P. Kannan, R. Palanisamy and P. Rajeswari vs The Authorised Officer, Tamil Nadu Mercantile Bank

A.C. Arumugaperumal Adityan, J.—The order passed by the Debts Recovery Tribunal, Coimbatore, in O.A.(S). No. 127 of 2007 dated

28.11.2007 is under challenge in this revision. A notice u/s 13(4) of the Securitisation and Reconstruction of Financial Assets and Enforcement of

Security Interest Act, 2002 (hereinafter referred to as ''the Act), dated 7.7.2007 was challenged in the above said appeal in O.A.(S). No. 127 of

2007. The Debts Recovery Tribunal, Coimbatore, had dismissed the appeal on the ground that u/s 17(1) of the Act the appeal is barred by time.

The said order is under challenge in this revision.

The learned Counsel for the revision petitioners would contend that the sale notice u/s 13(4) of the Act was issued only on 15.11.2007 and for

the purpose of limitation the time will run only from 15.11.2007, the date of issuance of sale notice. Section 17(1) of the Act runs as follows:

Right to appeal_ (1) Any person (including borrower), aggrieved by any of the measures referred to in Sub-section (4) of Section 13 taken by the

secured creditor or his authorised officer under this Chapter, may make an application alongwith such fee, as may be prescribed, to the Debts

Recovery Tribunal having jurisdiction in the matter within forty-five days from the date on which such measures had been taken:

Provided that different fees may be prescribed for making the application by the borrower and the person other than the borrower.

Explanation_ For the removal of doubts, it is hereby declared that the communication of the reasons to the borrower by the secured creditor for

not having accepted his representation or objection or the likely action of the secured creditor at the stage of communication of reasons to the

borrower shall not entitle the person (including borrower) to make an application to the Debts Recovery Tribunal under this sub-section.

To calculate 45 days for the purpose of limitation, the cause of action will start from the date on which the measures referred to in Sub-section 4 of

Section 13, were taken shall be taken into consideration. The measures enumerated u/s 13 of the Act for enforcement of the security interest runs

as follows:

Section 13:-Enforcement of Security interest_

(1) ...

(2) ...

(3) ...

(4) In case the borrower fails to discharge his liability in full within the period specified in Sub-section (2), the secured creditor may take recourse

to one or more of the following measures to recover his secured debts, namely:

(a) take possession of the secured assets of the borrower including the right to transfer by way of lease, assignment or sale for realising the secured

asset;

(b) take over the management of the business of the borrower including the right to transfer by way of lease, assignment or sale for realising the

secured asset;

Provided that the right to transfer by way of lease, assignment or sale shall be exercised only where the substantial part of the business of the

borrower is held as security for the debt:

Provided further that where the management of whole of the business of part of the business is severable, the secured creditor shall take over the

management of such business of the borrower which is relatable to the security for the debt

(c) appoint any person (hereinafter referred to as the manager), to manage the secured assets the possession of which has been over by the

secured creditor;

(d) require at any time by notice in writing, any person who has acquired any of the secured assets from the borrower and from whom any money

is due or may become due to the borrower, to pay the secured creditor, so much of the money as is sufficient to pay the secured debt.

So u/s 13(4) of the Act to enforce their right to secure debt under the act, the respondent herein have issued notice dated 7.7.2007 u/s 13(4) of

the Act and took possession of the immovable properties. Even in the memorandum of grounds of appeal at para 4 for the purpose of limitation the

revision petitioners have clearly stated that they have cause of action from the notice dated 7.7.2007 which was issued u/s 13(4) of the Act. As per

Section 17(1) of the Act, they ought to have filed the appeal within 45 days from the measures taken by the respondent as contemplated u/s 13(4)

of the Act. Here even according to the revision petitioners security measures were taken by the respondent u/s 13(4) of the Act by a notice dated

07.07.2007. So within 45 days from 07.07.2007 the appeal ought to have been preferred by the revision petitioners before the Debts Recovery

Tribunal, Coimbatore. But the revision petitioners have filed the appeal only on 20.11.2007 i.e., long after the expiry of the time stipulated u/s

17(1) of the Act.

The learned Counsel for the revision petitioners relying on AIR 2004 SCW 2541 (Mardia Chemicals Ltd., Etc., Etc. v. Union of India and Ors.

etc etc.) and contended that the revision petitioners have got time even till the date of sale / auction of the property and that in the case on hand the

property is yet to be brought to sale and auction is yet to be conducted, so their cause of action to file the appeal still survives. The said

interpretation cannot be given u/s 17(1) of the Act. For the purpose of calculating the time of limitation, Section 17(1) of the Act clearly emphasis

that if a person is aggrieved by any of the measure referred to u/s 13(4) of the Act can prefer an appeal within 45 days from the date on which the

said measures had been taken. As admitted by the learned Counsel for the revision petitioners the first measure of notice was served on

07.07.2007 u/s 13(4) of the Act. So the time for limitation runs only from 07.07.2007 and it cannot be said that the revision petitioners have got

time even after the date of sale. So the above observation by the Hon''ble Apex Court in the above cited judgment will have no barring to the

present facts of the case on the point of limitation. So under such circumstances, I am of the view that there is no material to interfere with the

findings of the Debts Recovery Tribunal, Coimbatore, in O.A.(S). No. 127 of 2007 dated 28.11.2007.

In fine, the revision is dismissed confirming the order passed in O.A.(S). No. 127 of 2007 on the file of the Debts Recovery Tribunal,

Coimbatore, dated 28.11.2007. No costs. Connected Miscellaneous Petition is closed.