Garg, J.@mdashBoth the aforementioned writ petitions are being decided by this common order as in both of them identical questions of facts and law are involved.
S.B. Civil Writ Petition No. 4130/2001
2. This writ petition under Articles 226 and 227 of the Constitution of India has been filed by the petitioner Company on 18.10.2001 against the respondents with the prayer that by an appropriate writ, order or directions, the impugned order dated 12.9.2001 (Annex.2) passed by the learned Judge, Debt Recovery Tribunal, Rajasthan, Jaipur (respondent No. 2) be quashed and set aside and the application filed by the petitioner-Company for staying the proceedings before the learned Judge, Debt Recovery Tribunal, Jaipur in Case No. 106/2001 be accepted.
3. It arises in the following circumstances:
The petitioner is a Company under the Companies Act, 1956 (hereinafter referred to as "the Act of 1956"). The petitioner- Company because of various reasons was declared as a Sick Industrial Establishment under the Sick Industrial Companies (Special Provisions) Act, 1985 (hereinafter referred to as "the Act of 1985"). The petitioner-Company stopped its manufacturing operations from September, 1997.
It was submitted by the petitioner-Company that the matter was taken to the Board of Industrial & Financial Reconstruction, New Delhi. However, no package of rehabilitation could be finalised and therefore, the Board recommended liquidation of the company and the matter was referred to the Hon''ble Company Judge of this Court for winding up proceedings under the Act of 1956. The case was registered as Company Petition No. 8/2000.
It was further submitted by the petitioner Company that the respondent No. 1 the Bank of Rajasthan Limited is one of the creditors and during the pendency of the liquidation proceedings, the respondent No. 1 Bank has filed as application before the Debt Recovery Tribunal, Rajasthan, Jaipur (respondent No. 2) and that application was registered as case No. 106/2001.
During the pendency of the above proceedings before the respondent No. 2 Debt Recovery Tribunal, the petitioner filed an application for staying the proceedings pending before the Debt Recovery Tribunal on the ground of pendency of liquidation proceedings before this Court and the copy of that application filed by the petitioner-Company before the Debt Recovery Tribunal, Rajasthan, Jaipur is marked as Annex. 1.
The learned Judge, Debt Recovery Tribunal, Jaipur through his impugned order dated 12.9.2001 (Annex.2) rejected the said application of the petitioner-Company holding inter-alia that in view of the judgment of the Hon''ble Supreme Court in Allahabad Bank v. Canara Bank and Anr. (1), the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (hereinafter referred to as "the Act of 1993") gets precedence over the Act of 1956 by virtue of Section 34 of the Act of 1993 and further, Section 442 of the Act of 1956 would not be applicable in this case.
Aggrieved from the said order dated 12.9.2001 (annex.2) passed by the learned Judge, Debt Recovery Tribunal, Jaipur, the petitioner-Company has preferred this writ petition.
4. In this writ petition, the following two submissions have been raised by the learned counsel appearing for the petitioner-Company:-
(1) That the learned Judge, Dept. Recovery Tribunal, Jaipur has erred in placing reliance on the judgment of the Hon''ble Supreme Court in the case of Allahabad Bank (supra) as the law laid down in that case was not applicable to the present case and further, in view of Section 18 of the Act of 1993, jurisdiction of this court under Article 226 and 227 of the Constitution of India has been saved and thus, this Court has ample power to pass appropriate order.
(2) That part from this, the provision of Section 20 of the act of 1993 which provide for appeal to the appellate tribunal would be applicable only when the order made by the Tribunal under the Act of 1993 is final in nature and since the impugned order dated 12.9.2001 (Annex.2) passed by the learned Judge, Debt Recovery Tribunal, Jaipur is not a final order, therefore, provisions of Section 20 of the Act of 1993 would not be applicable to the present case and the writ petition should be held to be maintainable.
5. On the other hand, the learned counsel appearing for the respondent No. 1 Bank has raised preliminary objection about the maintainability of the writ petition contending that the impugned order dated 12.9.2001 (Annex.2) passed by the learned Judge, Debt Recovery Tribunal, Jaipur is appealable u/s 20 of the Act of 1993 and when an alternative remedy by way of appeal is available to the petitioner-Company, the present writ petition is not at all maintainable and the same deserves to be dismissed, as not maintainable.
6. I have heard the learned counsel appearing for the petitioner-Company and the learned counsel appearing for the respondent and gone through the materials available on record.
Preliminary Objection about maintainability of the writ Petition.
7. The learned counsel appearing for the respondent No. 1 Bank has submitted that this writ petition is not maintainable as appeal against the impugned order Annex.2 dated 12.9.2001 passed by the learned Judge, Debt Recovery Tribunal lies before the Appellate Tribunal u/s 20 of the Act of 1993.
8. On the contrary, it was submitted by the learned counsel appearing for the petitioner-Company that an appeal u/s 20 of the Act of 1993 would lie before the Appellate tribunal only when the order passed by the Tribunal is final in nature and since the impugned order Annex.2 dated 12.9.2001 passed by the learned Judge, Debt Recovery Tribunal is not a final order, therefore, provisions of Section 20 of the Act of 1993 would not be applicable to the present case and the writ petition should be held to be maintainable.
9. Before proceeding further, it may be stated here that there is no dispute on the point that in view of Section 18 of the Act of 1993, the exercise of jurisdiction by the Civil Court in relation to matters specified Under the Act of 1993, is excluded, but the exercise of jurisdiction by the High Court under Articles 226 and 227 of the Constitution of India has been saved.
10. For convenience, Section 18 of the Act of 1993 is quoted here:-
"18. Bar of jurisdiction. On from the appointed day, no court or other authority shall have, or be entitled to exercise, any jurisdiction power or authority (except the Supreme Court, and a High Court exercising jurisdiction under Articles 226 and 227 of the Constitution) in relation to the matters specified in Section 17."
11. The Hon''ble Supreme Court in a latest decision in Union of India and Anr. v. Delhi High Court Bar Association and Ors. (2), has held that Debt Recovery Tribunal is presumed to be effective part of justice delivery system like courts of law. Suit for debut recovery filed by banks and financial institutions can no longer be decided by Civil Court and the appropriate Forum is Banking Tribunal.
12. No doubt by virtue of Section 18 of the Act of 1993, the High Court can exercise jurisdiction under Article 226 and 227 of the Constitution of India against an order passed by the Debt Recovery Tribunal, but it must be sparingly used especially when there is an alternative remedy of appeal available u/s 20 of the Act of 1993. Thus, as a principle, to say that since an alternative remedy of appeal is available, therefore, the jurisdiction of the High Court is barred in all respect is not correct proposition of law. But, such jurisdiction can be exercised by the High Court, though there is alternative remedy, in the following circumstances:
(1) Tribunal acted without or in excess of its jurisdiction;
(2) Tribunal formed its opinion of conclusion in disregard to the provision of the Act, rules or other applicable law;
(3) Tribunal acted mala fide or arbitrarily in rendering its decision;
(4) Decision of tribunal is tainted with fraud or collusion;
(5) There is an apparent error on the face of its records or proceedings on law or on facts, resulting in wrong or unwarranted conclusion or order.
13. Thus, jurisdiction can be exercised by the High Court when any one of the aforesaid grounds exists in the order of the Debt Recovery Tribunal, but no doubt they are not exhaustive, but only illustrative.
14. In the present case, non of the aforesaid grounds exists in the impugned order of the learned Judge, Debt Recovery Tribunal, Jaipur dated. 12.9.2001 (Annex.2) and, therefore, this writ petition is not maintainable.
15. Apart from this, as a rule, when any order is passed by the Tribunal, the aggrieved person should prefer an appeal u/s 20 of the Act of 1993 before the Appellate Tribunal.
16. For convenience, Section 20(1) of the Act of 1993 is quoted here:-
"20. Appeal to the appellate tribunal.-(1) Save as provided in Sub-section (2), any person aggrieved by an order made, or deemed to have been made, by a tribunal under this Act, may prefer an appeal to an appellate tribunal having jurisdiction in the matter."
17. A perusal of Section 20(1) of the Act of 1993 clearly reveals that any person aggrieved by an order made by the tribunal under the Act of 1993, may prefer an appeal before the Appellate Tribunal.
18. Thus, it is clear that any order whether interim of final in nature made by the Debt Recovery Tribunal is appealable and subject to challenge u/s 20 of the Act of 1993. There is no provision in the Act of 1993 stating that an appeal would lie before an Appellate Tribunal only when the order is final in nature and on the contrary, it is clear that any order passed by the Debt Recovery Tribunal is subject to challenge u/s 20 of the Act of 1993.
19. Therefore, the impugned order Annex.2 dated 12.9.2001 passed by the learned Judge, Debt Recovery Tribunal is appealable before the Appellate Tribunal.
20. No doubt the impugned order passed by the learned Judge, Debt Recovery Tribunal, Jaipur dated 12.9.2001 (Annex.2) is not a final order adjudicating the matter between the parties, but still that order is appealable because in Section 20 of the Act of 1993, the word is an order made and not final order made.
21. In Punjab National Bank v. O.C. Krishnan and Ors. (3), the Hon''ble Supreme Court held that in view of the remedy of appeal available u/s 20 of the act of 1993, a petition under Articles 22 and 227 was not entertainable. The Hon''ble Supreme Court in that case observed:-
"The Act has been enacted with a view to provide a special procedure for recovery of debts due to the banks and the financial institutions. There is a hierarchy of appeal provided in the Act, namely, filling of an appeal u/s 20 and this fact track procedure cannot be allowed to be derailed either by taking recourse to proceedings under Article 226 and 227 of the Constitution or by filing a civil suit, which is expressly barred. Even though a provision under an Act cannot expressly oust the jurisdiction of the Court under Articles 226 and 227 of the Constitution, nevertheless, when there is an alternative remedy available, judicial prudence demands that the Court refrains from exercising its jurisdiction under the said constitutional provisions."
22. From the above observations made by the Hon''ble Supreme Court, it is very much clear that the present petition under Articles 226 and 227 of the Constitution of India is not maintainable, as an alternative remedy of appeal u/s 20 of the Act of 1993 is available.
23. In this respect, the decision of the Delhi High Court in Shoes East Ltd. v. Allahabad Bank (4), may be referred to where the application for staying the proceedings before the Debt Recovery Tribunal was rejected by the Debt Recovery Tribunal and it was held by the Delhi High Court that the order is appealable and since that order was appealable, writ petition against that order or the Debt Recovery Tribunal was not maintainable. The Delhi High Court in that case observed as under:-
"Every order of debt recovery Tribunal which affects the rights and liabilities of parties is an appealable order under the act. Even an interlocutory order passed u/s 19(6) of the Act is an appealable order. As such an order passed by Debt Recovery Tribunal rejecting the stay on debt recovery proceeding initiated by bank would be an appealable order and writ petition against said rejection order would not be maintainable."
24. Similar is the position before this Court and in view of above observations made by the Delhi High Court, the present writ petition is not maintainable.
25. Thus, in view of the discussions made above, since an alternative remedy of appeal u/s 20 of the Act of 1993 is available against the impugned order of the learned Judge, debt Recovery Tribunal, Jaipur dated 12.9.2001 (Annex.2), therefore, this writ petition under Articles 226 and 227 of the Constitution of India is not maintainable and the same deserves to be dismissed, as not maintainable.
26. Hence, the argument of the learned counsel for the petitioner that since the impugned order Annex.2 dated 12.9.2001 passed by the learned Judge, Debt Recovery Tribunal, Jaipur was not a final order, therefore, it was not appealable u/s 20 of the Act of 1993 is devoid of any force and the same stands rejected:
27. Before concluding this order, the argument of the learned counsel for the petitioner that the impugned order was not passed under the provisions of the Act of 1993 because application was filed for staying proceedings by invoking Section 22 of the Act of 1985, is not to be appreciated at all because by filing that application, proceedings before the Debt Recovery Tribunal were prayed to be stayed.
For the reasons stated above, this writ petition is dismissed, as not maintainable.
S.B. Civil Writ Petition No/4129/2001
28. This writ petition raises the same controversy as involved in S.B. Civil Writ Petition No. 4130/2001 and, therefore, for the reasons given in S.B. Civil Writ Petition NO. 4130/2001, this writ petition also deserves to be dismissed, as not maintainable.
Accordingly, this writ petition is also dismissed, as not maintainable.
