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Judgment
Anil Kumar Srivastava, Chairperson
THE APPELLATE TRIBUNAL :
Heard the Learned Counsel for the parties and perused the record.
The instant appeal arises against an order dated 21st January, 2019, passed in S.A. 68 of 2012, whereby Learned Presiding Officer, Debts Recovery Tribunal, Vishakhapatnam has dismissed the SARFAESI Application.
The SARFAESI Application was filed by the Appellant challenging the notice under Section 13(2) of the SARFAESI Act and all the subsequent proceedings. Initially, SARFAESI Application No. 68 of 2012 was dismissed on 12th October, 2012.
Feeling aggrieved, Appeal No. 115 of 2017 was preferred which was decided by DRAT vide order dated 12th June, 2018 wherein the matter was remanded to DRT for recording specific finding on the issue as to whether the N.P.A., as classified by the Bank, was in accordance with the RBI Guidelines or not. Learned DRT had only recorded the submissions made by the Learned Counsel for the parties but did not record its own finding on the issue.
After remand of the matter, Learned DRT again passed an order dated 21st January, 2019 dismissing the SARFAESI Application. As far as the directions given by the DRAT, Kolkata, in its judgment dated 12th June, 2018, regarding specific finding on the issue of classification of the account as N.P.A., I am constrained to note that the Learned DRT in the judgment dated 21st January, 2019 did not comply the directions rather only finding is recorded in page 40 of the Paper Book to the effect that :
“So, I am not agreeing with the arguments of Ld Counsel for applicant that declaration of loan account of applicant as N.P.A. on 20.07.2011 is illegal and bad under the law.”
No reasons are recorded by the Learned DRT as to why he is not accepting SARFAESI Applicant’s version or why he is accepting the contention raised by the Creditor Bank.
In Brijmani Devi -vs- Pappu Kumar and Another, reported in (2022) 4 SCC 497, The Hon’ble Apex Court held as under:
“32. On the aspect of the duty to accord reasons for a decision arrived at by a court, or for that matter, even a quasi-judicial authority, it would be useful to refer to a judgment of this Court in Kranti Associates (P) Ltd., v. Masood Ahmed Khan, (2010) 9 SCC 496 wherein after referring to a number of judgments this Court summarised at para 47 the law on the point. The relevant principles for the purpose of this case are extracted as under:
32.1. Insistence on recording of reasons is meant to serve the wider principle of justice that justice must not only be done it must also appear to be done as well.
32.2. Recording of reasons also operates as a valid restraint on any possible arbitrary exercise of judicial and quasi-judicial or even administrative power.
32.3 Reasons reassure that discretion has been exercised by the decision-maker on relevant grounds and by disregarding extraneous considerations.
32.4. Reasons have virtually become as indispensable a component of a decision making process as observing principles of natural justice by judicial, quasi-judicial and even by administrative bodies.
32.5. The ongoing judicial trend in all countries committed to rule of law and constitutional governance is in favour of reasoned decisions based on relevant facts. This is virtually the lifeblood of judicial decision-making justifying the principle that reason is the soul of justice.
32.6. Judicial or even quasi-judicial opinions these days can be as different as the Judges and authorities who deliver them. All these decisions serve one common purpose which is to demonstrate by reason that the relevant factors have been objectively considered. This is important for sustaining the litigants’ faith in the justice delivery system.
32.7. Insistence on reason is a requirement for both judicial accountability and transparency.
32.8. If a Judge or a quasi-judicial authority is not candid enough about his/her decision-making process then it is impossible to know whether the person deciding is faithful to the doctrine of precedent or to principles of incrementalism.
32.9. Reasons in support of decisions must be cogent, clear and succinct. A pretence of reasons or "rubber-stamp reasons" is not to be equated with a valid decision-making process.
32.10. It cannot be doubted that transparency is the sine qua non of restraint on abuse of judicial powers. Transparency in decision-making not only makes the Judges and decision-makers less prone to errors but also makes them subject to broader scrutiny.
32.11. In all common law jurisdictions judgments play a vital role in setting up precedents for the future. Therefore, for development of law, requirement of giving reasons for the decision is of the essence and is virtually a part of "due process". “34. The Latin maxim “cessante ratione legiscessat lex” meaning “reason is the soul of the law, and when the reason of any particular law ceases, so does the law itself, is also apposite.”
Insistence on recording of reasons is meant to serve the wider principle of justice that justice must not only be done it but must also appear to be done as well. Insistence of reasons is a requirement for both judicial accountability and transparency. Transparency in decision making not only makes the Judges and decision makers less prone to errors but also makes them subject to broader scrutiny.
I am constrained to observe that the impugned order is nothing but an abuse of process of law. Learned Presiding Officer, DRT, Vishakhapatnam had not complied the orders and directions issued by this Appellate Tribunal in the Appellate Judgment dated 12th June, 2018. Such practice could not be appreciated in law. It was the duty of the Learned DRT to comply with the directions and to pass a judgment in accordance with the directions issued by the Appellate Tribunal. Non compliance of the orders is nothing but an arbitrary exercise of powers by the DRT. However, keeping in view the merits of the matter, since the only question involved in this case is regarding classification of N.P.A. by the Bank, the appeal deserves to be allowed and matter be remanded to DRT, Vishakhapatnam to decide afresh in accordance with the observation made in the body of the judgment. Since the SARFAESI Application relates to the year 2012, Learned DRT should decide the SARFAESI Application within a period of three months from the date of receipt of the copy of the judgment.
ORDER
The appeal is allowed. Case is remanded to DRT, Vishakhapatnam, who shall decide the SARFAESI Application afresh within a period of three months from the date of receipt of the copy of the judgment in the light of observations made in the body of the judgment.
Copy of the order be supplied to Appellant and the Respondents and a copy be also forwarded to the concerned DRT.
File be consigned to Record room.
Order dictated, signed, dated and pronounced in open Court. Copy of the Judgment/Final Order be uploaded in the Tribunal’s Website.