V. Sakkammal and Another Vs Union Bank of India and Others

@JUDGMENTTAG-ORDER

A. Arumughaswamy, J.@mdashThis Civil Revision Petition has been filed under Article 227 of the Constitution of India by the revision-Petitioners/judgment-debtors to call for records in E. P. No. 60 of 2001 on the file of the Sub-Court, Sivakasi and set aside the same.

2. The first Respondent /Plaintiff-Bank has filed the suit for recovery of the amount due to the first Respondent-Bank to the tune of Rs. 5,82,286.61 with interest at the rate of 16% within the time stipulated by the trial Court, failing which the properties in ''A'', ''B'', ''C'' Schedules shall be brought for Court auction sale and the amount due to the first Respondent-Bank shall be recovered.

3. The trial Court after examining P. W. 1 and perusing the documents in Exs.A.1 to A.37, passed the preliminary decree on 21-3-1991 and granted two months'' time to deposit the decree amount. The Defendants 1 and 2 therein failed to pay the decree amount within the time and hence, the trial Court on 9-2-1996 passed the final decree.

4. The first Respondent Bank filed E. P. No. 60 of 2001 in O. S. No. 66 of 1990 on the file of the Sub-Court, Sivakasi. Being aggrieved by the E. P. proceedings, the revision-Petitioners herein/Defendants 3 and 4, being the legal representatives of the first Defendant before the trial Court, has filed this Civil Revision Petition.

5. The vehement contention of the learned Counsel for the revision-Petitioners is that the first Respondent-Bank is not entitled to bring the properties for sale in view of the Amendment of Section 31A of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 and after the establishment of the Debt Recovery Tribunal.

6. The learned Counsel for the first Respondent-Bank contended that it is true that after passing of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 and the establishment of the Debt Recovery Tribunal, the civil Court''s jurisdiction is ousted if the decree amount is above Rs. 10 lakhs, but in this case, no transfer has been effected after the amendment of Section 31A of the Act, therefore, if this Court comes to the conclusion that the Civil Court has no jurisdiction, the matter has to be transferred to the Debt Recovery Tribunal after confirming the sale of first item of the properties.

7. Now, the points for consideration in this Civil Revision Petition, are:

(i) Whether the E. P. proceedings before the trial Court are liable to be quashed in view of the Amendment of Section 31A of the Recovery of Debts Due to Banks and Financial Institutions Apt, 1993? and

(ii) After the Amendment of Section 31A of the Act, whether the civil Court has got jurisdiction to auction the property if the debt is above Rs. 10 lakhs ?

8. From the perusal of the records, it is seen that the first Respondent/Plaintiff-Bank has filed the suit for recovery of Rs. 5,82,286.61 with interest at the rate of 16% and the suit has been decreed on 21-3-1991. The preliminary decree was passed on 21-3-1991 and the final decree was passed on 9-2-1996. Thereafter, E. P. No. 60 of 2001 has been filed for the recovery of the amount of Rs. 16,57,268.50 as on 4-9-2000.

9. In the E. P. proceedings, ''A'', ''B'' and ''C'' Schedules of properties have been brought for sale and the details of the said properties are as follows:

(See Table on next page)

10. It is not in dispute that three properties have been brought for sale and ''A'' Schedule property was sold on 17-12-2007 for a sum of Rs. 3,52,000/-. The first Respondent-Bank/Plaintiff is pressing the E. P. proceedings for the balance amount due to the first Respondent-Bank and the properties available have to be brought for Court auction sale. The abovesaid facts are not disputed.

11. The abovesaid properties have been brought for sale. In respect of ''A'' Schedule property, the upset price was fixed as Rs. 15,00,000/- and the said property was sold on 17-12-2007 for a sum of Rs. 3,52,000/- to one S. Thirugnanam. The 1/4th amount of the sale value has been deposited by the auction-purchaser on 17-12-2007 and the remaining 3/4th amount was also deposited on 20-12-2007 and the sale was concluded on 18-2-2008 and the issuance of sale certificate was also ordered.

12. The auction-purchaser namely S. Thirugnanam, has also filed M. P. (MD) No. 2 of 2008 to implead himself in this civil Revision Petition.

13. The vehement contention of the learned Counsel for the revision-Petitioners/judgment-debtors is that after the constitution of the Debt Recovery Tribunal, the civil Court has no jurisdiction to try the matter and in support of his contention, he relied on the following decisions:

(i) Indian Bank Vs. ABS Marine Products Pvt. Ltd.,

(ii) Punjab National Bank, Dasuya Vs. Chajju Ram and Others, .

(iii) United Bank of India, Calcutta Vs. Abhijit Tea Co. Pvt. Ltd. and Others,

14. In Indian Bank Vs. ABS Marine Products Pvt. Ltd., , the borrower has filed the suit for damages against the Bank for non-release of the sanctioned loan. Meanwhile, the Bank also filed an application for recovery of its debts against the borrower. Under such circumstances, the Bank official has filed a petition for transferring the civil suit pending before the civil Court to the Debt Recovery Tribunal. At this juncture, the Honourable Supreme Court has held that the suit filed by the borrower against the Bank official can not be transferred from the civil Court. Hence, this decision does not apply to the facts of the present case on hand.

15. In support of the contention that the Debt Recovery Tribunal alone is having jurisdiction, the learned Counsel for the Petitioners/judgment-debtors has relied on the decision of the Honourable Supreme Court in Punjab National Bank, Dasuya Vs. Chajju Ram and Others, , wherein it is held that the both principal amount and the interest must be joined together and on that basis only, the jurisdiction has to be fixed. In the said decision, the decree amount is Rs. 6,19,250/- and after the inclusion of the interest, the decree amount became more than Rs. 10 lakhs and the jurisdiction of the Debt Recovery Tribunal has been established. I am of the view that this decision also will not be helpful for the Petitioners since the facts of the abovesaid decision are different from the facts of the present case.

16. In United Bank of India, Calcutta Vs. Abhijit Tea Co. Pvt. Ltd. and Others, the jurisdiction has been decided in the transferred suit. Hence, this decision is also not applicable to the facts of the present case.

17. The learned Counsel for the first Respondent/Plaintiff-Bank contended that if this Court comes to the conclusion that the civil Court has no jurisdiction, in the interest of justice, the E. P. proceedings can be transferred to the Debt Recovery Tribunal, since the public money is involved.

18. Heard the learned Counsel for the revision-Petitioners/judgment debtors and the learned Counsel for the first Respondent-Bank and perused the materials available on record. There is no representation on behalf of the second Respondent/second Defendant and also the learned Counsel for the impleading Petitioner in M. P. (MD) No. 2 of 2008.

19. It is not in dispute that the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 came into force on 17-12-2002 and the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 came into force on 27-8-1993.

20. The E. P. has been filed in the year 2001 and at the time of passing of final decree, even though the Act has been pressed into service, no Debt Recovery Tribunal has been constituted in Tamil Nadu. Thereafter, it has been constituted later.

21. Therefore, as agreed by both sides, at the time of auction of the property, the Debt Recovery Tribunal in Tamil Nadu is functioning. Section 31A of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 has been inserted by Act 1 of 2000 and it came into force on 17-1-2000 and the same is extracted hereunder:

31A. Power of Tribunal to issue certificate of recovery in case of decree, or order.--

(1) Where a decree or order was passed by any Court before the commencement of the Recovery of Debts Due to Banks and Financial Institutions (Amendment) Act, 2000 and has not yet been executed, then, the decree-holder may apply to the Tribunal to pass an order for recovery of the amount.

(2) On receipt of an application under Sub-section (1), the Tribunal may issue a certificate for recovery to a Recovery Officer.

(3) On receipt of a certificate under Sub-section (2), the Recovery Officer shall proceed to recover the amount as if it was a certificate in respect of a debt recoverable under this Act.

22. As per Section 31A of the Act, if the decree was passed by the Civil Court, the decree-holder has to apply the Tribunal to pass an order for recovery of the amount.

23. Now, the short point for consideration is as to whether it is the duty of the decree-holder to apply the civil Court or the civil Court has to return the papers suo motu after coming into force of Amendment in the Act?

24. From the reading of Section 31A of the Act, it is clear that the duty is cast upon the decree-holder to file an application before the Debt Recovery Tribunal requesting to pass an order for return of the papers with a direction to represent before the proper forum. In this case, the final decree was passed on 09-02-1996. Thereafter, in the month of September 2000 only, the decree-holder filed the E.P. before the civil Court. At that time, on 17-01-2000 itself, the jurisdiction lies with the Debt Recovery Tribunal. The presentation of the E.P. before the civil Court itself is without jurisdiction. Though it is duty of decree-holder to apply for transfer of the papers, yet the civil Court is also having power to refuse to entertain the E.P. presentation. Further, at the same time, it is the moral duty of the judgment-debtors to inform the lackness of jurisdiction and they could have also moved before the civil Court for transfer of the E.P. proceedings. Anyhow, ''A'' Schedule property has been sold on 17-12-2007 itself. Further, the sale is having a defect and a petition ought to have been filed soon after earliest auction to set aside the sale and till now, they have not filed any petition to set aside the sale.

25. In this case, the first Respondent/Plaintiff-Bank has miserably failed to do it, whereas he has presented the application before the civil Court for the recovery of the amount. Anyhow, ''A'' Schedule property has been auctioned and the suit item has been sold and for the balance, the E.P. is pending. At this juncture, the revision-Petitioners/judgment-debtors have come forward with this Civil Revision Petition.

26. As already pointed out, the Bank authorities present the application before the civil Court itself without jurisdiction. The decree-holders are expected to get back the same and present it before the Tribunal, which they have failed to do so.

27. The next contention raised by the learned Counsel for the revision-Petitioners/judgment-debtors is that once the Court has no power to proceed in the E.P. and the auction held by the Court is invalid, it is nothing but void ab initio and hence, the Civil Revision Petition has to be allowed.

28. The learned Counsel for the first Respondent/Plaintiff-Bank contended that no petition to set aside the sale has been filed and hence, the order of the civil Court has to be upheld.

29. To sum up, the preliminary decree was passed on 21-03-1991 and the final decree was passed on 09-02-1996. The decree is for a period of twelve years. Now, the period is already over. E.P. was filed in the year 2000. Therefore, the limitation ends on 08-02-2008. Now, the E.P. is pending before the civil Court. As per the Amendment Act, the E.P. must have been transferred subsequent to 17-01-2000, after the introduction of Section 31A of the Act. The decree holder must have filed necessary application before the civil Court to transfer the matter to the Debt Recovery Tribunal or the Court itself could have transferred the case to the Debt Recovery Tribunal suo motu. Of course, the revision-Petitioners/judgment-debtors also have no bar to file the application. Anyhow, the duty is cast upon them and both the parties must have filed those applications before this Court.

30. As already discussed, after passing the final decree, ''A'' Schedule property alone has been brought for sale and the ''A'' Schedule of the properties alone was sold on 17-12-2007 for a sum of Rs. 3,52,000/- and the issuance of sale certificate has been ordered on 18-02-2008 by the civil Court.

31. Under this juncture, it is very useful to refer to the decision in Punjab National Bank, Dasuya v. Chajju Ram and Ors. reported in AIR 2000 SC 2671, wherein it has been held that the civil Court has no jurisdiction to conduct the E.P. proceedings after the amendment and further, at Paragraph 9, it is held thus:

9. The aforesaid Section 31A is clearly applicable in the present case. The decree was passed by the Court before the commencement of the Amendment Act and the same has not yet been executed. At least after the amendment, it is only the Tribunal which would have the jurisdiction of entertaining the application for execution of the decree inasmuch as the amount due for which the decree was sought to be executed is over Rs. 10 lakhs. We are also unable to agree with the High Court that because the original decree which was passed was for principal sum of Rs. 6,19,250/- the Tribunal would get no jurisdiction. It is to be seen that decree was for a sum of Rs. 6,19,250/- plus interest at the rate of 161/2 per cent, per annum from the date of filing of the suit till the recovery of money. As and when the amount due to the Bank under the decree became more than Rs. 10 lakhs and an application for execution was filed, it could only be entertained by the Tribunal and not by the civil Court. It is clear that in view of the provisions of Section 34 of the Act, the provisions of Order 21, Rule 10, CPC would have no application.

32. In view of the above decision, in the case on hand, the E.P. itself is presented in the wrong forum. Therefore, I am of the view that the entire E.P. proceedings are void ab initio and it has to be set aside and the Debt Recovery Tribunal alone has got jurisdiction as pointed out in the decision cited supra. Accordingly, the points are answered.

33. Therefore, I hereby set aside the entire E.P. proceedings and the sale conducted before the civil Court.

34. Now, the next question that arises for consideration is, as to whether the E.P. can be transferred to the Debt Recovery Tribunal by this Court suo motu?

35. The learned Counsel for the first Respondent/Plaintiff-Bank contended that this Court has to order for return of the E.P. to the Tribunal for presenting it in the correct forum.

36. According to the learned Counsel for the revision-Petitioners/judgment-debtors, since it is time barred one, this Court has no jurisdiction to pass the said order and hence, it has to be negatived.

37. As already indicated, the final decree has been passed in the year 1996 and thereafter, the E.P. has to be filed within twelve years. In this case, the period of twelve years expired on 08-02-2008. The E.P. itself has been filed in the wrong forum namely the civil Court on 04-09-2000. Since I have already held that the entire proceedings in the E.P. and the sale conducted before the civil Court are void ab initio, the Tribunal alone has got jurisdiction.

38. On a mere reading of Section 31A of the Act, I am of the view that the duty is cast upon the Bank Official to get back the papers and to present it before the correct forum or the Court can return for proper presentation before the proper forum. Till today, the Bank, who is the decree-holder has not moved before the civil Court for return of the E.P. papers to present before the correct forum. In this case, the decree-holder has not applied before the Civil Court and therefore, the question of ordering to return does not arise.

39. Under such circumstances, it is for the first Respondent/Plaintiff-Bank to decide the matter as per Section 31A of the Act.

40. So far as the question of limitation is concerned, I am not deciding the same since it is not adverted before me and the dispute attracts the jurisdiction of the Tribunal after amendment, Anyhow, prima facie, this Court is not ordering the return of the papers in view of the fact that the, request is after 08-02-2008.

41. Now, this Court cannot incorporate or extend fresh limitation by way of transferring the matter to the Debt Recovery Tribunal. Therefore, it is for the decree-holder to file appropriate application before the Court for transmitting the decree. At that point of time, it is open to the parties to adjudicate the question of limitation before the Court.

42. With these observations, this Civil Revision Petition is allowed. Consequently, the connected Miscellaneous Petition is closed. No costs.