Case Note & Summary
The appeal arose from an order of a Single Judge of the Bombay High Court dismissing the appellants' Notice of Motion seeking dismissal of an execution application filed by SICOM Ltd. The background is that SICOM Ltd. filed a summary suit against the appellants in 2000 for recovery of dues, and a decree was passed on 3 December 2002 for Rs.2,13,46,923/-. The Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (DRT Act) was brought into force in Maharashtra from 16 July 1999, but SICOM was notified as a financial institution under the DRT Act only on 30 April 2004. Thus, at the time of the decree, SICOM was not covered by the DRT Act, and the High Court had jurisdiction. SICOM filed the execution application in the High Court on 27 February 2012. The appellants took out a Notice of Motion for dismissal of the execution application on the ground that after the DRT Act applied to SICOM, only the Debt Recovery Tribunal (DRT) could execute the decree. The Single Judge dismissed the Notice of Motion, holding that no execution application was pending when the DRT Act came into force, and therefore, there was no question of transfer under Sections 31 and 31A of the DRT Act. The appellants appealed. The Division Bench upheld the Single Judge's order, reasoning that the decree was passed by the High Court when it had inherent jurisdiction, and the DRT Act's provisions for transfer of pending proceedings did not apply to decrees already passed. The Court found no error in the Single Judge's decision and dismissed the appeal.
Headnote
A) Civil Procedure - Execution of Decree - Jurisdiction - Sections 31, 31A Recovery of Debts Due to Banks and Financial Institutions Act, 1993 - The High Court passed a decree in favour of SICOM Ltd. on 3 December 2002, before SICOM was notified as a financial institution under the DRT Act on 30 April 2004. The execution application was filed in the High Court on 27 February 2012. The appellants contended that after the DRT Act applied to SICOM, only the DRT could execute the decree. The Court held that since the decree was passed by the High Court at a time when it had inherent jurisdiction, and no execution application was pending when the DRT Act came into force, the High Court retained jurisdiction to execute the decree. Sections 31 and 31A of the DRT Act only provide for transfer of pending proceedings, not decrees already passed. (Paras 2-4)
Issue of Consideration
Whether the High Court has jurisdiction to execute a decree passed by it before the decree-holder was notified as a financial institution under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, when the execution application was filed after such notification.
Final Decision
The appeal is dismissed. The order of the Single Judge dismissing the Notice of Motion is upheld. No order as to costs.
Law Points
- Jurisdiction to execute decree passed before notification under DRT Act
- Section 31 and 31A of Recovery of Debts Due to Banks and Financial Institutions Act
- 1993
- Transfer of pending proceedings
- Inherent jurisdiction of High Court
Case Details
2015 LawText (BOM) (07) 218
APPEAL NO.302 OF 2015 WITH NOTICE OF MOTION (L) NO.1226 OF 2015
MOHIT S. SHAH, C.J., A.K. MENON, J.
Mr. Dinyar D. Madon, Senior Counsel a/w Mr. Aditya Khandeparkar i/b Mr. Rakesh Pathak for the Appellants/Applicants; Mr. Vishal Kanade i/b Sunil M. Kadam for Respondent No.1.
Smt. Radhika Malhotra and Essken Engineering Enterprises Pvt. Ltd.
SICOM Ltd. and Mr. Naresh Malhotra
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Nature of Litigation
Appeal against order dismissing Notice of Motion for dismissal of execution application on ground of lack of jurisdiction.
Remedy Sought
Appellants sought dismissal of execution application filed by SICOM Ltd. in the High Court on the ground that after notification under DRT Act, only DRT had jurisdiction to execute the decree.
Filing Reason
Appellants contended that the High Court lacked jurisdiction to execute the decree passed in 2002 because SICOM was notified as a financial institution under the DRT Act in 2004, and the DRT Act had come into force in Maharashtra in 1999.
Previous Decisions
Single Judge dismissed the Notice of Motion, holding that no execution application was pending when DRT Act came into force, so no transfer under Sections 31 and 31A.
Issues
Whether the High Court has jurisdiction to execute a decree passed by it before the decree-holder was notified as a financial institution under the DRT Act, when the execution application was filed after such notification.
Submissions/Arguments
Appellants argued that since the DRT Act applied to SICOM from 30 April 2004, the execution application could only be filed before the DRT, not the High Court.
Respondent SICOM contended that the decree was passed by the High Court when it had jurisdiction, and the DRT Act's transfer provisions only apply to pending proceedings, not to decrees already passed.
Ratio Decidendi
The High Court retains jurisdiction to execute a decree passed by it before the decree-holder was notified as a financial institution under the DRT Act, as Sections 31 and 31A of the DRT Act only provide for transfer of pending proceedings, not decrees already passed. The inherent jurisdiction of the High Court to execute its own decree is not ousted by subsequent notification under the DRT Act.
Judgment Excerpts
The appeal is directed against the judgment and order dated 16 April 2015 passed by the learned Single Judge dismissing the appellants' Notice of Motion for dismissal of the execution application on the ground that this Court has no jurisdiction to execute the decree passed by this Court on 3 December 2002.
Hence this Court had inherent jurisdiction to try the suit and pass the decree before notification of SICOM as a financial institution under the DRT Act.
After considering the provisions of Section 31 and 31 A of the DRT Act and after considering the case law cited at the bar, the learned Single Judge took the view that no execution application was pending in this Court when the DRT Act came into force on 16 July 1999 and, therefore, there was no question of transfer.
Procedural History
SICOM filed a summary suit in 2000; decree passed on 3 December 2002. SICOM filed execution application on 27 February 2012. Appellants filed Notice of Motion for dismissal on ground of lack of jurisdiction. Single Judge dismissed Notice of Motion on 16 April 2015. Appellants appealed to Division Bench on 3 July 2015.
Acts & Sections
- Recovery of Debts Due to Banks and Financial Institutions Act, 1993: 31, 31A
