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Judgment
Ashok Menon, Chairperson
The Appellants are in appeal impugning the order dated 09.01.2023 in Interlocutory Applications (I.As.) Nos. 357 & 358 of 2022 in Original Application (O.A.) No. 1415 of 2016 on the files of the Debts Recovery Tribunal-I, Mumbai (D.R.T.) declining to condone the delay in filing the written statement by Defendants Nos. 1 to 3.
The first Appellant is a company. Appellants Nos. 2 and 3 are the directors of the company. The O.A. was filed on 27.07.2016 and the Defendants were served. It is contended that the Defendants had engaged a lawyer to represent them. However, they could not give proper instructions to their lawyer as the second Defendant was arrested on 29.12.2018 in a criminal case which was lodged against him in the year 2015. He attempted to avoid arrest by applying for pre-arrest bail but failed. After he was arrested, he was in detention for more than two years and succeeded in getting bail from the High Court only on 29.01.2021. Because of his detention, he was not able to attend to his ongoing litigations. The third Defendant is the wife of the second Defendant. Though she was also a director of the company, she was only acting according to the advice of the second Defendant and hence could not give any instructions independently to their counsel. That apart, there was also the Covid Pandemic which prevented the Defendants from filing their written statement in time. The whereabouts of their counsel were also not available and they had engaged another counsel who filed a fresh vakalatnama on 22.12.2021. It is also submitted that the order of the Hon’ble Supreme Court in Suo Motu Writ Petition No. 03 of 2020 excluding the period from 15.03.2020 to 28.02.2022 and a further extension of 90 days excluding the period of limitation would come to the assistance of the Defendants. Hence, it is prayed that the delay may be condoned and the written statement received.
The Respondent Punjab National Bank, the Applicant in the O.A. vehemently opposed the applications stating that the Defendants' attempt was only to delay the proceedings. It is pointed out that notice was served together with the complete paper books on the Defendants in January 2017, and that the written statement cannot be received after a delay of four years.
The Ld. Presiding Officer after considering the rival submissions and after perusal of the records and the statutory provisions dismissed the applications holding that the Tribunal has no power or authority to condone delay in filing the written statement. The Appellants are aggrieved and hence, in appeal.
Heard both sides. Records perused.
All the Defendants in the O.A. had entered an appearance on 13. 01.2017 on being served with summons. The O.A. was adjourned for filing of written statement. Sec. 19(5) (i) of the Recovery of the Debts and Bankruptcy (“RDB Act”, for short) reads thus:
“ (5)(i) the defendant shall within a period of thirty days from the date of service of summons, present a written statement of his defence including claim for set-off under sub-section (6) or a counter-claim under sub-section (8), if any, and such written statement shall be accompanied with original documents or true copy thereof with the leave of the Tribunal, relied on by the defendant in his defence:
PROVIDED that where the defendant fails to file the written statement within the said period of thirty days, the Presiding Officer may, in exceptional cases and in special circumstances to be recorded in writing, extend the said period by such further period not exceeding fifteen days to file the written statement of his defence;”
It is also to be observed that sub-section (5) was substituted by way of amendment by Act 44 of 2016. Before the amendment, the proviso provided the Presiding Officer to allow not more than two extensions for the defendant to file the written statement. The amendment has thus made the provisions more stringent. The Presiding Officer can grant only one extension that too of only fifteen days to file the written statement in exceptional cases or special circumstances by reasons recorded in writing.
The Debts Recovery Tribunal (Procedure) Rules, 1993 also has a similar provision in Rule 12 which reads thus:
“ 12. Filing of the written statement and other documents by the defendant and by the applicant as a reply to the written statement. — (1) The defendant may, within a period of thirty days from the date of service of summons, file two complete sets of written statement including claim for set-off or counter claim, if any, along with documents in a paper book form.
(2) A copy of the written statement filed under sub-rule (1) shall be served to the applicant.
(3) If the defendant fails to file the written statement of his defence, including claim for set-off or counter claim under sub-rule (1), if any, within the period of thirty days, the Presiding Officer may in exceptional cases and special circumstances to be recorded in writing, extend the period, by such further period not exceeding fifteen days.”
The Rules were also amended with effect from 04.11.2016 by way of an amendment restricting the powers of the Presiding Officer to grant an extension of time to file a written statement.
The question that arises for consideration in this appeal is whether the Tribunal has the power to grant an extension of time to file a written statement under Sec. 5 of the Limitation Act. The powers of the Tribunal under Sec. 5 to condone delay and extend time stipulated in the statute has now been settled by the Hon’ble Supreme Court in the decision of Standard Chartered Bank vs MSTC (2020)13 SCC 618 wherein it was held that the D.R.T. cannot extend the time of thirty days to review its orders provided under Rule 5-A of the D.R.T. Rules by resorting to Sec. 5 of the Limitation Act. Similarly, the Hon’ble Supreme Court in International Asset Reconstruction Company of India Ltd Vs. Official Liquidator of Aldrich Pharmaceuticals Limited and Ors (2017) 16 SCC 137 has held that when a special statute provides for time to entertain an appeal under Sec.30 of the RDB Act, it cannot be extended by resort to Sec. 5 of the Limitation Act.
The Hon’ble High Court of Madhya Pradesh has in Crest Steel and Power Pvt. Ltd & Ors vs Punjab National Bank & Ors AIR OnLine 2018 MP 572, rejected the prayer to receive the written statement after the expiry of the period stipulated under Sec. 19(5)(i). Similarly, the Hon'ble High Court of Delhi has in Anita Garg & Ors vs State Bank of India WP(C) 6886/2021(2021 DHC:2759DB) held that a written statement cannot be received beyond the stipulated time or extended time mentioned in Sec. 19(5)(i) of RDB Act.
The Appellants cannot resort to the decision of the Hon’ble Supreme Court in Suo Moto Writ Petition No. 3 of 2020 to get the time extended because the time for filing the written had expired long before the onset of the pandemic and hence, no extension is possible.
The appeal has no merits and therefore, needs to be dismissed.