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Judgment
Issue notice to respondent no.1. Ms. Usha Singh Advocate appearing on behalf of respondent no.1 accepted notice.
Arguments heard.
Respondent no.1 filed O.A. bearing T.A. No.150/2022 tilted as Asset Reconstruction Company (India) Limited V. JCT Electronics Limited & others. The appellant was impleaded as defendant no.3 being guarantor and he was also one of the legal heirs of the defendant no.2 (guarantor) before DRT. The appellant in the capacity of defendant no.3 and LR of defendant no.2 as 2(b) filed an application bearing I.A. no.880/2025 for seeking direction to the respondent no.1 to place on record certified copy of the documents as mentioned in para 20 of the application bearing no.880/2025. The said application bearing no.880/2025 was dismissed by DRT-III, Delhi vide the impugned order dated 16.01.2026. The relevant portion of the order dated 16.01.2026 is reproduced as under:-
6.Having given anxious consideration to the rival submissions and the material placed on record, this Tribunal finds no merit in I.A. No.880/2025. The record reveals that the present recovery proceedings have been pending since January 2002, and the application seeking production of documents has been moved after an inordinate and unexplained delay of more than 23 years. The applicants/defendants have not offered any cogent or satisfactory explanation as to why the documents now sought were not called for at the appropriate stage of the proceedings, particularly when the foundational facts relating to reference of the principal borrower to BIFR, sanction and failure of the rehabilitation scheme, and the subsequent winding-up were all within their knowledge for decades. The belated invocation of such grounds, under the guise of seeking production of documents, clearly demonstrates a lack of due diligence and militates against the settled principle that procedural indulgence cannot be extended to reopen issues at an advanced ad protracted stage of adjudication.
7.This Tribunal also notes that the contentions raised in the present application pertain to the alleged discharge of guarantees on account of BIFR proceedings and winding-up of the principal borrower, which issues, as rightly pointed out by the Applicant-Financial Institution, stand answered by the nature of the guarantees being unconditional and continuing. The mere pendency or failure of a rehabilitation scheme or liquidation of the principal borrower does not ipso facto result in discharge of guarantors. The application, therefore does not seek production of documents for any bona fide adjudicatory necessity, but appears to be an attempt to delay the final disposal of the long-pending recovery proceedings by reopening settled issues.
8.Moreover, it is noted that learned counsel for Defendant No.2(b) and Defendant No.3 had earlier filed I.A. No.778/2025, which was disposed of by this Tribunal on 07.11.2025, wherein substantially the same contentions were raised and considered. The present application is, therefore, a repetition of earlier pleas already adjudicated. It appears that learned counsel for the aforesaid defendants is repeatedly moving interlocutory applications on identical grounds, with the sole effect of protracting the proceedings. Such conduct cannot be countenanced, particularly when the matter has been pending for the last 23 years, which is clearly contrary to the spirit and mandate of the Recovery of Debts and Bankruptcy Act, 1993, which envisages expeditious adjudication of recovery proceedings.
9.In view of the above discussion, and considering the extraordinary delay of more than two decades, the advanced stage of the proceedings, and the absence of any justifiable cause for seeking production at this belated juncture, this Tribunal is of the considered opinion that IA No.880/2025 is misconceived and an abuse of the process of law. Accordingly, the IA no.880/2025 is hereby dismissed, subject to cost Rs.59m999/- which shall be deposit in the account of Prime Minister National Care Relief Fund within 10 days. Failing which the defence of the aforesaid defendants shall be struck off automatically without further reference of this Tribunal.
Sh. Sanjeev Bhandari, Ld. Senior Counsel appearing for the appellant referred I.A. bearing no.880/2025 filed before DRT-III, Delhi and confined his relief to para 20(c) of the application which is reproduced as under:-
20(c) Statement of accounts maintained by IFCI, prior to assignment of debt by IFCI to ARCIL and after the filing of present OA/TA before this Hon'ble Tribunal.
Ms. Usha Singh, Advocate appearing for respondent no.1 stated and argued that the appellant has not filed written statement although he is appearing in the capacity as personal guarantor and one of the LRs of another guarantor, i.e. defendant no.2. The respondent no.1 has already submitted all the necessary documents including the Statement of Account before DRT. It is prayed that present appeal may be dismissed.
Taking into consideration the fact that the O.A. is of the year 2002 and also the prayer made in the application, to cut short the controversy between the parties and proper adjudication of the matter, the respondent no.1 is directed to place on record of the O.A. the Statement of Account as mentioned in para 2(c) of the application bearing I.A. no.880/2025 before the next date of hearing before DRT. It is made clear that the DRT shall consider the admissibility of the document to be produced by the respondent no.1 in pursuance of this order. The appeal is accordingly disposed of.