Anil Properties vs Union Bank Of India & 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 order dated 11.03.2024, whereby the appeal No. 03/2022 filed by the appellant has been dismissed being barred by time.

Brief facts of the case are that the respondent No. 1-Bank had filed an Original Application No. 529/2019 against the respondent No. 2 for recovery of its dues, which was allowed and a recovery certificate was issued and the same was instituted as RC No. 158/2020 before the Recovery Officer. In the said execution proceedings, the respondent No. 3, Recovery Officer of the Tribunal below issued sale notice scheduling the auction of the property in question for 16.03.2022, in which the appellant was found to be highest bidder.

It appears that prior to confirmation of sale, the respondent No. 2-borrower had submitted one time settlement proposal on 28.02.2022 before the respondent No. 1-Bank by depositing a sum of Rs 11.00 lacs. The respondent No. 1-Bank vide letter dated 11.03.2022 informed the respondent No. 2-borrower that his OTS proposal has been accepted for a sum of Rs. 47.50 lacs and further informed that the remaining amount of the said OTS be deposited within three months.

It is averred that pursuant to the aforesaid auction dated 16.03.2022, the property were sold for a sum of Rs. 1.50 crores, which was deposited by the appellant within the time, as it is recorded in the order sheet dated 19.03.2022 of the respondent No. 3. Thereafter, the appellant-auction purchaser filed an application for confirmation of sale, against which the respondent No. 2-borrower filed his objection. The Recovery Officer vide order dated 05.05.2022 rejected the objection of the respondent No. 2 and confirmed the sale and the recovery certificate was issued accordingly on 25.05.2022 in favour of the appellant-auction purchaser, which was registered vide sale deed dated 30.05.2022 by the Recovery Inspector pursuant to the order dated 26.05.2022 passed by the respondent No. 3.

It transpires that the respondent No. 2-borrower had again submitted objection along with stay application, which was replied by the appellant on 31.05.2022. However, the respondent No. 3 vide order dated 30.05.2022 had stayed the proceeding of mutation to be carried out in revenue record pursuant to the sale deed dated 30.05.2022. The respondent No. 2 filed an urgency application before the respondent No. 3 on 08.07.2022, which was allowed and the matter was taken up by the respondent No. 3 with regard to the cancellation of the aforesaid sale deed and vide order dated 08.07.2022 the auction dated 16.03.2022 was cancelled and respondents No. 1 and 2 were directed to bear 50-50% of the expenses incurred by the appellant over execution of the sale deed. Being aggrieved by the said order the appeal No. 03/2022 was filed by the appellant, appeal No. 04/2022 by the respondent No. 1-bank and appeal No. 05/2022 by the respondent No. 2-borrower.

The Tribunal below vide order impugned has dismissed the appeal of the appellant being barred by time and the appeals filed by the respondents No. 1 and 2 were allowed and order passed by the Recovery Officer, by which the said respondents were directed to bear (50 - 50%) of the expenses incurred towards sale deed, was set-aside. Being aggrieved by the said order, the present appeal has been filed by the appellant-auction purchaser.

Learned counsel for the appellant submitted that prior to confirmation of auction, the respondent No. 2-borrower submitted an OTS proposal dated 28.02.2022 and deposited Rs. 11.00 lacs with the respondent-Bank but no information with regard to it was given either to the appellant or to the Recovery Officer. It was further contended that in the auction sale dated 16.03.2022, the appellant was declared as highest bidder and had deposited entire sale consideration of Rs. 1.50 lacs with the Recovery Officer within specified time and the Recovery Officer issued sale certificate on 25.05.2022, which was registered vide sale deed dated 30.05.2022 by the Recovery Inspector pursuant to the order dated 26.05.2022 of the respondent No. 3. It was also contended that on the basis of the urgency application filed by the respondent No. 2, the Recovery Officer vide order dated 08.07.2022 set-aside the auction sale dated 16.03.2022 without considering the fact that after confirmation of sale and execution of sale deed the Recovery Officer becomes functus officio.

Learned counsel further submitted that against the order dated 30.05.2022 and 08.07.2022 passed by the respondent No. 3, the appellant filed a Misc. Petition No. 2938/2022 before the Hon'ble High Court, which was disposed of vide order dated 02.08.2022 with liberty to file appeal by observing that the time consume before this court shall not be counted for the purpose of counting limitation by the learned Tribunal and accordingly the appeal was filed by the appellant before the Tribunal below on 24.08.2022, which is well within 30 days from the date of the order of Hon'ble High Court, but the Tribunal below without considering it dismissed the appeal of the appellant vide order impugned being barred by time, which is not sustainable in the eye of law.

Learned counsel for the respondent-Bank submitted that the respondent-bank had informed the Recovery Officer vide letter dated 11.03.2022 that the OTS proposal of the respondent No. 2-borrower has been excepted for Rs. 47.50 lacs and the borrower had deposited upfront amount of Rs. 11.00 lacs and the balance was to be deposited within three months i.e. 11.06.2022. It was further contended that once the Bank brought to the notice of the Recovery Officer that the account has been settled and the amount has been accepted, there was no occasion for the respondent No. 3 to proceed with the auction already fixed for 16.03.2022. It was further contended that the respondent No. 2-borrower deposited the entire OTS amount and this fact was well within the knowledge of the Recovery Officer before confirmation of the sale and issuance of the sale certificate.

Learned counsel further submitted that the appellant had not filed the appeal before the Tribunal below within the period of 30 days from the date of the order dated 08.07.2022, whereas the period of filing the appeal under section 30 of the RDB Act was expired on 08.08.2022, but the present appeal was filed before the Tribunal below on 21.02.2022. It was further contended that the contention of the appellant that the appeal was filed within 30 days from the date of order dated 02.08.2022 passed by the Hon'ble High Court is incorrect, as the said Writ Petition was filed against the order dated 30.05.2022 passed by the Recovery Officer, whereby the mutation proceeding was stayed, and the present appeal was filed by the appellant against the order dated 08.07.2025 passed by the Recovery Officer, by which the auction sale dated 16.03.2022 was cancelled. It was thus contended that the Tribunal below has rightly rejected the appeal of the appellant being barred by limitation in view of the judgment passed by the Hon'ble High Court of Madhya Pradesh at Jabalpur in Writ petition No. 5324/2023-Anirudh Singh Vs. Authorized Officer, ICICI Ltd. Bank decided on 03.01.2024, in which it has been held that the Tribunal below has no power to condone the delay in the appeal filed under section 30 of the RDB Act, 1993. It was therefore, prayed that the appeal filed by the appellant may be dismissed with heavy costs.

Learned counsel for the respondent No. 2-borrower reiterated the same, as argued by the learned counsel for the respondent-Bank. However, it was prayed that the appeal filed by the appellant may be dismissed with heavy costs.

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

Admittedly, the appeal filed by the appellant under section 30 of the RDB Act, 1993 has been dismissed by the Tribunal below vide order impugned on the ground of delay. Thus, the question arises, as to whether the appeal of the appellant has rightly been rejected by the Tribunal below or not?

The contention of the appellant that from the date of order passed by the Hon'ble High Court i.e. 02.08.2022, the present appeal filed by the appellant was well within the period of limitation of 30 days as prescribed under the RDB Act, is erroneous. From the said order, it clear that the Writ Petition No. 2938/2022 was filed against the order dated 30.05.2022 passed by the respondent No. 3-Recovery Officer, by which the mutation proceeding was stayed and in the said order, the liberty was given to the appellant for filing the appeal, but the present appeal was filed by the appellant against the order dated 08.07.2022, by which the auction sale dated 16.03.2022 was cancelled by the Recovery Officer, thus the time consumed in the proceeding of the said Writ Petition cannot be taken into consideration in the present case. As such the Tribunal below while passing the order impugned has rightly held that the benefit of the order of the Hon'ble High Court, by which it was observed that the time consumed before the Hon'ble High Court shall not be counted for the purpose of counting limitation by the learned Tribunal, cannot be extended to condone the delay occurred in filing the appeal under section 30 of the RDB Act.

It is to be seen that the order dated 08.07.2022, by which the auction sale dated 16.03.2022 was cancelled, was passed by the Recovery Officer in presence of the learned counsels for the parties including the counsel for the appellant namely Shri Praveen Chaturvedi, but the present appeal was filed before the Tribunal below on 01.09.2022 without any application for condonation of delay. As such the said appeal was filed with a delay of 24 days excluding the period of 30 days as prescribed under the said Act. In this regard, section 30 of the RDB Act says as under:-

From the above, it is clear that if any person is aggrieved by an order passed by the Recovery Officer, he may prefer an appeal under the said section within 30 days from the date of order. In the present case, the order was passed by the Recovery Officer on 08.07.2022, hence the present appeal ought to have been filed by the appellant on or before on 07.08.2022, but the same was filed on 01.09.2022 with the delay of 24 days, that too without any application for condonation of delay. However, it was filed on 27.02.2023 on the ground that the counsel of the appellant was ill, which was held by the Tribunal below not to be believable, because there was no document, which could support it nor before this Tribunal also. In this regard, the finding of the Tribunal given in para 19 of the order impugned that the appellant has not applied for obtaining the certified copy of the order impugned within the time, meaning thereby, the same was applied after expiry of period of 30 days and the time consumed for obtaining certified copy of the order is not able to be excluded, has not been controverted by the appellant. As such it can be said that the said delay was occurred in filing the appeal before the Tribunal below on the carelessness/latches on part of the appellant.

Besides above, it is relevant to point out that if any appeal is filed beyond the period of limitation of 30 days, the same cannot be condoned, as the Hon'ble Division Bench of the Bombay High Court in case of Madhukar Govindrao Thaware & Others Vs. Central Bank of India, [2012 (1) D.R.T.C. 14 (Bom) has held that there is no power vested with the Tribunal to condone the delay occurred in filing the appeal under Section 30 of the RDDBFI Act, 1993. As such the Tribunal below has rightly dismissed the appeal of the appellant on the ground of delay vide order impugned. Thus the order impugned does not call for any interference by this Tribunal.

In view of the discussions as recorded above, the appeal deserves dismissal, hence the same is dismissed 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.