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Judgment
Ranjit Singh, J
The Tribunal below has allowed the S.A. filed by the respondents on a highly technical ground, that too, after finding some substance in the plea raised by the appellant on merit to oppose the S.A. Even earlier also the Tribunal below had quashed the possession notice with a further direction to hand over the possession of the property back to the respondents on the ground that the appellant was declared financial institution in the year 2007 whereas the loan was disbursed in the year 2006 and thus the appellant was not entitled to take advantage of the SARFAESI Act. This order passed by the Tribunal was set aside 4.3.2014 in an appeal filed by the appellant and the case was remanded back to the Tribunal to decide the S.A. in accordance with law.
This time, the S.A. has been allowed by the Tribunal on the ground that the possession notice dated 24.6.2010, by which the possession was taken, mentioned Rule 9 of the Security Interest (Enforcement) Rules, 2002 (for short, the Rules) which is not relevant and applicable to take possession, ether symbolic or physical, and so the whole action of the appellant was bad in law. Aggrieved against this order, the appellant has filed the present appeal.
Notice in this appeal was issued on 22.7.2014 after recording submission of the Counsel for the appellant that the view formed by the Tribunal is totally misconceived while quashing the notice for the reasons as noticed above. The operation of the impugned order was also stayed.
Respondents stood served, but none appeared on their behalf on 25.9.2014. In the interest of justice, the case was adjourned to 13.11.2014. On that date, the Counsel appearing for the respondent was given time to file reply and the case was adjourned to 5.1.2015 for arguments. The case ultimately was taken up on 8.1.2015 when none appeared for the respondent. Reply had also not been filed. In the interest of justice, the case was again adjourned to 16.2.2015. On that day the case had to be adjourned to 4.3.2015 on the request of the Counsel for the respondent. On 4.3.2015, again Counsel for the respondent prayed for time to file reply. He, however, was apprised that a pure legal question of law only is involved in the appeal and he may make submission for which reply may not be very necessary. Despite persuasion, the Counsel did not budge and requested for adjournment. The case was then adjourned for today with liberty to the respondent to file reply. This was done despite the fact that on 8.1.2015, this Tribunal had noticed that no further adjournment shall be granted for filing reply.
When the case is taken up for hearing, a request for pass over was made on behalf of the respondent as the Counsel was on his way. Counsel even did not appear when the case was taken up in the second round. Even no reply is filed.
The Counsel for the appellant was heard but still there was no sign of the Counsel for the respondent. In the interest of justice, the case was kept aside for hearing the Counsel for the respondent and to awaiting this presence.
Ultimately, the Counsel for the respondent has appeared at about 2 p.m. The Counsel prays for taking the reply on record. Since the respondents have failed to file reply despite repealed opportunities, the prayer for taking the reply on record cannot be allowed. This will cause unwarranted delay in disposed of the appeal which seems to be the aim. The prayer is declined and the Counsel is given opportunity to advance his submissions. The Counsel for the respondent states that the case may be remanded back to the Tribunal to consider the legal aspect.
Mr. Saxena, Counsel for the appellant, on the other hand, would submit that all issues otherwise have been adjudicated in favour of the Bank and the Tribunal has allowed the S.A. only on the technical ground that a reference is made to Rule 9 in the possession notice instead of Rule 8 of the Rules, which was relevant. The Counsel would accordingly submit that there is no need to remand the case back to the Tribunal and this Tribunal may consider whether the impugned order can be sustained in law or not and then pass any appropriate order in the appeal. In short, the Counsel for the appellant has opposed the prayer for remand of the case to the Tribunal on the plea that there is no purpose or need for doing so.
The Counsel for the appellant otherwise has referred to the gazette notification where the format of possession notice is given as Appendix IV, and in the said notification Rule 9 of the Security Interest (Enforcement) Rules is mentioned even the gazette in place of Rule 8. Counsel submits that this unintended mistake too has crept in to the possession notice issued by the appellant when it was copied from the gazette notification. The same mistake is also repeated in the book publishing the provisions of the SARFAESI Act and in Appendix IV of these publications, Rule 9 of the Rules is mentioned instead of Rule 8 of the Rules.
The Counsel would also submit that this technicality was not legally enough to quash the possession notice and allow the S.A. The Counsel points that in view of the settled position of law mere mention to wrong provision in the background that the power to exercise this jurisdiction is available with the authority concerned would not invalidate the order as such.
In this regard, the Counsel has referred to the case of P.K. Palanisamy v. N. Arumugham & Anr., VI (2009) SLT 284 : (2009) 9 SCC 173. One of the contentions raised before the Hon'ble Supreme Court in this case was that the application filed by the appellant before the Court could not have been entertained by the High Court as it was filed under Section 148 of the Code, which was a general provision whereas Section 149 thereof was a special provision. The plea was that the first application should have been filed in terms of Section 149 of the Code and that once the Court had granted time for paying deficit Court fee within the period specified, it would have been possible to extend the same by the Court in exercise of its power under Section 148 of the Code, The Hon'ble Supreme Court has held that only because of a wrong provision was mentioned by the appellant, the same by itself would not be a ground to hold that the application was not maintainable or that the order passed thereon would be a nullity. It is further held that "It is well settled principle of law that mentioning of a wrong provision or non-mentioning of a provision does not invalidate an order if the Court and/or statutory authority had the requisite jurisdiction therefore".
In the case of Ram Sunder Ram v. Union of India & Ors., VII (2007) SLT 40 : 2007 (9) SCALE 197, the Court has considered the position where competent authority had wrongly quoted a section in the order of discharge whereas, in fact, the order was required to be read having been passed under a different section of the Army Act. As per the Hon'ble Supreme Court, the order of discharge of the appellant before it from the army service could not be held vitiated on this sole ground. Relevant observations of the Court in this regard are as under:
"... It appears that the competent authority has wrongly quoted Section 20 in the order of discharge whereas, in fact, the order of discharge has to be read having been passed under Section 22 of the Army Act. It is well settled that if an authority has a power under the law merely because while exercising that power the source of power is not specifically referred to or a reference is made to a wrong provision of law, that by itself does not vitiate the exercise of power so long as the power does exist and by itself does not vitiate the exercise of power so long as the power does exist and can be traced to a source available in law [see N. Mani v. Sangeetha Theatre and Ors. (2004) 12 SCC 278]. Thus, quoting of wrong provision of Section 20 in the order of discharge of the appellant by the competent authority does not take away the jurisdiction of the authority under Section 22 of the Army Act, therefore, the order of discharge of the appellant from the army service cannot be vitiated on this sole ground as contended by the learned Counsel for the appellant."
In the case of N. Mani v. Sangeetha Theatres & Ors., V (2005) SLT 596 : (2004) 12 SCC 278, the Court has again held that it is well settled that if an authority has a power under the law merely because while exercising that power the source of power is not specifically referred to or a reference is made to a wrong provision of law, that by itself does not vitiate the exercise of power so long as the power does exist and can be traced to a source available in law.
The legal position, therefore, is well settled that a action or order would not get vitiated merely on account of mentioning of a wrong provision or non-mentioning of a provision if the statutory authority has the requisite power. The competent officer of the Bank was well within his jurisdiction to issue the possession notice under Section 13(12) read with Rule 8 of the Rules. Because of misprint in the gazette notification instead of Rule 8 of the Rules, Rule 9 has got mentioned in this notice. Once the officer is competent to issue this notice and jurisdiction, non mentioning or mentioning of a wrong provision would not invalidate the possession notice as such in view of the law laid down by the Hon'ble Supreme Court and noticed above. The authorized officer of the Bank had the power under law and merely because while exercising such power to issue possession notice he happened to mention a wrong provision of rule would not itself go to vitiate the exercise of power as such when the power did exist and was traceable to a source. Moreover, this mistake is due to a misprint in gazette notification which percolated into the published book as well where specimen notice as Appendix IV to the Rules is reproduced. Accordingly, the view expressed by the Tribunal below to invalidate the possession notice on this ground cannot be sustained and would call for interference. The appeal is accordingly allowed. The part of the impugned order whereby the S.A. has been allowed on this short ground is set aside but the other findings returned by the Tribunal below are maintained. These findings are also not put to any challenge by the respondent. As a result, the present appeal is allowed and the S.A. field by the respondent shall stand dismissed.