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2001 Supreme(Raj) 955
High Court Of Rajasthan
Judgename : P.P.NAOLEKAR,GYAN SUDHA MISRA
PUNJAB NATIONAL BANK - Appellant
Versus
PUREWALLAND ASSOCIATES LTD. - Respondent
CIV. SPECIAL APPEAL (W.) 834 Of 1999
Decided On : 09/04/2001
ARVIND GUPTA, G.L.SINGHVI, HARI SHANKER, N.K.MALU, PARAS KUHAD, SATISH BIJARNIA, SUNIL NATH
The High Court has the power to entertain an appeal against the order passed by the Single Judge in exercise of the powers under Art. 227 of the Constitution of India.
Headnote:
COMPROMISE - SETTLEMENT - DEBT RECOVERY TRIBUNAL - JURISDICTION - BANKING - COMPROMISE - VALIDITY - POWERS OF HIGH COURT - SUPERVISION - JURISDICTION - APPEAL - LETTERS PATENT - INTERPRETATION - ORDINANCE XVIII OF 1949, RAJASTHAN HIGH COURT ORDINANCE - ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA - ORDER XXIII, RULE 3 OF THE CODE OF CIVIL PROCEDURE, 1908.
Fact of the Case:
The appellant-Punjab National Bank (hereinafter shall be REFERRED TO as the appellant-Bank) filed two civil suits in the High Court of Himachal Pradesh against the respondent-company bearing C. S. Nos. 53/1992 and 54/1992. Civil Suit No. 53/1992 was for Rs. 194. 38 lacs and Civil Suit No. 54/1992 was for Rs. 741. 91 lacs. During the pendency of the Civil Suits, Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (Central Act No. 51 of 1993) was enacted under which Debt Recovery Tribunal for the States of Himachal Pradesh, Punjab, Haryana, Rajasthan and U. T. of Chandigarh was established at Jaipur. The High Court of Himachal Pradesh vide its order dated 25-11-1994 transferred both the civil suits to the Debt Recovery Tribunal, Jaipur where they were registered as O. A. No. 391/1996 and O. A. No. 500/1996.
Finding of the Court:
The document dated 14/09/1998 has been signed by the General Manager, Chief (CAD) (Members of the Committee) and Chief PAD ). They signed it on various dates. It was signed by the Executive Director on 17th of September, 1998. The aforesaid Authority signed in token of accepting the aforesaid proposal of Bank and ultimately it was approved and signed by the Managing Committee. On behalf of the management committee it has been signed by the Chairman but not in the capacity of the Chairman but in the capacity of Managing Committee. It is thus clear that there was a complete compromise between the appellant Bank and the respondent Company whereby the entire claim of the appellant Bank was adjusted for a sum of Rs. 475 lacs. Therefore, the decision taken by the managing committee on 10th of October, 1998 is of no significance.
Issues: Whether the document dated 14/09/1998 is a document of compromise arrived at between the parties.
Ratio Decidendi: The powers under Art. 227 of the Constitution of India are analogous to the powers given to the High Court under Art. 226 of the Constitution of India. Reading of Ordinance 43 of the Ordinance, 1949 does not indicate that the legislature has intended to confer powers on the High Court akin to Art. 227 of the Constitution of India by Ordinance 43 of the Ordinance, 1949. Any judicial order passed by the High Court which relates to exercise of power of superintendence of the High Court over the inferior Courts or tribunals on the administrative side under Ordinance 43, no appeal shall lie to the Division Bench under Ordinance 18 of the Ordinance of 1949.
Final Decision: The order passed in both the writ petitions by the learned Single Judge on 20/08/1999 is set aside. The parties are directed to appear before the Debts Recovery Tribunal on 3-10-2001 and the Tribunal is directed to proceed further with the matter on merits and in accordance with law.
NAOLEKAR, J.
( 1 ) RESPONDENT No. 1, herein, M/s. Purewal and Associates Limited (hereinafter shall be REFERRED TO as the respondent-company) moved applications before the Debts Recovery Tribunal under Order 23, Rule 3 read with Section 151 of the Code of Civil Procedure for recording the compromise/settlement arrived at between the parties and passing of the Decree in terms thereof. Appellant-Punjab National Bank (hereinafter shall be REFERRED TO as the appellant-Bank) contested the said applications by filing reply. By order dated 15-12-1998 the learned Debts Recovery Tribunal has rejected the applications of the respondent-company filed under Order 23, Rule 3 of the Civil Procedure Code holding that the compromise cannot be recorded as it was not in writing signed by the parties. Being aggrieved by the said order dated 15-12-1998 of the Tribunal, the respondent- Company filed two writ petitions bearing S. B. Civil Writ Petition Nos. 6681/98 and 6682/98 challenging the order passed by the Debts Recovery Tribunal, Jaipur on 15-12-1998 refusing to record the alleged compromise entered into between the respondent-company and the appellant-Bank.
( 2 ) IT is alleged by the respondent-company in the writ petitions that the respondent-company registered under the Companies Act, 1956 is carrying on the business of watch components and watch movement making at Solan District. In order to finance the project of the respondent-company, a Bridge Loan of Rs. 120 lacs was taken from the appellant-Bank by the respondent-company. As the respondent-company failed to pay the entire loan amount and the interest thereon to the appellant-Bank, the appellant-Bank filed two civil suits in the High Court of Himachal Pradesh against the respondent-company bearing C. S. Nos. 53/1992 and 54/1992. Civil Suit No. 53/1992 was for Rs. 194. 38 lacs and Civil Suit No. 54/1992 was for Rs. 741. 91 lacs. During the pendency of the Civil Suits, Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (Central Act No. 51 of 1993) was enacted under which Debt Recovery Tribunal for the States of Himachal Pradesh, Punjab, Haryana, Rajasthan and U. T. of Chandigarh was established at Jaipur. The High Court of Himachal Pradesh vide its order dated 25-11-1994 transferred both the civil suits to the Debt Recovery Tribunal, Jaipur where they were registered as O. A. No. 391/1996 and O. A. No. 500/1996.
( 3 ) THE respondent-company approached the appellant-Bank to settle the dispute pending in both the suits and vide its letter of October, 1995 voluntarily offered a sum of Rs. 277. 53 lacs to the appellant-Bank to liquidate all the alleged outstanding against the respondent-company. In September, 1997 the appellant-Bank asked the respondent-Company to attend its zonal office at Chandigarh and as per the respondent-company the appellant-Bank demanded a sum of Rs. 367 lacs for settling the dispute. The respondent-company accepted the offer and agreed to pay the amount so demanded and accordingly submitted a letter for payment of final amount of Rs. 367 lacs. Again the representative of the respondent-company was called by the Zonal Office of the appellant-Bank and suggested that the settlement can take place at Rs. 375 lacs. In order to buy peace, the respondent-company consented to the said figure and submitted its acceptance letter dated 30/09/1997. The appellant-Bank again called the respondent-company at its Zonal Office in the month of November, 1997 and a proposal was given to enhance the figure of Rs. 375 lacs to a total sum of Rs. 400 lacs. The respondent-company again accepted the proposal of the appellant-Bank and gave its consent. Later on the respondent-company was informed by the respondent Banks Zonal Office, Chandigarh that the proposal of Rs. 400 lacs was finally recommended for approval of the Head Office at Delhi in December, 1998, thus, a compromise has been arrived at between the parties but still on 25th of May, 1998 the Executive
