TaxTMI 
TaxTMI 
TaxTMI 
2022 (5) TMI 704
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....ear 1986 for recovery of its dues and enforcement of securities. Upon enactment of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (hereinafter referred to as the Act, 1993), the suit was transferred to the Debts Recovery Tribunal (DRT), which was numbered as Transfer Application No. 95/1995. The DRT vide order dated 03.03.2000 decreed the said application and directed respondent No. 1 and the guarantors to pay jointly and severally a sum of Rs. 44,01,159.47/with cost. 2.2 Thereafter, the debts under the credit facility were assigned in favour of the appellant - bank. Pursuant to the assignment of dues, bank issued a demand notice upon the judgment debtor - respondent No. 1 and others under section 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act) for a sum of Rs. 27,35,85,200.62/as on 20.06.2011, together with further interest and expenses and costs. Before any further measures under section 13(4) of the SARFAESI Act could be taken by the appellant - bank, respondent No. 1 filed an application under section 17 of the SARFAESI Act before the DRT being Securitisation Application N....
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.... Misc. Application No. 643/2017 and order dated 21.01.2017 passed by the DRT in Securitisation Application No. 171/2016. Thus, respondent No. 1 challenged three different orders passed by three different authorities passed under two different Acts. The appellant resisted the said Special Civil Application on the grounds, inter alia, that without exhausting alternative remedies available under the SARFAESI Act and Act, 1993, the writ petition under Article 226 of the Constitution of India would not be maintainable. It was also submitted that the writ petition under Article 226 of the Constitution of India against the orders passed by the DRT and the orders passed under the SARFAESI Act and Act, 1993, would not be maintainable. That vide order dated 19.04.2021 and during the pendency of the aforesaid writ petition before the High Court, the DRT dismissed the Securitisation Application No. 171/2016 with cost of Rs. 25,000/. The learned Single Judge of the High Court subsequently dismissed the aforesaid Special Civil Application No. 2763/2017 vide detailed judgment and order dated 07.10.2021 with exemplary cost of Rs. 1,00,000/. The learned Single Judge specifically observed that the s....
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....nitiated under the SARFAESI Act and/or against an interim order shall not be maintainable. It is submitted that by granting such an adinterim order, the Division Bench of the High Court has virtually stalled the proceedings under the SARFAESI Act. Issue notice returnable on 15.03.2022. Dasti, in addition, is permitted. In the meantime, the Division Bench of the High Court either to finally decide and dispose of the LPA and/or at least the application for interim relief to be decided on or before 09.03.2022 and the order that may be passed to be placed before this Court on the next date of hearing." 2.8 It appears that having come to know of the present appeal and order dated 22.02.2022, calculatively respondent No. 1 withdrew the aforesaid Letters Patent Appeal with liberty to file appropriate proceedings before the appropriate forum. Respondent No. 1 - original appellant also requested to continue the earlier exparte adinterim order dated 25.01.2022, which as such is the subject matter of the civil appeal arising out of SLP (C) No. 2228/2022, pending before this Court. The Division Bench of the High Court vide impugned order dated 04.03.2022 (impugned order in civil app....
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....t Appeal with liberty to file appropriate proceedings before the appropriate forum and obtaining observations that the observations made by the learned Single Judge in order dated 07.10.2021 passed in Special Civil Application No. 2763/2017 may not be considered by the appropriate forum before whom the proceedings to be initiated which is also the subject matter of subsequent SLP, deliberately respondent No. 1 has chosen not to appear in the subsequent SLP (C) No. 4724/2022. 4. At the outset, it is required to be noted that the proceedings before the High Court initiated by respondent No. 1 in the year 2017 by way of Special Civil Application No. 2763/2017, as such was nothing but an abuse of court process and only with a view to delay the proceedings under the SARFAESI Act, initiated by the appellant - bank, to recover the amount due and payable since 1986. From the material available on record, it is noted that one after another, a number of proceedings were initiated by respondent No. 1. Thus, it can be said that all efforts were made by respondent No. 1 - original appellant to delay the proceedings under the SARFAESI Act, initiated by the bank, to recover the amount due and pa....
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.... proper and equitable in the facts and circumstances of the petition." After the detailed judgment and order and after having taken note of the subsequent order passed during the pendency of the writ petition before the learned Single Judge of the High Court and having taken note of the subsequent order passed by the DRT/appropriate authority dismissing the securitisation application with cost of Rs. 25,000/, the learned Single Judge by the detailed judgement and order dismissed the writ petition with exemplary cost of Rs. 1,00,000/. 4.2 In fact, while dismissing the securitisation application, the DRT made observations in paragraphs 31 to 33, which read as under: " 31. It is worthwhile to mention here that the bank filed the Recovery Proceedings in the year 1986 and now we are in the year 2021. The bank made part recoveries through process of law by sale of hypothecated assets and one property situated in Vatva. The amount recovered is merger amount, as compared to total recoverable dues. On the date of issuance of Demand Notice, bank claimed Rs.27,35,85,200.62 Ps, whereas amount recovered was approximately Rs.9,33,031.20 Ps. The Applicants made every effort to hinder the ....
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....ht of the bank to recover all expenses incurred to defend the litigation filed by the Applicants to question validity of Securitisation Process. Cost is to be deposited with National Defence Fund in the Account No. 11084239799 State Bank of India at New Delhi Main Branch (00691) and file a purshis in compliance of orders of this Tribunal within 7 days. The Respondent Bank may proceed further in accordance with law." That thereafter the learned Single Judge dismissed the aforesaid writ petition bearing Special Civil Application No. 2763/2017 by observing in paragraph 24 as under: " 24. From the narration of the facts made by the DRT it is clear that the petitioner has only one goal and agenda as not to pay any single rupee after the decree passed by the DRT in the year 2000. The petitioner has remained successful for almost 21 years for not paying any amount of the outstanding dues as per the decree passed by the DRT which has achieved finality. In such circumstances, without adverting to the further facts and taking into consideration the finding of the DRT which is not under challenge and which has achieved finality, the petition is dismissed with cost of Rs. 1 lakh. The amoun....
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...., there would be stay against the dispossession of the property i.e. not to take possession of the property in question as well as stay against imposing cost of Rs.1,00,000/to the present appellant - original petitioner. Direct service is permitted."] 4.4 While issuing the notice in the present Civil Appeal arising out of SLP (C) No. 2228/2022, this Court passed a detailed order which is as under: " Shri Amar Dave, learned Advocate appearing on behalf of the petitioner Bank has taken us to the reliefs sought/prayed in the main writ petition (pages 5758). He has submitted that as such some of the reliefs sought in the main writ petition were the interim order passed by the DRT dated 21.01.2017. It is submitted that one another relief which was sought was to hold and declare that the proceedings initiated by the Bank under the Securitization and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002 (SARFAESI Act) are illegal being time barred. It is reported that the proceedings before the DRT are disposed of and the same have been dismissed. It is further submitted that even the order passed by the Recovery officer dated 15.07.2016 upon which the re....
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....n paragraph 4 that the appropriate forum which is going to examine order dated 19.04.2016 passed by the Debt Recovery Tribunal1, Ahmedabad in Case No. S.A. 171 of 2016, shall deal with the case independently and without being influenced by the observations made by learned Single Judge, vide order dated 07.10.2021 passed in Special Civil Application No. 2763 of 2017 and without being influenced by the order of cost imposed by this Appellate Bench. For immediate reference the relevant portion of the aforesaid impugned order dated 04.03.2022 is extracted as under: ["3. ....Having considered the submissions made by the learned advocates for the respective parties, we pass the following order: [i] The appellant is permitted to withdraw present appeal with a liberty to file appropriate proceedings before the appropriate forum. [ii] Till the next date of hearing, interim relief, if any, granted and which is in existence, is extended upto 14.03.2022. [iii] As far as the cost imposed by the learned Single Judge is concerned, the same is reduced to Rs.25,000/( Rupees Twenty Five Thousand Only) and the same shall be paid to respondent No. 1 by RTGS on or before 11.03.2022. 4. It....
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....ation No. 2763 of 2017 and without being influenced by the order of cost imposed is also unsustainable. Such observations made while permitting withdrawal of the Letters Patent Appeal amounts to virtually allowing the appeal and setting aside the orders of the DRT as well as the learned Single Judge. Once having enjoyed the fruits of interim orders for approximately four years and in between initiating a number of other proceedings (even during the pendency of the writ petition) and thereafter, having invited the order in writ petition on merits and when the learned Single Judge dismissed the writ petition with cost, the Division Bench ought not to have passed an order nullifying the strong observations made by the learned Single Judge while dismissing the writ petition. In fact, the Division Bench also did not consider the order of the learned Single Judge on merits but has granted relief even while permitting withdrawal of the appeal. Such conduct on the part of the litigant to once enjoy the fruits of the litigation for number of years, invite the order on merits, which is against him and in the appeal initially after obtaining the exparte adinterim relief and thereafter, having....