TaxTMI 
TaxTMI 
2018 (11) TMI 532
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....dvocate, Mr. Gaurav Goel, Advocate, Mr. Anil Kumar Garg, Advocate, Mr. J.S. Mann, Advocate, Ms. Harpreet Kaur, Advocate, Mr. Shiv Kumar, Advocate, Mr. D.K. Singal, Mr. Sanjeev K. Aggarwal, Advocate, Mr. Vikas Kumar, Advocate for Mr. Harsh Chopra, Advocate, Mr. Sandeep Suri, Advocate and Ms. Kriti Sharma, Advocate And Mr. Vijay Parkash, Advocate for Mr. Nonish Kumar, Advocate ORDER Ajay Kumar Mittal, ( J) 1. This order shall dispose of a bunch of 23 petitions bearing CWP Nos.21519, 7790, 9017, 18798, 19341, 2134, 2338, 23122, 23057, 26055, 26487, 17893, 18246, 27310, 3689, 4335, 4710, 6118, 13848 and 16889 of 2018, 27382, 26380 and 28230 of 2017, as according to the learned counsel for the parties, the issue involved in all these petitions is identical. However, the facts are being extracted from CWP No. 21519 of 2018. 2. CWP No. 21519 of 2018 has been filed by the petitioners for quashing the impugned order dated 15.01.2018, Annexure P.6, passed by respondent No.2-Debt Recovery Tribunal-III (in short, "the DRT") in SA No. 466 of 2017 vide which the Securitisation application (SA) filed by them under Section 17 of the Securitisation and Reconstruction of Financial Assets....
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....n of export consignment and the recovery used to be effected through bill discounting facility which included the process of discounting of bills by the respondent Bank and consequent recoveries, which used to clear off the packing credit outstanding. In the first week of April 2010, respondent No.1 Bank suddenly refused to allow FBN facility and without any default from any of the reputed overseas customers of the petitioners. The said FBN facility was being allowed by the Bank for the last 15 years as per petitioners' requirement. Thus, the only source of recovery, was intentionally and willfully stalled by the Bank, forcing the account to turn into NPA. The petitioners made various efforts to convince the officers of the Bank but of no avail. Finally on 16.05.2016, respondent No.1 issued a demand notice under Section 13(2) of the 2002 Act claiming Rs. 16,82,99,955/49 as on 30.09.2015 vide Annexure P.1. The detailed objections were submitted on 14.07.2016 by the petitioners. The respondent-Bank issued a notice on 22.08.2016 under Section 13(4) of the 2002 Act vide which it took symbolic property i.e. property measuring 500 square yards at 92, Industrial Area A, Ludhiana. In the S....
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....y declared that the communication of the reasons to the borrower by the secured creditor for not having accepted his representation or objection or the likely action of the secured creditor at the stage of communication of reasons to the borrower shall not entitle the person (including borrower) to make an application to the Debts Recovery Tribunal under this sub-section. (1A) An application under sub-section (1) shall be filed before the Debts Recovery Tribunal within the local limits of whose jurisdiction- (a) the cause of action, wholly or in part, arises; (b) where the secured asset is located; or (c) the branch or any other office of a bank or financial institution is maintaining an account in which debt claimed is outstanding for the time being.] (2) The Debts Recovery Tribunal shall consider whether any of the measures referred to in sub-section (4) of section 13 taken by the secured creditor for enforcement of security are in accordance with the provisions of this Act and the rules made thereunder. (3) If, the Debts Recovery Tribunal, after examining the facts and circumstances of the case and evidence produced by the pa....
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....the time being in force, the Debt Recovery Tribunal may pass such order as it deems fit in accordance with the provisions of this Act.] (5) Any application made under sub-section (1) shall be dealt with by the Debts Recovery Tribunal as expeditiously as possible and disposed of within sixty days from the date of such application: Provided that the Debts Recovery Tribunal may, from time to time, extend the said period for reasons to be recorded in writing, so, however, that the total period of pendency of the application with the Debts Recovery Tribunal, shall not exceed four months from the date of making of such application made under sub-section (1). (6) If the application is not disposed of by the Debts Recovery Tribunal within the period of four months as specified in subsection (5), any part to the application may make an application, in such form as may be prescribed, to the Appellate Tribunal for directing the Debts Recovery Tribunal for expeditious disposal of the application pending before the Debts Recovery Tribunal and the Appellate Tribunal may, on such application, make an order for expeditious disposal of the pending application by the Debts....
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....the time being in force. Recovery of Debts due to Banks and Financial Institutions Act, 1993. 17. Jurisdiction, powers and authority of Tribunals.-(1) A Tribunal shall exercise, on and from the appointed day, the jurisdiction, powers and authority to entertain and decide applications from the banks and financial institutions for recovery of debts due to such banks and financial institutions. (2) An Appellate Tribunal shall exercise, on and from the appointed day, the jurisdiction, powers and authority to entertain appeals against any order made, or deemed to have been made, by a Tribunal under this Act. 22. Procedure and Powers of the Tribunal and the Appellate Tribunal- (1) The Tribunal and the Appellate Tribunal shall not be bound the procedure laid down by the Code of Civil Procedure, 1908 (5 of 1908), but shall be guided by the principles of natural justice and, subject to the other provisions of this Act and of any rules, the Tribunal and the Appellate Tribunal shall have powers to regulate their own procedure including the places at which they shall have their sittings. Xxxxxxxxxxxxxxxxx 24. Limitation.-The provisions of t....
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....er Section 13(4) provide continuity to the cause of action. An Explanation has been added to Section 17(1) clarifying that the communication of reasons to the borrower in terms of Section 13(3-A) shall not constitute a ground for filing application under Section 17(1). Sub-section (2) of Section 17 casts a duty on the Tribunal to consider whether the measures taken by the secured creditor for enforcement of security interest are in accordance with the provisions of the 2002 Act and the Rules made thereunder. If the Tribunal, after examining the facts and circumstances of the case and evidence produced by the parties, comes to the conclusion that the measures taken by the secured creditor are not in consonance with sub-section (4) of Section 13, then it can direct the secured creditor to restore management of the business or possession of the secured assets to the borrower. On the other hand, if the Tribunal finds that the recourse taken by the secured creditor under sub-section (4) of Section 13 is in accordance with the provisions of the 2002 Act and the Rules made thereunder, then, notwithstanding anything contained in any other law for the time being in force, the secured credit....
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....d by such special or local laws. In other words, Section 5 of the Limitation Act cannot be resorted to only when it is expressly excluded by a special or local law. (13.2) Section 239 of the Act has not expressly excluded the application of Section 5 of the Limitation Act. In fact, a conjoint reading of Sections 239 and 119(2) of the Act clearly shows that the application of Section 5 of the Limitation Act to the claims of refund has been specifically included in the Act. (13.3) Thus, in our view the power given to the Board under Section 119 (2) of the Act to entertain a belated claim is nothing but incorporation of the provisions of Section 5 of the Limitation Act, 1963. (14) In view of the above, we are satisfied that by virtue of power conferred on the Board under Section 119(2) of the Act, it is fully competent to admit an application for refund even after the expiry of period prescribed under Section 239 of the Act for avoiding genuine hardship in any case or class of cases." 11. In State of Haryana vs. Hindustan Machine Tools Limited and others, AIR 2015 Punjab 45, it was held by the Full bench of this Court that when any special statute prescri....
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....discretion, however, is to be judicial and not arbitrary. "Sufficient cause" has not been defined by the legislature in the 1963 Act but is to be ascertained on the individual facts of each case. 7. Section 29(2) of the 1963 Act, inter alia provides that where any special or local law prescribes for any suit, appeal or application a period of limitation different from the period of limitation prescribed by the schedule, the provisions of section 3 shall apply as if such period was the period prescribed by the schedule and for the purpose of determining any period of limitation prescribed for any suit, appeal or application by any special or local law, the provisions contained in Sections 4 to 24 shall apply only in so far as, and to the extent, they are not expressly excluded by such special or local law. When any special statute prescribes certain period of limitation shown, then the period of limitation prescribed under the special law shall prevail and to that extent the provisions of the 1963 Act shall stand excluded. If none of them are excluded, then in that situation all of them would be applicable. In our opinion, the language mentioned in Section 29(2) of the 1963....
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....2009 (8) SCC 646, then also in view of the observations made hereinabove, it cannot be accepted that Section 5 of the Limitation Act would not apply to the proceedings under Section 17 of the Securitisation Act before the Debt Recovery Tribunal. The reliance upon the decision of the Apex Court in the case of Consolidated Engineering Enterprises Vs. principal Secretary, Irrigation Department 2008 (7) SCC 169 is ill-founded inasmuch the observations off the Apex Court are to be considered and applied to the facts of that case. If such observation are considered, what is being held by the Apex Court that if there is express period prescribed in the special law, such would apply and not the prescription as provided under the Limitation Act, but the same cannot be read in absolute so as to excluded the applicability of other provisions of the Limitation Act which may apply, more particularly in view of the no express bar provided under the special law. Therefore, such a decision is of no help to the learned counsel for the petitioner." The applicability of provisions of Section 5 of the Limitation Act, 1963 to the proceedings under Section 17 of the 2002 Act was held to be available ....
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....ch the Tribunal arises on the initiation of proceedings by the secured creditor against the borrower or any aggrieved person. Therefore, though an application is to be filed by an aggrieved person including a borrower, but such application is an objection petition to the action taken by the secured creditor. Though sub-sections (5) & (6) of Section 17 of the Act, prescribes the period for a decision on an application filed in terms of Section 17 of the Act, but sub-section (7) contemplates that the Debt Recovery Tribunal shall dispose of the application filed in accordance with the provisions of the 1993 Act and the Rules made there under, save as otherwise provided under the Act. Similar provision is in respect of appellate proceedings contained in sub-section (2) of Section 18 of the Act. The right has been given to any person including borrower to invoke the jurisdiction of the Debt Recovery Tribunal in the matter within 45 days from the date on which such measures had been taken under sub-section (1) of Section 17. Section 37 of the Act contemplates that provisions of the Act or the Rules made there under are in addition to, and not in derogation of 1993 Act including ....
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....ggrieved including a borrower before the Debt Recovery Tribunal under Section 17 of the Act. (iii) The provisions of Sections 4 to 24 of the Limitation Act are applicable to an appeal to be preferred against an order passed by the Debt Recovery Tribunal before the Debt Recovery Appellate Tribunal under Section 18 of the Act. (iv) Whether sufficient cause is disclosed to seek condonation of delay, is a question of fact to be determined by the Debt Recovery Tribunal and/or the Debt Recovery Appellate Tribunal in the facts of each case." 15. In all fairness to learned counsels for the Bank, we refer to the judgments relied upon by them. Support was drawn by them from the decisions in Om Parkash vs. Ashwani Kumar Bassi, AIR 2010 SC 3791; Ashwani Kumar Gupta vs. Siripal Jain, 1998(2) RCR 222; Prakash H.Jain vs. Marie Fernandes, (2003) 8 SCC 431; AIR 2003 SC 459 and Officer on Special Duty vs. Shah Mari Lal, 1996 AIR SCW 941. Suffice it to notice that the principal of law enunciated therein is unquestionable but none of them relates to the provisions of 2002 Act or 1993 Act. Thus, no benefit can be derived by them from these pronouncements. 16. Further, it may be ....