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Ashok Kumar Rice Oil And Flour ... vs Presiding Officer, Debts ...

High Court Of Judicature at Allahabad|16 July, 2002

JUDGMENT / ORDER

JUDGMENT Janardan Sahai, J.
1. When the matter was taken up a preliminary objection was raised by Mr. Satish Chaturvedi, learned Counsel for the Bank that the writ petition is not maintainable as an appeal lies under Section 20, of the Recovery of Debts Due to Bank and Financial Institutions Act, 1993, hereinafter referred to as 'the Act'. In order to determine the question a brief reference to the facts of the case may be made. A suit for recovery of money was filed by the State Bank of India against the petitioner. The suit was decreed exparte by the judgment and decree dated 27.5.1994. An application for setting aside the exparte decree was filed by the petitioner in the Civil Court, which was pending and was registered as Misc. Case No. 9 of 1996. The decree was put to execution in the Civil Court on 30.5.1995. The execution proceeding as well as the proceedings under Order 9, Rule 13, C.P.C. were transferred to the Debts Recovery Tribunal. The Debit Recovery Tribunal by its order dated 13.6.2000 rejected the application under Order 9, Rule 13, C.P.C. This order and the exparte decree are under challenge in the present writ petition.
2. On the issue of maintainability, the first contention of the learned Counsel for the petitioner Mr. W.H. Khan is that under terms of Section 31 the proceedings under Order 9, Rule 13, C.P.C. could not have been transferred to the Debts Recovery Tribunal. Section 31(1) of the Act is quoted below :
"31. Transfer of pending cases:--(1) Every suit or other proceedings pending before any Court immediately before the date of establishment of a Tribunal under this Act, being a suit or proceeding the cause of action whereon it is based is such that it would have been, if it had arisen after such establishment, within the jurisdiction of such Tribunal, shall stand transferred on that date to such Tribunal :
Provided that nothing in this sub-section shall apply to any appeal pending as aforesaid before any Court."
3. Mr. Khan relies upon a decision of the Patna High Court in 1999(1) Bank C.L.R. 614 Arbind Kumar v. State Bank of India and Ors. In that case it was held that the words or other proceedings' occurring in Section 31 are not wide enough to include Misc. Case for setting aside the ex pane decree but refer to proceedings before other authorities, such as proceedings in the nature of certificate proceedings under the relevant State Public Demands Recovery Act before the Certificate Officer if such proceedings are at the instance of the Bank or other Financial Institution, within the meaning of the Act concerned, and these too would stand transferred to the Tribunal. A Division Bench of the Patna High Court in 2001 (1) Bank CLR 240. Ram Laxman Glass (P) Ltd. and Ors., v. State of Bihar and Ors. has overruled the decision in Arbind Kumar (supra). It was held that the words 'other proceeding' have to be given wider meaning and the miscellaneous case filed for restoration of the suit or for setting aside the exparte decree passed in the suit are deemed to be included in 'other proceedings'. The Division Bench relied upon Allahabad Bank v. Canara Bank, I(2000) BC 627 (SC)=III (2000) CLT 129 (SC)=VI (2000) SLT 325=2000(4) SCC 406, where the Apex Court held that the adjudication of the liability and recovery of amount by execution of the certificate respectively are within the exclusive jurisdiction of the Tribunal and no civil Court or Company Court has power to entertain suit or proceeding with regard to it. This question has also been examined in the context of an application under Order 9 Rule 9, C.P.C. by this Court by Hon' ble S. Harkauli, J. in Smt. Nirmata Devi v. Debt Recovery Tribunal and Ors. in Civil Misc. Writ Petition No. 16600 of 2002, in which it was held that the words 'other proceedings' include proceedings under Order 9 Rule 9, C.P.C.
4. Section 141, C.P.C. provides that 'proceedings' includes proceedings under Order 9, but does not include any proceeding under Article 226 of the Constitution. Section 31 of the Act provides that every suit or other proceeding pending before any Court immediately before the date of establishment of a Tribunal under this Act, being a suit or proceeding the cause of action whereon it is based is such that it would have been, if it had arisen after such establishment, within the jurisdiction of such Tribunal, shall stand transferred on that date to such Tribunal. A fiction in effect is created that even though the cause of action has actually arisen before the establishment of the Tribunal it has to be imagined that it has arisen after its establishment for the purpose of transfer. Now after the Tribunal is established it is only the Tribunal, which could have actually passed the decree in such suits, which are within its competence. The cause of action for setting aside an exparte decree where proceedings under Order 9 Rule 13, C.P.C. are pending in the Civil Court on the date of establishment of the Tribunal would have actually arisen before the Tribunal's establishment but by the fiction in effect employed in Section 31 it has to be imagined that it has occurred after its establishment. To give full effect to the fiction therefore for purpose of Section 31 no distinction can be made on the basis that the decree sought to be set aside was passed by the Civil Court and not by the Tribunal as under Section 22(2)(g) of the Act the Tribunal does have power to set aside an exparte order for recovery of money. The oft-quoted passage of, Lord Asquith in East End Dwellings Co. Ltd. v. Finsbury Borough Council, 1951(2) All ER 587 (HL), may be quoted once again :
"If you are bidden to treat an imaginary state of affairs as real, you must surely, unless prohibited from doing so, also imagine as real the consequence and incidents which, if the putative state of affairs had in fact existed, must inevitably have flowed from or accompanied it. The statute says that you must imagine a certain state of affairs; it does not say that having done so, you must cause of permit your imagination to boggle when it comes to the inevitable corollaries of that state of affairs."
5. I am in agreement with the view taken by the Division Bench of the Patna High Court as well as with the view taken by the learned Single Judge of our Court in Smt. Nirmala Devi and I am of the opinion that the words 'other proceedings' are wide enough to include an application under Order 9 Rule 9 or Order 9 Rule 13 CPC and are not restricted to proceedings at the instance of the Bank. As such the first contention of Mr. W.H. Khan is turned down.
6. Now we come to the second contention of the learned Counsel for the petitioner that no appeal lies against an order under Section 22(2)(g) of the Act. Learned Counsel for the petitioner draws support from the reasons in the referring order in Annichem Private Limited Allahabad and Ors. v. Chairperson, Debts Recovery Appellate Tribunal, Allahabad and Ors. by which the following reference has been made by a learned Single Judge to a Larger Bench by order dated 20.2.2002 :
"Whether having regard to the words ' under the Act' used in Section 20(J) of the Act and the decision of the Supreme Court reported in AIR 1967 Supreme Court 799, the decision of the learned Single Judge of this Court dated 18.1.2002 in Writ Petition No. 2533 of 2002; Lily Chemicals v. Chairperson, Debts Recovery Appellate Tribunal lays down the correct law?"
7. I have considered the decision in AIR 1976 Supreme Court 799 which has been relied upon in the referring order itself. The Supreme Court while interpreting Section 38(1) of the Delhi Rent Control Act observed that the Controller may pass many interlocutory orders under Sections 36 and 37 such as orders regarding the summoning of witnesses, discovery, production and inspection of documents, issue of a commission for examination of witnesses etc. and all these interlocutory orders are steps taken towards the final adjudication and for assisting the parties in the prosecution of their case in the pending proceedings and they regulate the procedure only and do no affect any right or liability of the parties. No appeal would lie from such interlocutory order. The Supreme Court decision only such cases as procedural orders and not orders by which the rights of the parties have been adjudicated upon. The order on the application for setting aside an ex pane decree affects the rights of the parties. As regards such an order the Supreme Court plainly held that it would be "subject to appeal to the Rent Control Tribunal". It is clear from the reference order that the order sought to be challenged before the learned Single Judge were orders in the nature of amendment in the pleadings or production of documents, etc. in the nature of procedural orders not determining the rights of the parties and as such the reasons given by the learned Single Judge in the context of different nature of orders cannot help in strengthening the submission made by the learned Counsel for the petitioner. The reasons in the Supreme Court decision reported in AIR 1967 Supreme Court 799 rather support the view that an appeal lies against an order rejecting an application under Order 9 Rule 13, CPC. An order rejecting an application under Order 9 Rule 13, CPC is a final Order. It affects the right of parties and therefore subject to appeal within the plain language of Section 20 of the Act.
8. Now coming to the last contention of the learned Counsel for the petitioner that it is open to the Court to interfere in a case where injustice has been caused to the parties. It is submitted that against an interlocutory order also it is open to the Court in writ jurisdiction to interfere. Reliance is placed upon a decision of the Supreme Court in II (1999) BC 57 (SC)=V(1999)SLT310=AIR 1999 SC 1975, Industrial Credit and Investment Corporation of India Ltd. v. Grapco Industries Ltd. and Ors., in which in paragraph 14 it was held that there was no bar on the High Court to itself examine the merits of the case in the exercise of its jurisdiction under Article 227 of the Constitution if the circumstances so require. In the context of the facts the Supreme Court observed that objection of the High Court was two fold : (1) the Tribunal did not give any reasons and (2) it was an omnibus order and that there was no reference even to prayers in the application and that the prayers stood allowed. The Supreme Court was of the view that the "judgment of the High Court, however, does not refer at all to the facts of the case and it proceeds more on abstract principles of law. There was no bar on the High Court to itself examine the merits of the case in the exercise of its jurisdiction under Article 227 of the Constitution if the circumstances so require. There is no doubt that High Court can even interfere with interim orders of the Courts and Tribunals under Article 227 of Constitution if the order is made without jurisdiction. But then a too technical approach is to be avoided. When facts of the case brought before the High Court are such that High Court can itself correct the error, then it should pass appropriate orders instead of merely setting aside the impugned order of the Tribunal and leaving everything in vacuum." The case is entirely distinguishable. The principle that alternative remedy can be waived is well established. However, there are settled circumstances in which the alternative remedy can be waived like want of jurisdiction or breach of principles of natural justice. I have already repelled the contention of the learned Counsel for the petitioner that the proceedings under Order 9 Rule 13, C.P.C. could not be transferred or that the Tribunal did not have jurisdiction. There is no reason why the petitioner should not be made to avail the alternative remedy, which is provided under the Act.
9. The writ petition has no merits. Dismissed. It is made clear that this Court has not gone into the merits of the application under Order 9 Rule 13, C.P.C. or of the correctness of the order under challenge. The writ petition is being dismissed only on the ground of alternative remedy. It will be open to the petitioner to raise all the contentions open to it before the appellate authority in accordance with law.
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Title

Ashok Kumar Rice Oil And Flour ... vs Presiding Officer, Debts ...

Court

High Court Of Judicature at Allahabad

JudgmentDate
16 July, 2002
Judges
  • J Sahai