Realizing the Dues (On the Basics of Sale and a Criticism)

To fathom the rudimentary elements of Sale and its mechanism around the execution of a certificate mainly a few sections of The Public Demands Recovery Act 1913, ss 11-28 (hereinafter ‘the Act') of Part III of the Act and the rulesof schedule II of the same must be scrutinized. The main functionality of the Actpivots on creating a vehicle for realizing various kinds of dues for the state which is mentioned in section 3(6) and elaborated in schedule I of the act.

The discussion on realizing due from a certificate debtor from ‘sale' comes into play from section 14 (a) of the Act where it is divided into two forms one is ‘attachment and sale' and another ‘just by sale.' These processes are a medium to execute a certificate for the purpose of actually realizing the dues are liquidated from the certificate debtor.

Now the first part, ‘attachment' mainly means the seizure of property in anticipation of a favorable ruling for a creditor according to the case of V Dharmavenamma v C Subrahmanyam Mandadi (2009). It is mainly dealt with by Section 60 of The Code of Civil Procedure, 1908 but when sections relating to sale come into play, the Act itself gives a few safeguards to the certificate debtor while also balancing the interests of the certificate holder and the purchaser.  The initiation of all things related to Sale starts under the umbrella of section 4 and section 6 of the Act through the filing of a certificate and serving of notice to the alleged certificate debtor which actually has the effect of an attachment to the concerned property. In cases of Sale, the properties are broadly separated into two spectrums which are moveable property and immovable property.

After the conduction of the sale, the purchaser naturally has a right to be delivered the property which is pronounced in rule 59 if it is moveable, and also can enjoy the transactions without any encumbrances if the certificate holder may allow so by the virtue of rule 63 of the act. But the rights of the purchaser are also balanced by the limitations of rule 60 and the consequence in 70.

Although this whole process of execution of certificates through sale seems to be the one in control is the certificate officer who is mainly empowered by the virtue of section 11 of the Act. From hearing and determining petitions, even taking evidence, having the discretion to adjust the certificate to adjourning [rule 50(1)] and stopping sale (rule 50), these motifs are completely vested on the certificate officer except for cases like frauds. The topics will be elaborated on in the later parts.

Even in cases of setting aside sale, a certificate officer gets unhinged power in lieu of section 23 of the Act through the obscure words like ‘satisfaction of the certificate officer' prevalent in the section.  Hence a question may arise about the status quo of the processes of a certificate officer, if their functions are overstepping the boundaries of separation of power which is one of the bases of Bangladesh's constitution, and destroying certain balances.

Also, an inquiry might spark up if a constitutionally guaranteed right of property should be dealt to such an extent without a proper judicial forum overseeing it which may connect to the question of due process in a broader spectrum too. But, nonetheless, whatever the anomalies may be present in the Act, by the virtue of the Act having a maverick quality, it can promise a speedier end if the means of attaining that end and the personnel around it are seasoned in a proper judicial oven and their powers are tailored with checks and balances.

The Protagonist of the Act (On the Certificate officer)

Continuing from the previous segment of the article, it seems pertinent to briefly discuss this legal creature created by the Act named ‘Certificate officer.' Through the virtue of the public demands recovery Act 1913's section 39, the Board of land administration has made rules on the appointment and powers of Certificate-officers. This enables the certificate-officer to exercise all the powers conferred upon him by the Act freely with a few qualifications from section 41, clause (3) relating to the exercise of appellate powers and Rule 11, schedule II of the Act relating to the transfer of petitions of objection.

This actually preludes the behemoth role a certificate officer plays in realizing debts which revolves around public demands recovery and the actual act.  The certificate manual of the board of land administration recognizing this pivotal role of the certificate officer, under its instruction 16, has made this position responsible for the punctual disposal of certificate cases without undue delay. Now coming back to the act, section 3(3) states “Certificate-officer” means a Collector, an Upazila Nirbahi Officer, an Upazila Magistrate, and any officer, appointed by a Collector with the sanction of the Commissioner to perform the functions of a Certificate-officer under this Act. The proceedings of realization of dues start with the satisfaction of a certificate-officer as per sections 4 and 5 of the Act on realizing debts for two categories one for the collector and other cases which are not barred by law as per section 6 of the Act.

The Judiciary in the case of Sasa Musa Works v State of Bihar (1955) seems to put a restrain on the ‘satisfaction' part of the certificate officer in cases of arbitrariness when an order is passed without any material before him. When a certificate is filed the certificate officer has the duty to ensure that the demand falls within the list contained in Appendix-A of Schedule I.When the certificate officer declares the due against the certificate-debtor it becomes equivalent to a decree of a civil court through an extraordinary effect (12 DLR 448).

When a denial is filed through section 9, it seems section 10 coupled with section 49 gives power to the certificate officer a notion of judicial power which is civil in nature, to take some actions and run some procedures like a court, (e.g. receiving evidence, administering oaths, etc.). This gives the certificate officer a mechanism to act on the due, take various actions like adjusting it, disposing it in the prescribed manner, etc.

Also, rule 39(1) of the schedule II gives the power to investigate an objection against attachment or sale and through 41 to release the property from said action. From attachment to sale and setting aside sale, the certificate officer holds a behemoth amount of discretionary power. Alongside the power of arrest and detention in a civil prison as per section 29(1) of the Act.

Through the plain reading of the sections of the Act it can be seen that the primary dealings of a certificate debtor is dealt by the certificate officer. As per the constitution of Bangladesh, The right to property is a fundamental right of great gravity. So, giving total procedural freedom without a proper judicial forum can be an imbalanced measure to the fabric of the right of property.

The ‘satisfaction' part and the prescribed forms of discretionary instructions of the certificate officer found throughout the Act are the focal problematic areas. But nevertheless, a balancing factor must be kept in mind also, as overburdening the judiciary is never desired. Hence some spectrums of law must be left to other limbs of the state to be dealt with in a controlled manner.

The safety net of a Certificate Debtor (On Judicial Intervention)

But disseminating the law to be dealt with in different facets of the state, leaves scopes open for certain faults. Like most laws or acts, The Public Demands Recovery Act 1913 has laid out certain judicial safeguards, so a proper forum can deal with certain such anomalies, should they make an appearance.

To ensure the smooth operation of public demands recovery and to balance out the parties' rights, liabilities, disputes, and other consequential reliefsof the certificate debtor, the Judiciary must intervene in certain matters which are mainly laid down from sections 34 to 37 of the Actincluding other instrumental commodities. Also, by the virtue of different constitutional articlesof Bangladesh, the High Court Division shall have the power to adjudge on this Act also, if no efficaciousremedies are to be found, on the basis of justice, equity and conscience.

Section 34 of the Act gives power to the certificate debtor under specific conditions of section 7, denial of liability under section 9 and subsequent appeal under section 51 from an order passed under section 10 to come to the civil court under the limited timeframe of 6 months.

After going through these procedures, a certificate debtor can ask for the civil court's intervention to have the certificate canceled, modified, or to have any consequential relief. If those conditions are not fulfilled according to section 34 (b), the court shall not entertain the suit of the certificate debtor.  Also, the court can't intervene if a petition under section 10 is pending as it would be deemed premature then as per the case Rani Harsha Mukhi v Noba Krishna, (1938). Reading sections 34 and 35 together gives out a clear picture of how the court can intervene and the demarcation of the Court's interventional power on as to what conditions the courts can cancel or modify the certificate.

The court can do so under three grounds laid down in section 35(1) and can modify it under two broad grounds under section 35(2) of the act. The court shall intervene when the certificate officer acts without jurisdiction if the certificate is already satisfied under section 35(1).

Also from the plain reading, it can be seen fraud is a genuine and undisputed ground for the intervention of civil courts in the matters of public demands recovery according to the case of Akmal Khan v Amaresh Chandra 18 DLR.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.