Notice of Motion Nos.251 & N/72 of 2004

3rd April, 2006

Petitioner Counsel: J. B. SEN i/b G. R. MEHTA
Respondent Counsel: KISHORE JAIN,B. COLABAWALA,SNEHAL BAVALIA

Cases Cited:
Diwan Brothers Vs. Central Bank of India, AIR 1976 SC 1503 [Para 5,10,11]
Re : Siddharth Srivastava (Judgment debtor) Vs. K. K. Modi Investment and Financial Service Put Ltd. (Petitioning Creditor), 2002(4) Mh.L.J. 281 [Para 6]
State of U.P. Vs. Mukhtar Singh, AIR 1957 Allahabad 505 [Para 6]
Dhirendra Bhanu Sanghvi.. Judgment Debtor Ex-parte ICDS Ltd., 2003(5) BCR 161 [Para 6]
Allahabad Bank Vs. Canara Bank, 2000(3) ALL MR 475 (S.C.)=AIR 2000 SC 1535 [Para 6,13]
Yeshwant Deorao Vs. Walchand Ramchand, AIR 1951(38) SC 16 [Para 9,11]
Yanumula Malludora Vs. Peruri Seetharathnam, AIR 1966 SC 918 [Para 9]
Bharat Chandulal Nanavati Vs. UCO Bank, AIR 1992 Bom 170 [Para 10]
Haryana Telecom Ltd. Vs. Sterlite Industries (India) Ltd.), 1999(5) SCC 688 [Para 10,13]
Re : Dhirendra Bhanu Sanghvi Ex parte ICDS Ltd, 2003 (Supp.) BCR 678 [Para 10]

JUDGMENT

JUDGMENT :- The present Notice of Motion No.251 of 2004 has been taken out by the judgment debtor inter alia seeking relief that Insolvency Notice No.N/72 of 2004 dated 21-4-2004 taken out by the judgment creditor be set aside. Some of the material facts of the present case, briefly stated, are as under :-

2. Pursuant to an application made by the judgment creditor which is a bank to the Debt Recovery Tribunal being O.A, No.811/2000, the Debt Recovery Tribunal has passed an order and judgment dated 8.1.2003 inter alia holding that the judgment debtor is liable to make payment to the judgment creditor of a sum of Rs.3,30,11,926 along with further interest at the rate of 15% per annum. On 3.3.2003 a recovery certificate was issued by the Debt Recovery Tribunal on the basis of the order and judgment dated 8.1.2003. The judgment creditor has on the basis of the said order and judgment of the Debt Recovery Tribunal and consequent recovery certificate issued to them made an application to this Court under section 9 of the Presidency-Towns Insolvency Act, 1909 (hereinafter referred to as "the Insolvency Act") on the ground that by virtue of non-payment of the amount awarded by the Debt Recovery Tribunal by an order and judgment dated 8.1.2003 the debtor has committed an act of insolvency. The said application has been made in accordance with the provisions of sub-section (2) of section 9 of the Insolvency Act. Pursuant to the said application, the Insolvency Registrar has issued an insolvency notice on 8.10.2004. On 9.10.2004 the said notice is duly served on the judgment debtor. On 13.12.2004 the present application has been initiated by the judgment debtor for setting aside the insolvency notice.

3. In support of the application for setting aside the insolvency notice it has been contended that issuance of the notice is bad in law in as much as the Court has no power to issue insolvency notice under section 9(2) of the Insolvency Act on the basis of the recovery certificate issued by the Debt Recovery Tribunal. It has been also contended in the affidavit in support of the motion that the jurisdiction of the Debt Recovery Tribunal is exclusive. The execution of the recovery certificate can be made only under the provisions of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (hereinafter referred to as the "RDDB Act"). It has been also contended that there is no provision under the Insolvency Act to issue an insolvency notice on the basis of a recovery certificate issued under the provisions of the RDDB Act. It has also been contended that what is issued by the Debt Recovery Tribunal is only a recovery certificate and the same can not amount to order or decree as contemplated under the provisions of section 9(2) of the Insolvency Act.

4. The learned Counsel for the judgment debtor has inter alia further contended in support of the notice of motion that insolvency notice can be issued only on the basis of a decree or order for payment of money as contemplated by sub-section (2) of section 9 of the Insolvency Act. It has been contended that the recovery certificate issued by the Debt Recovery Tribunal under the provisions of the said RDDB Act is not an order or decree as contemplated under the provisions of the Civil Procedure Code and thus no notice under section 9(2) can be issued on the basis thereof. It has been further contended that under the provisions of section 2(2) and 2(14) of the Civil Procedure Code, 1908 the decree and order is defined as decree and order passed by the Civil Court and thus the order passed by the Debt Recovery Tribunal and/or consequential recovery certificate issued by the Tribunal under the RDDB Act is not an order or a decree empowering this Court to issue insolvency notice under subsection (2) of section 9 of the said Act.

5. In the alternative to the aforesaid submission it has been submitted that section 9 pre-supposes a notice of insolvency on the basis of a decree or order for payment which is capable of execution. It is submitted that the order passed by the Debt Recovery Tribunal is not an executable order but only recovery certificate issued on the basis thereof is an executable certificate. Thus, there is no order which is executable so as to satisfy the requirements of sub-section (2) of Section 9 and recovery certificate which is executable is not covered by the words "decree or order" as contemplated under sub-section (2) of Section 9 of the Insolvency Act and, therefore, also the insolvency notice is liable to be set aside. In further alternative to the aforesaid two submissions the learned Counsel for the judgment debtor has submitted that the provisions of the Debt Recovery Tribunal is a complete code by itself. He has further relied upon the provision of section 34 of the RDDB Act and by relying upon the said section it has been contended that section 34 of the RDDB Act provides an overriding effect and thus confers a exclusive jurisdiction on the Debt Recovery Tribunal for taking all steps once an application is made for recovery of the amount and thus the recovery and/or execution of the certificate also has to be in accordance with the provisions of section 25 of the RDDB Act and no notice under section 9(2) of the Insolvency Act can be issued by this Court. In support of the aforesaid contention, the learned Counsel has relied upon a series of judgments commencing from the judgment of (Diwan Brothers Vs. Central Bank of India and others), reported in A.I.R. 1976 S.C. 1503 and particularly he has relied upon paras 19 and 20 of the said judgment which read as under :-

"19. Having regard to these circumstances we are satisfied that the term "decree" used in Schedule II, Article 11, is referable to a decree as defined in section 2(2) of the Code of Civil Procedure and as the decision of the Tribunal in the instant case does not fulfil the requirements of a "decree" as mentioned above, the said decision is not a decree within the meaning of Sch.II, Article 11 of the Court Fees Act and, therefore, the memorandum of appeal filed by the appellants squarely falls within the ambit of Schedule II Article 11 of the Court Fees Act and ad valorem Court-fees under Schedule I, Article 1 are not leviable.

20. Apart from the above considerations, it is a well-settled principle of interpretation of statutes that where the Legislature uses an expression bearing a well-known legal connotation it must be presumed to have used the said expression in the sense in which it has been so understood. Craies on "Statute law" observes as follows:

"There is a well-known principle of construction, that where the legislature uses in an Act a legal term which has received judicial interpretation, it must be assumed that the term is used in the sense in which it has been judicially interpreted, unless a contrary intention appears"."

It has been contended that in the aforesaid judgment the Supreme Court has considered the nature and character of the order passed by a Tribunal under the provisions of Displaced Persons (Debts Adjustment) Act vice versa section 2(2) of the Civil Procedure Code and held that the order of the Tribunal cannot amount to a decree under the provisions of the Civil Procedure Code and therefore it was held that the order of the Tribunal not being a decree under section 2 (2) of the CPC the payment of the Court fees under the provisions of the Court Fees Act is not attracted.

6. Thereafter the learned Counsel for the plaintiffs has relied upon a judgment of the Single Judge of this Court in the case of (Re : Siddharth Srivastava (Judgment debtor) Vs. K. K. Modi Investment and Financial Service Put Ltd., (Petitioning Creditor), reported in 2002(4) Mh.L.J. 281 : [2000(3) ALL MR 475 (S.C.)]. He has relied upon para 18 of the said judgment which reads as under :-

"18. In the instant case, the order passed in Contempt Petition No.9 of 1995 of 21-12-1998 reads as under:

(2) Consent terms duly signed by the parties and their attorney / Counsel taken on record and marked "X' for identification, Undertakings contained in paras 3, 4 and 10 of the consent terms are accepted.

(3) In view of the above, contempt petition is disposed of in terms of the consent terms at 'X'.

The question is whether such an order passed on the consent terms passed in Contempt proceedings can be regarded as an order within the meaning of term as given in section 2(14) of the Civil Procedure Code. Shri. Bulchandani referred to the definition of the term "Order" and pointed out that there are 3 requisites which make an order within the meaning of section 2(14) of the Civil Procedure Code and they are: (1) It must be formal expression, (2) such expression must be of a decision and (3) it must be of Civil Court. Shri. Bulchandani further submitted that the High Court is not Civil Court but it is a Court of record as it is constituted under the Constitution. In this respect he relied upon a decision in (State of U.P. Vs. Mukhtar Singh), A.I.R. 1957 Allahabad 505, wherein it was held that a "final order" within the meaning of Order 45, Rule 1 must be an order as defined in section 2(14) of the Code, i.e. it must be a formal expression of a decision of a Civil Court. It was further held that whether the High Court in a writ petition passes an order quashing certain orders of the Consolidation of Holdings Act, 5 of 1954, it is not an order of a Civil Court, because High Court is a Court of record created by the constitution, and not a Civil Court. Civil Courts are inferior Courts created by the States through their local Acts. It may be noted that contempt is a matter essentially between the Court and contemnor. The party filing an application seeking action against the contemnor is only informant. Once the Court admits the contempt petition, then the petitioner has really no effective role to play though usually he is given an hearing in such a petition. The contempt alleged may be a contempt of civil nature but by exercising its jurisdiction to deal with the alleged contempt, the Court does not become a Civil Court within the meaning of section 2(2) and section 2(14) of the Civil Procedure Code. It remains as a Court exercising contempt jurisdiction. The Court either punishes the contemnor or discharges him or remedies punishment on apology being made to its satisfaction, No other order is contemplated in such a proceeding. If in such a proceeding the parties file certain consent terms, they do not form the part of the final order which is contemplated in contempt proceedings. Filing of the consent terms by the parties is only a consideration which prompts the Court not to proceed further in the matter and terminate the proceedings by disposing of the petition. Therefore, it can hardly be said that the consent terms in terms of which the petition is "disposed of" form the part of the final order of the Court. The Court, in exercise of its contempt jurisdiction, does not decide any issue or question much less on merits. Therefore, in my opinion, the consent terms incorporated in the final order passed in contempt petition do not amount to a decision within the meaning of the term as used in section 2(14) of the Civil Procedure Code and therefore, it is not an 'order' within the meaning of that section. Consequently, such an order cannot be said to be executable under Order 21 read with section 36 of the Civil Procedure Code."

This judgment is on the point whether an award obtained by the petitioner-creditor on the basis of the consent terms is a decree or not within the meaning of section 2(2) of the Civil Procedure Code has been overruled by the Division Bench judgment in the case of Re : Dhirendra Bhanu Sanghvi.. Judgment Debtor Ex-parte ICDS Ltd. (Judgment Creditor), reported in 2003(5) Bom.C.R. 161. However, the learned Counsel for the judgement debtor has contended that he is relying upon the said judgment for the proposition of law namely, that when the order is passed in terms of consent terms then it does not amount to an order or a decree as contemplated under section 2(2) and 2(14) of the CPC. He has thereafter relied upon the judgment of the Apex Court in the case of (Allahabad Bank Vs. Canara Bank and another), reported in A.I.R. 2000 S.C. 1535. This judgment has been relied upon by the learned Counsel for the judgment debtor in support of his alternative contention that in view of the provisions of the RDDB Act being a complete Code by itself and further in view of the fact that section 34 of the RDDB Act gives an overriding jurisdiction, the provisions of Section 9(2) of the CPC cannot apply and the only remedy of the bank being the judgment creditor is to execute the recovery certificate under Section 25 of the said RDDB Act. In support of the aforesaid contention he has relied upon paras 23 and 24 of the said judgment which read as under :-

"23. Even in regard to 'execution', the jurisdiction of the Recovery Officer is exclusive. Now a procedure has been laid down in the Act for recovery of the debt as per the certificate issued by the Tribunal and this procedure is contained in Chapter V of the Act and is covered by Sections 25 to 30. It is not the intendment of the Act that while the basic liability of the defendant is to be decided by the Tribunal under Section 17, the Banks/Financial institutions should go to the Civil Court or the Company Court or some other authority outside the Act for the actual realisation of the amount. The certificates granted under Section 19(22) has, in our opinion, to be executed only by the Recovery Officer. No dual jurisdictions at different stages are contemplated. Further, section 34 of the Act gives overriding effect to the provisions of the RDB Act. That section reads as follows:

"Section 34(1). Act to have overriding effect-

(1) Save as otherwise provided in sub-section (2), the provisions of this Act shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force or in any instrument having effect by virtue of any law other than this Act.

(2) The provisions of this Act or the Rules made thereunder shall be in addition to, and not in derogation of, the Industrial Finance Corporation Act, 1948 (15 of 1948), the State Financial Corporations Act, 1951 (63 of 1951), the Unit Trust of India Act, 1963 (52 of 1963), the Industrial Reconstruction Bank of India Act, 1984 (62 of 1984) and the Sick Industrial Companies (Special Provisions) Act, 1985 (1 of 1986).

The provisions of section 34(1) clearly state that the RDB Act overrides other laws to the extent of 'inconsistency'. In our opinion, the prescription of an exclusive Tribunal both for adjudication and execution is a procedure clearly inconsistent with realisation of these debts in any other manner,"

"24. There is one more reason as to why it must be held that the jurisdiction of the Recovery Officer is exclusive. The Tiwari Committee which recommended the constitution of a Special Tribunal in 1981 for recovery of debts due to Banks and financial institutions stated its Report that the exclusive jurisdiction of the Tribunal must relate not only in regard to the adjudication of the liability but also in regard to the execution proceedings. It stated in Annexure XI of the Report that all "execution proceedings" must be taken up only by the Special Tribunal under the Act. In our opinion, in view of the special procedure for recovery prescribed in Chapter V of the Act, and section 34, execution of the certificate is also within the exclusive jurisdiction of the Recovery Officer."

7. On the other hand, the learned Counsel appearing for the respondent has contended that firstly it is required to be borne in mind that the jurisdiction of the insolvency Court is not for recovery of any claim of any one individual but it is an important remedy in rem rather than in personam. It has been contended that it is now well settled that insolvency proceedings are in rem and being for benefits of creditors at large and not for recovery of an individual claim of an individual creditor. Secondly it has been contended by the learned Counsel for the judgment creditor that the contentions raised by the judgment debtor relying upon sub-section (2) of section 9 are erroneous. It has been brought to my notice that the words which are appearing in sub-section (2) of section 9 are as under :-

"if a creditor, who has obtained a decree or order against him for the payment of money."

He has submitted that the words "decree or order" appearing in sub-section (2) of section 9 are not qualified by the words "an decree or order of any Court". It has been submitted that in view of the absence of the words "of any Court" in sub-section (2) of Section 9 the limited restrictive meaning cannot be given to the words "decree or order" as suggested by the judgment debtor. He has further submitted that the analysis of the provisions of sub-section (2) of section 9 makes it very clear that the Legislature has consciously omitted the words "of any Court" because advisedly the Legislature has used the words "of any Court" both under section 9(1)(e) and 9(1)(h) whereas the Legislature has advisedly deleted the words "of any Court" from the provisions of sub-section (2) of Section 9 of the Insolvency Act. It has been submitted that when the Legislature has consciously omitted the words "of any Court" it is not open for this Court to introduce these very words by inserting the definition of the words "decree or order" contained in sub-section (2) of section 2 and sub-section (14) of section 2 of the Civil Procedure Code. It has been submitted thus that the decree or order passed by any authority whether it is a Court or not, it is permissible that on the basis of such decree or order the notice can be issued under the provisions of sub-section (2) of Section 9 of the Insolvency Act. It has been further submitted that section only requires that such decree and order must be for payment of money and must have achieved the finality and the execution whereof has not been stayed. It is submitted that it is not necessary that such order and decree must be only of Civil Court. It has been further contended that in the light of the aforesaid, the submissions made by the learned Counsel are without any merits.

8. Thereafter the next contention has been advanced by the learned Counsel for the judgment-creditor that the order passed under the provisions of Section 19 of the RDDB Act is an order as contemplated under sub-section (2) of section 9 of the Act and thus this Court has jurisdiction to issue the insolvency notice. It has been submitted that the recovery certificate is only a form of execution and recovery certificate is not a decision or adjudication of the dispute between the parties. The Debt Recovery Tribunal passes an order for issuance of a recovery certificate after adjudicating the dispute between the parties. Once such an order is passed then issuance of a recovery certificate is a mere formality for the purpose of initiating an execution proceedings. Even the liability of the judgment-debtor stands determined by virtue of the fact that such an order is passed under the provisions of Section 19 of the RDDB Act. It has been further submitted that while construing the provisions of sub-section (2) of section 9 of the Insolvency Act, this Court must take into consideration the purpose and object of enactment of the said Act. It has been submitted that the purpose and object of the enactment of the said Act is an expeditious recovery of money of the various creditors and similarly is the object for the purpose of enactment of the RDDB Act. It has been thus submitted that the provisions of sub-section (2) of Section 9 must not be in derogation of the power of the Debt Recovery Tribunal to recover the amount by execution of a recovery certificate but should be read in addition thereto. And thus it is submitted that the present notice of motion is liable to be dismissed.

9. The learned Counsel for the judgment debtor has in support of the aforesaid contentions relied upon a judgment of the Supreme Court in the case of (Yeshwant Deorao Vs. Walchand Ramchand), reported in A.I.R. 1951 (38) S.C. 16, particularly para 5 thereof which reads as under :-

"(5) Points 1 to 3 above-mentioned are of no avail to the appellant. The decree was not a conditional one in the sense that some extraneous event was to happen on the fulfilment of which alone it could be executed. The payment of Court-fees on the amount found due was entirely in the power of the decree-holder and there was nothing to prevent him from paying it then and there; it was a decree capable of execution from the very date it was passed. There could be no exclusion of the time occupied by the insolvency proceedings which clearly was not for the purpose of obtaining the same relief. The relief sought in insolvency is obviously different from the relief sought in the execution application. In the former, an adjudication of the debtor as insolvent is sought as preliminary to the vesting of all his estate and the administration of it by the Official Receiver or the official Assignee, as the case may be, for the benefit of all the creditors; but in the latter, the money due is sought to be realized for the benefit of the decree-holder alone, by processes like attachment of property and arrest of person. It may be that ultimately in the insolvency proceedings the decree-holder may be able to realize his debt wholly or in part, but this is a mere consequence or result. Not only is the relief of a different nature in the two proceedings but the procedure is also widely divergent."

It has been pointed out to me that in the aforesaid judgment the Supreme Court has made a distinction between the insolvency proceedings and execution proceedings and that the proceedings of insolvency is in the nature of benefit of all creditors. Thereafter he has relied upon the Constitution Bench Judgment of the Apex Court in the case of (Yanumula Malludora Vs. Peruri Seetharathnam and others), reported in A.I.R. 1966 S.C. 918 and he has relied upon para 6 of the said judgment which reads as under :-

"(6) An act of insolvency once committed cannot be explained or purged by subsequent events. The insolvent cannot claim to wipe it off by paying some of his creditors. This is because the same act of insolvency is available to all his creditors. By satisfying one of the creditors the act of insolvency is not erased unless all creditors are satisfied because till all creditors are paid the debtor must prove his ability to meet his liabilities. In this case the petitioning creditors had their own decrees. It was in the decree of another creditor that the payment was made but only after the act of insolvency was committed. Besides the petitioning creditors there were several other creditors to whom the appellant owed large sums of money and his total debts aggregated to Rs.two lakhs. It is plain that any of the remaining creditors, including the petitioning creditors, could rely upon the act of insolvency even though one or more creditors might have been paid in full. The act of insolvency which the appellant had committed thus remained and was not purged by payment of decretal amount after the sale in execution of the money decree."

10. Thereafter he has relied upon the judgment of the Division Bench of this Court in the case of (Bharat Chandulal Nanavati and another Vs. UCO Bank and another), reported in A.I.R. 1992 Bombay 170, particularly the portion of para 7 of the said judgement the relevant portion of which reads as under :-

"Section 17 sets out the effect of an order of adjudication. It says that on the marking of an order of adjudication, the property of the insolvent wherever situate shall vest in the official assignee and shall become divisible among his creditors, and thereafter, except as directed by the Act, no creditor to whom the insolvent is indebted in respect of any debt provable in insolvency shall, during the pendency of the insolvency proceedings, have any remedy against the property of the insolvent in respect of the debts. Section 51 provides that the insolvency of a debtor shall be deemed to have relation back to and to commence at the time of the commission of the act of insolvency on which an order of adjudication is made against him."

By relying upon each of the aforesaid judgments, the learned Counsel for the judgment creditor has submitted that the nature of insolvency proceedings is totally different and in fact the proceedings are in rem and not in personam. Thereafter the learned Counsel has relied upon the judgment of the Apex Court in the case of (Haryana Telecom Ltd. Vs. Sterlite Industries (India) Ltd.), reported in 1999(5) S.C.C. 688, particularly paras 4 and 5 of the said judgment which read as under :-

"4. Sub-section (1) of Section 8 provides that the judicial authority before whom an action is brought in a matter, will refer the parties to arbitration the same matter in accordance with the arbitration agreement. This, however, postulates, in our opinion, that what can be referred to the arbitrator is only that dispute or matter which the arbitrator is competent or empowered to decide.

5. The claim in a petition for winding up is not for money. The petition filed under the Companies Act would be to the effect, in a matter like this, that the company has become commercially insolvent and, therefore, should be wound up. The power to order winding up of a company is contained under the Companies Act and is conferred on the Court. An arbitrator, notwithstanding any agreement between the parties, would have no jurisdiction to order winding up of a company. The matter which is pending before the High Court in which the application was filed by the petitioner herein was relating to winding up of the Company. That could obviously not be referred to arbitration and, therefore, the High Court, in our opinion was right in rejecting the application."

The Supreme Court while dealing with the arbitration proceedings vis-a-vis winding up proceedings under the Companies Act has come to the conclusion that the proceedings of winding up is a proceeding in remand not for the recovery of any debt and it has been held that such a proceeding in rem cannot be excluded or barred by virtue of the provisions of Arbitration Act which is a Code by itself. The learned Counsel for the judgment debtor has thereafter contended that a similar issue arose before this Court but while determining whether insolvency notice under sub-section (2) of Section 9 can be issued in respect of an award. The similar argument was advanced that the award is neither order nor decree of this Court as defined under section 2(2) and 2(14) of the CPC. He further pointed out that the judgment relied upon by the learned Counsel for the judgment debtor in the case of Re : Siddharth Srivastava (supra) had taken the view that since the award is not a decree as defined under section 2(2), the proceedings for insolvency is not maintainable. He also pointed out that another learned Single Judge has in the case of (Re : Dhirendra Bhanu Sanghvi .. Judgement Debtor Ex parte ICDS Limited..Judgement Creditor), reported in 2003 (Supp.) Bom.C.R. 678 taken a different view and referred the matter to the Division Bench. The Division Bench has by a judgment in the case of Dhirendra Bhanu Sanghvi ... Judgement debtor and ICDS Limited, Bombay, (supra) has resolved the said issue and held that the award is a deemed decree and, therefore, the same is executable under subsection (2) of Section 9 of CPC. However, the learned Counsel for the judgment creditor drew my attention to the fact that the judgment of the Apex Court which has been cited by the learned Counsel for the judgment debtor in the case of Diwan Brothers Vs. Central Bank of India, Bombay and others, reported in A.I.R. 1976 S.C. 1503 was considered by the learned Single Judge in the case of Dhirendra Bhanu Sanghvi (supra) and while dealing with the said judgment the learned Single has held as under:-

"15. The learned Counsel appearing on behalf of the applicant urged before the Court the expression "decree" should be construed in the sense in which that expression is defined by section 2(2) of the Code of Civil Procedure and the expression "order" as it is defined in section 2(14). In so far as the Code of Civil Procedure is concerned, three essential conditions are necessary in order to meet the definition of expression "decree" therein : (i) the adjudication must be given in a suit; (ii) the suit must start with a plaint and culminate in a decree; and (iii) the adjudication must be formal and final and must be given by a civil or revenue Court. These three requirements of the section have been elucidated in a judgment of three learned Judges of the Supreme Court in Diwan Brothers Vs. Central Bank, Bombay, A.I.R. 1976 S.C. 1503. In that case, the Supreme Court construed the provisions of Schedule II, Article 11 of the Court Fees Act, 1870, which dealt with the Court fee payable on a Memorandum of Appeal when the appeal was not from a decree or order having the force of decree and was presented to a High Court or Chief Commissioner or other Chief Controlling Executive or Revenue Authority. The Supreme Court held that the expression "decree" as used in the Court Fees Act is a term of art and must be deemed to have been used in the same sense as understood by the Code of Civil Procedure. In the case which arose before the Supreme Court, an order had been passed by the Tribunal under the Displaced Persons (Debts Adjustment) Act, 1951. Neither the Court Fees Act nor the Displaced Persons (Debts Adjustment) Act had defined the term "decree". The Supreme Court held that the concept of a decree had been crystalised in Act No.VIII of 1859 passed by the Governor-General in Council and that consequently, when the Court Fees Act was enacted in 1870 and used the term "decree", it must have intended to use the word "decree" so as to bear the same connotation as in the Act of 1859. Moreover, the Supreme Court noted that an order rejecting a plaint was mentioned as falling under the term "decree" both in the Code of Civil Procedure of 1882 and of 1908. Having regard to that definition. Schedule II, Article 11 of the Court Fees Act was amended so as to delete the words "from an order rejecting the plaint" for the reason that an order rejecting a plaint was incorporated in the expression "decree" and it was, therefore, not necessary to retain it in the Court Fees Act. In paragraph 10 of the judgment of Court Mr. Justice Fazal Ali, therefore, held that this was the most important intrinsic evidence to show that the legislature in enacting the Court Fees Act used in term "decree" in the same sense as it was used in section 2(2) of the Code of Civil Procedure, 1908. The Court was of the view that the Court Fees Act and the Code of Civil Procedure are more or less, complementary to each other."

11. Independent to the said judgment, the learned Single Judge, I am of the view that the issue at hand is not directly dealt with by the Apex Court in the case of Diwan Brothers Vs. Central Bank of India, Bombay and others (supra). An order passed by the Tribunal cannot be termed as a decree of a Civil Court attracting the Payment of Court Fees. The order of the Tribunal even if it is not a decree still it is covered by sub-section (2) of section 9 of the Insolvency Act because the words used in the said sub-section are 'decree' or 'order'. In the present case, the order has been passed under the provisions of section 19 sub-section (20) of the RDDB Act. It is not in dispute that the said order adjudicates the liability of the judgment debtor and gives a direction to the judgment debtor to pay the said amount to the judgment creditor. Thus, in my opinion, by virtue of the fact that the provisions of sub-section (2) of section 9 use the word 'decree' or 'order' and are not qualified with the word 'of any Court' it is not permissible to restrict the meaning of the said work 'decree' or 'order' by resorting to and relying upon sub-section (2) of section 2 and sub-section (14) of section 2 of the CPC. In my opinion, the word 'order' or 'decree' must be given its full meaning and its full effect under the provisions of sub-section (2) of Section 9 of the Insolvency Act. I also accept the contention of the learned Counsel for the judgment creditor that while using the word 'decree' or 'order' in sub-section (2) of Section 9 the words 'of any Court' has been deliberately not used by the Legislature though it was conscious of the same because in the provisions of sub-section (2) of Section 9 the said words "of any Court" are expressly used in sub-section 9(1)(e) and 9(1)(h) of the said Act. In my opinion, it is not permissible to give a restrictive meaning to the words "decree or order" as contemplated under subsection (2) of Section 9 of the Act so as to defeat the provisions of the Act in case where a claim is adjudicated by any other authorities other than the Court of Law as contemplated under Section 2(2) and Section 2(14) of the CPC. I am also of the further opinion that the provisions of Section 9(2) must be given widest possible interpretation and meaning so as to include each and every kind of recoveries which are adjudicated and has achieved finality so as to enable the judgment creditor to effectively seek to recover his dues. Apart from the aforesaid, now it is well settled in the light of the judgments which are cited before me being in the case of Yeshvant Deorao Vs. Walchand Ramchand (supra), Yenumula Malludora Vs. Peruri Seetharathnam & Ors. (supra) and Bharat Chandulal Nanavati and another Vs. UCO Bank and another (supra) that the provisions of the insolvency proceedings are in rem and not in personam. The provisions of the proceedings which are in rem. are for the benefits of all creditors and is not for an individual creditor. In that view of the matter, it is not permissible to interpret the said provisions in a restrictive manner as sought to be suggested by the learned Counsel for the judgment debtor and accordingly I reject the aforesaid contention.

12. Now dealing with the alternative contention of the learned Counsel for the judgment debtor that the order is not executable and it is only the recovery certificate which is executable and the words 'recovery certificate' are not included within the provisions of sub-section (2) of section 9. The argument is totally devoid of any merits. It is now well settled that for the purpose of executing any order or decree it needs to be in a format. Even a decree is required to be drawn up and execution application is required to be filed for the purpose of execution thereof. Thus, the question of issuance of recovery certificate is a procedural requirement for the purpose of execution of the said order of the Tribunal passed under Section 19 sub-section (20) of the RDDB Act. In my opinion, the argument that the words 'recovery certificate' are not included in sub-section (2) of section 9 has no merit. The word 'decree' or 'order' is included under sub-section (2) of section 9. Once a Tribunal has passed an order after adjudicating the claim between the parties then such order is executable in law and on the basis of such order an insolvency proceedings can be initiated under sub-section (2) of section 9 of the Insolvency Act.

13. This leads me to the last contention of the learned Counsel for the judgment debtor that RDDB Act is a complete code by itself and all remedy sought to be resorted to only under the provisions of the said Act. The learned Counsel's contention is based upon the judgment of the Apex Court in the case of Allahabad Bank Vs. Canara Bank [2000(3) ALL MR 475 (S.C.)] (supra). However, when the judgment is carefully read it is very clear that the said submission has no merit. In the said judgment the issue was whether in case of liquidation of a company the Tribunal would not have the power to execute the recovery certificate under section 25 of the said Act. In that light of the matter, the Court held that the RDDB being a Code by itself it can execute a recovery certificate and no two stage proceedings are contemplated i.e. adjudication on the one hand by the Tribunal under the RDDB Act and recovery on the other hand through the official Liquidator under the Companies Act. In the present case no such eventualities arise. It is nobody's case that the Tribunal has no jurisdiction to execute the recovery certificate under section 25 of the RDDB Act. However, the contention is that the remedy under sub-section (2) of section 9 is an additional remedy than the remedy available under section 25 of the Act. In my opinion, it is clear that the provisions of sub-section (2) of section 9 of the Insolvency Act do not contemplate an execution of a decree in personam but it only is for the benefit of a creditor as a class and the action is in rem. Therefore the argument of the learned Counsel for the judgment debtor must be rejected out right. The fact that it is a proceeding in rem is now well-established by each of the various judgments which are already cited by me. Thus, once the proceeding is in rem then it cannot be controlled by individual proceedings of recovery of debt of each bank under the RDDB Act. The Apex Court in the case of Haryana Telecom Ltd. Vs. Sterlite Industries (India) Ltd. (supra) though in the context of arbitration. and winding up proceedings has taken a view that the proceedings in rem are not controlled by the individual recovery proceedings under the individual Act. In the present case the situation is identical. The proceeding under the insolvency is a proceeding in rem and such proceedings in rem are not controlled by the individual proceedings for recovery of the amount under the provisions of the RDDB Act. In that light of the matter, the contention of the learned Counsel for the judgment debtor that by virtue of the provisions of section 34 of the Act this Court has no jurisdiction to invoke insolvency proceedings by virtue of the fact that it is based on recovery certificate issued by the Debt Recovery Tribunal has to be rejected. In my opinion, the proceedings in rem cannot be controlled by a individual recovery proceedings which are initiated under the provisions of the RDDB Act. In that light of the matter, there is no substance in the contention advanced by the learned Counsel for the judgment debtor and therefore the notice of motion must fail. The notice of motion is accordingly dismissed. Insolvency notice is accordingly made absolute. However, there shall be no order as to costs.

Notice of motion dismissed.