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TMI Blog2020 (5) TMI 750X X X X Extracts X X X X X X X X Extracts X X X X ..... a Bank Maryadit Khargone. The undisputed facts also reveal that the mortgaged property is agricultural land owned by the petitioners situated at Khasra Nos.142,146,147 of Gram Lakhangaon Tehsil Thikri, District Badwani admeasuring 5.350 hectare. The aforesaid fact that the land in question is agricultural land is not in dispute. The relevant provisions as contained under the SARFAESI Act, 2002 for deciding the controversy involved in the petition reads as under:- "14. Chief Metropolitan Magistrate or District Magistrate to assist secured creditor in taking possession of secured asset (1) Where the possession of any secured assets is required to be taken by the secured creditor or if any of the secured asset is required to be sold or transferred by the secured creditor under the provisions of this Act, the secured creditor may, for the purpose of taking possession or control of any such secured asset, request, in writing, the Chief Metropolitan Magistrate or the District Magistrate within whose jurisdiction any such secured asset or other documents relating thereto may be situated or found, to take possession thereof, and the Chief Metropolitan Magistrate or, as the case may be, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... may by order, declare the recourse to anyone or more measures referred to in sub-section (4) of section 13 taken by the secured creditors as invalid and restore the possession of the secured assets to the borrower or restore the management of the business to the borrower, as the case may be, and pass such order as it may consider appropriate and necessary in relation to any of the recourse taken by the secured creditor under sub-section (4) of section 13. (4) If, the Debts Recovery Tribunal declares the recourse taken by a secured creditor under sub-section (4) of section 13, is in accordance with the provisions of this Act and the rules made thereunder, then, notwithstanding anything contained in any other law for the time being in force, the secured creditor shall be entitled to take recourse to one or more of the measures specified under sub- section (4) of section 13 to recover his secured debt. (5) Any application made under sub-section (1) shall be dealt with by the Debts Recovery Tribunal as expeditiously as possible and disposed of within sixty days from the date of such application: PROVIDED that the Debts Recovery Tribunal may, from time to time, extend the said perio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wenty per cent of the principal amount and interest thereon." It is true that there is a remedy available to the petitioners to approach the Debt Recovery Tribunal but the order passed by the District Magistrate is void abnitio in the light of Section 31(i) of SARFAESI Act, 2002 which categorically provides that the provisions of Act of 2002 are not applicable in respect of any security interest created in agricultural land and therefore, once the Act of 2002 was not applicable in respect of the agricultural land, the order passed by the District Magistrate is a nullity and there appears to be no justification in forcing the petitioners to file an appeal. The Hon'ble Supreme Court in the case of ITC Limited Vs. Blue Coast Hotels Limited reported in 2018 SCC OnLine SC 237 in paragraphs 44 to 52 has held as under:- Inclusion of Agricultural Land as Security Interest in the Notice of Recovery 44. One of the contentions raised on behalf of the debtor questioned the correctness of the finding of the High Court on the ground that the inclusion of agricultural land as security interest could not have been validly included in the notice for recovery of the secured loan. The co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sq. mtrs. are used for growing vegetables, fruits, shrubs and trees for captive consumption of the hotel. There is no substantial evidence about the growing of vegetables but what seems to be on the land are some trees bearing curry leaves and coconut. This amounts to about 12.8 % of the total area. 48. The Corporate Loan Agreement 37 that deals with the mortgage in question in the relevant clause38 reads as follows:- "The Borrower shall create mortgage on Exclusive basis on the 'Park Hyatt Goa Resort and Spa" Hotel Property admeasuring 1,82,225 Sq Mtrs with a built up area of 25182 Sq. Mtrs situated at 263 C, Arossim, Canasaulim Goa." 49. The mortgage is thus intended to cover the entire property of the Goa Hotel. Prima facie, apart from the fact that the parties themselves understood that the lands in question are not agricultural, it also appears that having regard to the use to which they are put and the purpose of such use, they are indeed not agricultural. 50. At the outset, it was argued on behalf of the debtor that Section 31(i) is beyond the legislative competence of the Parliament since it is only the State Legislature which is competent to legislate on land under ..... X X X X Extracts X X X X X X X X Extracts X X X X
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