Appeal No.62 of 1999

16th September, 1999

Cases Cited:
AIR 1991 S.C.1400 [Para 9]

JUDGMENT

JUDGMENT :- The UCO Bank has filed present Appeal impugning therein an order of the Presiding Officer of DRT, Patna dated 31.5.99. The memorandum of Appeal was filed by the Appellant under Rule (5) of DRT (Procedure) Rules 1993 along with an application under Section 5 of the Indian Limitation Act for condonation of delay in filing the Appeal. By the impugned order the learned Presiding Officer of the DRT, Patna has declined to condone the delay and also dismissed the Appeal holding that it was meritless. The facts leading to this Appeal are as follows :

2. The Appellant UCO Bank presented the application under Section 19 of the RDDB & FI Act for a recovery certificate of an amount of Rs.1,40,78,000/- on 27.3.97 against the Respondents herein before the DRT at Patna. For filing the said application the Appellant Bank engaged services of Advocate Mr.B.P.Tandon. The Office of the Registrar DRT, Patna scrutinised the application and noted certain defects and an order was passed under the signature of the Registrar for removal of those defects by 20.4.98. Since, none appeared and rectified the defects, time was extended firstly to 13.5.98 and then to 18.6.98. Ultimately on 23.10.98, the Registrar DRT, Patna refused registration of the application for non-removal of defects within the time granted.

3. According to the case of the Appellant Bank, Mr.Tandon, Advocate, did not apprise the Appellant of the progress of the matter for a long time. As such due to unsatisfactory services of Mr.Tandon, the Appellant Bank discharged him and engaged Mr.Shambhunath Chowbe as the Advocate to attend to the said matter. This was done on 21.12.98. A letter to that effect was written to the Registrar of the DRT at Patna on 5.1.99. Advocate Mr.Shambhunath Chowbe took inspection of the records in the office of DRT at Patna and learnt the aforesaid facts. As such Mr.Chowbe Advocate obtained an ordinary copy of the scrutiny report and the order and informed the Appellant Bank. Accordingly on 6.1.99 the Appellant Bank applied for certified copy of the order of Registrar dated 23.10.98 and the same was supplied to the Appellant on 18.1.99. Therefore, on 20.1.99 the Appellant Bank filed the Appeal as provided in Rule(5) of the DRT (Procedure) Rules 1993 before the Presiding Officer of DRT, Patna for setting aside the order of Registrar and permission to remove the defects and for order of restoration of the matter and registration thereof. This Appeal came to be numbered as Appeal No.62 of 1999. It was out of abundant caution that the Appellant Bank filed an application for condonation of delay, if any, in filing the said appeal.

4. The learned Presiding Officer after hearing both the sides came to the conclusion that there was a delay in filing the Appeal and that the same was not properly explained. As such there was no sufficient reason for condonation of delay. Further the learned Presiding Officer entered into the merits of the Appeal and came to the conclusion that there was no sufficient ground made out by the Bank for non-removal of objections raised by the office and therefore the Appeal itself was without any merit. On both the grounds therefore the learned Presiding Officer dismissed the Appeal of the Appellant Bank as stated above and this order is challenged in the present Appeal.

5. The Appellant Bank is represented by Mr.B.M.Gupta Advocate while on behalf of Respondents initially Mr.Shrivastav, Advocate appeared and undertook to file Vakalatnama except for Respondents 2 for whom he had tendered his Vakalatnama. Later on Mr.Shrivastav did not appear. One Mr.R.K.Sharma Chartered Accountant holding power of attorney on behalf of Respondents 2 & 3 appeared and argued this matter by filing reply. Mr.Gupta for the Appellant submitted that in fact there was no delay in preferring the Appeal under rule(5) of the (Procedure) Rules before the Presiding Officer, inasmuch as, under the Procedure Rules namely Rule No.16 every order passed on an application is required to be communicated to the applicant and to the Respondents either in person or by Registered Post. The order passed by the Registrar on 20.10.98 was never communicated to the Appellant and therefore, the limitation for filing the Appeal provided under rule(5) would commence from the date on which the Appellant Bank learnt about the said order namely 5.1.99 and therefore, the Appeal filed on 20.1.99 before the Presiding Officer of the DRT at Patna was quite within limitation namely 15 days of making such order. Mr.Gupta also submitted that even if it is considered that there was a delay in preferring the Appeal the facts stated by the Bank namely its Advocate Tandon did not communicate the progress of the matter and it is only when Mr.Shambhunath Chowbe Advocate took inspection that the Bank learnt about the order in question. Thus the negligence on the part of Advocate Mr.Tandon was a good ground for the Appellant Bank to seek condonation of delay. Mr.Gupta therefore submitted that in any view of the matter the order of the Presiding Officer is not sustainable. Further according to him once the Presiding Officer came to the conclusion that there was no sufficient ground for condoning the delay, he had no justification to enter into the merits of the Appeal. On the other hand Mr.Sharma being a Chartered Accountant was not well-versed with the legal concepts and procedure followed in courts and he went on arguing that matter to a considerable length even covering the merits of the application under Section 19 of the Act filed by the Bank. He was often reminded about the scope of the Appeal but he persisted in arguing the matter, though the main contention which he has raised is about maintainability of the Appeal before this Tribunal and further the sufficiency of the cause pleaded by the Bank before the Presiding Officer of the DRT at Patna. In that behalf he supported the reasons given by the Presiding Officer for dismissing the Appeal.

6. At the outset it must be observed that the Presiding Officer of the DRT has acted in a hyper technical manner ignoring that the claim of Rs.1,40,78,000/- was involved in the application. The application for recovery of such a huge amount is thus allowed to be set at naught on technical ground of non-removal of office objections. The learned Presiding Officer does not appear to be alive to the fact that this money of the Bank was public money and public interest was involved in the matter. With these observations, I would first consider the preliminary objections raised on behalf of the Respondents by Mr.Sharma. He relied upon Rule 5(5) of the (Procedure) Rules which reads:

"An Appeal against the order of Registrar under subrule (4) shall be made within 15 days of the making of such order to the Presiding Officer concerned in chamber whose decision thereon shall be final." (Emphasis supplied)

In this behalf Mr.Sharma submits that the word 'final' has a definite meaning and therefore no further Appeal would lie against the order of the Presiding Officer made under this Rule. In that behalf he tried to rely upon certain decisions regarding interpretations of statutes, construction of rules etc, though he was not having copies of this decisions. I, however, find that this submission of Mr.Sharma is totally without any merit. That the word 'final' is used in the matter is not conclusive. In this behalf Section 20 of the Act has quite relevance and reads as under;

"1) Save as provided in sub-section (2), any person aggrieved by an order made, or deemed to have been made by a Tribunal under this Act, may prefer an Appeal to an Appellate Tribunal having jurisdiction in the matter.

2) No Appeal shall lie to the Appellate Tribunal from an order made by a Tribunal with the consent of the parties.

3) Every Appeal under sub-Section (1) shall be filed within a period of 45 days from the date on which a copy of the order made, or deemed to have been made, by the Tribunal is received by him and it shall be in such form and be accompanied by such fee as may by prescribed.

Provided that the Appellate Tribunal may entertain an Appeal after the expiry of the said period of 45 days if it is satisfied that there was sufficient case for not filing within that period.

4) On receipt of an Appeal under sub-Section (1), the Appellate Tribunal may, after giving the parties to the Appeal, an opportunity of being heard, pass such orders thereon as it thinks fit, confirming, modifying or setting aside the order Appealed against.

5) The Appellate Tribunal shall send a copy of every order made by it to the parties to the Appeal and to the concerned Tribunal.

6) The Appeal filed before the Appellate Tribunal under Sub-section (1) shall be dealt with by it as expeditiously as possible and endeavor shall be made by it to dispose of the Appeal finally within six months from the date of receipt of the Appeal."

7. Thus under this provision any person aggrieved by an order made or deemed to have been made by the Tribunal under the Act can preferr an Appeal to the Appellate Tribunal having jurisdiction in the matter. Thus the main Act provides for Appeal against every order passed by the Tribunal. The rules cannot over vide the main statute and therefore, even though the word 'final' used in Rule 5(5) that would not take away the right of the aggrieved person to prefer an Appeal against the order of DRT nor of this Tribunal to entertain the Appeal. It is therefore, unnecessary to find out the meaning of the word 'final' which was sought to be argued on behalf of Respondents. It was however, contended that Section 20 applies to all such orders as are passed by the Tribunal after registration of the application and would not be attracted to the orders of the nature impugned in this Appeal which are passed before registration of the matter. Section 20 does not make any such distinction and therefore, this submission is also devoid of any merit. I am therefore, of the opinion that the Appeal against the impugned order is quite maintainable.

8. The submission of Mr.Gupta for the Appellant that in fact there appears no delay in preferring the Appeal before the Presiding Officer of DRT, Patna and by way of abundant caution application for condonation of delay was filed on behalf of the Bank appears to be well founded. As seen under rule 16, Every order passed by the Tribunal is required to be communicated to the parties and the purpose in framing such rules is that the parties must get knowledge of the orders. It is nobody's case that the order passed by the Registrar declining registration of the matter was communicated to the Bank or to the Respondents. Had such an order been communicated and Appeal was not preferred within 15 days of such communication, it could have been said that there was a delay. The case of the Bank shows that Advocate Tandon engaged in regard to the filing of the application under Section 19 of the Act did not inform any progress of the matter. The various orders passed by the Registrar extending time for removing objections would also go to show that none cared for removing the objections. Under the circumstances, when the Appellant Bank first learned about the order on 5.1.99, it immediately applied for certified copy and preferred Appeal before the Presiding Officer as provided under Rule 5(5) of the (Procedure) Rules. The learned Presiding Officer has overlooked these provisions of the procedure rules and has stuck up to the letter of the Rule that the Appeal was required to be filed within 15 days of the making of the order by the Registrar.

9. Apart from this, even if it is considered that there was a delay in preferring appeal case made out by the Bank for condonation of delay was quite acceptable. In fact on behalf of the Appellant Bank, reliance was placed upon certain decisions of the Apex court but without understanding the purport of the decisions, the learned Presiding Officer has distinguished them and held that those were not applicable. For example AIR 1991 S.C.1400 the observation of the Supreme Court therein were relied upon and those are:

"The problem that agitates us is whether it is proper that the party should suffer for the inaction, deliberate omission, or misdemeanor of his agent; the answer obviously is in the negative. May be that the learned Advocate absented himself deliberately or intentionally. We have no materials for ascertaining that aspect of the matter. We say nothing more on that aspect of the matter. However, we cannot be a party to an innocent party suffering injustice merely because his chosen Advocate defaulted. Therefore, we allow this Appeal."

10. In paragraph 12 the learned Presiding Officer has distinguished this decision by saying that in the case before the Supreme Court there was some individual litigant party who had to suffer for default of his lawyer but in the present case Bank is an institution/organisation in which the local Manager is its Principal employee. The learned Presiding Officer then observes there is Law Officer employed in each and every Bank. And in addition to all other so many staff, a private lawyer is also engaged by the Bank to look after the welfare of the case filed on behalf of the Bank. It is not understood how this would be a distinguishing factor namely a private individual litigant and Bank being a litigant. On the other hand Bank is a legal creature having no life in it and has necessarily to act through its officers and employees. I do no find that the decision was distinguishable as is done by the Presiding Officer.

11. In AIR 1993 S.C.1182 which was cited before the Presiding Officer, the counsel appearing for a party suddenly with drew himself and his case was heard in absence of the lawyer representing the party. In that behalf the Supreme Court held that the interest of justice required that fresh notice for actual date of hearing should have been sent to the parties. Again this decision has been distinguished by observing that the Bank itself engaged new Advocate in this case by removing the former one. Therefore the case of the Supreme Court was held not applicable.

12. In paragraph 13 of the judgment the Presiding Officer appears to have stated some facts of his own knowledge that the office of the Bank was situated at a place which is at stone throw distance from the office of Tribunal. On that basis it was observed none of the officials of the Bank including Law officer cared to attend the case filed on behalf of the Bank. I think that this observation of the Presiding Officer were totally unjustified. The learned Presiding Officer has ignored the case made out by the Appellant Bank namely its Advocate Tandon did not inform the progress of the matter and the facts were disclosed only when Mr.Shambhunath took inspection. If this facts would have been properly appreciated, one would have known how the Bank cannot be blamed for the default on the part of its Advocate.

13. Mr. Gupta for the Appellant had tried to show that although the application under Section 19 was filed as far back as 27.3.97 on the scrutiny report shows the first endorsement regarding objections and fixing the date for removal thereof as 24.8.98. According to Mr.Gupta this itself shows that the first order raising objections was passed in April 1999 and this would go to show that right from March 1997 scrutiny was not at all undertaken till the first order as aforesaid.

14. Mr.Gupta has produced the copy of the scrutiny report with order thereon at Page 32 & 33 of the paper book of this Appeal. Mr. Gupta also pointed out that this objections were so minor and insignificant that for such objections such huge claim of the Bank in crores is totally thrown away. This submission is made in the context of the fact that the Presiding Officer did not find any merit in the Appeal itself. I find considerable force in the submission of Mr.Gupta. In fact once the Presiding Officer had come to the conclusion that there was no sufficient cause for condonation of delay, he should not have entered into the merits of the Appeal.

15. Mr.Sharma as I have stated above representing the Respondents not being well versed with legal concepts and procedures in course went on arguing the matter touching the merits of the original application under Section 19 of the Act. Even the perusal of the reply filed on behalf of the Respondents would go to show that they dealt with the merits of the application and points not germane to the present Appeal.

16. As a result of the above discussion I am of the opinion that the Presiding Officer of DRT, Patna was in error in dismissing the Appeal. Accordingly this Appeal is allowed and the order impugned in this Appeal is quashed and set aside. The matter as remitted to the Presiding Officer of DRT, Patna with a direction to register the Appeal and decide it on merits in the light of the observations made herein above. The Respondents shall pay the cost of the Appeal to the Appellant. Copy of the order be forwarded to the parties & DRT Patna.

Appeal Allowed.