Case Note & Summary
The petitioners, M/s. IDEB Projects Pvt Ltd and others, filed writ petitions under Article 227 of the Constitution of India challenging an order dated 06.03.2014 passed by the Debts Recovery Appellate Tribunal (DRAT), Chennai in MA No.3/2014. The DRAT had dismissed the petitioners' appeal against an interim order passed by the Debts Recovery Tribunal (DRT), Bangalore in OA No.393/2011, on the ground that the petitioners failed to comply with the pre-deposit condition under Section 21 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (RDDBFI Act). The respondent, HDFC Bank Ltd, had filed the original application for recovery of debt. The petitioners contended that the appeal before DRAT was not maintainable as the impugned order was an interim order under Section 17 of the Act, and that the pre-deposit condition was onerous. The court, after hearing both sides, held that an appeal under Section 18 of the RDDBFI Act lies against any order made by the DRT, including an interim order under Section 17. The DRAT had jurisdiction to entertain the appeal. Regarding the pre-deposit condition, the court noted that the DRAT had considered the petitioners' request for waiver but found no grounds to waive the requirement. The High Court, exercising its limited supervisory jurisdiction under Article 227, found no perversity or lack of jurisdiction in the DRAT's order. Accordingly, the writ petitions were dismissed.
Headnote
A) Debt Recovery - Maintainability of Appeal - Section 18 of Recovery of Debts Due to Banks and Financial Institutions Act, 1993 - Appeal against interim order under Section 17 - The court held that an appeal under Section 18 lies against any order made by the Debts Recovery Tribunal under the Act, including an interim order under Section 17. The Debts Recovery Appellate Tribunal had jurisdiction to entertain the appeal. (Paras 2-3)
B) Debt Recovery - Pre-deposit Condition - Section 21 of Recovery of Debts Due to Banks and Financial Institutions Act, 1993 - Waiver of pre-deposit - The Appellate Tribunal's order refusing to waive the pre-deposit condition was not perverse or without jurisdiction. The High Court, in exercise of its supervisory jurisdiction under Article 227, declined to interfere with the order. (Paras 4-5)
C) Constitutional Law - Supervisory Jurisdiction - Article 227 of Constitution of India - Scope of interference - The High Court's power under Article 227 is limited to ensuring that subordinate tribunals act within their jurisdiction and do not commit errors of law apparent on the face of the record. The impugned order did not suffer from any such infirmity. (Para 5)
Issue of Consideration
Whether an appeal against an interim order passed under Section 17 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 is maintainable before the Debts Recovery Appellate Tribunal under Section 18 of the Act, and whether the Appellate Tribunal's order refusing to waive the pre-deposit condition under Section 21 of the Act is liable to be interfered with under Article 227 of the Constitution of India.
Final Decision
The High Court dismissed the writ petitions, holding that the appeal under Section 18 of the RDDBFI Act, 1993 was maintainable against an interim order under Section 17, and the Debts Recovery Appellate Tribunal's order refusing to waive the pre-deposit condition was not perverse or without jurisdiction. No interference was warranted under Article 227 of the Constitution of India.
Law Points
- Maintainability of appeal under Section 18 of Recovery of Debts Due to Banks and Financial Institutions Act
- 1993
- Interim order under Section 17 of RDDBFI Act
- Pre-deposit condition under Section 21 of RDDBFI Act
- Scope of Article 227 of Constitution of India
Case Details
2014 LawText (KAR) (06) 1
WP Nos.23806/14-23810/2014 & WP No.23811/2014(GM-DRT)
D.H.Waghela, Chief Justice, H.G.Ramesh, Justice
Sri. Ajesh Kumar S., Adv. for AKS Law Associates, Advs. for petitioners; Sri. Sreevatsa, Sr. Adv. for Sri.Sudheer H M, Adv. for M/S.Wadia Ghandy & Co., (South) for C/R
M/s. IDEB PROJECTS PVT LTD, M/s. IDEB BUILDCON PVT.LTD, MR H.S. BEDI, MRS. AVNEET BEDI, MR. AMAN SINGH BEDI, MS. BANI KAUR BEDI
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Nature of Litigation
Writ petitions under Article 227 of the Constitution of India challenging an order of the Debts Recovery Appellate Tribunal, Chennai.
Remedy Sought
Petitioners sought to set aside the order of the Debts Recovery Appellate Tribunal dated 06.03.2014 passed in MA No.3/2014 and to stay further proceedings in OA No.393/2011 pending before the Debts Recovery Tribunal, Bangalore.
Filing Reason
The petitioners challenged the order of the Debts Recovery Appellate Tribunal which dismissed their appeal against an interim order passed by the Debts Recovery Tribunal under Section 17 of the RDDBFI Act, 1993, on the ground of non-compliance with the pre-deposit condition under Section 21 of the Act.
Previous Decisions
The Debts Recovery Tribunal, Bangalore had passed an interim order in OA No.393/2011. The petitioners appealed against that order before the Debts Recovery Appellate Tribunal, Chennai, which dismissed the appeal by order dated 06.03.2014 for non-compliance with the pre-deposit condition.
Issues
Whether an appeal under Section 18 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 is maintainable against an interim order passed under Section 17 of the Act?
Whether the order of the Debts Recovery Appellate Tribunal refusing to waive the pre-deposit condition under Section 21 of the Act is liable to be interfered with under Article 227 of the Constitution of India?
Submissions/Arguments
Petitioners argued that the appeal before the Debts Recovery Appellate Tribunal was not maintainable as the impugned order was an interim order under Section 17 of the RDDBFI Act, 1993.
Petitioners also contended that the pre-deposit condition under Section 21 was onerous and should have been waived.
Respondent HDFC Bank supported the order of the Debts Recovery Appellate Tribunal and argued that the appeal was maintainable and the pre-deposit condition was correctly imposed.
Ratio Decidendi
An appeal under Section 18 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 lies against any order made by the Debts Recovery Tribunal under the Act, including an interim order under Section 17. The High Court, in exercise of its supervisory jurisdiction under Article 227 of the Constitution of India, will not interfere with an order of the Debts Recovery Appellate Tribunal unless it is perverse or without jurisdiction.
Judgment Excerpts
The petitioners have invoked Article 227 of the Constitution of India to challenge the order of the Debts Recovery Appellate Tribunal, Chennai dated 06.03.2014 passed in MA No.3/2014.
The learned counsel for the petitioners submitted that the appeal before the Appellate Tribunal was not maintainable as the impugned order was an interim order under Section 17 of the Act.
We are unable to accept the submission that the appeal under Section 18 of the Act is not maintainable against an interim order under Section 17 of the Act.
The Appellate Tribunal has considered the request for waiver of the pre-deposit condition and has refused to waive the same. We do not find any perversity or lack of jurisdiction in the impugned order.
Accordingly, these writ petitions are dismissed.
Procedural History
The respondent HDFC Bank filed an original application (OA No.393/2011) before the Debts Recovery Tribunal, Bangalore for recovery of debt. The Debts Recovery Tribunal passed an interim order under Section 17 of the RDDBFI Act, 1993. The petitioners appealed against that interim order before the Debts Recovery Appellate Tribunal, Chennai by filing MA No.3/2014. The Appellate Tribunal dismissed the appeal by order dated 06.03.2014 for non-compliance with the pre-deposit condition under Section 21 of the Act. The petitioners then filed the present writ petitions under Article 227 of the Constitution of India before the High Court of Karnataka.
Acts & Sections
- Recovery of Debts Due to Banks and Financial Institutions Act, 1993: 17, 18, 21
- Constitution of India: Article 227
