The High Court
Case Details
Signature Not Verified Digitally Signed Signed by: RANJEETA SAHOO Designation: JUNIOR STENOGRAPHER Reason: Authentication Location: High Court of Orissa Date: 07-Mar-2025 13:51:10 IN THE HIGH COURT OF ORISSA AT CUTTACK W.P.(C) No. 7854 OF 2015 (An Application under Articles 226 and 227 of the Constitution of India, 1950) ****** M/s Sobha Garage, Manguli Chhak, Cuttack …. Petitioner Mr. J.R. Dash, Advocate -versus- Odisha State Financial Corporation Cuttack and others …. Opp. Parties Advocates for the Parties For Petitioner
Legal Reasoning
: Mr. J.R. Dash, Advocate For Opp. Parties : Mr. Abinash Routray, Advocate (For Opposite Party Nos.1 to 3) CORAM: JUSTICE K.R. MOHAPATRA JUSTICE SANJAY KUMAR MISHRA --------------------------------------------------------------------------
Decision
Heard and Disposed of on : 05.03.2025 -------------------------------------------------------------------------------------------------------------------- JUDGMENT By the Bench : 1. This matter is taken up through hybrid mode. 2. The Petitioner in this writ petition prays for setting aside the letter No.1424 dated 1st September, 2008 under Annexure-4 issued by the Branch Manager, Odisha State Financial Corporation, Cuttack Branch, Cuttack (for brevity ‘Corporation’) intimating the husband of the Petitioner that the property has been sold to Opposite Party No.4 for a consideration of Rs.10,20,000/-. Hence, the husband of the Petitioner was made liable to pay Rs.3,19,603/- towards residual loan dues. W.P.(C) No. 7854 OF 2015 Page 1 of 7 Signature Not Verified Digitally Signed Signed by: RANJEETA SAHOO Designation: JUNIOR STENOGRAPHER Reason: Authentication Location: High Court of Orissa Date: 07-Mar-2025 13:51:10 3. Mr. Dash, learned counsel submits that the husband of the Petitioner, in order to establish an automobile repairing workshop in the name and style, ‘Sobha Garage’, mortgaged the property in question with the Corporation in the year 1988 and obtained financial assistance. Due to non-payment of the EMIs of the loan account, the property was seized under Section 29 of the Odisha State Financial Corporation Act, 1951 (for brevity, ‘the Act’) and auction sale notice was published in Odia daily newspaper ‘The Samaj’ on 1st January, 2007. Pursuant to the sale notice for auction, the husband of the Petitioner as well as Opposite Party No.4 participated in the proceeding. The Opposite Party No.4 came out successful in the auction, but due to failure on his part to deposit the sale price within stipulated time, the sale of the assets vide letter No.2454 dated 19th January, 2007 was cancelled and the EMD furnished by the Opposite Party No.4 was forfeited. Copy of the said letter was also communicated to the Petitioner vide memo No.947(3) dated 17th July,2007 (Annexure-3). But clandestinely, the authorities under the Corporation at later stage sold the mortgaged property to the Opposite Party No.4 without any further notice of auction. 3.1 Mr. Dash, learned counsel for the Petitioner submits that although the said fact was intimated to the husband of the Petitioner vide letter dated 1st September, 2008 under Annexure-4, but due to his illness he could not take steps at that point of time. The Petitioner was unaware of the said facts. Hence, she also could not take any step in the matter. The husband of the Petitioner died on 19th January, 2013 for W.P.(C) No. 7854 OF 2015 Page 2 of 7 Signature Not Verified Digitally Signed Signed by: RANJEETA SAHOO Designation: JUNIOR STENOGRAPHER Reason: Authentication Location: High Court of Orissa Date: 07-Mar-2025 13:51:10 which the Petitioner was in a deep shock. After recovery from the mental shock, the Petitioner took advice of legal practitioner and has filed the writ petition in the year 2015. 4. It is further submitted by Mr. Dash, learned counsel for the Petitioner that the mortgaged property was sold to the Opposite Party No.4 clandestinely by practicing fraud. Hence, the same can be assailed at any time when it came to the knowledge of the Petitioner. As such, the writ petition is maintainable. Since the only residential house of the Petitioner is being taken away by clandestine sale made by the Corporation in favour of Opposite Party No.4, this Court should interfere with the matter and restore the property to the Petitioner. 5. Mr. Routray, learned counsel for the Corporation relying upon the counter affidavit submits that, though the property was mortgaged in the year 1988 but husband of the Petitioner without intimating the Corporation managed to sell the same to a third party vide RSD No.688 dated 17th April, 2006 (Annexure-A to the counter affidavit) at a consideration of Rs.1,30,000/-. The auction sale as well as the subsequent sale made in favour of Opposite Party No.4 was intimated to the husband of the Petitioner vide Annexures-3 and 4 respectively making demand of the residual loan amount after adjustment of the sale price as stated therein. The husband of the Petitioner being aware of the same remained silent till his death. After more than one year of the death of the husband of the Petitioner, this writ petition has been filed. Hence, the writ W.P.(C) No. 7854 OF 2015 Page 3 of 7 Signature Not Verified Digitally Signed Signed by: RANJEETA SAHOO Designation: JUNIOR STENOGRAPHER Reason: Authentication Location: High Court of Orissa Date: 07-Mar-2025 13:51:10 petition suffers from delay and latches and should not be entertained. 5.1 He further submits that the Opposite Party No.4 could not deposit the auction sale price within the stipulated time. Hence, notice under Annexure-3 was issued cancelling the sale as well as forfeiting the EMD. Thereafter, the Opposite Party No.4 approached the Corporation for reconsideration of the cancellation of sale and forfeiture of EMD and permit him to deposit the amount as per the auction sale. Considering his prayer, the cancellation order under Annexure-3 was revoked on 7th August, 2007 and the Opposite Party No.4 was directed to deposit the money within fifteen days therefrom. Since the same was deposited within the stipulated time, the lease deed was executed in his favour and possession of the property was handed over to him. Thus, there is no infirmity in the procedure adopted by Corporation in alienating the property in favour of Opposite Party No.4. He, therefore, prays for dismissal of the writ petition. 6. Heard learned counsel for the parties; perused the case record. On perusal of the record, it is apparent that the husband of the Petitioner had taken a loan from the Corporation by mortgaging the property in question. He could not repay the loan. Hence, the possession of the property was taken by the Corporation in exercise of power under Section 29 of the Act, 1951. Thereafter, the mortgaged property was put to auction publishing a notice in Odia daily newspaper ‘The Samaj’ on 1st January, 2007. The Petitioner and Opposite Party No.4 participated in the bid and the Opposite Party No.4 W.P.(C) No. 7854 OF 2015 Page 4 of 7 Signature Not Verified Digitally Signed Signed by: RANJEETA SAHOO Designation: JUNIOR STENOGRAPHER Reason: Authentication Location: High Court of Orissa Date: 07-Mar-2025 13:51:10 came out successful. The Petitioner at that point of time raised objection to the auction sale of the property. But the sale was confirmed in favour of the Opposite Party No.4. However, the Opposite Party No.4 could not deposit the sale price within the stipulated time. Hence, vide notice under Annexure-3, the auction sale dated 19th January, 2007 was cancelled and the EMD deposited by Opposite Party No.4 was forfeited. Immediately thereafter, the Opposite Party No.4 approached the Corporation to revoke the cancellation and reconsider his prayer to purchase the property accepting the sale price. The authorities under the Corporation on consideration of the prayer made by the Opposite Party No.4 revoked the cancellation order under Annexure-3 by order dated 7th August, 2007 directing the Opposite Party No.4 to deposit the sale price within fifteen days therefrom. The sale price was deposited by the Opposite Party No.4 within the stipulated time. Hence, registered lease deed was executed in his favour and possession of the property was delivered to Opposite Party No.4. These facts were communicated to the husband of the Petitioner vide letter No.1424 dated 1st September, 2008 under Annexure-4. As the property was sold at a price Rs.10,20,000/- to Opposite Party No.4, residual loan amount of Rs.3,19,603/- was also demanded from the husband of the Petitioner at that point of time, when he was alive. But he did not take any step either to challenge the sale in favour of Opposite Party No.4 or the demand raised against him during his lifetime. W.P.(C) No. 7854 OF 2015 Page 5 of 7 Signature Not Verified Digitally Signed Signed by: RANJEETA SAHOO Designation: JUNIOR STENOGRAPHER Reason: Authentication Location: High Court of Orissa Date: 07-Mar-2025 13:51:10 7. It is, however, submitted by Mr. Dash, learned counsel for the Petitioner that the property has been sold at a throw away price of Rs.10,20,000/-, whereas the property would have fetched more than Rs.25,00,000/- at that point of time. Such submission prima facie does not appear to be correct in view of the fact that husband of the Petitioner himself sold the property to a third party at a consideration of Rs.1,30,000/- on 17th April, 2006 by registered sale deed as would be evident from Annexure-A to the counter affidavit. 7.1 Mr. Dash, learned counsel for the Petitioner further submits that due to illness of the husband of the Petitioner, he could not take step to challenge the letter under Annexure-4 at the relevant time. But no document is available on record in support of the same save and except some bald averments made in the writ petition with regard to illness of the husband of the Petitioner. Thus, the plea taken by Mr. Dash, learned counsel for the Petitioner is not believable, more particularly when, no detail of the alleged illness of the husband of the Petitioner and period of such illness has been stated in the writ petition. 8. The husband of the Petitioner died on 19th January, 2013 as would appear from his death certificate at Annexure- 5, but no step was taken by the husband of the Petitioner during his lifetime. Till 2015, the Petitioner also did not take any step to challenge the letter under Annexure-4. 9. Thus, in view of the discussions made above, the writ petition suffers from delay and latches and also sans merit. W.P.(C) No. 7854 OF 2015 Page 6 of 7 Signature Not Verified Digitally Signed Signed by: RANJEETA SAHOO Designation: JUNIOR STENOGRAPHER Reason: Authentication Location: High Court of Orissa Date: 07-Mar-2025 13:51:10 Hence, the writ petition stands dismissed. In the facts and circumstances, there shall be no order as to costs. Ranjeeta (K.R. Mohapatra) Judge (S.K. Mishra) Judge W.P.(C) No. 7854 OF 2015 Page 7 of 7