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2025 Supreme(Online)(Mad) 33749
IN THE HIGH COURT OF JUDICATURE AT MADRAS
HONOURABLE MS. JUSTICE R. POORNIMA
Revision petitioner – Appellant
Versus
1st respondent/plaintiff – Respondent
I.A.No.03 of 2019|O.S.No.165 of 2019|O.A.No.1108 of 1999|T.A.No.473 of 2007|R.P.No.248 of 2017|D.R.C.No.234 of 2017
For the Appellants/Petitioners:
For the Respondents:
Section 18 of the Recovery of Debts Due to Banks and Financial Institutions Act bars civil court jurisdiction to entertain suit for redemption of mortgage pending recovery proceedings before the Debt Recovery Tribunal.
Headnote:(A) Recovery of Debts Due to Banks and Financial Institutions Act, 1993 - Sections 17 and 18 - Code of Civil Procedure, 1908 - Order VII Rule 11 - Civil suit for redemption of mortgage - Jurisdictional bar - “Section 18 of the RDDBFI Act, 1993 explicitly restricts the jurisdiction of civil courts after proceedings initiated under Section 17” - Suit for redemption barred before civil court once recovery proceeding is pending before Debt Recovery Tribunal (DRT) (Paras 4, 6, 8, 10).
(B) Doctrine of res judicata - Suit barred as issues already adjudicated in prior recovery proceedings - Prevents re-litigation of same cause of action in civil court (Paras 2.vi, 3.i).
(C) Jurisdiction - DRT has exclusive jurisdiction over recovery and related matters - Civil courts lack jurisdiction to entertain redemption suits during pendency of recovery proceedings (Paras 2.iv, 2.v, 7).
Facts of the case:
Respondent/plaintiff mortgaged property to petitioner/bank as security for loans availed since 1996 and thereafter defaulted repayment. Bank initiated recovery proceedings under Section 17 of the RDDBFI Act before DRT, Madurai, which decreed the claim in 2017. Subsequent recovery certificate issued. Respondent filed civil suit for redemption of mortgage before Additional District Judge in 2019 without approaching DRT or depositing money as directed. Bank alleged suit barred under Section 18 of RDDBFI Act and doctrine of res judicata.
Findings of Court:
Trial court’s order allowing suit challenged. Court found that once recovery proceedings were initiated and pending before DRT, civil court had no jurisdiction in the matter. Respondent delayed repayment and did not file redemption application before DRT. Sale deed forged by respondent to third party. Court held suit barred by statutory provisions and earlier adjudication, thus contrary to law.
Issues: Whether civil court has jurisdiction to entertain suit for redemption of mortgage pending recovery proceedings before DRT; Whether Section 18 of RDDBFI Act bars such suit; Whether suit barred by doctrine of res judicata; Whether respondent can maintain suit without depositing requisite money or approaching DRT.
Ratio Decidendi: The court reasoned that Section 18 of RDDBFI Act bars civil court jurisdiction in matters where recovery proceedings have been initiated under Section 17, ensuring exclusive jurisdiction of Recovery Tribunal to adjudicate and execute recovery claims. Allowing suit in civil court would frustrate the purpose of the enactment. Further, issues already adjudicated by Tribunal cannot be re-litigated in civil court under guise of redemption suit. Respondent’s delay and absence of deposit confirmation negates right to redeem independently.
Result: Civil Revision Petition allowed; the order permitting suit for redemption of mortgage set aside; suit held barred for lack of jurisdiction and as abuse of process of law.
| Table of Content |
|---|
| 1. factual background of mortgage, loan default, suit and recovery proceedings (Para 1 , 5) |
| 2. parties’ conflicting contentions on jurisdiction and maintainability of redemption suit (Para 2 , 3) |
| 3. court’s analysis on jurisdictional bar under rddbfi act and prior judgments (Para 4 , 6 , 7 , 8 , 9 , 10) |
ORDER
The Civil Revision Petition has been filed against the Fair and Decreetal Order dated 31.07.2020 made in I.A.No.03 of 2019 in O.S.No.165 of 2019 on the file of the I Additional District Judge (PCR), Thiruchirapalli.
2. Brief averments of the petition are as follows :
i) The 1st respondent/plaintiff has filed the suit against the petitioner for the relief of redemption of mortgage and to return the original title deeds of the suit schedule property on receipt of Rs. 17.50,000/- towards the mortgage money and perpetual prohibitory injunction and other reliefs.
ii) The 1st respondent/plaintiff is a partner of M/s.Sakthi Time Company. The Company was availing credit facility. In the year 1996 they were received OCC limit of a sum of Rs.5,00,000/- from the revision petitioner Bank. As security for the repayment of the said loan, the schedule property was mortgaged by the respondent. Subsequently, the 1st respondent/plaintiff availed an educational loan of Rs.6,00,000/- for his son's education. The mortgage on the schedule property was extended to the educational loan as well. However, the 1st respondent/plaintiff committed default in repaying the amounts due to the Bank. Under the said loan, due to the default of repayment of the loan amount, the revision petitioner/1st defendant bank initiated proceedings under Section 17 of Recovery of Debts and Bankruptcy Act, 1993 before the Debts Recovery Tribunal, Madurai in O.A.No.1108 of 1999 before Debts Recovery Tribunal, Chennai and transferred to Debts Recovery Tribunal, Madurai and numbered as T.A.No.473 of 2007. The 1st respondent/plaintiff has participated the T.A.No.473 of 2007 proceedings. The Debts Recovery Tribunal, Madurai passed the final order in O.S.No. 473/2007 on 11.10.2017. Thereafter, allowed the claim of the revision petitioner. The recovery certificate was also issued. Now the recovery proceeding is pending before the Recovery Officer, Debts Recovery Tribunal, Madurai in R.P.No.248 of 2017 in D.R.C.No.234 of 2017. In order to bring the property for sale the Recovery Officer, Debts Recovery Tribunal, Madurai directed to produce encumbrance certificate, which was obtained by Revision petitioner and it reveals that the respondent /plaintiff created a sale deed on 29.10.1999, in favour of third party a complaint was lodged against the respondent.
iii) The respondent filed a suit for redemption in O.S.No.165 of 2019 on the file of the I Additional District Judge, Trichy. The revision petitioner filed petition under Order VII Rule 11 of Code of Civil Procedure to reject the claim which was dismissed.
iv) As per the Section 18 of the RDDBFI Act 1993, no Court or other authority shall have or be entitled to exercise power of attorney in relation to matters specified the jurisdiction after proceedings initiated under Section 17 of the RDDBFI Act 1993, once the proceedings have been initiated thereunder. Therefore, the present suit is not maintainable before the civil Court.
v) The Debts Recovery Tribunal had the power to adjudicate the liability of the borrower conferring the re-payment. The civil Court do not have jurisdiction over such matter. Since the Execution Proceedings are currently pending before the Recovery Officer any attempt by the 1st respondent/plaintiff to redeem the mortgaged property, must be made by approaching the Recovery Officer of Debts Recovery Tribunal, Madurai and by depositing the requisite money. In such circumstance, the Civil Court lack jurisdiction to entertain the present suit which is therefore, not maintainable.
vi) The plaintiff cannot compel the petitioner/1st defendant to participate in the second round of litigation on the same c
