IFCI Limited vs Dev Spinners Ltd. And Ors.

S.N.H. Zaidi, J

This application has been filed by the appellant seeking condonation of delay in filing the appeal under Section 18 of the SARFAESI Act. Respondent Nos. 1 and 2 have opposed the application by filing the counter-affidavit. Mr. R.P. Aggarwal, the learned Counsel appearing for the applicant, has pointed out that the accompanying appeal has been filed against the interim order dated 2.5.2011 passed in S.A. No. 62/2011 whereby the possession of the properties in question has been directed to be restored to the SA applicants (respondents 1, 2 and 4 herein). He has contended that the said S.A. was initially filed against the secured creditor Bank, namely, the Industrial Investment Bank of India Ltd. (IIBI), which had assigned the debt with all the underlying securities to the applicant FI through registered assignment deed dated 25.4.2011 and the documents of the case were handed over to it. He has further contended that administrative clearance for filing the appeal took some time and thereby a delay of 20 days had occurred in filing the same, which was neither deliberate nor intentional.

Mr. Pallav Saxena. the learned Counsel for respondent Nos. 1 and 2, has, however, contended that this Tribunal has no power to condone the delay in filing the appeal under Section 18 of the SARFAESI Act as has already been held by this Tribunal in various matters and as such the question of sufficiency of cause of delay has lost its significance. He has also placed reliance upon the Division Bench judgments of the Madhya Pradesh and Madras High Courts in M/s. Seth Banshidhar Kedia Rice Mills Pvt. Lid. & Ors. v. State Bank of India & Anr., I (2013) BC 667 : AIR 2011 MP 205 and Dr. Zubida Begum & Anr. v. Indian Bank & Anr. I (2013) BC 67 : 2012(5) Current Tamil Nadu Cases 369 respectively, in support of his contention.

The Division Bench of the Madhya Pradesh High Court in the matter of M/s. Seth Banshidhar Kedia Rice Mills (supra) has considered at length the question whether the delay in filing the appeal under Section 18 of the SARFAESI Act could be condoned under Section 5 of the Limitation Act? The Hon'ble Court, while comparing the provisions of the RDDBFI Act and the SARFAESI Act, more particularly Section 20 of the RDDBFI Act with Section 18 of the SARFAESI Act, has found that the period of limitation in filing an appeal under Section 18 has been reduced from 45 to 30 days with no discretion to condone the delay whereas such a discretion has been given to the appellate Tribunal in the proviso to Section 20(3) of the RDDBFI Act, and has ultimately held that the Legislature has consciously decided not to confer power with the appellate Tribunal to condone the delay in filing the appeal under Section 18 of the SARFAESI Act. While interpreting Section 29(2) of the Limitation Act in the light of the observations of the Hon'ble Supreme Court in Fair Growth Investments Ltd. v. Custodian, (2004) 11 SCC 472 and Hukumdev Narain Yadav v. L.N. Mishra, IV (2004) CLT 156 (SC) : VI (2004) SLT 376 : AIR 1974 SC 480, the High Court has observed that the Legislature has consciously excluded the applicability of the provisions of Sections 4 to 24 of the Limitation Act so far as they relate to Section 18 of the SARFAESI Act, and has held that the appellate Tribunal has no power to condone the delay under Section 5 of the Limitation Act in filing the appeal under the Section 18.

In Dr. Zubida Begum's case (supra), a Division Bench of the Madras High Court, while agreeing with the views expressed by the Madhya Pradesh High Court in Seth Banshidhar Kedia Rice Mills (supra) and also considering the judgment of the Hon'ble Supreme Court in Mukri Gopalan v. Cheppilat Puthanpurayil Aboobacker, AIR 1995 SC 2272, has observed that once it is held that the Tribunal is not Court, the provisions of section 5 of the Limitation Act would not be available to the appeal filed under Section 18 of the SARFAESI Act and has also held that the appellate Tribunal has no power to condone the delay in filing the appeal under the SARFAESI Act.

In view of the aforesaid propositions of law, with which this Tribunal is in respectful agreement, the application under consideration cannot be allowed as this Tribunal has no power to condone the delay in filing the accompanying appeal. The question relating to the sufficiency of cause of delay has, therefore, become insignificant. The application is thus liable to be dismissed and is dismissed accordingly. Since the appeal is admittedly time-barred by 20 days, therefore, the same cannot be entertained and is dismissed as such.

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