HC Sets Aside ULCA Proceedings on Vijaya Talkies Land

HYDERABAD: Justice B. Vijaysen Reddy of the Telangana High Court set aside proceedings under various provisions of the Urban Land Ceiling Act (ULCA) on the ground that they were passed against dead persons. The judge allowed a writ petition filed by G. Siva Sankar Reddy and four others questioning orders made by the special officer and competent authority, Urban Land Ceiling. The petitioner purchased the immoveable property in question admeasuring 7,073 square feet, formerly Vijaya Talkies in Ameerpet revenue village. It was stated that the predecessor in title, Mohd Hyder Ali Khan, who was in possession of various extents of land, left behind three legal heirs who sold the property to the petitioner. In April 1993, the authorities declared that Hyder Ali Khan was a surplus landowner. The order was set aside in appeal and remanded in 2002. On remand the authorities in 2004 again determined him as a surplus owner by which time he had died. The authorities then issued a notice under Section 10(5) requiring the declarants to deliver surplus land. It was the case of the petitioner that though notice was issued in 2005, possession was not taken. Later the subject land was acquired by the then HUDA for development and construction of commercial buildings but the purpose was not served due to non-viability and the then government of undivided Andhra Pradesh vide GO Ms No. 288 issued in July 15, 2010, de-notified the land by withdrawing it from acquisition proceedings. It was submitted that the land was in physical possession of the petitioners from the date of purchase. Senior counsel B. Mayur Reddy appearing for the petitioner pointed out that the proceedings beginning with determination of surplus land and consequential proceedings under Sections 10(5) and 10(6) of the Act were vitiated. There was no evidence to prove that possession of the land was taken on 30.09.2005. The land was no more surplus by the time the petitioners purchased it under registered sale deed executed on August 4, 2010, as they were re saved by virtue of Sections 3 and 4 of the Repeal Act and ULC proceedings were abated. Justice Vijaysen Reddy rejected the stance of the government that the petitioners and purchasers had no locus and that the challenge was delayed. Rejecting the plea of latches, the judge pointed out that possession was not taken and therefore the issue of delay did not arise. Rejecting the plea of locus, the judge said that by the time the sale deed was executed, the land had become freehold property by virtue of Section 4 of the Repeal Act. Thus, the petitioners had valid title to the land and had locus to challenge the impugned proceedings. Even if the petitioners had not impleaded the legal heirs of the declarant, the writ would be maintainable. In view of the fact that the original owner died in 2004, all proceedings thereafter amounted to orders against a dead person and were challenged as being void by the purchaser. However, in the light of the observations that possession of the subject land was not taken, the point regarding proceedings/notices issued to dead person would be superfluous and insignificant, the judge said allowing the writ petition.

HC refuses to dismiss firm’s plea

Justice S. Nanda of the Telangana High Court refused to dismiss a writ petition on the ground that it was not maintainable and the petitioner had an effective alternative remedy. The judge was dealing with a writ petition filed by Samvit Gupta of Bitstreet Technologies, complaining that Agrasen Cooperative Bank was not following RBI guidelines on the Emergency Credit Line Guarantee Scheme (ECLGS). The petitioner claimed that Bitstreet Technologies had been in the business for nearly a decade but all the work orders of about Rs 75 crore got cancelled due to the Covid lockdown and booked a loss of about Rs 10 crore due to shutdown of offices in Mumbai and Hyderabad due to non-support of bank credit line on time. Thereafter, the RBI circular issued on March 27, 2020, provided moratorium to commercial borrowers under the light of Covid-19. It was stated that the RBI issued another circular which provided for the initiation of loan moratorium period wherein the customers of the financial institutions could defer the EMIs under the light of Covid-19 circumstances and therefore during such moratorium there will be no pressure on the borrowers to comply with the payment of the instalments. It was the complaint of the petitioner that Agrasen Cooperative Bank turned the account of the petitioner into a non-performing asset (NPA) without any prior information, which was contrary to the circular issued by the RBI on March 27, 2020, as a Covid-19 relief package. It was further contended that the inaction and reluctance by the bank along with its inhuman action had resulted in the violation of petitioner's fundamental rights, primarily the right to livelihood and right to live with dignity under Article 21 of the Constitution.

Senior counsel Prabhaker appearing for the bank stated that the writ petition was neither maintainable in law nor on facts and was devoid of merits and liable to be dismissed. The petitioner had an alternative remedy by approaching the Debt Recovery Tribunal and the petitioner is a chronic defaulter in repaying loans which led to the declaration of his account as NPA on February 9, 2021. Counsel for RBI stated that the petitioner had not represented to the RBI with regard to the issue even as on date. Any borrowing arrangement was a commercial contract between the lender and the borrower and each lending institution was best placed to assess the requirements of its customers and therefore the discretion was left to the lending institutions concerned. The RBI further said that the central bank only provided an enabling mechanism for the lenders to implement the resolution plans in terms of resolution frameworks. However, the discretion regarding extending the same in specific cases is left to the lending institutions concerned, who were to decide as per their board approved policies. Rejecting the plea on maintainability, Justice Nanda said that the power under Article 226 of the Constitution to issue writs can be exercised not only for the enforcement of fundamental rights, but for any other purpose as well. The judge further said that an alternative remedy by itself does not divest the High Court of its powers under Article 226 of the Constitution in an appropriate case though ordinarily a writ petition should not be entertained when an efficacious alternative remedy is provided by law. Justice Nanda said that when a right was created by a statute, which itself prescribed the remedy or procedure for enforcing the right or liability, resort must be had to that particular statutory remedy before invoking the discretionary remedy under Article 226. This rule of exhaustion of statutory remedies was a rule of policy, convenience and discretion. She recorded a finding that the petitioner had not represented about his grievance as put forth in the writ petition either to the RBI or bank even as on date and therefore the relief as prayed for could not be granted. The court accordingly left it open for the petitioner to submit a detailed representation raising all the pleas to the RBI and the bank within two weeks. The respondents were directed to consider the same in accordance to the law, and pass appropriate orders within two weeks thereafter by affording reasonable opportunity of hearing to the petitioner, in conformity with principles of natural justice duly taking into consideration the full bench judgment of the apex court.