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BOMBAY HIGH COURT (DB)
R.M. Borde and A.S. Gadkari, JJ.
Panther Fincap & Management Services
Limited and others —Petitioners
versus
Bank of India and others —Respondents
Writ Petition No.904 of 2016
Decided on 11.04.2017
For the Petitioners:Mr. Mayur Khandeparkar a/w Mr. Prakash Shinde, Ms. Chinmayee Ghag, Ms. Ambreen Sahid i/by Mr. Devanshu Pravinbhai Desai, Advocates.
For the Respondent No. 1: Ms. Saumya Shrikrishna a/w Ms. Pooja Karacha i/by Nahush Shah Legal.
For the Respondent No.3: Mr. U.S. Upadhyaya, Asst. Government Pleader.
IMPORTANT POINT
Finding of fact recorded by Recovery Officer, DRT and DRAT need not be interfered with in exercise of extraordinary jurisdiction under Article 226 of Constitution of India.
Headnote:Recovery of Debts Due to Banks & Financial Institutions Act, 1993—Section 25(b)—Recovery of debt—Modes of recovery—Coercive measures—Procedure for execution of a decree taking recourse to provisions of Civil Procedure Code cannot be equated with proceedings for recovery under a certificate issued by DRT—Certificate issued by DRT cannot be equated with a decree—Proceedings under RDB Act are predominantly recovery proceedings at instance of bank and does not lead to passing of a decree like a Civil Court—DRT is not a Civil Court and provisions of C.P.C. cannot be straight-way made applicable to proceedings in respect of recovery of amount by Recovery Officer exercising powers under RDB Act—In present case, when a penal action is taken, then only petitioners make payment—Impugned orders passed by Recovery Officer, Debts Recovery Tribunal and Debts Recovery Appellate Tribunal do not call for any interference in exercise of extraordinary jurisdiction under Article 226 of Constitution of India—Petition dismissed. (Paras 11, 15 and 16)
Result: Petition dismissed.
R.M. Borde, J.— Heard respective counsel appearing for both the parties.
2. Rule. With the consent of the parties, petition is taken-up for final decision at admission stage.
3. The petitioners are aggrieved by the order dated 31.5.2017 passed by the Recovery Officer, Debts Recovery Tribunal, below Exhibit 111 in the Recovery Proceedings No.187/2005, allowing the Application, presented by Respondent No.1 bank, requesting to put the petitioner No.3 in civil prison. The Appeal presented by the petitioner to the Debts Recovery Tribunal (DRT) has been rejected by the learned Presiding Officer by order dated 21.9.2007. The petitioners, herein, preferred an Appeal bearing No.346/2007, which has also been dismissed by the Chair Person, Debts Recovery Appellate Tribunal (DRAT) on 3.2.2016. Applications presented, seeking recall of the order by the petitioners, have also been rejected by the DRAT on 14.3.2016.
4. In the Application presented by respondent No.1 bank, it is stated that, the bank has obtained three separate Recovery Certificates against the debtors, petitioners herein, authorizing the recovery of more than Rs.200 crores. The Recovery Officer directed the petitioners herein to disclose their assets on affidavit, along with income-tax and wealth-tax returns by order dated 11.10.2005. However, after extending sufficient opportunity to the petitioners, they did not disclose the assets, nor produced the documents, as directed by the Recovery Officer. On 7.3.2006, a last opportunity was given to the petitioners to disclose their assets, however, they did not comply with the direction. It is recorded that, the petitioners are facing several proceedings initiated at the instance of Central Bureau of Investigation (CBI) and other Authorities. It is the contention of the bank that, the petitioners have sufficient means to pay the dues recoverable by the bank. However, they are intentionally avoiding to pay the debt. It is the contention of the bank that, the petitioners herein have made a payment of more than Rs.280 crores to Madhavpura Mercantile Cooperative Bank Limited (herein after referred to as ‘MMCB’ for the sake of convenience). Order passed by the Apex Court dated 27.2.2006 against the petitioners herein has been placed on record. It is also the contention of the bank that, the petitioners are paying Rs.1 crore a month to Mr. Ashok Mittal, apart from making payment of Rs.238 crores to MMCB. It is thus contended by the Respondents that, petitioners herein have sufficient assets to satisfy the decree amount. However, they are deliberately avoiding repayment of amount and are making the payment to other creditors. The wilful disobedience on the part of the petitioners herein calls for extreme action like putting them in civil prison by taking recourse to remedies provided under section 25(b) of The Recovery of Debts Due to Banks & Financial Institutions Act, 1993 (‘‘the RDB Act’’).
5. The application was opposed by the petitioners herein contending that by a Notification dated 5,10.2001, Mr. Ketan Parekh (petitioner No.3) and Mr. Navinchandra Parekh (Petitioner No.2) are declared a Notified Parties. Their movable and immovable assets are already attached. It is contended that, so far as payment to MMCB is concerned, the repayment is being made by the debtors of MMCB for and on behalf of Mr. Ketan Parekh - petitioner No.3. It is the contention of the petitioners that, they have disclosed their assets and have filed balance sheet for three years. The borrowers of MMCB have deposited Rs.236 crores on behalf of Mr. Ketan Parekh in October, 2006 and deposits have not been made by Mr. Ketan Parekh but by the borrowers of MMCB on behalf of Mr. Ketan Parekh.
6. The Recovery Officer, after hearing both the sides, allowed the application, issuing direction to issue arrest warrant against Mr. Ketan Parekh/Petitioner No.3.
7. It is the contention of the petitioners that, it is impermissible for the Recovery Officer to take extre
