RAGHUNATH RAI BAREJA vs PUNJAB NATIONAL BANK

Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2006 Supreme(UK) 698

2007 UAD 178
SUPREME COURT OF INDIA
Hon’ble Mr. Justice S.B. Sinha and Hon’ble Mr. Justice Markandey Katju
Civil Appeal No. 5634 of 2006 (Arising out of Special Leave Petition
(Civil) Nos. 22058-22059/2005)
RAGHUNATH RAI BAREJA & ANR. – Appellants
Versus
PUNJAB NATIONAL BANK & ORS. – Respondents
Decided on : 06.12.2006

For the Appellants :Mr. M.K. Dua, Advocate
For the Respondents:Mr. Dhruv Mehta, Mr. Harshvardhan Jha, Mr. Yashraj Deora, Mr. Manoj Mehta (for M/s K.L. Mehta & Co.) and Mr. Subramonium Prasad, Advocates

Headnote:(A) Recovery of Debts Due to Bank and Financial Institution Act, 1993 - Sec. 31 — Sec. 31 states that only suits or other proceeding pending before the court immediately before the establishment of the Tribunal under the Act, stand transferred to the Tribunal — High Court transfer the Execution petition to Debt Recovery Tribunal which is pending before High Court — Such Execution petition not pending before immediately before establishment of Tribunal under the Act — There are no such inherent powers of the court of transferring the Execution Proceeding to the Debit Recovery Tribunal — We respectfully disagree with the High Court that it has inherent powers apart from Section 31 for transferring the Execution Petition to Debit Recovery Tribunal. (Paras 19, 28)
       (B) Jurisdiction — Appellant had given his consent to the transfer of the Execution Petition from High Court to the Tribunal — It is well settled in law that consent can not confer jurisdiction. (Para 22)
       (C) Indian Limitation Act, 1963 - Art. 136 — And Recovery of Debts Due to Banks and Financial Institutions Act, 1993 - Sec. 24 — Sec. 24 of the RDB Act applies the provisions of the Limitation Act, 1963 — To application filed before the Tribunal — Since Art. 136 of Limitation Act provides a period of limitation of 12 years for filing an execution petition — Hence now no such application can be filed since that period of 12 years expired — Hence the debt became time barred. (Para 24)
       ¼v½ vf/kfu;e 1993 & /kkjk 31 dFku djrh gS fd dsoy okn ;k vU; dk;Zokfg;k¡ tks vf/kfu;e ds vUrxZr vf/kdj.k LFkkfir gksus ls rqjUr igys yfEcr Fkh vf/kdj.k esa gLrkarfjr dh tk;saxh & mPp U;k;ky; us fu"iknu ;kfpdk tks fd mPp U;k;ky; ds le{k yfEcr Fkh _.k olwyh vf/kdj.k esa gLrkarfjr dj nh & bl izdkj dh fu"iknu ;kfpdk vf/kfu;e ds vUrxZr vf/kdj.k LFkkfir gksus ls rqjUr igys yfEcr ugha gksxh & U;k;ky; dks bl izdkj dh vUrfuZfgr 'kfDr izkIr ugha gS fd oks fu"iknu dk;Zokgh dks _.k olwyh vf/kdj.k dks gLrkarfjr dj ns & ge mPp U;k;ky; ds fu.kZ; ls vlger gS fd mls bl izdkj dh vUrfuZfgr 'kfDr izkIr gS fd og fu"iknu ;kfpdk dks _.k olwyh vf/kdj.k esa gLrkarfjr djsA
        ¼izLrj 19] 28½
       ¼c½ {ks=kf/kdkj & vihykFkhZ us fu"iknu ;kfpdk dks mPp U;k;ky; ls vf/kdj.k esa gLrkarfjr djus dh viuh lgefr iznku dh & ;g fof/k esa lqO;ofLFkr gS fd lgefr ls {ks=kf/kdkj iznRr ugha gksrkA ¼izLrj 22½
       ¼l½ Hkkjrh; e;kZnk vf/kfu;e 1963 & vuqPNsn 136 & vkSj vf/kfu;e 1993 & /kkjk 24 & /kkjk 24 vkjdMhdchd vf/kfu;e] e;kZnk vf/kfu;e 1963 ds izko/kku ykxw djrh gS & vf/kdj.k esa izkFkZuk i= nkf[ky djus ds fy;s & vuqPNsn 136 e;kZnk vf/kfu;e fu"iknu ;kfpdk nk;j djus ds fy;s 12 o"kZ dh vof/k e;kZfnr djrk gS & bl izdkj vc 12 o"kZ dh vof/k ds i'pkr~ dksbZ izkFkZuk i= nk;j ugha fd;k tk ldrk & bl izdkj _.k le; ckf/kr gSA ¼izLrj 24½

JUDGMENT

Markandey Katju, J. — Leave granted.

2. This appeal has been filed against the impugned judgment and order dated 26.5.2005 of the Punjab & Haryana High Court in Execution Petition No. 1-L of 1999 by which the execution proceeding was transferred to the Debt Recovery Tribunal, Chandigarh (hereinafter referred to as the ‘Tribunal’), for being disposed of in accordance with law.

3. Heard learned counsel for the parties and perused the record.

4. The facts of the case are that on a Company Petition No. 57 of 1983 - M/s. S.P. Nagrath & Co. vs. M/s Bareja Knipping Fasteners Ltd., the High Court vide order dated 23.10.1983 ordered winding up of the Company and an Official Liquidator was appointed who took over possession of the properties of the Company.

5. The respondent - Bank filed a Suit (Company Petition No. 46 of 1984) for recovery of Rs. 14,53,577/- with pendente lite and future interest.

6. A preliminary decree for recovery of Rs. 19,07,800/- with future interest @ 12% per annum was passed by the High Court in favour of the decree-holder Bank, the respondent herein, on 2.12.1985 in Company Petition No. 46 of 1984.

7. Ultimately, a decree was passed in favour of the Bank on 15.1.1987 in Company Application No. 115 of 1986.

The aforesaid final decree dated 15.1.1987 stated as under :

“It is hereby ordered and decreed that the mortgaged/pledged/hypothecated properties in the aforesaid preliminary decree mentioned or sufficient part thereof be sold, and that for the purpose of such sale the plaintiff/petitioner shall produce before the Court or such officer as appointed, all documents in his possession or power relating to the mortgage properties.

And it is hereby ordered and decreed that the money realized by such sale shall be paid in the Court and shall be duly applied (after deduction therefrom of expenses of the sale) in the payment of the amount payable to the plaintiff/petitioner under aforesaid preliminary decree and under any further orders that may have been passed in this petition and in payment of any amount which the Court may have adjudged due to the plaintiff/petitioner for such costs of the petition including costs of this application and such costs, charges and expenses as may be payable under Rule 10 together with such subsequent interest as may be payable under Rule 11 of Order XXXIV of the first Schedule to Code of Civil Procedure, 1908 and that the balance, if any, shall be paid to the defendants/respondents or other persons entitled to receive the same.”

8. Under Article 136 to the Schedule of the Limitation Act, 1963 the period for applying for execution of any decree is 12 years from the date when the decree becomes enforceable. Since in the present case the final decree was passed and became enforceable on 15.1.1987, the period of limitation for filing an execution application expired on 15.1.1999.

9. In the present case, the Bank filed three Execution Petitions. The first one, being Execution Petition No. 14-L of 1987, was dismissed on 8.11.1990 by the following order :

“No list of the property sought to be attached has been filed. This application is dismissed. The petitioner may, however, file a fresh execution application in accordance with law.”

10. It appears that a second Execution Petition thereafter was filed in 1994 being Execution Petition No. 3-L of 1994 by which the decree holder bank sought attachment and sale of properties which did not belong to the judgment debtors. After contest by the objectors, this second Execution Petition was dismissed by a Learned Single Judge of the High Court on 18.8.1994 holding that the decree passed against the Company cannot be satisfied by attachment and sale of properties belonging to other Companies, as these other Companies are different and distinct juristic personalities with different set of shareholders.

11. Thereafter on 4.9.1998, the respondent-bank filed another Company Petition No. 236 of 1998 under Section 446 of the Companies Act, 1956

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2006 Supreme(UK) 698

Cases Referred (30)