Aakash Bothra vs The Presiding Officer, Debts Recovery Tribunal & Ors.

JUSTICE R. D. KHARE, CHAIRPERSON

The present appeal has been filed under Section 20 of the Recovery of Debts and Bankruptcy Act, 1993 (in short "the RDB Act, 1993") against the judgment and order dated 28.09.2021, whereby the Appeal No. 06/2021 filed by the respondent-borrower has been allowed.

Brief facts of the case are that the respondent no. 5 and his wife were the directors of the company, which availed a term loan of Rs. 1.75 crores in the year 2008 and an equitable mortgage was created over their properties in favour of the respondent no. 4. Since the borrowers did not adhere to the terms of the loan agreement, therefore, the account was classified as NPA. The respondent-FI filed an Original Application No. 89/2012 before the DRT, Patna for realization of Rs.1,05,34,925/- along with pendente-lite and future interest, which was allowed vide judgment and decree dated 04.09.2012 and the recovery certificate was issued, which was registered as RP Case No. 298/2012 before the Recovery Officer. Thereafter, a demand notice dated 19.06.2012 was issued to the respondent no. 5 for payment of the decreed amount with pendente-lite and future interest plus costs of Rs.1,08,268/-. Subsequently, the sale notice was published in the newspapers on 30.04.2019 scheduling the auction of the property in question on 31.05.2019, but the said sale could not materialize for want of bidders. Therefore, another sale notice was published in the newspapers scheduling the auction of the property on 05.09.2019, which also could not materialize for want of bidders. However, the Recovery Officer published third auction sale notice in the newspapers on 04.01.2020 scheduling the auction of the properties in question on 06.02.2020, in which the appellant was declared as highest bidder and the property in question was sold for a sum of Rs.1,73,10,100/-, which was deposited with the respondent-FI on 07.02.2020 and 20.02.2020 respectively.

It appears that the respondent-borrower filed an application before the Recovery Officer showing his willingness to redeem his property, which was sold in public auction, along with a cheque of the amount mentioned in the sale notice, which was rejected by the Recovery Officer vide order dated 07.03.2020 and further the sale was confirmed vide order dated 22.03.2021 and sale certificate was issued in favour of the appellant-auction purchaser. Both the orders were challenged by the respondent-borrower by filing the Appeal No. 06/2021 before the Tribunal below, which has been allowed by the Tribunal below vide order impugned setting aside the orders dated 07.03.2020 and 22.03.2021. Being aggrieved by the said order the present appeal has been filed by the appellant-auction purchaser.

Learned counsel for the appellant-auction purchaser submitted that the appellant is bonafide purchaser of the property auctioned by the Recovery Officer of the DRT, Patna on 06.02.2020 and after deposition of entire sale consideration of Rs.1,73,10,000/-, the sale certificate was issued by the Recovery Officer on 22.03.2021. It was further contended that the appellant vide letter dated 12.04.2021 prayed before the Recovery Officer to pass an order to hand over the physical possession of the property in question, but instead of getting the same, he received a summon from the Tribunal below for appearance on 22.09.2021 and accordingly, he appeared through his present counsel and filed his written statement/reply and the next date was fixed for 01.10.2021 by the Tribunal below and parties were asked to file their written synopsis. It was further contended that on 01.10.2021, the case was adjourned to 08.10.2021 vide notice dated 01.10.2021 issued under the signature of the Registrar of the Tribunal below. It was further contended that all the cases fixed before the Tribunal below on 08.10.2021 were adjourned to 28.10.2021 vide notice dated 08.10.2021 issued by the Registrar, DRT, Patna and on 28.10.2021, the case was adjourned to 14.12.2021 vide notice dated 28.10.2021 issued by the Registrar of the Tribunal below.

Learned counsel also submitted that the appellant was shocked to know that the appeal filed by the borrower had already been decided by the Presiding Officer on 28.09.2021, whereas the case was being listed subsequent to the said date. It was further contended that as to how the judgment was pronouncement without the same being listed on the said date. It was thus contended that the said judgment was passed behind back of the appellant on 28.09.2021 in favour of the respondent no. 5-borrower, as such the same was passed without jurisdiction and having no authority. It was, therefore, prayed that the order impugned may be set aside and the matter may be remanded back to the Tribunal below for deciding it afresh.

Learned counsel for the respondents no. 3 & 4-FI submitted that the Tribunal below vide order dated 22.09.2021 had heard the arguments and directed the parties to file written synopsis and fixed the next date on 01.10.2021 for clarification and the record of recovery certificate were sought, but prior to the said date, judgment was pronounced on 28.09.2021. It was further contended that it is not clear as to where the judgment was pronounced i.e. from Patna DRT or from Ranchi DRT. It was also contended that there is nothing on record in the order sheet regarding location of file, as to whether the file was at DRT Patna or at DRT Ranchi and also that when the said judgment was kept in record. It was further contended that if the judgment was passed on 28.09.2021 and brought on record, then there was no occasion for the Registrar of DRT Patna to list the case again and again i.e. 08.10.2021, 28.10.2021 and 24.12.2021. It was further contended that as such it is clear that the said judgment was passed by the DRT Ranchi in back date, which is evident from the date of uploading of the said judgment on e-DRT portal i.e. 01.11.2021. Hence, it was contended that the said judgment passed by the DRT Ranchi is without jurisdiction, therefore, it is liable to be set aside and the matter may be remanded back.

I have considered the rival contentions of the learned counsels for the parties and perused the material available on record.

It is averred that this Tribunal vide order dated 20.04.2023 has summoned the record from the DRT Patna on the allegation leveled by the counsel for the respondent-FI that the judgment was pronounced without there being any date fixed in the matter. Pursuant to the said order, the record was received by the Registry of this Appellate Tribunal. On receipt of the same, this Tribunal vide order dated 22.02.2024 directed the Registrar of this Court to examine the matter and submit a report within 10 days with regard to the date of availability of file at DRT Patna and at DRT Ranchi and what orders have been passed by the Registrar of both the DRTs. Accordingly, the Registrar of this Tribunal has given his report, which is as under:-

From the above, it is clear that the file of the present case was at DRT Ranchi for the period from 24.09.2021 to 30.10.2021, as the same was handed over by the DRT Patna to the DRT Ranchi on 24.09.2021 and the same was received back to DRT Patna on 30.10.2021. As per record, the charge of DRT, Patna was with the DRT, Ranchi up to 30.09.2021, as the same was not extended beyond 30.09.2021. While going through the cause list dated 28.09.2021 of the DRT, Patna, the said case was admittedly not listed in the said cause list, as the order sheet dated 22.09.2021 itself shows that the said case was listed on 01.10.2021 for clarification. Since the charge of DRT, Ranchi was not extended by the Ministry, therefore, the Registrar, DRT, Patna was continuously adjourning the case, as the DRT, Ranchi had also not informed about any orders passed by the Presiding Officer on the said file up to 29.10.2021, whereas the additional charge was already over on 30.09.2021.

It is relevant to point out that the Presiding Officer, DRT, Ranchi holding additional charge of DRT, Patna itself had heard the said case on 22.09.2021 by passing a detailed order and the case was fixed on 01.10.2021 for clarification and the record of recovery certificate was also summoned. There is nothing on record, which may show that any application was filed by any of the parties for preponing of the said date. Admittedly, the charge was over on 30.09.2021. The said file along with the judgment was received by the DRT, Patna on 30.10.2021. Prior to the said date, DRT, Ranchi had not informed about the said judgment to the DRT, Patna and in absence of any information, the Registrar, DRT, Patna was continuously adjourning the said case till the said case file is received back. Thus it is held that the judgment impugned was passed by the Presiding Officer, DRT, Ranchi holding additional charge of DRT, Patna after the charge and it can also be said that the same was passed in back date. If any order is passed after expiry of the charge, the same is considered to have been passed without jurisdiction and having no authority. As such the order impugned has been passed by the Tribunal below without jurisdiction and having no authority. Hence, the same is liable to be set aside and the matter requires fresh adjudication by the Tribunal below.

In view of the discussions as held above, the order impugned is set aside and the matter is remanded back to the Tribunal below for deciding the Appeal No. 06/2021 filed by the respondent-borrower afresh in accordance with law after affording proper opportunity of hearing to the parties concerned most expeditiously. Consequently, the present appeal filed by the appellant is allowed with no order as to costs.

A copy of this judgment be forwarded to the parties as well as to the DRT concerned and also be uploaded on the e-DRT portal.