2024 (12) TMI 1245 - HC - FEMA

Special Director's 2009 order set aside due to inordinate unexplained delay between arguments and pronouncement

UCO Bank, Bank of Baroda (Erstwhile Dena Bank) Versus The Special Director (Enforcement), Mumbai.

The Bombay HC set aside an order dated 9 March 2009 due to inordinate and unexplained delay between conclusion of arguments and pronouncement by the ... Validity of delayed judgment and order made by the Special Director (Enforcement) - Inordinate and unexplained delay between the conclusion of the arguments and the pronouncement of the impugned order - HELD THAT:- As in the peculiar facts of the present case and upon considering the delay between the conclusion of arguments and pronouncement of impugned orders and further, also upon considering the explanation offered, we are satisfied that such an explanation hardly constitutes exceptional or extraordinary circumstances, and therefore that the impugned order dated 9 March 2009 warrants interference. We note that the appeal instituted by the South Indian Bank Limited against the same impugned order dated 9 March 2006 was allowed by the appellate tribunal on the grounds of delay between the conclusion of the hearing and pronouncement of the said judgment and order. Considering that the tribunal, on that occasion, spoke through its single member, was not quite relevant. It was not the case of the respondent that the single member, i.e. the Chairperson was not competent to dispose of the appeal. Nothing on record states that the respondents had challenged the tribunal order dated 25 January 2021 in the appeal instituted by South Indian Bank Limited, nor was the same brought to our notice. Therefore, the appellate tribunal was not justified in taking a different view on identical facts. Thus, we set aside the impugned order dated 9 March 2009 and remand the matter to the Special Director (Enforcement) or the Competent Authority by whatever name called to dispose of the show cause notices issued against the appellants herein as expeditiously as possible. Needless to add, the appellants must be given a hearing, and the competent authority must pass reasoned orders within a reasonable period from the conclusion of the hearing. In terms of Ramdular Singh vs. State of UP [2024 (12) TMI 1127 - SC ORDER] matters must be disposed of within a maximum of three months from the date of all parties' hearings. Though these observations have been made in the context of Courts, there is no reason why a different timeline should apply to the facts and circumstances of the present case. In any event, this timeline could always be taken as a guideline for determining a reasonable period. These appeals are allowed in the above terms. The appellants or their duly authorized representatives must appear before the Special Director on 2 January 2025 at 11.00 am so that a schedule can be set out by the competent authority for hearing in the show cause notices. Issues:Delay in pronouncement of judgmentAnalysis:The judgment addressed the issue of inordinate and unexplained delay between the conclusion of arguments and the pronouncement of the impugned order. The appellant argued that the delay of about three years in issuing the impugned judgment and order was unjustifiable, citing previous cases where such delays led to interference. The respondent, on the other hand, claimed that the delay was due to the transfer of the Special Director hearing the case and was not deliberate. The court considered the arguments and previous judgments highlighting the importance of timely judgments to maintain litigants' confidence in the legal system.The court noted that the delay in this case was significant, with the conclusion of arguments in 2006 and the judgment delivered in 2009. Referring to past Supreme Court decisions, the court emphasized that unreasonable delays between hearing arguments and delivering judgments are undesirable. The court cited cases where judgments were set aside due to such delays, emphasizing the need for litigants to have confidence in the legal process.The judgment also discussed the appeal filed by South Indian Bank Limited against the same impugned order, which was allowed due to the delay between the conclusion of the hearing and the pronouncement of the judgment. The court found that the appellate tribunal's decision to dismiss the appellant's appeal was not justified, as the delay was a valid ground for interference. The court set aside the impugned order and remanded the matter for expeditious disposal, emphasizing the importance of timely decisions in legal proceedings.Furthermore, the court provided a timeline for the disposal of the matter, emphasizing the need for expeditious resolution within a reasonable period. The court directed the appellants to appear before the Special Director for setting a schedule for hearing in the show cause notices, ensuring that the competent authority passes reasoned orders within a specified timeframe. The judgment highlighted the importance of adhering to timelines to ensure the efficient administration of justice and maintain litigants' trust in the legal system.