Supreme Court allows condonation of appeal delays under SARFAESI Act

The Supreme Court held that the Appellate Tribunal under the SARFAESI Act can condone delays in filing appeals by applying the proviso to Section 20(3) of the RDB Act. The judgment overruled the Madhya Pradesh High Court's contrary view, allowing the borrowers' appeals and dismissing the Bank's appeal. The matters were remanded for fresh consideration in line with the law, with specific remands to the High Court of Madhya Pradesh and the Debt Recovery Appellate Tribunal, Delhi.

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Issues Involved
1. Whether the Appellate Tribunal under the SARFAESI Act has the power to condone delay in filing an appeal under Section 18(1) of the Act.

Detailed Analysis

1. Applicability of Proviso to Section 20(3) of the RDB Act to SARFAESI Act Appeals
The core issue is whether the Appellate Tribunal under the SARFAESI Act can condone delays in filing appeals by applying the proviso to Section 20(3) of the RDB Act. Section 18(2) of the SARFAESI Act mandates that appeals be disposed of in accordance with the RDB Act's provisions. Thus, the proviso to Section 20(3) of the RDB Act, which allows for condonation of delay if sufficient cause is shown, is incorporated into the SARFAESI Act. The judgment emphasizes that unless expressly excluded, the power of condonation should be available to advance the cause of justice.

2. Interpretation of Legislative Intent and Statutory Scheme
The judgment refutes the Madhya Pradesh High Court's view that the absence of an express provision for condonation in the SARFAESI Act implies its exclusion. The court clarifies that the legislative intent behind the SARFAESI Act's shorter appeal period does not negate the applicability of the RDB Act's condonation provision. The principle of legislation by incorporation supports this interpretation, ensuring that the Appellate Tribunal can condone delays as per the incorporated RDB Act provisions.

3. Conflicting High Court Views
The judgment addresses conflicting High Court decisions. The Madhya Pradesh High Court held that condonation of delay is excluded by the SARFAESI Act's scheme, which the Supreme Court found erroneous. Conversely, the Andhra Pradesh, Bombay, and Madras High Courts allowed condonation based on Section 29(2) of the Limitation Act. The Supreme Court clarifies that while Section 29(2) may not absolutely apply, the SARFAESI Act's scheme does not exclude condonation powers implied by the RDB Act.

4. Tribunal as a Court for Section 29(2) of the Limitation Act
The judgment explores whether the Appellate Tribunal under the SARFAESI Act qualifies as a court under Section 29(2) of the Limitation Act. Although the Andhra Pradesh High Court deemed the Tribunal a court, the Supreme Court finds it unnecessary to resolve this for the present appeals. The court concludes that the power of condonation is expressly applicable via Section 18(2) of the SARFAESI Act and the proviso to Section 20(3) of the RDB Act, rendering Section 29(2) inapplicable.

5. Applicability of Section 14 of the Limitation Act
The judgment acknowledges that even if Section 5 of the Limitation Act is inapplicable, the principle of Section 14 (exclusion of time spent in bona fide proceedings) can apply. This aligns with the Supreme Court's decisions in Consolidated Engineering Enterprises and M.P. Steel Corporation.

Conclusion
The Supreme Court concludes that the Appellate Tribunal under the SARFAESI Act can condone delays in filing appeals under Section 18(1) by applying the proviso to Section 20(3) of the RDB Act. The contrary view of the Madhya Pradesh High Court is overruled. The appeals by the borrowers are allowed, and the matters are remanded for fresh consideration in accordance with the law. The appeal by the Bank against the Andhra Pradesh High Court's judgment is dismissed.

Disposition
All appeals are disposed of accordingly, with specific remands to the High Court of Madhya Pradesh and the Debt Recovery Appellate Tribunal, Delhi for fresh adjudication.

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