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2019 Supreme(Megh) 166

IN THE HIGH COURT OF MEGHALAYA
H.S. Thangkhiew, J.
Madhu Bajaj - Appellant
Versus
State Bank Of India And Others - Respondent
CRP No. 2 of 2018
Decided on : 02-04-2019

Important Points

The main legal point established in the judgment is the importance of exhausting statutory remedies before seeking relief under Article 227 and the need for judicial prudence in refraining from exercising jurisdiction under constitutional provisions when alternative remedies are available.

Subject

Civil Law - Debt Recovery

Act Referred

CIVIL PROCEDURE CODE : S.10, O.9 R.13
CONSTITUTION OF INDIA : Art.226, Art.227
RECOVERY OF DEBTS AND BANKRUPTCY ACT : S.20, S.30
RECOVERY OF DEBTS DUE TO BANKS AND FINANCIAL INSTITUTIONS ACT : S.19, S.7, S.22
SECURITISATION AND RECONSTRUCTION OF FINANCIAL ASSETS AND ENFORCEMENT OF SECURITY INTEREST ACT : S.13(4)

Headnote

Article 227 - Recovery of Debts Due to Banks and Financial Institutions - Section 19, 22, 25-29, 30 - The court discussed the provisions of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, particularly focusing on the hierarchy of appeal, alternative remedies, and the jurisdiction of the court under Article 227 of the Constitution of India. The court emphasized the importance of exhausting statutory remedies before seeking relief under Article 227 and highlighted the need for judicial prudence in refraining from exercising jurisdiction under constitutional provisions when alternative remedies are available.

Fact of the Case:

The petitioner challenged the order, recovery certificate, and demand notice issued by the Debt Recovery Tribunal, Guwahati under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993. The petitioner contended that the orders were obtained by suppression of facts and without proper service. The respondent argued that the petitioner had alternative remedies available and the revision petition was unsustainable.

Finding of the Court:

The court found that while the petitioner had alternative remedies available, there were irregularities in the proceedings before the Debt Recovery Tribunal, warranting limited interference under Article 227. The court disposed of the revision petition and remanded the matter to the Debt Recovery Tribunal with specific directions.

Issues: The issues revolved around the maintainability of the revision petition under Article 227 in the presence of alternative remedies, the irregularities in the proceedings before the Debt Recovery Tribunal, and the possibility of settlement.

Ratio Decidendi: The court emphasized the need to exhaust statutory remedies before seeking relief under Article 227 and highlighted the importance of judicial prudence in refraining from exercising jurisdiction under constitutional provisions when alternative remedies are available. The court also found irregularities in the proceedings before the Debt Recovery Tribunal, warranting limited interference under Article 227.

Final Decision: The revision petition was disposed of, and the matter was remanded to the Debt Recovery Tribunal with specific directions, including permitting the petitioner to file fresh applications for setting aside the exparte orders and suspending the impugned order dated 16.10.2017 until disposal of the applications.

Advocates:
Advocate Appeared:
For the Petitioner: Mr. K. Paul
For the Respondent: Mr. S. Dutta

JUDGMENT :

1. The instant application under Article 227 of the Constitution of India has been filed challenging the order dated 16.10.2017, recovery certificate dated 17.10.2017 and demand notice dated 25.12.2017 issued by the Debt Recovery Tribunal, Guwahati in OA No. 265 of 2017 against the petitioner and other respondents. The main contention of the petitioner is that the impugned order as well as the consequential order and the certificate were obtained by suppression of materials of fact and without proper service being affected upon the petitioner.

2. The brief facts leading to the said impugned orders, is that the respondent No. 1 Bank company filed OA No. 265 of 2017 before the Debt Recovery Tribunal under Section 19 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (hereinafter referred to as the Recovery Act) against the petitioner (and other respondents herein) who are directors of M/s R.N.B. Cements Pvt. Ltd. for recovery of Rs. 44,66,81,083.12p (Rupees Forty Four Crores Sixty Six Lakhs Eighty One Thousand Eighty Three and Paise Twelve only). The petitioner and the other respondents having not appeared before the Tribunal, the matter was decided exparte and the order was passed for recovery of the above mentioned amount. Thereafter, pursuant to the aforesaid order dated 16.10.2017, recovery certificate dated 17.10.2017 under Section 19 sub Section 7 and 22 of the Recovery Act for the said amount was issued on 17.10.2017, and notice of demand under Sections 25 to 29 was issued on 25.12.2017. Being aggrieved thereby, the instant revision petition under Article 227 of the Constitution of India, has been filed before this Court.

3. Mr. K. Paul, learned counsel for the petitioner submits that the application has been filed under Section 227 of the Constitution of India in view of the fact that the respondent Bank had in spite of being aware on an earlier proceeding between the parties being OA No. 34 of 2017 and also the existence of a Civil Suit before the Court at Nongpoh, Ri- Bhoi District, and by willfully and deliberately suppressing the order dated 19.06.2017 passed in CRP No. 15 of 2017, had filed a second original application i.e. OA No. 265 of 2017 before the Debt Recovery Tribunal, Guwahati. As such, he prayed that it is a fit case for interference by this Court under Article No. 227 of the Constitution of India.

4. Mr. S. Dutta, learned counsel for the respondent State Bank of India has on the other hand has strongly challenged the maintainability of the instant civil revision under Article 227. He submits that the same has been done without any jurisdiction and by bypassing efficacious alternative remedies which are available to the petitioner as provided in the Recovery of Debts and Bankruptcy Act, 1993. He submits that the case filed by the respondent Bank for recovery of the outstanding claim had already attained finality, with the passing of Judgment and Order dated 16.10.2017 by the Debt Recovery Tribunal, and the issuance of recovery certificate dated 17.10.2017. That being the case, he submits the remedy available to the petitioner was only to file an appeal before the Appellate Tribunal at Kolkata under Section 20 of the Recovery of Debts and Bankruptcy Act, 1993 against the Order dated 16.10.2017. He further submits that there is also a provision for challenging the recovery certificate, under Section 30 of the Recovery of Debts and Bankruptcy Act, 1993 by filing an appeal before the Debt Recovery Tribunal.

5. The learned counsel for the respondent further submitted that the revision petitioner had also filed an application under Order 9 Rule 13 of the C.P.C. numbered as I.A. No. 43 of 2018 for recalling and setting aside the exparte Judgment and Order dated 16.10.2017 and also Notice of Demand and that the same is pending disposal. He strongly urged that admittedly, therefore, by filing of the application before the Tribunal, the revision petition is unsustainable and also hit

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