Amalgamation of a claimant with a bank can shift a pending recovery suit to the Debts Recovery Tribunal.

A pending recovery suit originally filed by a non-banking entity was held to fall within the Debts Recovery Tribunal's jurisdiction after that entity amalgamated with a bank. The amalgamation meant the banking company continued the claim in its own right, so the proceeding was treated as a debt recovery matter within the Tribunal's statutory competence, unlike a mere assignment. Section 31 was read as procedural and could not override the substantive bar on civil court jurisdiction under Sections 17 and 18. Accordingly, the pending civil/commercial suit was transferable to the Tribunal, and the exclusive forum for adjudication became the DRT.

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Issues: (i) Whether, after amalgamation of the original non-banking plaintiff with a bank, the pending recovery suit became amenable to the jurisdiction of the Debts Recovery Tribunal. (ii) Whether Section 31 of the Recovery of Debts and Bankruptcy Act, 1993 prevented transfer of the suit, or had to yield to the bar of civil court jurisdiction under Sections 17 and 18.

Issue (i): Whether, after amalgamation of the original non-banking plaintiff with a bank, the pending recovery suit became amenable to the jurisdiction of the Debts Recovery Tribunal.

Analysis: The suit was for recovery of a monetary claim originally advanced by a non-banking entity, but pending the suit that entity amalgamated with a banking company. After amalgamation, the bank became entitled to pursue the outstanding claim in the course of its banking business. The Court treated the resulting proceeding as one falling within the definition of debt and within the class of applications that the Tribunal is empowered to entertain and decide. The distinction between assignment and amalgamation was material: in amalgamation the transferor company loses its existence, and the surviving banking entity prosecutes the claim in its own right, not merely as an assignee.

Conclusion: The suit became subject to the jurisdiction of the Debts Recovery Tribunal after amalgamation, and the transfer was proper.

Issue (ii): Whether Section 31 of the Recovery of Debts and Bankruptcy Act, 1993 prevented transfer of the suit, or had to yield to the bar of civil court jurisdiction under Sections 17 and 18.

Analysis: Section 31 was treated as procedural, whereas Sections 17 and 18 were treated as substantive provisions conferring exclusive jurisdiction on the Tribunal and barring other courts. The Court adopted a purposive construction and held that Section 31 could not be read in isolation so as to defeat the statutory scheme. Since the claim, after amalgamation, fell within the Tribunal's jurisdiction, the pending civil/commercial proceeding had to be transferred notwithstanding that the original suit was instituted before the change in status of the plaintiff.

Conclusion: Section 31 did not defeat transfer, and the bar under Sections 17 and 18 operated in favour of transfer to the Tribunal.

Final Conclusion: The petition failed because the amalgamated banking company could prosecute the recovery claim only before the Debts Recovery Tribunal, and the civil court was no longer the proper forum for adjudication.

Ratio Decidendi: Where a recovery claim pending in civil court comes, by amalgamation, to vest in a bank, the claim falls within the Tribunal's exclusive jurisdiction and must be dealt with under the Recovery of Debts and Bankruptcy Act, 1993 by giving Sections 17 and 18 primacy over the procedural transfer provision in Section 31.

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