S N GANAPATHY vs The RECOVERY OFFICER DRT MADURAI on 1 April 2026

O R D E R

1. This Appeal has been filed u/s. 30(1) of the Recovery of Debts and Bankruptcy Act 1993 by the Appellant praying that this Hon'ble Tribunal may be pleased to quash the order passed in M.A.200 of 2023 in R.P.No.43/2007 in T.R.C.No.28/2003 dated 20.02.2024.

2. The brief averments of the Application filed by the Appellantt are as follows:-

The appellant submitted that the impugned order dated 20.02.2024 passed by 1st respondent is exfacie illegal and liable to be set aside by this Hon’ble Tribunal.

It is further submitted that the 1st respondent ought to have seen that as admitted by the 3rd respondent herein, the properties of Mr. Dharmalinga Mudaliar alone was attached and the sale certificate was issued to the 3rd respondent herein in respect of Door No. 148, 149 alone. The Door No. 148, 149 is corresponding to Old Door No. 63H/9, 630/9. In the sale certificate, Old Door was wrongly shown as 63T, instead of 63H/9, 63O/9. The four boundaries were also wrongly mentioned in the sale certificate.

Further it is submitted that 1st respondent ought to have seen that Rule 39 of the Income-tax (Certificate Proceedings) Rules, 1962 deals with the delivery of immovable property in occupation of defaulter or of some person on his behalf or of some person claiming under a title created by the defaulter subsequent to the attachment of the property. The appellant is neither a borrower nor a guarantor and he has no nexus with the loan availed by the 4th respondent. Further, the appellant’s property had not been mortgaged to the 2nd respondent. Hence the 1st respondent has no jurisdiction to pass the present impugned order to evict the appellant from his dwelling house.

It is also submitted that the 1st respondent ought to have seen that as per rule 43 of the ITCP Rules, Where the Tax Recovery Officer is satisfied that the resistance or obstruction was occasioned by any person (other than the defaulter) claiming in good faith to be in possession of the property on his own account or on account of some person other than the defaulter, the Tax Recovery Officer shall make an order dismissing the application. Hence the 1st respondent ought to have passed orders on the appellant’s application, before passing the impugned order. Whereas, the 1st respondent has returned the appellant’s application as not maintainable.

It is also submitted that the 1st respondent ought to have seen that the Division Bench of the Hon’ble Madras High Court in A. Stephen Samuel vs The Union Of India reported 2003 (3) CTC 95 has held that ITCP Rules largely correspond to the relevant Rules occurring under Order 21 of the Code of civil Procedure relating to the execution of a decree. Rule 39 of the ITCP Rules corresponds to Order 21 Rule 95

C.P.C. which deals with the delivery of possession in occupancy of judgment debtor and Rule 40 of the ITCP Rules corresponds to Order 21 Rule 96 C.P.C.

It is also submitted that the 1st respondent ought to have seen that the Hon’ble Apex Court in BRAHMDEO CHAUDHARY v. RISHIKESH PRASAD JAISWAL has held that it should not be insisted that possession be delivered first and the objector may later on move the court under Order 21 Rule 99, C.P.C. Hence the 1st respondent ought to have heard the appellant’s objection, before passing the impugned order.

It is also submitted that the 1st respondent ought to have seen that as per the partition deed dated 01.12.1960, Old Door No. 63T had been allotted to the appellant’s father Mr. N.K.S. Nataraja Mudaliar’s share. The 3rd respondent herein has no right over the property allotted to the appellant’s father. It is also submitted that 1st respondent ought to have seen that the 3rd respondent failed to state the terms of settlement which is recorded in the order dated 18.08.2016 in M.P. No. 1 of 2009 in W.A.S.R. No. 6753 of 2009.

Further it is submitted that 1st respondent ought to have seen that except the western side pathway comprised in Survey No. 264/2; Present T.S. No. 4, there is no alternative pathway to approach the appellant’s house in Door No. 155 (New Door No. 26). Hence the 3rd respondent has intended to block the pathway of the appellant’s residence and grab the appellant’s property. It is further submitted that the 1st respondent ought to have seen that by fabricating the Door Numbers as Door No. 25, 26 and forging the four boundaries, the 3rd respondent is attempting to take possession of the appellant’s property. In the petition in Crl.O.P(MD)No. 15062 of 2020, the 3rd respondent herein had averred about the decree in O.S. No. 165 of 2017 dated 06.12.2019. Even then, the 3rd respondent had suppressed the civil court decree passed against him in O.S. No. 165 of 2017 dated 06.12.2019, before the 1st respondent.

4. On the other hand the 2nd Defendant submitted that the 4th respondent herein had availed various credit facility and they had failed to repay the same. The 2nd respondent bank had initiated recovery proceedings and filed O.A 467 of 2001 before DRT – 2 Chennai and DRC No 28 of 2003 was issued by the tribunal and the subject property was put for public auction by the Tribunal. Further the 3rd respondent herein had purchased the property and Sale certificate was issued in the name of the petitioner and sale certificate was also registered in favour of him in Doc No. 95 of 2006. It is also submitted that 3rd respondent had filed W.P (MD) No. 11191 of 2008 before Madras High Court Madurai Bench seeking possession of the property and the same was allowed and as per the directions of the High court this Tribunal had appointed advocate commissioner for taking physical possession of the property sold to the petitioner. The advocate commissioner had failed to take the physical possession of the entire extent and only a part of the property was handed over to the petitioner. The commissioner had also filed a report before the tribunal. And another advocate commissioner was appointed by the 1st respondent by order dated 20.02.2024 to take physical possession of the remaining property. It is further submitted that there was certain dispute between the petitioner and the occupier of the premises, 3rd respondent and several round of litigation before High court was made among them where bank is not a party to those proceedings. The present applicant is not a party to the proceedings in M.A 200 of 2023, T.A No. 55 of 2007, O.A.No. 467 of 2001. The present appeal filed by the appellant is not maintainable. It is also submitted that the subject mentioned property is the secured asset of the bank. The 4th defendant is a defaulter and bank had initiated proceedings to recover the loan outstanding. The 3rd respondent is the auction purchaser and the 1st respondent had conducted the sale. The bank had sold the secured asset by following the procedures to the 3rd respondent. The order in O.A 467 of 2001 was passed by DRT Chennai and the appellant is aware of the proceedings. They had not made any attempt to challenge those proceedings and subject mentioned property is the secured asset of the bank. The 4th defendant is a defaulter and bank had initiated proceedings to recover the loan outstanding. It is collusive attempt of the family members to defray the interest of the bank.

5. On the other hand the 3rd respondent submitted that being the successful bidder in the public auction conducted by the DRT-II, Chennai dated 18.11.2005. The debt recovery Certificate was issued with reference to 19 properties of the 4th respondent herein. All the 19 properties were attached by the recovery officer of DRT No. 2, Chennai and based on that the properties were brought for public auction by issuing sale notice by the said recovery officer, DRT II, Chennai. The present subject matter of the property is the 10th property in the said Debt Recovery Certificate. The sale certificate was issued in his name with reference to the above 10th of the property. The said Sale certificate was registered with the SRO, Sankarankoil vide Doc No. 95 of 2006 dated 19.01.2006. Since the physical possession was not handed over to 3rd respondent. Further submitted that he filed a writ petition with a prayer for writ of mandamus directing the first respondent to handover the actual possession of the land and building to the petitioner bearing new Door No. 148 and 149 (Old Door No. 63T) old ward No. 9, New Ward No. 2, in the 8th main road, Sankarankoil Town, comprised in Natham S No. 264/2 measuring East to West 110 feet, north to south 57 ¾ feet, bounded on the North by District board land, south by Dharmalingam Mudaliar Factory common wall, east by Jinning Factory building common wall west by property belonging to Nataraja Mudaliar situate within the Sub Registrar Jurisdiction of Sankarankoil and in the registration District of Tenkasi as described in sale certificate No. 6/06 dated 02.01.2006 vide the representation of the petitioner dated 15.10.2008 consequently by directing the third respondent to give sufficient police protection at the time of proceedings of the first respondent and for other relieves and the High court passed the the following order: “4. At this juncture, my considered opinion is that as per section 14 of the said Act, it is the duty of the secured creditor as well as the Recovery Officer, to one that the purchaser is put in effective possession of the premises concerned and if there is failure, the Debts Recovery Tribunal on being approached, should take steps to see that the purchaser is enjoying the property peacefully. But in this case, it has not been done so. As such, I make it clear that (i) Indian Overseas Bank, Sankarankoil,

(ii) Recovery Officer concerned, shall see that Section 14 of the said Act is fully invoked for making the petitioner to enjoy the property

purchased by him. It is further directed that the Debts Recovery Tribunal also shall intervene in the matter and see that the petitioner’s grievance is redressed within a period of one month from the date of receipt of a copy of this order.” It is also submitted that the said order was properly communicated to the 1st respondent and in obedience of the said order, one Mr. D. Saravanan, Advocate was appointed as Advocate Commissioner to take physical possession of the subject matter of the property and handed over to the same. In execution of the said order, the said advocate commissioner had taken half of the property and handed over. The remaining property was occupied by a tenant and the said tenant took time for vacating the premises. Hence the said Advocate commissioner abandoned his commission work and the remaining property was not taken possession and handed over to 3rd respondent. Further he filed a petition for the appointment of advocate commissioner for taking physical possession of the remaining property in MA No. 200 of 2023. The 1st respondent by an order dated 20.02.2024, appointed one advocate Mr. S. Sukumar who is the junior to the earlier advocate commissioner Mr. D. Saravanan for taking physical possession of the remaining property. As per the orders of the Hon’ble High Court, Madurai Bench, the 1st respondent taken partial steps to comply the orders of the Hon’ble High Court and abandoned to comply the remaining. Pending the above, the Inspector General of Police, Madurai illegally directed the Superintendent of Police, Tenkasi through the Inspector of Police, Sankarankoil PS to grab the entire property from 3rd Respondent as well as his power agent Mr. Karunakaran. Based on the illegal direction of the IG of Police, the Superintendent of Police and the Inspector of Police, Sankarankoil PS had registered a criminal case against 3rd Respondent and 3rd Respondent power agent in FIR in Crime No. 754 of 2020 dated 17.12.2020. The Additional Superintendent of Police, Tenkasi while enquiring the power agent Mr. Karunakaran, informed that the IG of Police alone is interested in the above property and on his direction alone, the above said false criminal case was registered. If such criminal case is really wanted to be registered, it should be registered only against the 1st respondent, the Recovery Officer of Chennai and the Indian Overseas Bank, Sankarankoil Branch.

Further it is submitted that since the application made by the IOB, Sankarankoil for recovery of amount from Anusooya Cotton Mills based on the mortgage created by the Anusooya Cotton Mill. The Recovery Officer, Chennai after making debt recovery certificate against the said M/s Anusooya Cotton Mills, passed an order to attach all the properties of M/s Anusooya Cotton Mills including the present subject matter of the property through an order dated 28.11.2003. After the above attachment order, a public auction was held and he become the successful bidder and purchased the subject matter of the property and the sale certificate dated 02.01.2006 was also issued in favour of 3rd Respondent name. It was properly registered with the SRO, Sankarankoil. Thus I become the absolute owner of the said property and the fraudulent claim of the appellant, S.N. Ganapathy based on the created and bogus documents are total abuse of process of law.

It is submitted that similarly the appellant had not taken any steps to set-aside the sale in my favour in the year 2006. Without setting aside the court auction sale, the present appeal is not at all maintainable. Moreover, the subject matter of the property is one of the property mortgaged by M/s Anusooya Cotton Mills and apart from that in the sale certificate issued by DRT II, Chennai, very much disclosed the unregistered partition deed dated 01.12.1960. Therefore the above unregistered partition deed mentioned properties are mortgaged with the bank and the same was rightly attached by the DRT II, Chennai and also sold through public auction. Therefore there is no infirmity in the mortgage as well as the sale conducted by the DRT II, Chennai. The above appeal is totally unwarranted which is not at all maintainable under any law and the same is liable to be dismissed in limine.

6. On the other hand, 4th respondent submitted that the property in Survey No. 264/2 and other properties originally belong to the 4th respondent's grandfather Mr. N.K.S. Subbiah Mudaliar. His sons namely 1) N.K.S. Dharmalinga Mudaliar (my father) 2) N.K.S. Nataraja Mudaliar (appellant's father), 3) N.K.S. Rajagopal Mudaliar vide unregistered partition deed dated 01.12.1960 had partitioned the above properties. As per the said partition deed, 1st schedule comprised of Old Door No. 63-A/9, 63-H/9, 63-O/9, 63-I/9 corresponding to New Door No. 148, 149, 150 had been allotted to the 4th respondent's father Mr. Late N.K.S. Dharmalinga Mudaliar. The 2nd schedule comprised of Old Door No. 63T/9, corresponding to Door No. 152, 152A, 125B, 152C

measuring east to west 110 feet, south to north 87 3/4 feet in east, south to north 92 3/4 feet in west and other properties measuring east to west 72 feet in northern side, east to west 81 feet southern side, south to north ½ feet had been allotted to the appellant’s father Mr. Late N.K.S. Nataraja Mudaliar’s share and after the demise of the 4th respondent’s father Mr. N.K.S. Dharmalinga Mudaliar, the 4th respondent and his brothers started a business in the name and style of M/s Anooshyal Cotton Mills and they availed loan from the 2nd respondent Bank by pledging the 1st schedule of properties in the partition deed dated 01.12.1960. Since they committed default in repayment, the 2nd respondent bank had filed O.A. No. 467 of 2001 before the DRT - II, Chennai and the same was allowed. It is submitted that the 1st schedule of partition deed (Door No. 148 & 149) alone had been pledged to the 2nd respondent bank which is evident from the valuation report issued by the approved valuer of the 2nd respondent dated 09.01.1998. The above property in Door No. 148 & 149 was brought for public auction by the Recovery Officer, DRT II, Chennai. The Old Door number, Measurement and Four boundaries of the Door No. 148 & 149 were wrongly mentioned in the sale certificate. Hence the 4th respondent gave a letter dated 12.04.2004 to 1st and 2nd respondent highlighting the error crept in the auction notice. Further it is submitted that on 18.11.2005, the Recovery Officer, DRT II, Chennai had conducted public auction and the 3rd respondent had purchased the property in Door No. 148, 149, (Old Door No. 63T) comprised in Survey No. 264/2 measuring east to west 110 feet, north to south 87 ¾ feet. The Old Door Number was wrongly shown as 63T, instead of 63H/9, 630/9. The sale certificate was also issued in favour of the 3rd respondent. On the face of the sale certificate, the measurement, four boundaries, door number does not tally with the parent document namely the partition deed dated 01.12.1960 by which the loan has been granted. It is submitted that the 3rd respondent has taken the physical possession of Door No. 148 and 149. He had also sold the said property to the third parties vide two registered sale deeds dated 29.10.2009 bearing Document No. 3780 and 3781. However, the 3rd respondent has filed M.A. No. 200 of 2023 before the 1st respondent herein after a lapse of more than 16 years for taking possession without mentioning the schedule of property.

It is submitted that Door No. 148, 149 is the 4th respondent’s property and the same was pledged before the 2nd respondent bank. The property in Old Door No. 63T belongs to the appellant's father Mr. Nataraja Mudaliar. The property in Door No. 148,149 and Old Door No. 63T are not one and the same. The Old Door No. 63T is a different property. The schedule of the property in the sale certificate and the order of attachment prove that based on the partition deed only, the 4th respondent availed loan from the 2nd respondent bank. Hence the bank cannot deny the recitals of the partition deed. The appellant's father Mr. Nataraja Mudaliar is a third party to the loan transaction. Hence the 3rd respondent cannot claim right over Mr. Nataraja Mudaliar's property i.e. Old Door No. 63T.

7. Having heard all the parties and after perusal of the entire record and DRC, I find that the appellant has filed this appeal to set aside the order of the Recovery Officer dated 20.02.2024 passed in MA No.200/2023 in which the Recovery Officer has appointed an Advocate Commissioner for taking physical possession of the property which was sold to D-3. I also find that the petitioner has contended that on 18.11.2005 the Recovery Officer, DRT II conducted public auction and the 3rd defendant purchased the property in Door No.148,149 (Old Door No.63T) comprised in Survey No.264/2. It is further submitted that the Old Door No is wrongly mentioned as 63T, instead of 63H/9, 630/9. It is also submitted that the Sale Certificate issued in favour of the 3rd Respondent also bears discrepancy in the measurement, four boundaries and Door Numbers which does not tally with the Un- Registered Partition Deed dated 01.12.1960 by which the loan was granted.

It is further submitted that Door No.148,149 is the 4th Defendant’s property and the same was placed before the 2nd Respondent Bank and the property old door no.63T belongs to appellant’s father hence the appellant has filed objection application before the Recovery Officer for passing orders but the 1st Respondent has returned the appellants objection application as not maintainable. I also find that the Rule 43 of Income Tax Certificate Proceedings clearly mentioned that “where the Tax Recovery Officer is satisfied that the resistance or obstruction was occasioned by any person (other than the defaulter) claiming in good faith to be in possession of the property on his own account or on account of some person other than the defaulter, the Tax Recovery Officer shall make an order dismissing the application”.

In view of the above provision and after perusing the facts of the case, I find force in the appeal filed by the Appellant. Accordingly, the order dated 20.02.2024 is hereby set aside and the Ld. Recovery Officer is directed to decide the application according to law if filed by the appellant and thereafter only he can proceed for taking physical possession of the property. Dictated to Varshini, taken down, transcribed, typed by her, corrected and pronounced by me in the Open Court in this the 01st APRIL, 2026. Sd/- (SEEMA SINHA) PRESIDING OFFICER

Uploaded on 10.04.2026