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Judgment
Sindhu Sharma, J
M/s Prabhat Terepenes and Synthetics Ltd. (respondent No.3 in OWP No.323/2008) decided by this Court on 16.04.2009 is the petitioner seeking review of the judgment on the following grounds:-
I. That the petitioner in the counter filed has contested the liability in the suit filed by respondent No. 1 on the various grounds on the basis of which as many as nine issues were framed and the suit is still pending in the Court of Additional District Judge Bank Cases, Jammu. Since the amount claimed is disputed so the directions given by this Court in Para No. 26 of the judgment is an error apparent on the record.
II. That Para No. 26 of the judgment is, "being misunderstood" because this Court has given the direction to the Jammu and Kashmir State Industrial Development Corporation Limited to pay the amount due to the Bank, needs to be reviewed at first blush as the error is not deliberate or intentional;
III. That since inadvertent error is capable of "being misunderstood" as the direction from this Court to pay the amount to the petitioner/Bank without subject to outcome of the civil suit pending in the Court of Additional District Judge, Bank Cases, Jammu is being claimed by the Bank from respondent SIDCO, therefore, the error may be rectified by a rider "subject to decision of Civil suit";
IV. That since the pendency of the suit for recovery filed by the respondent-Bank is admitted, therefore, the amount due is to be read and qualified by a rider "subject to outcome of civil suit" and;
V. That lastly Section29 of the State Financial Corporation Act and laws framed thereunder, dictates that when the amount is disputed the action under Section 29 is not proper because the issue relates to amount on which there is a dispute between the parties being debatable and once the Bank chooses the course of civil suit, it has bowed itself down to the completion of proceedings.
The respondent has filed written objections questioning the maintainability of the review petition inter alia on the grounds that there is no error apparent on the face of record in the absence of which, review is not maintainable. It is further contended that Section 29 of the Act has been invoked by the Jammu and Kashmir State Industrial Development Corporation for recovery of the debt by selling petitioner"s assets on which the respondent-Bank held second charge. Since the letter dated 10.03.2008 issued by respondent No. 1 (Jammu and Kashmir State Industrial Development Corporation Limited) has been quashed, therefore, the direction of the Court in Para No. 26 of the judgment cannot be faulted.
The contention of Mr. Jalali, learned senior counsel, is that direction to respondent No.1 to pay the amount due to Bank "being misunderstood" because suit for recovery of the amount filed by the respondent-Bank is pending and as such, no amount can be said to be deducted. The order to pay the amount due as argued the learned senior counsel ought to carry a rider subject to the decision of the civil Court. Mr. Jalali further argued that Section 29 of the State Financial Corporation Act could not be invoked in a case where the amount due is not finally determined.
Per Contra, Mr. Kapahi, learned counsel for respondent No. 1, argued that the order to pay the amount due does not create any misunderstanding as it has no other meaning. Moreover, according to Mr. Kapahi, the balance amount of the sale consideration cannot be allowed to be retained by the Corporation after it has recovered the amount due to it in view of the law laid down by the Hon"ble Apex Court in 2004 (7) SCC 151. According to Mr. Kapahi, the grounds urged in support of the review are not tenable in view of the law down by this Court in State of J&K vs. Govt. Handloom Silk Weaving Factory, 2016 (II) SLJ (HC) 651, 1986 (3) SCC 16, 1999(9) SCC 596, 2013 (7) SCC 615 and AIR 1980 SC 674.
Heard. Main argument of Mr. Jalali, learned senior counsel, is that one of the reliefs claimed by the respondent-Bank in OWP No.323/2008 was to direct respondent No. 1 to settle the claim of the petitioner, who is a secured creditor before settling the claim of the insecured creditor. The word "settle" according to learned senior counsel does not mean to pay the amount due as directed by the Court. However, according to the Law Lexicon 2ndEdition, the word "settle" means to adjust or ascertain to pay. It is further stated that Webster Dictionary defines the word "settle as meaning in law" to adjust to liquidate to balance as an account to pay a debt. To "settle" is synonymous with, to adjust, or to pay, it means to pay. Similarly, in Oxford Dictionary 10th Edition, the word "settle" is defined to pay a debt or an amount.
So the word "settle" is synonymous to pay the amount due used in Para 26 of the judgment and there can be no misunderstanding about its contours. Whether the direction is illegal or erroneous is a different question because in that case, the remedy is appeal and not review. As held by the Hon"ble Division Bench of this Court reported in 2016 (2) SLJ 651, Para No.13 being relevant is reproduced:-
"13. At the very outset it needs to be kept in mind that review jurisdiction of the Court is limited. It is settled law that it is only an error apparent on the face of the record which can be considered and gone into by the Court. In the present review petitions, the grounds of fact of law urged in review petitions, as narrated above, including the submissions made at the Bar by the learned Counsels appearing in these Review Petitions, which in content and substance were the same as taken in the respective review petitions, cannot in any manner be considered as errors on the fact of record. Instead the grounds sought to be raised and urged may constitute grounds of appeal alone. In fact, the instant review petitions on grounds enumerated herein appear to be disguised Second Appeals. As notice above, the grounds taken by the review petitioners are either that the findings recorded by the Court are not legally tenable, or that the same are perverse, or that the same are unacceptable. A judgment may be wrong, erroneous, incorrect, perverse, illegally untenable, etc. etc., the only course available for the aggrieved party is to go in appeal. Such grounds do not constitute errors of fact or of law on the face of the record as would call for a review.
The scope of review of an order is very limited and it cannot be a forum to reargue the matter already decided and this cannot be also used as a tool for changing the opinion/view of the Court. The said position is explained by the Hon"ble Supreme Court in the decisions reported in (1980) 2 SCC 167, (1999) 9 SCC 596, (2013) 7 SCC 615 and (2013) 8 SCC 320."
It is not necessary to multiply the authorities on the point of law as declared by the Court.
Regarding application of Section 29 of the State Industrial Development Act could not be invoked in case the amount due is not paid. This argument is belated because Section 29 of the Act was invoked by the Corporation being first Creditor and the entire assets of the petitioner were sold by public auction for Rs.819.50 lakhs without any objection from the petitioner. It cannot be the case of the petitioner that Section 29 of the Act was wrongly applied. Since the answering respondent holds second charge on the assets of the petitioner industrial concern, so according to Mr. Kapahi, it is entitled to the entire balance amount. The Supreme Court in Gajraj Jain Vs. State of Bihar, 2004 (7) SCC 151 has been pleased to hold that Section 29(1) of the Act contemplates for distribution of sale proceeds and not a sale for distribution of property charged with debt. It also implies that the first charge holder must act in a manner which protects not only its interest but also the interest of subsequent charge holder as a mortgagor. Since the answering respondent is the second charge holder on the mortgaged property, which has been sold in auction, so the balance amount must according to Mr. Kapahi, be deposited with the Bank who will hold it as Trustee of surplus sale precedes as held by their lordship in Gajraj Jain case (Supra). Para-12 of the judgment is relevant, same is reproduced as under:-
"Under section 29(1) of the 1951 Act, where any industrial concern under a liability to the financial corporation makes any default in repayment of loan, the corporation is empowered to take over possession of the industrial concern and realize the property pledged, mortgaged, hypothecated or assigned to the corporation. Under section 29(4), all costs, charges and expenses incurred by the corporation as incidental to such realization of the property pledged, hypothecated or mortgaged shall be recovered firstly from the industrial concern and the balance shall be paid to the person entitled thereto. As stated above, a charge consists in the right of a creditor to receive the payment out of the proceeds of the realization of property or fund charged with the debt. A bare reading of sub- sections (1) & (4) of section 29 shows that it is similar to section 69 of T.P. Act under which it is stipulated that a mortgagee exercising the power of sale is a trustee of the surplus sale proceeds and after satisfying his own charge he holds the surplus for the subsequent encumbrancers and ultimately for the mortgagor [See: Rajah Kishendatt Ram v. Rajah Mumtaz Ali Khan reported in [Vol. VI Indian Appeals 145 (PC)]. Section 29(1) contemplates, therefore, a sale for distribution of sale proceeds and not a sale for distribution of property charged with the debt. It also implies that the first charge holder must act in a manner which protects not only its own interest but also the interest of the subsequent charge holder and the mortgagor. This in turn implies that the first charge holder is bound to obtain the best possible price for the mortgaged assets and the best possible price must, in the context, mean the fair market value."
Incidentally in this case also, first charge is with the Corporation and second charge is in favour of the Central Bank of India so the amount will be safe so it is not a case of misunderstanding.
In view of the aforesaid preposition of law, no ground for review is made out. Accordingly, this petition for review is found without any merit and is dismissed.
Record of OWP No.323/2008 be remitted back.