HC dismisses PIL against sealing of school on public land by bank due to non-payment of loan

New Delhi, May 23 (PTI) The Delhi High Court has dismissed a public interest litigation (PIL) seeking protection of interest of students enrolled with schools located on public land which have been mortgaged and may be auctioned by banks over non-payment of loan.

The high court said it was of the opinion that the present PIL was “motivated through extraneous and oblique interests” and was frivolous in nature.

The petition had urged the court to protect the fundamental right to education guaranteed to over 900 students enrolled at Laxmi Public School, which is established and managed by Laxmi Educational Society, at Karkardooma in East Delhi as well as to others who are studying in such institutions whose land has been mortgaged and may be sealed or auctioned in future for non-payment of loan.

The high court said the Petitioner NGO Justice for All, knowing fully well that the educational society has approached this court and has other appropriate remedies available before it, has chosen to come before this court on the basis of a news report.

“In the present case, the concerned society and school have already approached this court to ensure that the school is not shut off for the students to ensure that the fundamental right of children is not affected.

“Further, the issue pertaining to the non-applicability of the SARFAESI Act to land granted under the Government Grants Act is an issue which can be addressed by the concerned society.
“Considering the society has appropriate legal remedies available to it and has exercised its right to avail such remedies, it would not be appropriate for this court to entertain a public interest litigation, preferred by a third party,” a bench of Chief Justice Satish Chandra Sharma and Justice Subramonium Prasad said.

The high court said the petitioner has taken the news report and attempted to paint a picture wherein the banks are abusing the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act (SARFAESI), 2002 and attempted to show that this is a systemic issue and not a single instance but has failed to establish the same through the documents presented before the court.

“While this court is cognisant of the liberal rules pertaining to locus vis- -vis public interest litigation, it must also ensure that busybodies, meddlesome interlopers, wayfarers or officious interveners having oblique interests are not allowed to waste precious judicial time of this court.

“In the opinion of this court, the present public interest litigation is motivated through extraneous and oblique interests and is frivolous in nature. The present case is not a fit case for this court to exercise its extraordinary jurisdiction under Article 226 of the Constitution and the prayers sought for by the petitioner cannot be granted by this court,” the bench said in a May 18 judgment.

It said the petitioner has made bald allegations and failed to establish the veracity of these allegations through documents or averments.

The petitioner NGO, through advocates Khagesh B Jha and Shikha Sharma Bagga, had also sought the court’s directions for enquiry as to how the leasehold land of Laxmi Public School has been mortgaged.

It had also sought financial stability of societies seeking allotment of public land for charitable or institutional purposes.

The petition submitted that Bagga was surprised to know from a news report of April 17 that a bank has taken over the school building for loan default.

Jha submitted the petition was not regarding one particular school but several schools which are built on public land where the authorities take loan against the building and fail to repay.

Standing counsel Santosh Kumar Tripathi and advocate Arun Panwar, appearing for the Delhi government, had said during the arguments that the land parcel belonged to the government and was given to Laxmi Educational Society under the Government Grants Act for the purpose of running a school and the society could not have dealt with it further under the Transfer of Property Act.

Tripathi had submitted the land was never available to the bank as any other land to be purchased from any institution.

He had said the Delhi government’s objective was to protect students and promote education.

The counsel representing the school and the society had opposed the petition claiming it was a publicity stunt and the petitioner filed the plea without any basis or material. The school had sought rejection of the petition with costs.

The petition said a large number of institutions have first obtained land at throwaway prices, then taken loan from banks to create five star facilities. This, it said, increased the competition for luxury in education and resulted in commercialisation of education. These institutions mortgaged the land risking the education of children, it said.

” the present example of the respondent school is one of the classic examples of the device used by the management and failure of authorities to reconstruct the asset, that is, school,” it said.

The petition said things have reached a stage where the school is going to be auctioned for repayment of loan and guidelines for business are being enforced on school land which is otherwise a public land reserved for public institutions.

“The bank in the guise of seeking possession of the school has sealed it, thereby disturbed the education of students enrolled in the school. The mortgage/ auction of lease hold land of unaided school would be detrimental for the education of the presently enrolled and prospective students of the respondent school, and thereby would hamper the planned development of union territory of Delhi,” the plea said.