Corporation Bank vs Harish Chandra (India) Ltd.

S.N.H. Zaidi, J

Mr. Kumar points out that the required authority letters from the member Banks of the consortium have been filed on 24.12.2013. Mr. Chaudhary, however submits that respondent No. 1 has received a letter dated 1.12.2013 from Bank of India appellant No. 7, saying that the said Bank has assigned he debt in question to Phoenix ARC Pvt. Ltd. on 6.12.2013 whereas the letter of authority filed on behalf of Bank of India is dated 19.12.2013 as such the sad Bank has ceased to have any right to authorize the Corporation Bank to purse the appeal before the Tribunal on its behalf. Mr. Kumar states at the bar that as per his instructions the deed of assignment executed between the Bank of India and Phoenix ARC Pvt. Ltd. has not been registered, the debt in question cannot be said to have been legally assigned of transferred to the assignee company. In view of the above statement of Mr. Kumar and looking to the authority letters given by appellant Bank Nos. 2 to 7 in favour of appellant No. 1, I am satisfied that Corporation Bank has sufficient authority to file and pursue this appeal, on behalf of all the appellants.

Heard the parties' Counsel on appeal. This appeal has been directed against order dated 19.11.2013 to P.O., DRT-III, Delhi as additional charge-holder of DRT-1, Delhi passed on I.A. No. 730/2013 filed in S.A. No. 80/2013 whereby the earlier order dated 18.10.2013 was sought to be reviewed.

Mr. Kumar points out that on 30.8.2013 the respondents had filed the S.A., which was taken up for hearing on interim relief on that very day and an ex parte interim order was made through the appellant Bank had already lodged a caveat in the matter, that on 4.10.2013 when it was pointed out to the Tribunal below that a caveat was lodged in the matter, the Tribunal did not further extend the interim order and listed the matter for hearing on 15.10.2013 that when the matter was again taken up for hearing on interim relief on 18.10.2013, the same was declined with a detailed order with the observation that the measures/actions taken by the Bank under the SARFAESI Act were in accordance with law, that the S.A. applicant thereafter moved an application (I.A. No. 730/2013) for the review of order dated 18.10.2013, which was heard on 19.11.2013 and the Tribunal below, while observing that contentions issues were to be decided and other matters were already listed before him on that date, listed the matter for final arguments on 27.1.2014 with a direction to the parties to complete their pleadings and evidence in the meanwhile and the S.A. applicants were directed to hand over the properties of 113-A, Kamla Nagar Delhi and Subzi Mandi, Delhi to the Court Receiver, appointed by the CMM, and the Bank was also directed to proceed to sell other properties but without taking the physical possession of those properties until that date.

Mr. Kumar submits that the Bank is aggrieved with that portion of the order impugned whereby the Tribunal has restrained the Bank from taking physical possession of the properties. His main contention is that though the Tribunal below has not found any mistake/error apparent on the face of order dated 18.10.2013 while considering the review application, yet it has made the aforesaid restraint order against the Bank without any sufficient ground, which is not sustainable in law.

Mr. Chaudhary, on the other hand, submits that since after the order dated 4.10.2013 the Court Receiver had issued possession notice qua the Subzi Mandi property fixing 19.10.2013 for taking its possession, the Tribunal below was requested for hearing on the interim relief only in respect of that property and the Tribunal below, vide order dated 18.10.2013, had declined the interim relief. He further submits that though the Receiver did not come forward to take the possession on 19.10.2013, but since he later issued possession notices in respect of all the properties, including Subzi Mandi property, therefore, two applications were moved before the Tribunal below, one (I.A. No. 229/2013) for preponement of the hearing, as the matter was listed to hearing on 22.11.2013 and the other (LA. No. 730/2013) for review of the order dated 18.10.2013. Mr. Chaudhary also submits that the Tribunal below though took up both the applications on 19.11.2013 for hearing but without affording any opportunity of hearing to the applicants has passed the order impugned with the direction to the S.A. applicants to hand over the possession of the aforesaid two properties and has also allowed the Bank to sell other properties with the condition that physical possession of those properties would not be taken till the next date. According to him, the said order has been made by the Tribunal below to equate the balance.

Mr. Kumar, in rejoinder, points out that prior to the filing of review application before the Tribunal below, the S.A. applicants had filed an appeal before this Tribunal but this fact was suppressed in the review application. Mr. Chaudhary, however, disputes this contention and submits that the appeal was filed on 18.11.2013 whereas the review and the preponement applicants were filed on 13.11.2013.

Considering the submissions of the parties Counsel and looking to the facts and circumstances of the case, I am in agreement with the contention of Mr. Kumar that while dealing with the review application the jurisdiction of the Tribunal below was very limited and it was required to see whether or not there was any mistake/error apparent on the face of the order, sought to be reviewed. It appears that without returning any finding on this point, the order impugned has been made with the observation that as it could not go into any contentious issue raised by the parties at that stage, fixed a date for final hearing with a direction to the parties to complete their pleadings and evidence in the mean while and without recording any finding qua the applicants prima facie case in respect of other properties, has restrained the Bank from taking the physical possession of those properties. The respondents have not assailed the order impugned in respect of the Tribunal's direction for handing over the possession of Kamla Nagar and Subzi Mandi properties. Mr. Chaudhary has however, submitted that the Bank is free to take possession of those two properties on any date and the respondents have no objection if the Bank proceeds against those properties. He also undertakes that the evidence of the applicants shall be filed in the S.A. without exhibiting any document positively within 10 days and will not take any adjournment for final hearing on 27.1.2014.

In view of the above, I am of the considered view that since the Tribunal below has disposed of the review application without giving any finding qua any mistake/error apparent on the face of the record, the order impugned, so far as it permits the Bank to sell the other properties without taking its physical possession, is not sustainable and is liable to be set aside. However, looking to the circumstances of the matter that the S.A. is already listed for final hearing on 27.1.2014 and Mr. Chaudhary has undertaken to file the evidence in 10 days and has also assured that no adjournment would be sought by the S.A. applicants on that date, the parties may proceed with their arguments on the date fixed before the Tribunal below and until that date the status quo of the properties in question, except property No. 113 A, Kamla Nagar, Delhi and Subzi Mandi, Delhi property shall not be disturbed. It is, however, clarified that if the Bank will have any difficulty in filing its evidence before 27.1.2014, it may seek the indulgence of the Tribunal below and the Tribunal may accommodate it and fix some other date for filing the evidence/arguments and until that date the interim order, as made above, shall continue. Subject to the observations, as made above, the order impugned directing the appellant Bank to sell the other properties without taking physical possession thereof is set aside and the appeal stands disposed of accordingly.

Copy of this order be furnished to the parties as per law.