Attachment of agriculture land less than 5 acres in mp for recovery of loan for industry of the guar
Sanjay
(Querist) 12 December 2014
This query is : Resolved
Author : Sanjay
Posted 3 years ago
The owner of the agricultural land in Madhya pradesh is the guarantor of loans for industrial purposes.The agricultural land owned by the guarantor is also not mortgaged with the bank. The area of land is 4.5 acres and crops are being shown in the Khasra plan also. Sarafi act is not applicable as the decree is of 1992.DRT Jabalpur has initiated the orders for attachment of the said agricultural land due to non payment of dues.DRT has initiated sale proceeding against the guarantor and the recovery officer has published the ad in the newspaper. Petition filed in High Court. hearing pending. What should be the couse of action now.
ROHIT SHARMA
(Expert) 13 December 2014
1. During the hearing of the matter before the H.C. it can be mentioned that u/s 31 (i) of the SARFAESI Act, 2002 provision of such SARFAESI Act is not applicable to agricultural land which is pledged as a security and not mortgage - hence the D.R.T. cannot make such attachment suo motto that too when a decree has been awarded in 1992 restricting applicability of such SARFAESI Act, 2002.
2. If you feel and need to have further professional legal consultation on this issue, get my contact details by clicking my name shown in the L.H.S. margin of this reply format.
ajay sethi
(Expert) 13 December 2014
agree with MR sharma
malipeddi jaggarao
(Expert) 13 December 2014
SARFAESI ACT is not applicable to agricultural land. The land is not mortgaged. DRT cannot make any attachment. Bring these points before High Court.
Dr J C Vashista
(Expert) 14 December 2014
I agree with experts.
However, the decree passed in the year 1992 and being executed in the year 2014, how it is maintainable since it is barred by limitation, isn't it?
Dr J C Vashista
(Expert) 14 December 2014
@Sanjay,
You have posted this query 3 years ago, which is appearing now, is it?
T. Kalaiselvan, Advocate
(Expert) 15 December 2014
Rightly observed by expert Dr.Vashista that the author has posted the query three years ago but is seeking remedy to his crisis now. Since the matter is subjudice, wait for the court's outcome.
c.p.s. ramachary
(Expert) 15 December 2014
According to you the owner of the agricultural property is the guarantor in the loan transaction. The DRT Jabalpur might have passed order for a Recovery Certificate against the borrower and the the guarantor and forwarded it to the Recovery Officer for execution as per the provisions of the RDDB & FI Act 1993. Agricultural property is not exempted under the provisions of the RDDB & FI Act 1993. Therefore the Recovery Officer might have rightly attached the agricultural property. The queriest is under misconception that, the agricultural property is exempted under RDDB & FI Act. The querriest has not revealed all the facts as to what has transpired in the matter. The case before High Court is against the order of DRT or DRAT is not explained clearly. I do not think that the querriest has any tenable contest in the matter. The High Court may dismiss the case as alternative remedy is available to the qurriest in DRT / DRAT.
Sanjay
(Querist) 15 December 2014
Thanks Expert Mr. Ramachary. Appeal was filed before DRT and DRAT which were rejected. Now the writ is pending in the High Court.The agriculture property is of the guarantor which is also less than 5 acres and it was told to me that bank cannot sell any agriculture land which is less than 5 acres.The land in question is also not given as security to the bank. The DRT has attached the same when the bank was unable to recover even a penny from the borrower.
T. Kalaiselvan, Advocate
(Expert) 15 December 2014
Till the end you have not given reply to the expert Mr. Ramachary's observation. He has opined that the recovery officer has taken action under the provisions of RDDB and FI Act, 1993,is there any reply from the author to deny it? Wait for the outcome of the pending writ petition.
Biswanath Roy
(Expert) 16 December 2014
Why after filing petition in the High Court against the order of the DRT you are asking for what should be the cause of action? What cause of action you relied upon in your petition?
There are two legal questions arises partly relating to the order of DRT and partly relating to the liability of a guarantor for non payment of debts by the debtor.
In reply to the first question law never permits DRT to attach and sell the agricultural land by application of the provisions under SARFAESI ACT save and except following the provisions of RDDB and FI Act,1993 whereas, in reply to the question of determination of a guarantor's liability nature and charactor of the Guarantee Bond is to be looked into which is not disclosed here. A guarantor either guarantees payment or collection, depending on the words used. "Payment guaranteed" or equivalent words added to a signature mean the signor will pay the instrument if it is not paid when due without a need for the holder to resort to another party.Collection guaranteed means resort must first be had to others. Moreover guarantor of colectibility arises only when one who guarantees a debtor's solvency and is under a duty to pay only if the creditor is unable to collect from the principal debtor after exhausting all legal remedies including demand, suit, judgement and any supplementary proceedings.
