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2015 Supreme(Cal) 630
IN THE HIGH COURT OF CALCUTTA
Harish Tandon, J.
Indrajit Roy – Petitioner
Versus
Bank of Baroda and Another – Opposite Parties
C.O. No. 2907 of 2015
Decided On : 04-09-2015
For the Petitioners: Mr. Joy Saha, Mr. Joydip Banerjee and Mr. Rahul Karmakar.
For the Opposite Parties : Mr. N. Srinivas and Mr. M.K. Singh.
THE DEBTS RECOVERY TRIBUNAL CANNOT PASS AN INJUNCTION AGAINST A GUARANTOR WITHOUT RECORDING COGENT FINDINGS OR REASONS AND WITHOUT CONSIDERING THE INTERESTS OF BOTH PARTIES.
Headnote:
ATTACHMENT BEFORE JUDGMENT - RECOVERY OF DEBTS DUE TO BANKS AND FINANCIAL INSTITUTIONS ACT, 1993 - SECTION 19(12) - COURT HELD THAT THE DEBTS RECOVERY TRIBUNAL ERRED IN PASSING AN INJUNCTION AGAINST THE PETITIONER WITHOUT RECORDING COGENT FINDINGS OR REASONS AND WITHOUT CONSIDERING THE INTERESTS OF BOTH PARTIES.
Fact of the Case:
THE BANK FILED AN APPLICATION BEFORE THE DEBTS RECOVERY TRIBUNAL FOR ATTACHMENT BEFORE JUDGMENT AND INJUNCTION AGAINST THE PETITIONER, WHO WAS A GUARANTOR FOR A LOAN TAKEN BY ANOTHER PERSON. THE TRIBUNAL PASSED AN ORDER OF INJUNCTION WITHOUT RECORDING ANY FINDINGS OR REASONS.
Finding of the Court:
THE COURT HELD THAT THE DEBTS RECOVERY TRIBUNAL ERRED IN PASSING AN INJUNCTION AGAINST THE PETITIONER WITHOUT RECORDING COGENT FINDINGS OR REASONS AND WITHOUT CONSIDERING THE INTERESTS OF BOTH PARTIES. THE COURT ALSO HELD THAT THE TRIBUNAL SHOULD HAVE PERMITTED THE PETITIONER TO FILE A COUNTER AFFIDAVIT BEFORE PASSING THE ORDER OF INJUNCTION.
Issues: 1. WHETHER THE DEBTS RECOVERY TRIBUNAL ERRED IN PASSING AN INJUNCTION AGAINST THE PETITIONER WITHOUT RECORDING COGENT FINDINGS OR REASONS? 2. WHETHER THE TRIBUNAL SHOULD HAVE PERMITTED THE PETITIONER TO FILE A COUNTER AFFIDAVIT BEFORE PASSING THE ORDER OF INJUNCTION?
Ratio Decidendi: THE COURT RELIED ON THE PROVISIONS OF SECTION 19(12) OF THE RECOVERY OF DEBTS DUE TO BANKS AND FINANCIAL INSTITUTIONS ACT, 1993, WHICH EMPOWERS THE TRIBUNAL TO MAKE AN INTERIM ORDER OF INJUNCTION OR ATTACHMENT AGAINST THE DEFENDANTS TO DEBAR THEM FROM TRANSFERRING, ALIENATING OR OTHERWISE DEALING WITH OR DISPOSING OF ANY PROPERTY AND ASSETS BELONGING TO THEM WITHOUT THE PRIOR PERMISSION OF THE TRIBUNAL. THE COURT ALSO RELIED ON THE PROVISIONS OF ORDER 38 OF THE CODE OF CIVIL PROCEDURE, WHICH DEALS WITH INJUNCTIONS.
Final Decision: THE COURT SET ASIDE THE ORDER OF THE DEBTS RECOVERY TRIBUNAL AND DIRECTED THE TRIBUNAL TO HEAR THE APPLICATION AFRESH AFTER PERMITTING THE PETITIONER TO FILE A COUNTER AFFIDAVIT. THE COURT ALSO DIRECTED THE TRIBUNAL TO DISPOSE OF THE APPLICATION WITHIN TWO WEEKS FROM THE DATE OF EXPIRATION OF THE PERIOD FOR EXCHANGE OF AFFIDAVITS.
Harish Tandon, J.
1. In an original proceeding an application was taken out for attachment before judgment with further prayer in the form of injunction restraining the petitioner from encumbering, transferring or dealing with the properties mentioned in the said application.
2. Admittedly a credit facility was extended to one Monirul Alam in the nature of house-loan for Rs.12,00,000/- and odd by the Bank. It is alleged that the said Monirul Alam neglected and failed to pay the outstanding dues even after the demand having raised upon him. It is further alleged in the said petition that the said Monirul Alam mortgaged a Flat, being G-1 on the 3rd Floor of the building having super built up area of 1302 sq. ft. lying and situated at Mouza Bagjola, Municipal Holding No. 06/73, M.M. Ghosh Road, Kolkata - 700 074 by depositing the title deed.
3. In paragraphs 3 & 4 of the application it is stated that since the said property would not fetch the amount due to the Bank because the present value whereof is much less than the same, the enquiry was conducted as to the personal properties of the defendants therein including the petitioner and it appears that the petitioner is the owner of an immovable property jointly with the wife, Jayati Roy, in respect of a piece and parcel of land measuring 2 cottahs 13 chittacks and 21 sq. ft., being Premises No. 50, G.B. Road under the South Dum Dum Municipality, where one storied house has been erected.
4. Paragraph 5 thereof relates to the service of summons and non-appearance of the parties before the Tribunal. In paragraph 6, the Bank proceeds to say that the defendants avoided the payment of the lawful dues and in there an apprehension that they may deal not only the secured property but also their personal properties to negate or frustrate the claim of the Bank by creating a third party interest.
5. Paragraph 7 simply contains the statements relating to prejudice and loss, which the Bank would suffer, in the event the defendants failed to furnish security and if the order of attachment is not passed.
6. Paragraphs 8 & 9 contain the standard statements required to be made for attachment before judgment. Paragraph 10 relates to the prayer for injunction against in dealing with those properties by the defendants and in paragraph 11 the Bank prayed for appointment of a Special Officer to make an inventory of the scheduled property.
7. On the backdrop of the aforesaid averments the following reliefs are claimed in the said application:
(a) Direct the defendants to furnish security to the applicant for a sum of Rs.21,45,795/- before this Hon’ble Tribunal;
(b) In default of furnishing security as aforesaid an order of attachment before judgment of properties mentioned in Schedule-‘Y’ and ‘Z’ hereinafter written be passed;
(c) A show cause to the defendants and an order for sale of the scheduled mentioned properties;
(d) A Special Officer be appointed over the properties morefully mentioned in Schedule - ‘Y’ and ‘Z’ with a direction to make inventory and submit a Report to this Hon’ble Tribunal;
(e) An order of Injunction restraining the Defendants and each of them, their servants, agents and assigns from dealing with or disposing of and or otherwise encumbering or transferring the properties and or fixed assets and bank account without the leave of this Hon’ble Tribunal;
(f) The Defendants be directed to disclose their further personal properties, assets on affidavit before this Hon’ble Tribunal;
(g) Any other relief as this Hon’ble Tribunal may deem fit and proper in the facts of this case.”
8. In the impugned order the Debts Recovery Tribunal fails and omits to record the observations relating to the attachment before judgment except that the interest of the Bank needs to be protected, when the secured property does not have the enough market value for recovery of the lawful dues.
9. Curiously enough the Presiding Officer of the Debts Recovery Tribunal proceeded to pass an order of injunction restraini
