II, DRT,
Lucknow in DRC case No.40/06 Canara Bank Vs
ELCEE Education Pvt. Ltd. & Others which has been
released vide order dated 07.03.2017.
The CH Bank i.e. Canara Bank ARMB, Lucknow
regret for the aforesaid mistake which was not
intentional.”
29. This is little solace for somebody like the petitioner as noted
above. Would this tiny publication in a corner of the Financial
Express restore the petitioner’s loss of reputation and compensate
the petitioner’s loss of reputation and the humiliation which he
would have suffered by the pasting of the order of attachment, its
proclamation and its announcement using a loudspeaker-public
addressal mode?
30. Given the above narration of facts, we are satisfied that the
action of the Bank touted as a “mistake”, was not a genuine
mistake but was a deliberate act which they have stood by even
after they were put to notice that they had illegally attached the
petitioner’s property. The respondents did not withdraw the
attachment even when the petitioner filed objection on 14th
September, 2015 against the order of attachment before the Debt
Recovery Tribunal, Lucknow. The petitioner attempted follow-up
with the detailed reminder dated 29th September, 2015 to the
Canara Bank as well as the Recovery Officer, Debt Recovery
Tribunal which was of no avail. Even the filing of this writ
petition on the 25th of October 2016 did not persuade the
respondent bank to seek cancellation of the attachment which was
informed by the petitioner as being completely wrongful. The
attachment was withdrawn only on 7th of March 2017 by the
Recovery Officer.
31. It is evident that if the petitioner had not agitated before the
Recovery Officer, the respondents may have very well proceeded
with the attachment and may have even sold the property pursuant
to the recovery certificate.
32. The act of attachment of the property is a serious matter.
This attachment was effected without taking the basic care and
effecting a title search. The attachment remained in force from 14th
September, 2015 to 7th March, 2017. Undoubtedly, the present
case is a fit case where the petitioner deserves to be compensated
for the wrongful act of the respondents and the harassment,
insecurity and the trauma which has been faced by 68 year old
petitioner for over one and a half years.
33. It would appear that the compensation amount at the rate of
Rs.15,000/- per month of the attachment i.e., from 14th September,
2015 to 7th March, 2017 (seventeen and half months) being a total
of Rs.2,62,500/- would be a reasonable compensation for the
petitioner.
34. We may note that the petitioner has been compelled to
contest the attachment in Lucknow and by filing the present writ
petition in this court. The petitioner is entitled to litigation costs as
well which are quantified at Rs.1,00,000/-.
35. The above amounts in terms of para nos.33 and 34 of the
present judgment shall be paid by the respondents to the petitioner
within a period of four weeks from today.
36. The above narration of facts manifests utmost negligence on
the part of the officials of the bank in proceeding against the
property of the petitioner thereby permitting the debtors to go scot
free. Financial loss would have enured to the bank. The present
case is a fit case in which the bank undertakes an inquiry and fixes
responsibility for the failure of its employees in ascertaining assets
of the debtors as well as wrongly proceeding against the property
of the petitioner without a careful due diligence and without
conducting basic title research/inspection of property and
municipal records.
37. A further direction is therefore, issued to the Chairman,
Canara Bank to cause an inquiry to be conducted into the issues
noted herein to fix the responsibility for the wrongful and negligent
acts and omissions set out above and proceed in accordance with
law against the person(s) found culpable.
This writ petition and pending application are hereby
disposed of in the above terms.
ACTING CHIEF JUSTICE
ANIL KUMAR CHAWLA, J
JUNE 20, 2017
action of the Bank touted as a “mistake”, was not a genuine
mistake but was a deliberate act which they have stood by even
after they were put to notice that they had illegally attached the
petitioner’s property. The respondents did not withdraw the
attachment even when the petitioner filed objection on 14th
September, 2015 against the order of attachment before the Debt
Recovery Tribunal, Lucknow. The petitioner attempted follow-up
with the detailed reminder dated 29th September, 2015 to the
Canara Bank as well as the Recovery Officer, Debt Recovery
Tribunal which was of no avail. Even the filing of this writ
petition on the 25th of October 2016 did not persuade the
respondent bank to seek cancellation of the attachment which was
informed by the petitioner as being completely wrongful. The
attachment was withdrawn only on 7th of March 2017 by the
Recovery Officer.
31. It is evident that if the petitioner had not agitated before the
Recovery Officer, the respondents may have very well proceeded
with the attachment and may have even sold the property pursuant
to the recovery certificate.
32. The act of attachment of the property is a serious matter.
This attachment was effected without taking the basic care and
effecting a title search. The attachment remained in force from 14th
September, 2015 to 7th March, 2017. Undoubtedly, the present
case is a fit case where the petitioner deserves to be compensated
for the wrongful act of the respondents and the harassment,
insecurity and the trauma which has been faced by 68 year old
petitioner for over one and a half years.
33. It would appear that the compensation amount at the rate of
Rs.15,000/- per month of the attachment i.e., from 14th September,
2015 to 7th March, 2017 (seventeen and half months) being a total
of Rs.2,62,500/- would be a reasonable compensation for the
petitioner.
34. We may note that the petitioner has been compelled to
contest the attachment in Lucknow and by filing the present writ
petition in this court. The petitioner is entitled to litigation costs as
well which are quantified at Rs.1,00,000/-.
IN THE HIGH COURT OF DELHI AT NEW DELHI
W.P.(C) 10210/2016 & CM No.40335/2016
Date of decision : 20th June, 2017
V.K. BHATNAGAR
v
CANARA BANK & ANR
CORAM:
HON'BLE THE ACTING CHIEF JUSTICE
HON'BLE MR. JUSTICE ANIL KUMAR CHAWLA
Dated:JUNE 20, 2017
1. The instant case reflects an extremely sorry state of affairs
with regard to the manner in which the Canara Bank has conducted
itself. We first set out the factual matrix, to the extent necessary,
and as is discernible from the documentation of the Canara Bankrespondent
no.1 before us.
2. This writ petition has been filed by V.K. Bhatnagar, s/o Dr.
Chander Bhan Bhatnagar a permanent resident of H-26/2, Sainik
Farm, Ward Deoli, Delhi-110062. The writ petitioner claims to be
the owner in possession of this sole residential property.
3. We note the essential facts giving rise to this writ petition
hereafter. A branch of the Canara Bank situated at 4, Sapru Marg,
Lucknow, U.P. appears to have extended financial facilities to the
following, either as principal debtors, or, as guarantors thereof :
(i) M/s Elcee Education Pvt. Ltd.
Registered Office at :
Chitrahar, 3, Naval Kishore Road,
Hazratganj, Lucknow, U.P.
(ii) Shri V.K. Bhatnagar
S/o Shri P.P. Bhatnagar
R/o 2/3, Vishwas Khand, Gomti Nagar
Lucknow, U.P.
(iii) Mrs. Urvashi Malik
W/o Shri S. Malik,
R/o 6D, Shrinagar Nagar,
Alambagh, Lucknow, U.P.
(iv) Mrs. Rekha Bhatnagar
W/o Shri V.K. Bhatnagar
R/o 2/3, Vishwas Khand, Gomti Nagar
Lucknow, U.P.
4. On account of default in payments by these persons with
regard to these facilities, proceedings by way of Original
Application No.2000 were initiated under the Recovery of Debts
Due to Banks and Financial Institutions Act, 1993 (‘the Act’
hereafter) by the Lucknow Branch of the Canara Bank at the Debt
Recovery Tribunal at Lucknow. The above four principal
debtors/guarantors were arrayed as debtors. In these proceedings,
in exercise of jurisdiction under sub-section 22 of Section 19 of the
said Act, a certificate dated 7th March, 2006 was issued ordering
that the applicant’s bank i.e. Canara Bank at its said branch at
Lucknow was entitled to recover Rs.12,00,099.48 together with
pendente lite and future interest @ 19.25% per annum with
quarterly rest from 19th January, 2000 till full realisation from the
debtors. The certificate also permitted the Bank that in case the
debt amount is not recovered from the sale of the “mortgaged and
hypothecated properties”, then the bank would be entitled to
recover the same “by selling the other personal assets/properties
of the debtor nos. 1 to 4”.
5. Having failed to recover the amount, it appears that the
respondent no.1 thereafter sought attachment of the property of the
judgment debtor no.2 i.e. the aforementioned Sh. V.K. Bhatnagar.
We extract hereunder the specification of the property which the
Canara Bank sought to be attached :
“SPECIFICATION OF UNCHARGED PROPERTY
Land & Building being Plot / House No.H-26/2, Single
Portion, Block – H, Plot No.26/2, Sainik Farm, Ward
– Deoli, Delhi, owned by Sri Vinod Kumar Bhatnagar,
the J.D.No.2”
6. Based on this representation of the respondent no.1 - Bank,
the Recovery Officer, DRT, Lucknow issued a warrant of
attachment dated 14th September, 2015 attaching the said property
towards recovery of the above debt of M/s Elcee Education Pvt.
Ltd. and the aforedetailed persons. This warrant of attachment was
executed by affixation at the said scheduled premises.
7. The petitioner has stated that apart from the affixation of the
attachment, the respondent no.1 effected proclamation and
announcement of the attachment using loudspeakers at the subject
property, to the utter consternation and humiliation of the petitioner
and his family who were occupying the said property. The
petitioner learnt of the said attachment from these actions on behalf
of the respondent No.1.
8. The petitioner was thereby compelled to file objections
against the order of attachment before the recovery officer of the
Debt Recovery Tribunal, Lucknow seeking vacation of the
attachment and informing him that he had no connection at all with
M/s Elcee Education Pvt. Ltd. and that he had no financial dealings
and had never been involved in any transactions with the Canara
Bank. The petitioner had declared that he had also no connection
with the said Sh. V.K. Bhatnagar who was the debtor to the
respondent-Bank.
9. In the objections, the petitioner disclosed the parentage and
full details. He also disclosed that the name of his father was
Dr.Chander Bhan Bhatnagar and that his wife's was Mrs. Komal
Bhatnagar. It was made clear that the petitioner had no connection
with the judgment debtor Mr. V.K. Bhatnagar who was son of
Sh.P.P. Bhatnagar and a resident of Gomti Nagar, Lucknow. The
appellant also pointed out that the judgment debtor was married to
Smt.Rekha Bhatnagar who was also JD No.IV.
10. Despite the said objections having admittedly been filed as
back as on 14th September, 2015, no reply thereto was being filed
by the Canara Bank to the utter dismay and difficulties of the
petitioner who was a senior citizen, a resident of Delhi and was
constrained to contest those proceedings in Lucknow from Delhi.
11. The petitioner additionally submitted a detailed
representation dated 29th September, 2015 to the Canara Bank
(respondent no.1 herein) as well as to the Recovery Officer, DRT,
Lucknow (respondent no.2 herein) seeking relief which was also of
no avail.
12. Completely harassed, the petitioner has as a result preferred
the present writ petition arraying the Canara Bank as the
respondent no.1 and the Recovery Officer, DRT Lucknow as
respondent no.2. It was pointed out that the respondent no.2 was
granting unwarranted adjournments to the Canara Bank without
any cogent and plausible explanation and that the petitioner was
being unfairly tormented due to the arbitrary actions of the
respondent. The present writ petition came to be filed on 25th
October, 2016 and seeks the following prayers :
“(i) issue an appropriate writ, order or direction in
the nature of certiorari quashing the order for
attachment dated 14.09.2015 passed by the Respondent
No.2 i.e. the Ld. Recovery Officer, DRT, Lucknow, U.P.
in DRC No.40 of 2006;
(ii) issue an appropriate writ, order or direction in
the nature of mandamus commanding the respondents
to release/discharge the petitioner’s subject property
being House No.H-26/2, Lane W-10, Western Avenue,
Sainik Farms, New Delhi-110062, from the purview of
the Recovery Proceedings in DRC No.40 of 2006, DRT,
Lucknow”
13. Before us, the petitioner has submitted that he is a senior
citizen of 68 years who has suffered unwarranted extreme tension
on account of this harassment. The petitioner has placed on record
details of the treatment which were necessitated and his hospital
admission in the Saket Citi Hospital from 20th January to 29th
February, 2016 during which period he had to be kept in the ICU
even. The discharge summary of the petitioner notes the following
serious ailments for which the petitioner was treated and thereafter
discharged :
“Hospital course (including initial examination) :
Patient was admitted to the hospital with above
mentioned complaints. He was drowsy, tachycardiac,
Tachypaeic at the time of admission for which he kept
in ICU. Patient initially kept on SIPAP and treated with
broad spectrum antibiotics. HRCT Thorax showed
dense bilateral pneumonia with pleural effusion.
Thereafter, after few days patient got incubated and
ventilated in view of prolonged. Respiratory failure
and acute drowsiness and kept on ventilator. Patient
was tracheostomized after 10 to 15 days of prolonged
ventilation and difficult weaning trails. Direct
laryngoscopy and bronchoscopy done for BAL while
patient was on ventilator and routine BAL reports
grows klebsiella pneumonia for which patient treated
with penam group of antibiotics and Colistin for two to
three weeks. 20 ECBO showed normal systolic
function, mild AS, mild PAH and small pericardial
effusion. Patient remained in ICU till the recovery of
acute illness and later on excubated and shifted to the
room after attainment of hemodynamically stable
condition. Patient discharged today with follows up
advise.”
(Emphasis by us)
14. It is the submission of the petitioner before us that the
trauma on account of the attachment of his residential property had
grossly aggravated the stress with which he was suffering
rendering his medical condition extremely fragile.
15. We find that the respondents have been represented before
this court right from the first date. On 31st January, 2017 while
issuing formal notice, in the present writ petition, this court had
observed as follows :
“... It is the case of the petitioner that the
petitioner has never borrowed any money from the
respondent bank nor ever guaranteed any payment to
the respondent bank. It is submitted that there has never
been any transaction between the petitioner and the
respondent bank. The only possible reason for
issuance of the impugned order of attachment is the
name of the petitioner, which is the same as the name
of the Judgment Debtor No.2 in the proceedings
before the Debt Recovery Tribunal, Lucknow.
It is true that the writ petition is directed against
an order issued by the Recovery Officer of the Debt
Recovery Tribunal, Lucknow, from outside the
jurisdiction of this Court. However, the fact remains
that the property sought to be attached is located in
Delhi, within the jurisdiction of this Court. A
substantial part of the cause of action has thus arisen
within the jurisdiction of this Court. If, as contended
by the petitioner, the petitioner has even not transacted
with the respondent bank, the petitioner cannot be
refused the relief and relegated to proceedings in Uttar
Pradesh, when the property under attachment is located
in Delhi within the jurisdiction of this Court.
In answer to the question asked by the Court to
learned counsel appearing on behalf of the
Respondent Bank, Counsel submitted that particulars
of the property had been furnished by the respondent
bank to the Recovery Officer of the concerned Debt
Recovery Tribunal, on the basis of some report of
some private investigating agency/detective agency.
Prima facie, the petitioner has disclosed materials to
show that the order of attachment is the result of
mistaken identity. Prima facie, the petitioner is a
resident of Delhi, whereas the concerned judgment
debtor is a resident of Lucknow. The copies of the
Voter’s Identity Cards and the Aadhar Cards of the
petitioner and his wife reveal that the petitioner’s
father’s name is Chander Bhan Bhatnagar, whereas
the concerned judgment debtor has been described as
the son of one P.P. Bhatnagar. It also appears that the
wife of the concerned judgment debtor, Rekha
Bhatnagar has been impleaded as Defendant No.4,
whereas the name of the petitioner’s wife is Kamal
Bhatnagar.”
(Emphasis supplied)
16. Our attention is drawn by learned counsel for the petitioner
to the counter affidavit which has been filed on behalf of the
Canara Bank (respondent no.1) on 10th April, 2017 wherein the
above narration of facts has been placed before us. So far as
attachment is concerned, the respondent no.1 has stated that its
prayer for attachment was premised on a report dated 4th May,
2017 received by it from M/s Bright Detective Agency who had
been appointed to ascertain the assets of Sh. V.K. Bhatnagar who
was the son of Sh. P.P. Bhatnagar. It is stated that the respondent
no.1 had submitted to the Recovery Officer, DRT, Lucknow that
the house No. H-26/2, Sainik Farms, Ward-Deoli, Delhi belonged
to Sh. V.K. Bhatnagar S/o Sh. P.P. Bhatnagar on the basis of this
report.
17. We are absolutely appalled at the manner in which the
respondent no.1 has proceeded in the matter. Even before us, the
engagement of the private detective agency is being propounded as
if this was ipso facto proof that the bank had taken sufficient care
to ascertain the assets of its debtor or effected due diligence
thereof. It is inconceivable as to how a financial institution could
rely on a bald statement contained in a report without seeking
copies of the title documents. Mere inspection of the records of the
Registrar of Documents (freely available to the public) or the
Municipal Authorities could have enabled verification of the
correct ownership of the said property. These basic steps were
admittedly not undertaken by the Canara Bank.
18. Bare perusal of the inspection of the title documents would
have also disclosed parentage of the petitioner and would have
established that the petitioner was not the 'V.K. Bhatnagar' who
was owing money to the respondent no.1-Bank.
19. This is certainly a serious matter where the residential
property of a senior citizen has been attached. Not only was the
owner of the property which was attached a senior citizen, but he
appears to have been ailing with serious medical ailments as well.
The action of attachment of its property has had extremely drastic
consequences. It is providential that despite his fragile health, he
has been able to fight for his rights.
20. It was not as if the respondent-bank stopped at obtaining the
warrant of attachment or its pasting at the premises. The petitioner
has informed that the same was followed up by declaration of the
proclamation and announcement of the attachment by use of
loudspeaker in the colony. The petitioner and his family must have
suffered extreme mortification and loss of face in the community.
21. Despite the petitioner having filed objections in September,
2015 itself and having made representations to the Canara Bank on
29th September, 2015, no effort has been admittedly made by the
bank, which has huge resources at its command, to have
immediately ascertained the correct position regarding the
property.
22. It is obvious that having obtained the attachment, the bank
exhibited its position of supremacy in taking no action at all to give
some relief or succour to the distressed petitioner, which per se
would have caused extreme insecurity in the mind of the petitioner
as to what would be the possible fate and outcome of the objections
which he had been compelled several hundred miles away in the
city of Lucknow in the state of U.P. as well as the writ petition in
this court.
23. In para 11 of the counter affidavit dated 1st April, 2017, the
respondent No.1 - Bank has stated that it had appointed another
detective agency namely M/s Daredevils which submitted its report
only on 29th September, 2016 wherein it was confirmed that the
petitioner (Sh. V.K. Bhatnagar S/o Sh. Chander Bhan Bhatnagar)
and the judgment debtor no.2 (Sh. V.K. Bhatnagar S/o Sh. P.P.
Bhatnagar) in the proceedings before the Debt Recovery Tribunal,
Lucknow are two different persons who had no association with
each other.
24. The counter affidavit dated 1st April, 2017 further discloses
the callous disregard of the rights and trauma of the petitioner on
the part of the Canara Bank. Despite receipt of the report on 29th
September, 2016, we are informed in para 12 thereby that the
Canara Bank filed an application as late as on 7th March, 2017 for
withdrawal of the attachment order dated 16th September, 2015. It
was only when this application was filed by the Canara Bank that
the Recovery Officer has recorded an order of the same date which
has been also placed by the Canara Bank before us. Unfortunately,
the application which was filed by the Bank before the Recovery
Officer has not been placed before us. However, we deem it
appropriate to extract the order dated 7th March, 2017 which was
recorded by the Recovery Officer and reads as follows :
“Adv. Sh. S.K. Gupta BH of Sh. Vinay Shankar present
for CH Bank and filed application dated 07/03/2017 for
withdrawal of attachment order dated 14/09/2015 copy
whereof supplied to Adv. Sh. Gaurav Bhatnagar who
present on behalf of P.P.O. Sh. V.K. Bhatnagar Ld.
counsel of P.P.O. also filed an application dated
07/03/2017 for disposal of its objection copy whereof
supplied to the Ld. counsel of the CH Bank. CH Bank
in its application dated 07/03/2017 annexed affidavit
dated 07/03/2017 deposed by Alka Verma Mgr Law of
the CH Bank wherein it is admitted that the property
attached vide order dated 14/09/2015 is not concerned
to the JD No.-2 and hence attachment should be
withdrawn.
It is on the record that the CH Bank has filed and
supporting affidavit F-16 relying thereupon
undersigned attached the property vide order dated
14/09/2015 now admitting that was done by mistake.
In view of the above, property attached vide order
dated 14/09/2015 is hereby released. As an innocent
person PPO suffered due to wrong attachment, CH
Bank is directed publish the extract of this order that
the property attached vide order dated 14/09/2015 was
wrongly attached by mistake of facts provided by the
CH Bank and is duly released by the undersigned.
Further publication must contain clear specification of
property attached and also regret to the P.P.O. Ch
Bank is hereby warn to be cautious while filing any
affidavit before the undersigned otherwise it will attract
action as per law. List on 24/03/2017 by strict
compliance by the CH Bank.”
(Emphasis by us)
25. It would, therefore, appear that so far as the prayer made by
the petitioner for quashing of the order of attachment dated 14th
September, 2015 and consequential reliefs/discharge of the
property no. H-26/2, Sainik Farm, Ward-Deoli, Delhi from the
purview of the recovery proceedings in DRC No.40/2006 in the
Debt Recovery Tribunal, Lucknow is concerned, the same stands
satisfied. However, the petitioner has prayed for such further
orders as this court may deem fit and proper in the facts and
circumstances of the case.
26. It has been pointed out that the petitioner’s property has
remained attached from 14th September, 2015 to 7th March, 2017
despite the petitioner having brought all the correct and complete
facts regarding his ownership and occupation of the property to the
Bank in the month of September, 2015 itself. The petitioner’s
submission is that the action of the respondent - Bank and its
omissions were completely illegal and that extreme prejudice has
resulted to the petitioner by this wrongful act of attachment and
that he has been compelled to contest the litigation before the
Recovery Officer attached to the Debt Recovery Tribunal in
Lucknow as well as by way of the present writ petition which was
dragged and delayed by the respondent - Bank despite the filing of
the present writ petition as back as on 25th October, 2016.
27. Learned counsel for the petitioner points out that the action
of the respondents appears to be deliberate and malafide in as much
as they have diverted their entire energy into the attachment of the
present petitioner’s property and thereby avoided recovery of any
amount from the principal debtor and the real defaulters. As a
result of their mala fide and deliberate action, they have enabled
the real debtors to go scot free, thereby causing a huge public loss.
28. The counter affidavit states that in compliance of the order
dated 7th March, 2012 of the Recovery Officer, the Canara Bank
has caused a publication to be effected in the Financial Express
dated 19th March, 2017 wherein it is stated as follows :
“ Canara Bank
ARM Branch Vipin Khand, Gomti Nagar, Lucknow-
226010
PUBLIC NOTICE
It is submitted that property Land & Building
Plot/House No. H-26/2, Single Portion, Block-H, Plot
No. 26/2, Sainik Farm, Ward-Deoli, Delhi owned by
Shri V.K. Bhtnagar S/o Late Chander Bhan Bhatnagar
R/o H-26/2, Lane W-10, Western Avenue, Sainik Farm,
New Delhi-110062 was wrongly attached vide order
dated 14.09.2016 passed by Recovery Officer II, DRT,
Lucknow in DRC case No.40/06 Canara Bank Vs
ELCEE Education Pvt. Ltd. & Others which has been
released vide order dated 07.03.2017.
The CH Bank i.e. Canara Bank ARMB, Lucknow
regret for the aforesaid mistake which was not
intentional.”
29. This is little solace for somebody like the petitioner as noted
above. Would this tiny publication in a corner of the Financial
Express restore the petitioner’s loss of reputation and compensate
the petitioner’s loss of reputation and the humiliation which he
would have suffered by the pasting of the order of attachment, its
proclamation and its announcement using a loudspeaker-public
addressal mode?
30. Given the above narration of facts, we are satisfied that the
action of the Bank touted as a “mistake”, was not a genuine
mistake but was a deliberate act which they have stood by even
after they were put to notice that they had illegally attached the
petitioner’s property. The respondents did not withdraw the
attachment even when the petitioner filed objection on 14th
September, 2015 against the order of attachment before the Debt
Recovery Tribunal, Lucknow. The petitioner attempted follow-up
with the detailed reminder dated 29th September, 2015 to the
Canara Bank as well as the Recovery Officer, Debt Recovery
Tribunal which was of no avail. Even the filing of this writ
petition on the 25th of October 2016 did not persuade the
respondent bank to seek cancellation of the attachment which was
informed by the petitioner as being completely wrongful. The
attachment was withdrawn only on 7th of March 2017 by the
Recovery Officer.
31. It is evident that if the petitioner had not agitated before the
Recovery Officer, the respondents may have very well proceeded
with the attachment and may have even sold the property pursuant
to the recovery certificate.
32. The act of attachment of the property is a serious matter.
This attachment was effected without taking the basic care and
effecting a title search. The attachment remained in force from 14th
September, 2015 to 7th March, 2017. Undoubtedly, the present
case is a fit case where the petitioner deserves to be compensated
for the wrongful act of the respondents and the harassment,
insecurity and the trauma which has been faced by 68 year old
petitioner for over one and a half years.
33. It would appear that the compensation amount at the rate of
Rs.15,000/- per month of the attachment i.e., from 14th September,
2015 to 7th March, 2017 (seventeen and half months) being a total
of Rs.2,62,500/- would be a reasonable compensation for the
petitioner.
34. We may note that the petitioner has been compelled to
contest the attachment in Lucknow and by filing the present writ
petition in this court. The petitioner is entitled to litigation costs as
well which are quantified at Rs.1,00,000/-.
35. The above amounts in terms of para nos.33 and 34 of the
present judgment shall be paid by the respondents to the petitioner
within a period of four weeks from today.
36. The above narration of facts manifests utmost negligence on
the part of the officials of the bank in proceeding against the
property of the petitioner thereby permitting the debtors to go scot
free. Financial loss would have enured to the bank. The present
case is a fit case in which the bank undertakes an inquiry and fixes
responsibility for the failure of its employees in ascertaining assets
of the debtors as well as wrongly proceeding against the property
of the petitioner without a careful due diligence and without
conducting basic title research/inspection of property and
municipal records.
37. A further direction is therefore, issued to the Chairman,
Canara Bank to cause an inquiry to be conducted into the issues
noted herein to fix the responsibility for the wrongful and negligent
acts and omissions set out above and proceed in accordance with
law against the person(s) found culpable.
This writ petition and pending application are hereby
disposed of in the above terms.
ACTING CHIEF JUSTICE
ANIL KUMAR CHAWLA, J
JUNE 20, 2017
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