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2003 (2) TMI 357
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.... at hand fresco a picture which not only creates a stir and an unusual ado to judicial discipline but also provokes and in a way accelerates the institutional syllogistic rethinking to have a deeper and greater probe into the arena of controversy. The spinal issue spiralled to this Court when the writ petitions were instituted assailing the orders passed by the Debts Recovery Tribunal (in short 'the Tribunal') on the foundation that Debts Recovery Appellate Tribunal (for short 'the Appellate Tribunal') had already pronounced a verdict that against and interlocutory order passed under the Recovery of Debts Due to Banks and financial Institutions Act, 1993 (for brevity 'the Act') no appeal lies. The learned Single Judge felt that a complex situation had surfaced inasmuch as this Court in the case of Earnest Health Care Ltd. v. Debts Recovery Tribunal [W.P. No. 4955 of 2000] placing reliance on the decisions rendered in the cases of Kavita Pigments & Chemicals (P.) Ltd. v. Allahabad Bank AIR 2000 Pat. 43, Shoes East Ltd. v. Allahabad Bank AIR 1997 Delhi 325 and Bank of India v. Baroda Cables [1999] ISJ (Bom.) 309 had expressed the view that any order passed by the Debts Recovery Tribu....
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....oss-examine the deponents of the affidavits, but, objecting the procedure adopted by the Tribunal by which it had received the evidence on affidavits. Being dissatisfied by the aforesaid order, the petitioner knocked at the doors of this Court in W.P. No. 660/2001 in which the petitioner questioned the defensibility of the order passed by the Tribunal and simultaneously raised the issue of validity of the provisions contained in Regulations 31 and 32 of the Debts Recovery Tribunal Regulation of Practice, 1998 (hereinafter referred to as 'the Regulations') on many a ground. This Court vide order dated 14-2-2001 dismissed the petition holding that the vires had been considered in Kishorilal Loomba v. Debts Recovery Tribunal [2001] 1 MPLJ 400 and the provisions in question have been held to be valid. It is contended that after passing of the aforesaid order, the petitioners by way of abundant caution filed an application for cross-examination of the deponents as the said prayer was not made in the earlier application. In the application, the petitioners set out the reasons why cross-examination was sought for. The Bank filed a reply in opposition to the said prayer. It is alleged that....
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....e petitioners therein, namely, M/s. Dhar Industries Ltd. and others forming the subject-matter of W.P. No. 894 of 2001 was dismissed relying on the earlier judgment passed in Kishorilal Loomba's case (supra). The said order was assailed before the Supreme Court and their Lordships of the Apex Court have dismissed the Special Leave Petition in limine. However, for the sake of completeness, we will advert to the same. We reiterate, we are not delving into the niceties and subtleties of the issue whether the said matter can be dealt with in a reference of this nature but as the learned counsel argued for some time, we are inclined to devote some space to put the controversy to rest, more so, in view of the latest Apex Court decision rendered in the case of Union of India v. Delhi High Court Bar Association AIR 2002 SCW 1347. Thus, three questions emerge for adjudication : (i)Whether interim order passed by the Tribunal is appealable before the Appellate Tribunal? (ii)Whether Regulations 31 and 32 of the Regulations famed by the Tribunal are invalid and deserve to be so declared ? (iii)Whether the impugned order deserves to be interfered with in exercise of jurisdiction under Articl....
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.... of objective law and that cannot govern the prescription in the main statute. It is also urged by them the Act was enacted with an avowed purpose, and recourse of appeal as provided in the 1994 Rules are to apply mutatis mutandis even in respect of an appeal preferred against the interim or interlocutory order barring an appeal which is referred to under section 21 of the Act. In support of their contentions, they have placed reliance on the decisions rendered in the cases of Kavita Pigments & Chemicals (P.) Ltd. (supra), Baroda Cables (supra ), Shoes East Ltd. (supra ), Sandeep Singh Sandhu v. Debt Recovery Tribunal II (1999) BC 556, M.C. Mittal v. Central Bank of India [L.P.A. No. 9 of 1996 dated 18-1-1996]. 6. To appreciate the rival submissions raised at the bar, it is appropriate to refer to the statement of objects and reasons. We are referring to the same only for the purpose of appreciating why the aforesaid Act was enacted by the Parliament and to understand the basic requisite. The enactment was made for establishment of Tribunals for expeditious adjudication and recovery of debts due to banks and financial institutions and for matters connected therewith or institution....
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.... cause for not filing it within that period. (4) On receipt of an appeal under sub-section (1), the Appellate Tribunal may, after giving the parties to the appeal, an opportunity of being heard, pass such orders thereon as it thinks fit, confirming, modifying or setting aside the order appealed against. (5) The Appellate Tribunal shall send a copy of every order made by it to the parties to the appeal and to the concerned Tribunal. (6) The appeal filed before the Appellate Tribunal under sub-section (1) shall be dealt with by it as expeditiously as possible and endeavour shall be made by it to dispose of the appeal finally within six months from the date of receipt of the appeal." 8. Section 21 deals with deposit of amount of debt due, on filing appeal. The said provision reads as under : "Deposit of amount of debt due, on filing appeal.--When an appeal is preferred by any person from whom the amount of debt is due to a bank or a financial institution or a consortium of banks or financial institutions, such appeal shall not be entertained by the Appellate Tribunal unless such person has deposited with the Appellate Tribunal seventy-five per cent of the amount of debt so due fr....
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....section 19 of the said Act. 40. This requirement of pre-deposit of amount determined is a common feature in many fiscal statutes and the said requirement of pre-deposit is only to be enforced in a case where the determination has been made by the Tribunal under section 19 of the said Act. Therefore, the expression 'such appeal' has been used. The requirement of such pre-deposit of the amount determined cannot be enforced by the Appellate Tribunal in connection with an appeal where no such determination has been made as is in the instant case. So this point has no substance." (p. 50) 11. In the case of Baroda Cables (supra) a Division Bench of Gujarat High Court in paragraph 14 held as under : "14. Looking to the above provisions, there is no doubt in our minds that there is no provision in the Act stating that an appeal would lie before an Appellate Tribunal only when the order is final in nature. On the contrary, looking to the above provisions in their entirety, it is clear that any order passed by the Debt Recovery Tribunal is subject to challenge under section 20 before the appellate Tribunal. If it is so, in our opinion, the contention of Mr. Trivedi is well-founded that th....
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....im order passed under section 19(6) of the Act by the Tribunal, if it affects the rights or liabilities of any party, will be subject to appeal under section 20(1) of the Act." 14. In the case of M.C. Mittal (supra) a Division Bench of Delhi High Court after referring to sections 17 and 20 in paragraph 3 expressed the view as under : "3. A reading of sub-clause (2) of section 20 shows that the Appellate Tribunal shall exercise its powers in relations 'any order' made or deemed to have been made by the Tribunal. The words 'any order' would include interlocutory orders which substantially affect the rights of the parties and those words are not confined to the final disposal of the application filed under section 19. Similarly, sub-clause (1) of section 20 reads the words 'an order' and that would also mean that an appeal lies against interim orders which substantially affect the rights of the parties and those words are not confined to an order which finally disposes of the application before the Tribunal." 15. In this context, we may profitably refer to the decision rendered in the case of Central Bank of India Ltd. v. Gokal Chand AIR 1967 SC 799, wherein a three Judge Bench of ....
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....ct. Even an interlocutory order passed under section 37(2) is an order passed under the Act and is subject to appeal under section 38(1) provided it affects some right or liability of any party. Thus, an order of the Rent Controller refusing to set aside an ex parte order is subject to appeal to the Rent Control Tribunal. 4. Similar considerations have induced the Courts to give a limited construction on the apparently wide words of other statutes conferring rights of appeal. Section 202 of the Indian Companies Act, 1913 confers a right of appeal 'from any order or decision made or given in the matter of the winding up of a company by the court.' In Shankarlal Agarwal v. Shankarlal Poddar [1964] 1 SCR 717 at p. 736 this Court decided that these words, though wide, would exclude merely procedural orders or those which did not affect the rights or liabilities of parties." (p. 800) 16. After noticing the aforesaid pronouncements we think it condign to deal with another facet of submission of Mr. Kishore Shrivastava that no rules having been prescribed, it is an exercise in futility to state that an appeal lies. Emphasis has been laid on the unworkability of the provisions. The 1994 ....
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....ade". Though Mr. Shrivastava has made herculean endeavour to point out the difference between the terminology used in section 17 and section 20 on the backdrop that in one provision the word 'an' is used and in another provision the word 'any' is used. There is no difference between the two terms, namely 'an' and 'any'. If the words used are understood in proper perspective taking into consideration the text and the context, we are of the considered view that the expressions used in sections 17 and 20 are not repugnant to each other. In fact, they point out to a complete harmonious whole leading to a specific, precise, appropriate destination i.e. the tenability of appeal from an order or any order. The distinction which is sought to be drawn by Mr. Shrivastava on the basis of the use of the word, in our considered opinion, is absolutely fallacious. The High Court of Delhi in the case of M.C. Mittal (supra ) accepted the interpretation that any order would mean interlocutory orders which substantially affect the rights of the parties. The Court presided by the learned Chief Justice M. Jagannatha Rao (as His Lordship then was) has also referred to the term "an orders" and held that ....
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....e acceptation of this nature would defeat the science of interpretation. Judged from all this angle, we are inclined to hold that an appeal lies against any order or an order which substantially affect some rights or liabilities of the party and is not confined to the final order alone. 20. The second limb of argument of Mr. Shrivastava relates to validity of Regulations 31 and 32. We are dealing with this facet as an argument was canvassed, for sake of completeness and put the controversy to rest. The Regulations 31 and 32 occurring in Chapter XI of the Regulations read as under : "31. Examination of witnesses and the issue of Commissions--(a ) Evidence shall be on affidavits. (b) Provisions of section 22 sub-section (2) of the Act and the relevant provisions of the Code of Civil Procedure shall mutatis mutandis apply in the matters of summoning and enforcing attendance of any person as witness and for examining him on oath and issuing a commission for the examination of such witnesses. 32. Attendance of Deponent for cross examination.--The Tribunal may, on the application of either party assigning reasons and after hearing, order the attendance of deponent who has sworn an af....
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....also drawn inspiration from the decision rendered in the case of Rajinder Pershad (supra) wherein the Apex Court in paragraph 4 has indicated that right to cross-examination is a valuable right. The other decisions which have been cited are on the same line. It is contended by Mr. Shrivastava the Regulations totally curtail the rights of the defendants in relation to cross-examination of witnesses by stating that evidence shall be on affidavits. The learned counsel has submitted that when the averments made in the application are combatted or resisted there has to be grant of permission for cross-examination. It is proponed by him that sub-rule 6 of Rule 12 casts an obligation on the Tribunal to permit cross-examination and no option is left with the Tribunal. To appreciate the aforesaid submission, it is seemly to reproduce sub-rule (6) of Rule 12 of the Rules 1993. "12. Filing of reply and other documents by the respondent-- 1 to 5.****** 6. The Tribunal may at any time for sufficient reason order that any particular fact or facts may be proved by affidavit, or that the affidavit of any witness may be read at the hearing, on such conditions as the Tribunal thinks reasonable : ....
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....th Order 19, Rule 1 of the Code of Civil Procedure, and the view taken by some of the Tribunals that a party does not have a right to cross-examine a witness, whose evidence is taken on affidavit, is not correct." Thereafter, their Lordships referred to section 22 and Rule 12 and eventually in paragraphs 21 and 23 held as under : "21. As a result of the amendments made in the Act and the Rules, the position which would emerge is that section 19(1) of the Act requires the filing of an application by a bank or a financial institution for the recovery of debt to be made before a Tribunal having territorial jurisdiction. On receipt of the application, summons are issued to the defendant who has to show cause within the stipulated period as to why the relief prayed for should not be granted. A right is now given by sub-section (6) of section 19 to the defendant to claim a set off against the applicant's demand and the said written statement is to have the same effect as a plaint in a cross-suit. Under sub-section (8) of section 19, the defendant is also entitled to set up a counter-claim in addition to his right of claiming a set off. Sub-section (2) of section 19 provides that after ....
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....e produced and it is necessary to do so and there is no desire to prolong the case that it shall require the witness to be present for cross-examination and in the event of his not appearing, then the affidavit shall not be taken into evidence. When the High Courts and the Supreme Court in exercise of their jurisdiction under Art. 226 and Art. 32 can decide questions of fact as well as law merely on the basis of documents and affidavits filed before it ordinarily, there should be no reason as to why a Tribunal, likewise, should not be able to decide the case merely on the basis of documents and affidavits before it. It is common knowledge that hardly any transaction with the Bank would be oral and without proper documentation, whether in the form of letters or formal agreements. In such an event the bona fide need for the oral examination of a witness should rarely arise. There has to be a very good reason to hold that affidavits, in such a case, would not be sufficient." 23. The Division Bench of this Court while upholding the validity of Regulations in the case of Kishorilal Loomba ( supra) in paragraphs 10 and 11 held as under : "10. The Tribunal and the Appellate Tribunal hav....
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....le. Construing them in manner submitted by the petitioners would make the purpose of the Act and the scheme redundant. Rather harmonious and purposeful meaning has to be assigned to the provisions of the Act, Rules and Regulations to achieve the basis purpose of the legislation." [Emphasis supplied] 24. In our considered view, the view expressed by the Division Bench of this Court is absolutely in consonance and unquestionably in accord with the view expressed later on by the Apex Court in the case of Delhi High Court Bar Association (supra). The perception of the learned counsel in regard to the term 'appears' is inconceivable even by conferring the allowance of dialectics of 'perceptual shift'. It is worthnoting here that if a case is made out as per Regulation 32, the Tribunal shall order the attendance of deponent who has sworn an affidavit. That is what has been held in paragraph 23 of the judgment rendered by the Apex Court in the case of Delhi High Court Bar Association (supra). Therefore, we have no hesitation in holding that "Regulations 31 and 32 do not transgress the limits stipulated under section 22 of the Act or sub-rule (6) of Rule 12 of the 1993 Rules. Hence, they ....
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....onferred the power to interpret it. It is they who have to ensure that the balance of power envisaged by the Constitution is maintained and that the Legislature and the executive do not, in the discharge of their functions, transgress constitutional limitations. It is equally their duty to oversee that the judicial decisions rendered by those who man the subordinate Courts and Tribunals do not fall foul of strict standards of legal correctness and judicial indpendence. The constitutional safeguards which ensure the independence of the Judges of the superior judiciary are not available to the Judges of the subordinate judiciary or to those who man Tribunals created by ordinary legislations. Consequently, Judges of the latter category can never be considered full and effective substitutes for the superior judiciary in discharging the function of constitutional interpretation. We, therefore, hold that the power of judicial review over legislative action vested in the High Courts under article 226 and in this Court under article 32 of the Constitution is an integral and essential feature of the Constitution, constituting part of its basic structure. Ordinarily, therefore, the power of ....
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....ce of it erroneous or raises question of jurisdiction or of infringement of fundamental rights of the petitioner. . . ." (p. 647) 29. In the case of A.V. Venkateswaran v. Ramchand Sobhraj Wadhwani AIR 1961 SC 1506 the Apex Court expressed thus : "The wide proposition that the existence of an alternative remedy is a bar to the entertainment of a petition under article 226 of the Constitution unless (1) there was a complete lack of jurisdiction in the officer or authority to take the action impugned, or (2) where the order prejudicial to the writ petitioner has been passed in violation of the principles of natural justice and could, therefore, be treated as void or non est and that in all other cases, Courts should not entertain petitions under article 226 or in any event not grant any relief to such petitioners cannot be accepted. The two exceptions to the normal rule as to the effect of the existence of an adequate alternative remedy are by no means exhaustive, and even beyond them a discretion vests in the High Court to entertain the petition and grant the petitioner relief notwithstanding the existence of an alternative remedy. The broad lines of the general principles on which....
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....ative writs, on the negative plea of 'alternative remedy' since the root principle of law married to justice, is ubi jus ibi remedium." (p. 1038) Their Lordships further proceeded to lay down as under : "6. Article 226 grants an extraordinary remedy which is essentially discretionary, although founded on legal injury. It is perfectly open for the Court, exercising this, flexible power, to pass such order such as public interest dictates and equity projects. Courts of equity may, and frequently do, go much further both to give and withhold relief in furtherance of the public interest than they are accustomed to go where only private interests are involved. Accordingly, the granting or withholding of relief may properly be dependent upon consideration as of public interest. . . .' (p. 1039) 32. In the case of Dr. Smt. Kuntesh Gupta v. Management of Hindu Kanya Mahavidyalaya AIR 1987 SC 2186 the Apex Court held thus : "Further, it is well established that an alternative remedy is not an absolute bar to the maintainability of a writ petition, when an authority has acted wholly without jurisdiction, the High Court should not refuse to exercise its jurisdiction under article 226 of ....
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....ourt, such as cases involving purely questions regarding interpretation of law. . . ." (p. 93) 35. In this context we may profitably quote a passage from the decision rendered in the case of Reg. v. Hillington, London Borough Council 1974-1 QB 720, wherein Lord Widgery, C.J. stated thus : "It has always been a principle that certiorari will go only where there is no other equally effective and convenient remedy. . . The statutory system of appeal is more effective and more convenient than application for certiorari and the principal reason why it may prove itself more convenient and more effective is that an appeal to (say) the Secretary of State can be disposed of at one hearing whether the issue between them is a matter of law or fact or policy or opinion or a combination of some or all of these. . . whereas of course an appeal for certiorari is limited to cases where the issue is a matter of law and then only it is a matter of law appearing on the face of the order. An application for certiorari has however this advantage that it is speedier and cheaper than the other methods and in a proper case therefore it may well be right to allow it to be used. . . I would, however, de....