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2019 Supreme(Bom) 1934
IN THE HIGH COURT OF BOMBAY
A.A. SAYED, RIYAZ I. CHAGLA, JJ.
MSTC Limited — Appellant
Versus
Standard Chartered Bank — Respondent
Writ Petition No. 2765 of 2018
Decided on : 03-05-2019
Advocate Appeared:
Gaurav Joshi, Adv., Rohit Gupta, Adv., Darpan Bhatia, Adv., Victor Basu, Adv., Rafiq A Dada, Adv., Tushad Cooper, Adv., Kingshuk Banerjee, Adv., Radhika Gupta, Adv., Wadia Ghandy & Co, Adv.
Headnote:
Constitution of India, 1950 - Article 226 - Recovery of Debts and Bankruptcy Act, 1993 - Sections 19, 20, 22 and 30 - Limitation Act, 1963 - Sections 5, 14 and 24 - Application For Condonation Of Delay - This petition filed impugns order passed by debts recovery tribunal dismissing miscellaneous application for condonation of delay in filing review application for review of order in interim application passed by DRT - Learned senior counsel appearing for petitioner had during arguments stated that only prayer in petition is pressed and prayer which challenges order passed by DRT in interim application in original application is not pressed - Petitioner is engaged in business of export of gold jewellery to foreign countries in association with certain traders of gold jewellery - Petitioner had entered into a receivable purchase agreement with respondent whereby respondent was to factor invoices raised by petitioner on foreign buyers and make payment thereof to petitioner - Respondent had in turn availed of an insurance policy from ICICI general insurance company limited - Petitioner had made exports to foreign buyers approved by respondent and raised bills accordingly which were accepted by foreign buyers - Bills were thereafter placed before respondent for factoring and pursuant to which respondent was made a payment of amount raised on bill in favour of petitioner - Held, We further find from impugned order that learned presiding officer had erred in concluding that limitation will have to be computed till date of filing application for condonation of delay - This finding is clearly erroneous as limitation will have to be computed till filing of review which was under consideration and not filing of application for condonation of delay - We find that presiding officer of DRT should have condoned delay and answered issues in favour of petitioner - This considering fact that order being reviewed is a decree on basis of what has been considered to be an admission and since petitioner is a government undertaking no personal interest is involved - Having arrived at finding that DRT had power to condone delay in filing of review application by petitioner and that delay is to be condoned as sufficient justification for delay had been made out in miscellaneous application it is not necessary to decide other issues as to whether review application is maintainable as it has been filed during pendency of an Appeal which is stated to have been preferred before DRAT and disputed by petitioner is an issue which has not been raised by respondent before DRT impugned order had merely dismissed miscellaneous application by holding that there is no power to condone delay - Hence this issue is kept open to be decided by DRT whilst considering review on merits - Order Accordingly.
JUDGMENT :
R.I. Chagla, J.
Rule. Rule made returnable forthwith. Heard by consent of parties.
2. This Petition filed under Article 226 of the Constitution of India impugns the order dated 21st April 2018 passed by the Debts Recovery Tribunal -I at Mumbai (for short "D.R.T.") dismissing the Miscellaneous Application for condonation of delay in filing the Review Application for review of the order dated 16th September 2017 in Interim Application No. 302 of 2017 passed by the D.R.T.
3. Learned Senior Counsel appearing for the Petitioner had during arguments stated that only prayer (a) in the Petition is pressed and prayer (b) which challenges the order dated 16th September 2017 passed by the D.R.T. in the Interim Application No. 302 of 2017 in Original Application No. 43 of 2012 is not pressed.
4. The Petitioner is engaged in the business of export of gold jewellery to foreign countries in association with certain traders of gold jewellery. The Petitioner had entered into a Receivable Purchase Agreement with the Respondent whereby the Respondent was to factor invoices raised by the Petitioner on the foreign buyers and make payment thereof to the Petitioner. The Respondent had in turn availed of an insurance policy from ICICI Lombard General Insurance Company Limited. The Petitioner had made exports to the foreign buyers approved by the Respondent and raised bills accordingly, which were accepted by the foreign buyers. The bills were thereafter, placed before the Respondent for factoring and pursuant to which the Respondent was made a payment of 95 percent of the amount raised on the bill in favour of the Petitioner.
5. The Petitioner intimated to the Respondent upon the failure of the foreign buyers to make payment and urged the Respondent to file a claim in respect of such payments with ICICI Lombard. Upon a claim being made by the Respondent, ICICI Lombard refused to make payment of the insurance money as the payments from foreign buyers was not forthcoming. Instead of Respondent taking legal action against ICICI Lombard pursuant to its claim, the Respondent initiated proceedings under Section 19 of the Recovery of Debts and Bankruptcy Act, 1993 (for short "the said Act") against the Petitioner before the D.R.T. by filing Original Application No. 43 of 2012. The Respondent filed Interim Application No. 302 of 2017 seeking an order from D.R.T. under Rule 12(5) of the Debts Recovery Tribunal (Procedure) Rules, 1993 directing the Petitioner to make payment of an amount of Rs. 222,51,00,000/- on the ground that same was admitted by the Petitioner in its Annual Report. On 16th September 2017, the D.R.T. by its order allowed the Interim Application No. 302 of 2017 filed by the Respondent. It was only on 23rd October 2017 that the order of the D.R.T. was made available to the Petitioner. The Petitioner within prescribed time under the said Act filed an Appeal before the Debts Recovery Appellate Tribunal (for short "D.R.A.T."). Subsequent to filing of the Appeal, the Petitioner filed Review Application before the D.R.T. on 18th December 2017 wherein it was stated that the Petitioner was taking steps to withdraw the Appeal. On 2nd January 2018, the Petitioner applied for withdrawal of the Appeal by stating that the Petitioner wished to pursue the Review Application and pursuant to the application, the D.R.A.T. by order dated 2nd January 2018, allowed the Petitioner to withdraw the Appeal. On 21st April 2018, the impugned order was passed by the D.R.T. rejecting the Miscellaneous Application for condonation of delay in filing the Review Application. The three Issues which fell for consideration before the D.R.T. are set out in paragraph 5 of the impugned order and which are as under:-
"(1) Whether the delay is properly calculated and whether there is a delay of more than 28 days in filing the Review Application?
(2) Whether this Tribunal has power to invoke the provisions of Section 5 of the Limited Act?
(3) Whether the Applicant is entitled for
