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Ishan System Pvt. Ltd V/S Optiemus Infracom Ltd. & Another.

    I.A. No. 707 of 2012

    Decided On, 03 April 2013

    At, Debt Recovery Appellate Tribunal At Delhi

    By, THE HONORABLE JUSTICE: S.N.H. ZAIDI
    By, (CHAIRPERSON)

    For Petitioner: Mr. Manish Vashisht, Mr. Sameer Vashisht and Mr. Ricky Gupta, Advocates And For Respondents: Mr. Amit Chadha, Sr. Advocate with Mr. Arvind Sharma, Advocate for the Respondent No. 1 and Mr. S.D. Dobhal, Advocate for the Respondent No. 2



Judgment Text


1. The instant application has been filed under Sections 5 and 14 of the Limitation Act read with Section 151 of the C.P.C.. for condonation of delay in filing the accompanying Appeal against the judgment and order dated 10th July, 2012 of the DRT-III, Delhi, whereby S.A. No. 714/2011 has been dismissed. According to the office report, the Appeal is time-barred by 48 days as it has been filed on 26th September, 2012 qua the order dated 10th July, 2012.

2. As per the averments of the application, the delay in filing the Appeal had occasioned due to the filing of the writ petition [W.P. (C) No. 35215/2012] before the Allahabad High Court against the order impugned, which had been dismissed on 30th July, 2012 on the ground of lack of territorial jurisdiction; that thereafter another writ petition was filed before the Delhi High Court, which had refused to entertain the same, vide order dated 21st August, 2012, on the ground of availability of alternative remedy of Appeal that the delay in filing the appeal was bona fide and was not intentional that the appellant/applicant was of the view that since this Tribunal had passed an order dated 24th January, 2012 wherein findings on all the issues raised in the accompanying appeal had been given, therefore, filing of the appeal before this Tribunal would be a idle formality.

3. In his additional affidavit the applicant has further stated that there is no delay in filing the appeal as the time spent by the appellant/applicant in prosecuting the writ petitions before the Allahabad and Delhi High Courts is entitled to be excluded; that the certified copy of the order dated 21st August, 2012 of the Delhi High Court was applied for on 11th September, 2012, which was prepared on 17th September, 2012, and as such the periods of delay from 11th July, 2012 to 21st August, 2012 and from 11th September, 2012 to 17th September, 2012 are required to be excluded in computing the period of limitation.

4. Though no formal reply to the application has been filed by the respondents, yet Mr. Amit S. Chadha, the learned Senior Advocate, had vehemently opposed the application on behalf of respondent No. 1.

5. I have considered the submissions of the parties learned Counsel and perused the record. In Clause 4 of the appeal memo, which relates to the limitation it has been stated that the appeal could not be filed within the limitation period of 30 days from the date of receipt of the order impugned, because the appellant was pursuing its remedy under the Constitution of India and as such there had been a delay of 57 days in filing the appeal, which had occurred owing to the bona fide action of the appellant. Thus in view of the specific admission of delay in filing the appeal in the pleadings, the averment in the application that there is no delay cannot be accepted. The next contention of the appellant/applicant that it was of the view that since this Tribunal had already expressed its views on the issues raised by the appellant in this appeal, therefore, filing of appeal before this Tribunal would be a formality can also not be accepted as a ground sufficient for bypassing the statutory appeal. The appellant/applicant cannot be allowed to take the benefit of its own wrong of assailing the order impugned in the writ petitions before the Allahabad and Delhi High Courts, despite the availability of the remedy of Appeal under the SARFAESI Act, Mr. Chadha has, however, contended that the filing of the writ petition before the Allahabad High Court was a deliberated and strategic move of the Appellant as it had earlier filed a writ petition [WP(C) No. 8409/2012) before the High Court and had obtained certain order/directions, but this time it had not been so lucky and the writ petition was dismissed for want of territorial jurisdiction.

6. Mr. Chadha has further contended that the subsequent filing of the writ petition before the Delhi High Court was also a calculated move on the part of the appellant and despite the fact that it was fully aware that the order of the DRT is appealable before this Tribunal, it had filed the writ petition not because this Tribunal had expressed any prima facie view on any issue but to indulge in Bench hunting as the High Court, while dismissing the writ petition with a punitive cost of Rs. 50,000/- had also observed that:

In our considered view, the plea is misplaced in law as it would amount to stating that if a Court took a prima facie view at the interlocutory stage, the appeal should not be heard by it. A judicial bent of mind would always require a different approach at a prima facie stage and at the final stage, as the view formed at prima facie, stage is only tentative in nature. In any case the issue at the stage was whether respondent No. 2 could be called upon to pay the balance price to respondent No. 1 pending confirmation of auction. We, thus, find no merit in what is stated in para 29 of the writ petition and, thus, are of the view that there is no reason to circumvent the legal process where an alternative efficacious remedy had been provided before the DRAT in the statute itself, a retired High Court Judge manning the said post.

We have sketched out the facts earlier to show that there had been a constant endeavour by the petitioner to obstruct the proceedings on one pretext or the other making reckless allegations against the Presiding Officers unsuccessfully and now the endeavour to evade the proceedings before the DRAT.

There is also another aspect to this matter which is quite disturbing. In the petition an endorsement was made that the petitioner would be led by a named Senior Counsel, who cannot appear before DB-II. The matter was, thus, marked to DB-IV. However, the petitioner on the first date (i.e., 7th August, 2012) was led by a different Senior Counsel and, thus, DB-IV took note of the fact that since as a per roster these matters are listed before DB-II, they should be accordingly listed. The reason given was that the named Senior Counsel had declined to appear in the matter in view of an earlier litigation inter se the parties being dealt with by DB-II.

The aforesaid order inter se the parties had not been filed but had been placed before us which had been passed in WP (C) No. 1266/2011 on 24th February, 2011 by a Bench of Sanjay Kishan Kaul, J. and Rajiv Shakdher, J. The said order records the conduct of the petitioner herein in respect of the proceedings under the SARFAESI Act while dealing with the history of the matter and it was found that the writ petition was a gross abuse of process of Court and dismissed the same with exemplary costs quantified at 50,000.00. We may also not that all matters pertaining to DRAT and DRT as per roster notified by Hon'ble, the Acting Chief Justice are to be listed before this Bench. In fact, this subject-matter had remained with this Bench for more than a year. Thus, it is not as if the Counsel would be unaware that in the normal course the matter would be placed before this Bench apart from the fact that the prior litigation between the parties was dealt with by this Bench. This is clearly an endeavour at bench hunting by the petitioner which we strongly deprecate.

We are, thus, of the view that the petitioner must be burdened with costs for such a conduct. The costs must include the total actual expenses of the respondent in defending the litigation on the two dates apart from the punitive costs. We, thus, direct the respondents to forward their bill of fee and expenses including the fee of the Senior Counsel to the petitioner for reimbursement as costs of the proceedings and further impose punitive costs quantified at 50,000.00 to be deposited with the Delhi High Court Mediation and Conciliation Centre in UCO Bank A/c No. 48852. The needful be done within fifteen (15) days from today.

The writ petition is accordingly dismissed.

7. In view of the observation of the Hon'ble Delhi High Court looking to the conduct of the appellant/applicant, the contention that the time consumed in pursuing the writ petitions before the Allahabad and Delhi High Courts is entitled to be excluded and the appeal be held to have been filed within the period of limitation, is untenable. The Appeal had been filed after the expiry of the period of limitation, as is admitted by the appellant/applicant in Clause 4 of the appeal memo.

8. So far as the question of condonation of the delay is concerned, the SARFAESI Act does not confer power upon the Appellate Tribunal to condone the delay in filing the Appeal under Section 18 of the said Act. The question whether such a delay can be condoned by this Tribunal under Section 5 of the Limitation Act was considered at great length by a Division Bench of the Madhya Pradesh High Court in the case of Seth Banshidhar Kedia Rice Mills Pvt. Ltd. v. State Bank of India,: I (2013) BC 667 (DB) : AIR 2011 MP 205. It has been held therein that the provisions of the Limitation Act are not applicable to the Appellate Tribunal and as such this Tribunal has no power to condone the delay. Mr. Vashisht has, however, pointed out that the Supreme Court has admitted the S.L.P. filed against the aforesaid judgment of the Madhya Pradesh High Court and though the operation of the order has not been stayed, yet as per the observation of the Supreme Court, once the special leave is granted and the appeal is admitted, the correctness or otherwise of the impugned judgment is in jeopardy, Union of India v. West Coast Paper Mills Ltd., : I (2004) SLT 909 : I (2004) CLT 319 (SC) : (2004) 2 SCC 747.

9. Mr. Vashisht has also submitted that a Division Bench of the Andhra Pradesh High Court in Sajida Begum v. State Bank of India, : I (2013) BC 24 (CN) : AIR 2013 A.P. 24, has observed that the decision in Seth Banshidhar Kedia Rice Mills' case (supra) does not lay down correct law and is in fact contrary to the ratio of the judgment of the Supreme Court in Mukri Gopalan v. C.P. Aboobacker, : AIR 1995 SC 2272. It has also been submitted that the High Court has further held that Section 29(2) of the Limitation Act is clearly attracted and thereby Sections 4 to 24 (both inclusive) of the Limitation Act would be applicable to the proceedings under Sections 17 and 18 of the SARFAESI Act and as such this Tribunal has power under Section 5 of the Limitation Act to condone the delay in filing the Appeal.

10. In Dr. Zubida Begum & Anr. v. Indian Bank, : I (2013) BC 67 (DB) : 2012(5) C.T.C. 369, a Division Bench of the Madras High Court has also considered the question whether or not the D.R.A.T. has power to condone the delay in filing the Appeal under Section 18 of the SARFAESI Act and while agreeing with the view expressed by the Madhya Pradesh High Court in Seth Banshidhar Kedia Rice Mills case (supra) and also considering the judgment of the Apex Court in Mukri Gopalan's case (supra) has observed that once it is held that the Tribunal is not a Court, Section 5 of the Limitation Act would not be available to the Appeal filed under Section 18 of the SARFAESI Act. It has been pointed out that in the case of Mukri Gopalan (supra) the Apex Court has observed with reference to Section 29(2) of the Limitation Act that if the power under Section 5 of the Limitation Act is to be exercised by the Appellate Tribunal, it had to be conferred specifically and, ultimately, came to the conclusion that the D.R.A.T. has no power to condone the delay in preferring the statutory Appeal under the SARFAESI Act.

11. In Seth Banshidhar Kedia Rice Mills' case (supra) the High Court, while comparing the provisions of the SARFAESI Act with the RDDBFI Act, more particularly Section 18 of the SARFAESI Act with Section 20 of the RDDBFI Act, has found that the period of limitation for filing an Appeal under Section 18 of the SARFAESI Act has been reduced from 45 to 30 days with no discretion to condone the delay, whereas, power to condone the delay was given to the Appellate Tribunal under the proviso to Section 20(3) of the RDDBFI Act and came to the conclusion that the Legislature has consciously decided not to confer the power to condone the delay with the Appellate Tribunal under Section 18 of the SARFAESI Act. The Hon'ble Court has also considered the application of Section 29(2) of the Limitation Act to the D.R.A.T. in the light of the views expressed by the Supreme Court in the cases of Fair Growth Investments Ltd. v. Custodian, : IV (2004) CLT 156 (SC) : VI (2004) SLT 376 : (2004) 11 SCC 472 and Hukumdev Narain Yadav v. L.N. Mishra, : AIR 1974 SC 480, and while observing that the Legislature has consciously excluded the applicability of the provisions of Sections 4 to 24 of the Limitation Act so far as they relate to Section 18 of the SARFAESI Act, ultimately held that the Appellate Tribunal has no power to condone the delay in filing the Appeal before it under the said section.

12. In my opinion, the views taken by the High Court in the cases of Seth Banshidhar Kedia Rice Mills (supra) and Dr. Zubida Begum (supra) are more acceptable than the view taken by the Andhra Pradesh High Court in Smt. Sajida Begum's case (supra). The Andhra Pradesh High Court while holding that the decision in Seth Banshidhar Kedia Rice Mills' case does not lay down correct law, has not dealt with the reasoning given by the Madhya Pradesh High Court in support of its view with which the Madras High Court has expressed its agreement. It is pertinent to note that Section 17(7) of the SARFAESI Act provides that the D.R.T. shall dispose of the application in accordance with the provisions of the RDDBFI Act and Section 24 of the RDDBFI Act provides that the provisions of the Limitation Act shall, as far as may be, apply to an application made to a Tribunal and thus a conjoint reading of both the aforesaid provisions clearly indicates that for the disposal of an application filed under Section 17 of the SARFAESI Act, the provisions of the Limitation Act shall be applicable. The aforesaid provision of Section 24, however, d

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oes not make the Limitation Act applicable to the Appellate Tribunal which has been defined distinctly in Section 2(a) than the definition of the 'Tribunal' in Section 2(o) of the RDDBFI Act. The said circumstance clearly indicates that the Legislature has consciously excluded the application of the provisions of the Limitation Act to the Appellate Tribunal. I am also of the view that though the correctness or otherwise of the judgment of the Madhya Pradesh High Court in Seth Banshidhar Kedia Rice Mills' case (supra) may be in jeopardy after the grant of special leave and admission of the Appeal by the Apex Court against it, yet since its operation has not been stayed, it is a good law so long as it has not been set aside or varied and thus has all the persuasive value. I am in respectful agreement with the views of the Madhya Pradesh and Madras High Courts expressed in the above referred cases and hold that the provisions of the Limitation Act are not applicable to this Tribunal in exercise of the powers under Section 18 of the SARFAESI Act and as such this Tribunal has no power to condone the delay in filing the Appeal. The application (I.A. No. 707/2012) filed under Section 5 of the Limitation Act for condonation of delay is, therefore, liable to be dismissed and is dismissed accordingly. Since the Appeal has been filed beyond the limitation period of 30 days from the date of the receipt of the order impugned, therefore, the same cannot be entertained and is dismissed as time-barred. Copy of this order be furnished to the parties as per law.
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