Md. Rafiqul Islam Vs. Bangladesh and others 2016 (2) LNJ 333

Case No: Writ Petition No. 10297 of 2015

Judge: Mohammad Ullah,

Court: High Court Division,,

Advocate: Mr. Syed Mamun Mahbub,Mr. Abdul Matin Khasru,Ms. Mukti Rani Kundu,,

Citation: 2016 (2) LNJ 333

Case Year: 2016

Appellant: Md. Rafiqul Islam

Respondent: Bangladesh and others

Subject: Artha Rin, Writ Petition,

Delivery Date: 2016-07-26

Md. Rafiqul Islam Vs. Bangladesh and others 2016 (2) LNJ 333
HIGH COURT DIVISION
(SPECIAL ORIGINAL JURISDICTION)
Shamim Hasnain, J
And
Mohammad Ullah, J
Judgment on
26.07.2016

 
Md. Rafiqul Islam, son of Abdul Hamid Miah, Proprietor of M/S Welcome International, Plot No. 3780, Block- C, Merajnagar, Kadamtoli, Dhaka.
... Petitioner
-Versus-
Bangladesh represented by the Secretary, Finance Division, Ministry of Finance, Bangladesh Secretariat, Dhaka and 6(six) others.
...Respondents

Artha Rin Adalat Ain, (VIII of 2003)
Section 12
In case of sale of the mortgaged property through auction under section 12 of the Ain, the sale would be a valid sale in the eye of law and thus the question of right of redemption of the property will not arise. After sale of the mortgaged property through a lawful auction there shall be no scope of redemption of the property by the mortgagor. Therefore, by depositing a part of the defaulted amount, the petitioner cannot claim to buy back the sold property inasmuch as the right, title and interest of the third party in the meantime has been established over the property. However, the petitioner may proceed against the mortgagee Bank for any compensation if it is proved that there was illegality in the auction process. The petitioner can take back the rest of the amount after satisfaction of the mortgagee Bank procured through the auction sale.      . . .(8)

Mr. Syed Mamun Mahbub, Advocate
...For the petitioner
Mr. Abdul Matin Khasru with
Ms. Mukti Rani Kundu, Advocates
...For the respondent No. 4
 
JUDGMENT

Mohammad Ullah, J: 
On an application under Article 102 of the Constitution, this Court at the instance of a borrower issued the Rule in the following terms:
“Let a Rule Nisi be issued calling upon the respondents to show cause as to why the notice inviting tender published in the Daily Sakaler  Khabor dated 06.07.2015 under the signature of respondent nos.4-6 as contained in Annexure-E for selling the mortgaged properties by invoking power under section 12 of the Artha Rin Adalat Ain, 2003 and the post tender actions of the respondents particularly the registration process in the name of the respondent no.7 of the scheduled property which is the homestead of the petitioner should not be declared to have been issued illegally, mala fide and without lawful authority therefore, is of no legal effect  and/or pass such other or further order or orders as to this Court may seem fit and proper.”
  1. At the time of issuance of the Rule, this Court by order dated 22.09.2015 stayed the operation of all post tender actions of the respondents no. 3-6. At the instance of the petitioner, an order of injunction restraining the respondents from dispossessing the petitioner from his homestead was passed for a period of 2(two) months subject to payment of Taka 2 lacs within 10 (ten) days with a default order that if the petitioner fails to pay the money within the said period, the Rule would stand discharged. Pursuant to the order, the petitioner had deposited the sum through a pay order and filed an affidavit-in-compliance. This Court having received the affidavit-in-compliance extended the order of stay for a further period of 6(six) months from date i.e. 14.02.2016.
  2. The short facts, as disclosed in the averments of the writ petition, are that the petitioner being Proprietor of M/S Welcome International availed of certain credit facilities from the Bank Asia Limited, Dania Branch, Shyampur, Dhaka for the purpose of business. At one stage, when the petitioner became defaulter in repayment of the loan in terms of sanction letter, the creditor Bank wrote a letter on 05.02.2015 requesting the petitioner to repay the loan. Having received the letter, the petitioner rushed to the respondents Bank on 24.05.2015 and promised to pay the dues as early as possible. Apart from verbal assurance, the petitioner also sent a letter to the Managing Director, Bank Asia limited (respondent no. 3) requesting to exempt the interest accrued on the principal amount on the plea of loss of business caused due to unrest political situation of the country. It is also stated that while the discussion was going on between the petitioner and the creditor Bank, he became surprised to see a tender notice published in daily Sakaler Khabar dated 06.7.2015 for sale of the mortgaged property for recovery of the outstanding amount of Taka 12,20,733.74 invited by the respondent Bank. Pursuant to the tender invitation, the property was sold on 30.07.2015 to the respondent no. 7, Md. Rafiqul Islam at a consideration of Taka 21,96,000/-. The deed of sale was executed on 22.09.2015 in favour of the auction purchaser (respondent no. 7) by the Bank. At that stage, the petitioner moved in this Court, obtained the Rule and the order of stay with injunction as stated above.
  3. The Rule is contested by the respondent no. 4-creditor Bank through Mr. Abdul Matin Khasru, learned advocate who filed an exhaustive application for vacating the order of injunction. The case of the respondent-Bank, as disclosed in the said application is that the Bank before publication of the tender notice for auction sale of the mortgaged property had on several occasions requested the petitioner to regularize the installments in terms of sanction letter and when the petitioner failed to adjust the liability, the mortgaged property was sold through auction under the provisions of section 12 of the Artha Rin Adalat Ain, 2003 (“the Ain”). Prior to sell of the mortgaged property, the respondent no. 4 Bank rescheduled the classified loan of the petitioner on 30.06.2014 as per BRPD (Banking Regulations and Policy Department) Circular No. 15 dated 23.09.2012 and allowed him to repay the liability by 12 (twelve) equal monthly installments, but the petitioner did not deposit any amount in order to adjust the liabilities. On prayer of the petitioner, the respondent-Bank gave adequate opportunities to him to repay the loan money but in vain. The respondent Bank tried its best to accommodate the petitioner so that he could pay the loan money but he failed every time to keep his commitment. At one stage, the petitioner wrote a letter to the Bank on 30.07.2015 to give the property to respondent no. 7 through an auction (Annexure-2). In the auction process, the respondent no. 7, Rafiqul Islam also became the highest bidder and purchased the mortgaged property through a valid auction. Thereafter a registered sale deed dated 22.09.2015 was executed and registered in favour of the respondent no. 7 by the respondent-Bank.
  4. Mr. Syed Mamun Mahbub, learned advocate appearing for the petitioner, submit that due to political turmoil over the country, the petitioner could not run his business properly and became defaulter without any fault of his own. The learned advocate submits further that the mortgaged property was the homestead of the petitioner and therefore selling of the same through auction tantamount to infringement of right to property as enunciated in the Constitution of Bangladesh.
  5. Mr. Abdul Matin Matin Khasru, learned advocate appearing for the respondent-Bank submits that when the petitioner failed to make payment of the loan in spite of giving adequate opportunities to regularize the loan, the Bank sold the mortgaged property through auction under section 12 of the Ain and as such no illegality has been committed in selling the mortgaged property. The learned advocate submits further that the respondent-Bank realized the outstanding amount by selling in the mortgaged property to the respondent no. 7 and a registered deed of sale pursuant to the auction process was made and therefore there is no scope to set aside the sale as the right of a third party has already accrued. 
  6. We have heard the submissions of the learned advocates of both the sides and perused the materials on record.
  7. The admitted position is that the petitioner defaulted in payment of loan in spite of providing adequate opportunity to him to repay the same and therefore the Bank in order to realize its outstanding loan was compelled to publish auction notice for sale of the mortgaged property under the provision of section 12 of the Ain. It is also not disputed that the mortgaged property was sold to the respondent no. 7 in a competitive auction. Pursuant to sale of the mortgaged property, a deed of sale was also executed and registered in favour of the respondent no. 7 and thus the right, title and interest of the sold property accrued on the purchaser.  From a simple reading of sub-section (3) of section 12 of the Ain, it appears that the Artha Rin Suit cannot be filed by a creditor Bank or financial institution without taking step for selling of the mortgaged property. In case of sale of the mortgaged property through auction under section 12 of the Ain, the sale would be a valid sale in the eye of law and thus the question of right of redemption of the property will not arise. In other words, after sale of the mortgaged property through a lawful auction there shall be no scope of redemption of the property by the mortgagor. Therefore, by depositing a part of the defaulted amount, the petitioner cannot claim to buy back the sold property inasmuch as the right, title and interest of the third party in the meantime has been established over the property. In the instant case, no allegation of fraud or material irregularity in publishing or conducting the auction sale has been raised by the petitioner and therefore after sale of the mortgaged property finally at the instance of the creditor Bank through a lawful auction there would be no scope to allow the petitioner to deposit the part amount in order to set aside the sale. However, the petitioner may proceed against the mortgagee Bank for any compensation if it is proved that there was illegality in the auction process. The petitioner can take back the rest of the amount after satisfaction of the mortgagee Bank procured through the auction sale.
  8. In view of what have been stated above, we do not find any merit in the Rule.
  9. Accordingly, the Rule is discharged. 
Communicate a copy of this judgment.
Ed.
 

Writ Petition No. 10297 of 2015