High Court Of Rajasthan
Judgename : GYAN SUDHA MISRA
SUBASH CHAND JAIN - Appellant
Versus
SBBJ - Respondent
CIV. WRIT PETITION 2517 Of 1997
Decided On : 08/26/1997
RECOVERY OF DEBT DUE TO BANKS AND FINANCIAL INSTITUTIONS ACT, 1993 - SECTION 31 - DE NOVO PROCEEDINGS - WRITTEN STATEMENT - REJECTION:
Fact of the Case:
The petitioners, guarantors for the debtors, filed written statements in a suit for recovery of debt. The suit was transferred to the Debt Recovery Tribunal (DRT) under the Recovery of Debt Due to Banks and Financial Institutions Act, 1993 (Act of 1993). The DRT issued summons to the petitioners under Section 19(3) of the Act of 1993, and they filed their replies. The DRT later rejected the written statements, holding that it was received earlier by mistake.
Finding of the Court:
The court held that the DRT erred in rejecting the written statements without assigning any reason, especially when it was vested with the discretion to try the suit from whatever stage it thought proper, was appropriate, and in the interest of justice. The court also held that the DRT should have assessed the prejudice that may or may not have been caused to the plaintiff-respondent while entertaining the second written statement.
Issues: Whether the DRT erred in rejecting the written statements filed by the petitioners after the transfer of the suit from the District Court to the Tribunal.
Ratio Decidendi: The court held that the DRT should have assessed the prejudice that may or may not have been caused to the plaintiff-respondent while entertaining the second written statement, especially when the suit had earlier been dismissed against defendants Nos. 4 and 5 and the ex parte decree had been set aside. The court also held that the DRT should have assigned reasons for refusing to accept the written statement, especially when it had accepted it earlier.
Final Decision: The court allowed the writ petition and directed the DRT to accept the written statement filed by the defendant-petitioner and proceed further in the matter according to law.
GYAN SUDHA MISRA, J.
( 1 ) THIS writ petition challenges the order dated 13-3-1997 passed by the Debt Recovery Tribunal, Jaipur in case No. 52/1994 by which the written statements/replies filed by the petitioners after the transfer of the suit to the Tribunal under the provisions of the Recovery of Debt Due to Banks and Financial Institutions Act, 1993 has been ordered to be returned to the petitioner on the ground that the petitioner had already filed reply in the suit prior to its transfer from the Court of District Judge to the Debt (Tribunal ).
( 2 ) IN order to test the correctness of the order impugned, a slight enumeration of the facts and circumstances of the case are as follows :-
( 3 ) THE State Bank of Bikaner and Jaipur, impleaded as respondent herein, filed a civil suit for recovery of an amount of Rupees Twenty Eight lakhs, in the Court of Addl. District Judge, Kishagarhbas, Alwar against M/s. India Electronics Ltd. including the petitioners herein who were impleaded as defendants Nos. 2 and 4 respectively as they stood guarantors for the debtors - M/s. Indian Electronics. The defendants/ petitioners appeared before the Court of Addl. District Judge and in order to contest the suit, filed their written statements but the suit had been subsequently dismissed ex parte against some other (defendants Nos. 3 and 5 (who are not petitioners herein)) and, hence, they had filed an application for setting aside the ex parte proceedings against them. While the suit was pending, the Recovery of Debt Due to Banks and Financial Institutions Act, 1993 (shortly referred to as the Act of 1993) came into force, due to which the suit was transferred to the Debt Recovery Tribunal, which is empowered to deal with such suits for recovery either from the stage it reached before such transfer or from any earlier stage or de novo, as the Tribunal may deem fit. The relevant provision of the Act of 1993, in this regard envisages as follows :-"where any suit or other proceedings stands transferred from any court to a Tribunal under sub-section (1) (a) the court shall, as soon as may be after such transfer, forward the records of such suit or other proceedings to the Tribunal and (b) the Tribunal may, on receipt of such records, proceed to deal with such suit or other proceedings, so far as may be, in the same manner as in the case of an application made under Section 19 from the stage which was reached before such transfer or from any earlier stage or de-novo as the Tribunal may deem fit. "
( 4 ) UPON transfer of the present suit, the Tribunal issued summons under Sec. 19 (3) of the Act of 1993 along with a copy of the entire paper book, documents and affidavits to all the defendants requiring them to submit their reply within 30 days of the service of summons, which were also served on the petitioner. The petitioners, in response to the notice, submitted their respective reply on 10-5-1996 and 16-8-1996, which were taken on record and the matter proceeded further on the basis of the reply filed by the petitioner. The petitioners also filed an application thereafter for cross-examining the witnesses produced by the plaintiff-bank through affidavit, which it had filed in evidence before issuing of the summons to the defendants petitioners under Sec. 19 (3 ). Thereafter although the arguments were heard on this application and the matter was posted for orders on 6-2-1997, the Honble Member of the Tribunal refrained from passing any order on the application and posed a query as to whether the petitioners were entitled to file their written statement for the second time after the transfer of the suit from the Court of Addl. District Judge, Kishangarhbas to the Tribunal. The petitioners emphatically submitted before the Tribunal, that on transfer of cases, the defendants were fully competent to file their replies before the Tribunal as the Tribunal although did not pass any specific order, under Sec. 31 (12) (b) of the Act as to the sta
Login now and unlock free premium legal research
Login to SupremeToday AI and access free legal analysis, AI highlights, and smart tools.
Login
now!
India’s Legal research and Law Firm App, Download now!
Copyright © 2023 Vikas Info Solution Pvt Ltd. All Rights Reserved.