L.V.M. Exim Ltd. And Ors. vs Punjab National Bank And Ors.

Ranjit Singh, J

Three separate miscellaneous applications (M.A. Nos. 26/2013, 27/2013 and 28/2013) filed by M/s. Capricorn Alloys (P) Ltd., M/s. LVM Exim. Ltd. and M/s. AIP Industries, all against Punjab National Bank, in three separate S.A. Nos. 194/2012, 195/2012 and 196/2012 respectively were dismissed by the Tribunal below on 14.2.2014 through a common order. Aggrieved against the same, the appellants have filed these three separate appeals. Since the order impugned is common in all these appeals, these are being disposed of by this common order. On 18.7.2013, these three S.As. were dismissed in default. This happened primarily because the Counsel engaged by the appellants to argue these S.As. had withdrawn his power of attorney, whereas, the Counsel appearing subsequently had also withdrawn his power of attorney. The record shows that the appellants appeared personally before, the Tribunal, but still the S.As. were dismissed on 18.7.2013 on account of non-representation from the side of the appellants. These M.As. were accordingly filed for setting aside the order dismissing the S.As., on the plea that the non-appearance of the Counsel or the applicants was not wilful or intentional, but due to bona fide circumstances wherein its Counsel could not appear. The prayer accordingly was made for allowing these M.As. and restoring the S.As. for hearing on merits.

While making the prayer, the Counsel appearing for the appellants pointed out that their concern was only qua three properties which were statedly not mortgaged as the limits in the concerned accounts were obtained on 24.12.2008 after mortgaging 11 properties. A request was made to the Bank for enhancing the facilities, but no such enhancement or fresh limits were obtained till October 2010. It is stated that on assurance of the Bank title deeds of the properties were given for verification. The Bank in a clandestine manner had retained the said title deeds of the properties which were never intended to be mortgaged.

As can be made out, the order dismissing the S.As. in default was first challenged before the High Court by filing a Writ Petition No. 1989/2014. To justify this approach, the appellants would plead that they had approached the High Court as the properties were being put to sale.

The High Court had taken note of the plea raised on behalf of the appellants that they had not mortgaged the properties which were sought to be sold. By then, the appellants had also filed applications seeking restoration of the appeals which were pending hearing for 5.3.2014. The auction was scheduled for 17.2.2014. The High Court, therefore, observed that the limited direction which were required to be issued was to ensure that the DRT addressed the applications of the petitioners prior to the auction so as not to make them infructuous. The Court also noticed that there was sufficient time available with the Tribunal to take a call on these applications. The High Court while disposing of the Writ Petition accordingly directed the DRT to prepone the applications with notice to opposite side and ensure that order was passed on the applications filed by the petitioners for restoration and interim relief prior to 17.2.2014.

The pleas raised by the appellants were rebutted on merits by pointing out that the appellants had mis-stated the facts and also concealed material facts from the Hon'ble High Court, whereby they had obtained an ex parte order from the Court and that the Bank would reserve its right to approach the High Court for putting the facts straight. The Counsel for the Bank also opposed all the contentions raised by the appellants. The plea was that the properties which the appellants were pleading to have not been mortgaged with the Bank were in continuation of the sanction letter whereby the appellants had deposited the title deeds of these properties. The Tribunal below thus allowed the respondent Bank to make submissions on merits and the Bank primarily pleaded that the S.As. should not be restored as the intention of the appellants was to delay the disposal.

The Tribunal has noticed that ample opportunities were given to the appellants to plead their case not even for restoration, but even on merits. The Tribunal thereafter took note of the opportunities that were given to the appellants on the first date of hearing on 10.5.2012. The Tribunal has also taken note of the order dated 20.5.2013 where an application was filed for withdrawal of power of attorney by an Advocate. Thereafter, the Tribunal has further noticed that new Counsel was given sufficient time and opportunity to pursue the S.As., but none appeared for the appellants/applicants and the cases were dismissed on 18.7.2013.

The Tribunal also seems to have considered the S.As. on merits and after discussing the material prayer for consideration of merits on S.As., dismissed the M.As. by observing that no sufficient reason for absence on 18.5.2013 has been given by the appellants.

The perusal of the impugned order would show that on 18.7.2013, the Counsel for the appellants was not present when this M.As. were taken up for hearing. The order, however, records that applicant/appellant was present. This is even recorded in the first para of the order where it is mentioned that the applicant was appearing personally before the Tribunal. Even in the subsequent part of the order it is recorded:

"It could also not be ignored that despite the absence of Counsel, the applicant or their representative remain present in the Court, without showing their appearance."

The question that would arise, therefore, is whether the S.As. could be dismissed in default once the applicant was present in person. The Tribunal has even noticed that applicants had been declined the interim relief at the initial stage and had been repeatedly seeking time to make representation and clear the entire dues of the Bank. In my view, once the applicant was present in person, the S.As. could not have been dismissed in default. This alone, in my view, would be sufficient and good reason to recall the order dismissing the S.As in default and to order hearing of the appeals on merits.

The Counsel for the Bank has not disputed this fact that the S.As. could not have been dismissed in default while the applicant was present, but would submit that the Tribunal had gone on to consider the issue raised on merits and therefore no useful purpose would be served in setting aside the order dated 18.7.2013 whereby the S.As. were dismissed in default as the merits of the cases had been considered while considering the M.As. for recall or the setting aside of that order.

I have considered this plea, but would not go by the submission so made by the Counsel of the Bank. Parties engage Counsel who are well equipped in the Courts and Tribunals to plead on their behalf. Right to be represented by a Counsel is a constitutionally guaranteed right. One ingredient of fair procedure in Court process is lawyer's services. It has been observed that judicial justice, with procedural intricacies, legal submissions and critical examination of evidence, leans upon professional expertise. Failure of equal justice under the law is on the cards where such supportive skill is absent for one side. Our judicature, moulded by Anglo-American models and our judicial process, engineered by kindred legal technology, compel the collaboration of lawyer power for steering the wheels of equal justice under the law. It may not be necessary to quote pronouncement of any judges or jurists in support of the view that without the service of a lawyer a person would be denied 'reasonable', 'fair' and 'just' procedure [See Hussainara Khatoon & Ors. v. Home Secretary, State of Bihar, 1979 (SLT Soft) 45 : AIR 1979 SC 1369 and Madhav Hoskot v. State of Maharashtra, 1978 (SLT Soft) 204 : AIR 1978 SC 1548]. The importance of the presence of Counsel cannot be expressed in any better manner than to make reference to Gidion triumph wherein the case of Gidion v. Wainwright, 372 US 335 : 9 L Ed. At 799, it is observed that any person haled into the Court, who is too poor to hire a lawyer, cannot be assured a fair trial unless Counsel is provided to him. There can be no better way to express the need for presence of a Counsel during Court process. The right to be heard would be, in many cases of little avail if it did not comprehend the right to be heard by Counsel [See John Richard Argersinger v. Raymond Hamlin, 407 US 2532 L ED. 2nd 530].

The Counsel now appearing to make submission in the M.As. obviously would not have gone prepared to make submission on merit and was mainly concerned with seeking setting aside the order dismissing the S.As. in default. Mere mention to some of the pleas without drawing the attention of the Tribunal to bring out the evidence and material, in my view, would not be a substitute for right to make submission on merit. I am, therefore, of the considered view that in the interest of justice the order dated 18.7.2013 deserves to be set aside and it is so ordered. The S.As filed by the appellants shall be restored to its original positions and would now be heard on merits by giving opportunity to both the parties to advance their submissions on the basis of pleadings and evidence already placed on record. The parties through their Counsel are directed to appear before the Tribunal below on 25.5.2015 on which date the Tribunal would be at liberty to hear the parties to dispose of the S.As. on merit.

The appeals are allowed in above terms.