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2020 Supreme(Kar) 346
IN THE HIGH COURT OF KARNATAKA
Aravind Kumar, Hemant Chandangoudar, JJ.
Santhosh Kumar M.k. And Another - Appellants
Versus
Federal Bank Ltd. And Others - Respondents
W.P. No. 4483 of 2020 (GM-DRT)
Decided On : 03-03-2020
Sri. Giridhar H, Advocate, for the Appellants; Sri. Vijayakumar V, Advocate, for the Respondent No. 1
The main legal point established in the judgment is that permission to cross-examine can be permitted only on sufficient grounds being made out, and the decision on whether to permit cross-examination is at large before the appellate authority.
Headnote:
Recovery of Debts Due to Banks and Financial Institutions Act - Application for Cross-Examination - Rule 12(6) of Debt Recovery Tribunal (Procedure) Rules, 1993 - [PERMISSION TO CROSS-EXAMINE A.W.1] - [Recovery of Debts Due to Banks and Financial Institutions Act] - [Section 19, Rule 12(6)] - The court discussed the application for cross-examination under Rule 12(6) of the Debt Recovery Tribunal (Procedure) Rules, 1993, and emphasized that permission to cross-examine can be permitted only on sufficient grounds being made out. The court highlighted the primary reason assigned by the defendants for cross-examination and emphasized that the decision on whether to permit cross-examination is at large before the appellate authority. The court set aside the impugned order and directed the appellate tribunal to dispose of the application for stay expeditiously, and the Debt Recovery Tribunal to dispose of the Original Application within two weeks thereafter by taking into consideration the order passed by the appellate tribunal.
Fact of the Case:
The first respondent filed an application under Section 19 of The Recovery of Debts Due to Banks and Financial Institutions Act, 1993, for recovery of money due from the defendants. The petitioners sought permission to cross-examine A.W.1, which was rejected by the Debt Recovery Tribunal. The matter was taken to the writ court and subsequently to the Debt Recovery Appellate Tribunal (DRAT). The DRAT directed the Debt Recovery Tribunal to dispose of the Original Application despite the pendency of the appeal and application for stay.
Finding of the Court:
The court found that the direction issued by the DRAT to dispose of the Original Application without reference to the pendency of the appeal and application for stay would defeat the purpose of filing the appeal. The court held that the impugned order cannot sustain the test of law and set it aside.
Issues: The main issue revolved around the permission sought for by the petitioners to cross-examine A.W.1 and the direction issued by the DRAT to dispose of the Original Application despite the pendency of the appeal and application for stay.
Ratio Decidendi: The court emphasized that permission to cross-examine can be permitted only on sufficient grounds being made out and that the decision on whether to permit cross-examination is at large before the appellate authority. The court held that the impugned order directing the disposal of the Original Application without considering the pendency of the appeal and application for stay cannot sustain the test of law.
Final Decision: The writ petition was allowed, the impugned order was set aside, and the DRAT was requested to dispose of the application for stay expeditiously. The Debt Recovery Tribunal was directed to dispose of the Original Application within two weeks thereafter by taking into consideration the order passed by the appellate tribunal.
JUDGMENT
1. Though matter is listed for Preliminary Hearing, by consent of learned Advocates appearing for parties it is taken up for final disposal.
2. Heard Sri. Giridhar H, learned counsel appearing for petitioners and Sri.Vijayakumar V, learned counsel appearing for respondent No.1. Petition against respondent Nos.2 and 3 has been dismissed vide order dated 25.02.2020.
3. First respondent herein has filed an application under Section 19 of The Recovery of Debts Due to Banks and Financial Institutions Act, 1993, for recovery of money due from defendants therein and said proceedings are pending before Debt Recovery Tribunal. An affidavit of evidence came to be filed by the official of the bank in-lieu of examination-in-chief and on documents being marked, defendant Nos.1 and 2 filed an application seeking permission to cross examine A.W.1 on the grounds set out in the application Annexure-C, as required under Rule 12(6) of the Debt Recovery Tribunal (Procedure) Rules, 1993, as said rule mandates that sufficient grounds are to be made out by defendant/s to cross-examine plaintiffs witnesses and only on such permission accorded by the DRT, cross-examination can be proceeded with and not otherwise. Said application came to be rejected by order dated 13.11.2015. Being aggrieved by the said order, a writ petition came to be filed by the petitioners in W.P.No.4934/2016, which came to be disposed of on 08.03.2019 by setting aside said order and remitting the matter back to the tribunal to decide the application filed seeking cross-examination of applicant/defendant No.1 by a speaking order within two (2) weeks from the date of receipt of certified copy of said order. DRT reconsidered the same and by order dated 10.05.2019 dismissed the application with costs.
4. Being aggrieved by the said order a writ petition was preferred by the petitioners in W.P.Nos.28988-989/2019, which came to be disposed of by order dated 15.07.2019-Annexure-P reserving liberty to the petitioners to file an appeal before appellate tribunal, since order impugned was an appealable order. Liberty was also granted to the petitioners to file an application for stay before the Debt Recovery Appellate Tribunal (for short DRAT) and DRAT was directed to dispose of the appeal as well as application for stay, which may be preferred by the petitioners, by a speaking order within a period of two (2) weeks from the date of receipt of certified copy of order, subject to the rider that till application of stay is decided by DRAT, DRT should not deliver the judgment in O.A.No.351/2011. Hence, appeal came to be filed before DRAT in AIR No.277/2019 along with an interlocutory application for stay. By impugned order DRAT has directed the presiding officer of the DRT adjudicating O.A.No.351/2011 to dispose of the said OA as early as possible without reference to the pendency of the appeal.
5. A plain reading of the said order would clearly indicate that despite direction issued by the learned Single Judge in W.P.No.28988-89/2019, that appeal as well as stay application pending before DRAT be disposed of and till adjudication of the application for stay the DRT should not pass the judgment, said order has been over-taken by the impugned order. It is rather very intriguing that appellate tribunal has taken this recourse. When the writ Court has directed the DRAT to dispose of the appeal and application for stay by a speaking order within a period of two weeks and till such time DRT having been directed not to pass judgment, said direction cannot be truncated or frustrated by DRAT in directing DRT to dispose of OA. Without reference to pendency of appeal, particularly when application for stay which has been filed is not disposed of. If such recourse is taken then purpose of filing the appeal itself would be defeated. It is because of this precise reason the writ Court had directed DRAT in W.P.Nos.28988- 989/2019 by order dated 15.07.2019-Annexure-P to dispose of the application fo
