Standard Chartered Bank vs Mstc Limited

19 of the RDB Act for recovery of a sum of Rs.191,03,54,070.96/- – An I.A. was filed by the appellant stating that given the admissions contained in the balance of the relevant years of the respondentCompany, a sum of Rs. 222,51,00,000/- was owed by the respondent – The said I.A. was allowed by DRT – The respondent filed an appeal against the said order before the DRAT – While pending appeal, a review application was filed by the respondent before the DRT – Thereafter, the appeal filed earlier was withdrawn – Meanwhile, an application was filed to condone a delay of 28 days in filing the review petition before the DRT – Application was dismissed by the DRT – Writ Petition – The High Court held that no appeal would be maintainable against the dismissal of the review petition and that therefore, a writ petition would be maintainable – The High Court also held that application u/s. 19 of the RDB Act would subsume an application for review as a review application would originate from an order passed u/s.19 , as per procedure prescribed u/s. 22 of the RDB Act, and would therefore not be an application which could be said to be independent of s. 19 of the Act – This being the case, the High Court condoned the delay and set aside the judgment of the DRT – On appeal, held: The judgment of the Supreme Court in International Asset Reconstruction Company of India Limited makes it plain, though in a slightly different context, that only application that is referred to by s. 24 of the RDB Act is an application filed u/s. 19 and no other – This being the case, an application for review, not being an application u/s. 19, but an application u/s. 22 (2) (e) r/w. r. 5A of the Rules, this judgment would apply on all fours to exclude applications which are review applications from the purview of s. 24 of the RDB Act – The High Court also wrongly applied Or. XLVII, r. 7 of the CPC – S. 22 (1) of the RDB Act makes it clear that the Tribunal and the Appellate Tribunal shall not be bound by the procedure laid down by the Code of Civil Procedure, making it clear that Or. XLVII, r. 7 would not apply to the Tribunal – Further, s. 20 applies to all applications that may be made, including applications for review and orders being made therein subject to appeal – Also, s. 34 of the Act makes it clear that 1993 Act, will have overriding effect over any other law for the time being in force, which includes the Code of Civil Procedure – The High Court was clearly in error in holding that no appeal would be maintainable against the dismissal of the review petition and that a writ petition would be maintainable – Therefore, the judgment of the High Court cannot be sustained and is set aside.

Allowing the appeal, the Court

HELD : 1. Rules 2(b) and 2(c) of the Debt Recovery Tribunal (Procedure) Rules, 1993 define “applicant” and “application”, respectively, as including applicants and applications filed under Section 19, 31A of the Recovery of Debts and Bankruptcy Act, 1993 as well as appeals filed under Section 30(1) of the Act. An application under Section 31A is an application to enforce a decree or order passed by any court before the commencement of the Amendment Act of 2000 and which has not yet been executed. An appeal under Section 30(1) is an appeal to the Tribunal against orders of the Recovery Officer made under the Act. The reason why Rule 2(c) of the Rules defines application as including an application under Section 31A and an appeal filed under Section 31 of the Act, apart from applications filed under Section 19, is because under Rule 4 of the Rules, the procedure for filing such applications/appeal is under Forms I to III appended to the Rules. What is important to note is that even this extended definition,under the Rules, does not include an application for review filed under Rule 5A of the Rules. In point of fact, Rule 7 makes it abundantly clear that each such application, including applications for review, are viewed separately and independently, as fees payable for filing such applications are vastly different, as is clear from Rule 7(2) of the Rules. [Para 8][458-D-F]

2. In fact, this Court in International Asset Reconstruction Company of India Limited had to consider whether Section 5 of the Limitation Act can be invoked to condone delay in the filing of an appeal after the prescribed period of 30 days under Section 30(1) of the RDB Act. The Court first stated, in paragraph 8, that the RDB Act is undoubtedly a special law and a complete code by itself with regard to expeditious recovery of dues to banks and financial institutions. After then noticing Section 22(1) in paragraph 9 and stating that Section 5 of the Limitation Act cannot proprio vigore apply to a tribunal as a tribunal is not a Court. [Para 9][458G-H; 459A]

3. The judgment of this Court makes it plain, though in a slightly different context, that the only application that is referred to by Section 24 of the RDB Act is an application filed under Section 19 and no other. This being the case, an application for review, not being an application under Section 19, but an application under Section 22(2)(e) read with Rule 5A of the Rules, this judgment would apply on all fours to exclude applications which are review applications from the purview of Section 24 of the RDB Act. [Para 10][461A-B]

4. The peremptory language of Rule 5A would also make it clear that beyond 30 days there is no power to condone delay. It may also be noted that Rule 5A was added in 1997 with a longer period within which to file a review petition, namely, 60 days. This period was cut down, by amendment, with effect from 04.11.2016, to 30 days. From this two things are clear: one, whether in the original or unamended provision, there is no separate power to condone delay, as is contained in Section 20(3) of the Act; and second, that the period of 60 days was considered too long and cut down to 30 days thereby evincing an intention that review petitions, if they are to be filed, should be within a shorter period of limitation – otherwise they would not be maintainable. [Para 14][462C-D]

5. This Court is also of the view that the High Court wrongly applied Order XLVII Rule 7 of the Code of Civil Procedure. Section 22(1) of the Act makes it clear that the Tribunal and the Appellate Tribunal shall not be bound by the procedure laid down by the Code of Civil Procedure, making it clear thereby that Order XLVII Rule 7 would not apply to the Tribunal. Also, in view of Section 20, which applies to all applications that may be made, including applications for review, and orders being made therein being subject to appeal, it is a little difficult to appreciate how Order XLVII Rule 7 could apply at all, given that Section 20 of the RDB Act is part of a complete and exhaustive code. Section 34 of the Act makes it clear that the 1993 Act, (and, therefore, Section 20), will have overriding effect over any other law for the time being in force, which includes the Code of Civil Procedure. The High Court, in holding that no appeal would be maintainable against the dismissal of the review petition, and that therefore a writ petition would be maintainable, was clearly in error on this count also. [Paras 15 and 16][462E; 463B-D]

International Asset Reconstruction Company of India Limited v. Official Liquidator of Aldrich

Pharmaceuticals Limited and Others (2017) 16 SCC

137 : (2017) 10 SCR 199 – relied on.

Kamlesh Verma v. Mayawati and Others (2013) 8 SCC

320 : (2013) 11 SCR 25 – referred to.