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2010 Supreme(Bom) 1750
2011 (3) ALL MR 209
In the High Court of Bombay at Aurangabad
NARESH H. PATIL & SHRIHARI P. DAVARE
Smt. Laxmibai
Versus
The Jalgaon Merchant Co-operative Bank Ltd & Others
LETTERS PATENT APPEAL NO.333 OF 2010 WITH CIVIL APPLICATION NO.18209 OF 2010 IN WRIT PETITION NO.2337 OF 2010
Decided on : 20-12-2010
For the Appellant:Shri Dhananjay B. Thoke, Advocate.
For the Respondent:R1 to R4 - Shri V.D. Sapkal, Advocate, holding for Shri D.D. Pokhrankar, Advocate.
Headnote:Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 - Sections 13(4), 17, 34 and 35-Maharashtra Co-operative Societies Act, 1960, Section 91-Recovery from Guarantor-Jurisdiction of DRT-Bar to other Courts-Fraud allegedly committed by Bank-Allegation of fraud to be examined by DRT-Co-operative Court has no jurisdictions to examine said allegation.-It is explicitly clear from the very language of Section 17 of the Securitization Act that any person (including borrower-emphasis supplied) aggrieved by any of the measures referred to in sub-section (4) of Section 13 taken by the secured creditor or his authorized officer under II Chapter of the Securitization Act, is entitled to approach the Debt Recovery Tribunal and, therefore, there is no substance in the arguments canvassed by the counsel for the appellant that the DRT is required only to look into the aspect whether the procedure is properly adopted of not and the DRT is not bound to conduct full fledge trial under the said provisions, and the allegations of fraud are required to be adjudicated before the Co-operative Court. At this juncture it is material to note that the appeal filed by the present appellant is pending before the Debt Recovery Appellate Tribunal and, therefore, it is explicitly clear that the appellant has to pursue the said adopted remedy to its logical end and she has no scope to advert and agitate the alleged grievances before the Co-operative Court.
Shrihari P. Davare, J.
1. Rule. Rule made returnable forthwith and with the consent of learned counsel for the parties, taken up for final hearing at the admission stage itself.
2. Heard learned Counsel for the respective parties.
3. The challenge in this Letters Patent Appeal is to the judgment and order passed by the learned Single Judge of this Court in Writ Petition No. 2337 of 2010, on 18.10.2010, thereby allowing the said writ petition, resulting into quashing and setting aside the order dated 11.8.2008 passed by the Cooperative Court, Jalgaon, below Exhibit 30 in Dispute No.1057 of 2007, restraining the opponents therein from putting the property in dispute for sale, and also resulting into setting aside the judgment and order dated 15.11.2008 passed by the learned Member, Maharashtra State Cooperative Appellate Court, Mumbai, Bench at Aurangabad, in Appeal No. 169 of 2008, thereby dismissing the said appeal.
4. Respondent No.1 herein is the Cooperative Bank and the appellant herein is alleged to be the guarantor to the loan advanced by the said Bank to her close relatives i.e. the parties named in the Writ Petition. Respondent No.1 bank has assailed the order passed by the learned Judge, Cooperative Court, in Dispute No.1057 of 2007, dated 11.8.2007 which was confirmed by the learned Member, Cooperative Appellate Court, Aurangabad, by an order dated 15.11.2008 passed in Appeal No.169 of 2008, by filing Writ Petition No.2337 of 2007 which came to be allowed by the learned Single Judge of this court by the impugned order dated 18.10.2010 as aforestated.
5. On the aforesaid background, learned Counsel Shri Dhananjay Thoke for appellantLaxmibai, canvassed that the appellant never stood as guarantor for the loan which was renewed from time to time and submitted that she fairly admits the liability towards the loan which was originally advanced and renewed upto 31.10.2002 only, but stated that subsequent renewals were done without the consent and signature of the appellant herein.
According to the learned Counsel for the appellant, the provisions of the Indian Contract Act would also restrain the bank to recover the said loan amount from the appellant, since the liability after renewal is not fullfledged liability. It is also submitted that as per Section 62 of the Contract Act, it amounts to novation which has been admitted by the officers of the bank during cross examination before the Cooperative Court.
6. Learned Counsel for the appellant also argued that the Debt Recovery Tribunal is having inherent lack of jurisdiction, so far as matter of fraud, or other disputed questions of facts are concerned and, therefore, perhaps the Debt Recovery Tribunal ("DRT" for short) did not go into the said questions of disputed facts since there is inherent lack of jurisdiction under Section 17 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short, "the Securitization Act"). It is submitted by learned counsel for the appellant that according to Section 17 of the Securitization Act, the DRT is required to look into whether the procedure is properly adopted or not. and the DRT is not bound to conduct the full fledge trial under the said provision. it is further submitted that sofar as allegations of fraud are concerned, the same are required to be adjudicated before the Cooperative Court as the Cooperative Court is empowered under Section 91 of the Maharashtra Cooperative Societies Act ("MCS Act" for short) to look into the disputed questions of facts and to conduct fullfledge trial and to come to the conclusion whether the loan documents are false and fabricated.
7. The learned Counsel for the appellant also canvassed that bar under section 34 of the Securitization Act is not absolute bar and Section 34 specifically states, " No Civil Court shall have jurisdiction to entertain any suit or proceeding in respect of any matter which a Debt Recovery Tribunal or the A
