State Bank Of India vs M/s Manav Greys Exim Pvt. Ltd. & 4 Ors

Ashok Menon, Chairperson

This application is filed to condone the delay of 107 days in filing the appeal at lodging No. 390 of 2022. The State Bank of India is the Appellant and has filed an appeal challenging the impugned order of the Debts Recovery Tribunal-2 Mumbai Interlocutory Application No. 1316 of 2021 dated 5th of January 2022.

The Respondents herein are the applicant in S.A. No. 189 of 2021, in which the above-mentioned IA No. 1316/2021, was filed. The original applicants had filed IA No. 1315 of 2021, seeking leave to amend the Securitisation Application, and had, sought interim relief to private the secured creditor from acting in accordance with the statutory demand notice. The allegation against the Appellant bank was that they had in breach of the RBI guidelines in circulars illegally classified the borrower's account as Non-Performing Asset (NPA). The secured assets were intended to be sold by way of a sale notice dated 22/11/2021. Violations of mandatory provisions under sections 13 (3), (3-A) and Rule 3-A (b) of the SARFAESI Act and Rules are alleged. It is also alleged that two notices were issued under Section 13(2) of the surface the Act showing two different dates of classification of the debt as NPA.

On a prima facie consideration of the averments made in the application, the Ld. P.O. vide the impugned order restrained the Appellant bank from taking any action on measures based on the statutory demand notices. Aggrieved by the said order, the Appellant bank has come on appeal. There was a delay of 107 days. The Appellant seeks to condone that.

It is submitted in the application for condonation of delay and the accompanying affidavit that after IA 1316 of 2021, was allowed, the Appellant was expecting an order on IA No. 1315 of 2021, filed along with IA 1316 of 2021. But that application was adjourned. The Appellant was, therefore, prevented from approaching this Tribunal in appeal. The Appellant also relies on the decision of the Hon'ble Supreme Court in Suo Moto Writ Petition No. 3 of 2020, granting an extension of the period of limitation from 15/03/2020 to 30/05/2022 given the pandemic. The impugned order was made on 05/01/2022 and the appeal was filed on 30/05/2002, and would, therefore, squarely come within the purview of the Apex Court’s Judgement. The Appellant states that the impugned order would not stand the scrutiny of merits and that the Appellant has a very good case. Hence, it is prayed that the delay may be condoned.

The respondent has opposed the application with much vehemence stating that the Appellant has no case for getting the delay condoned. And, therefore, seeks dismissal of the application. The learned counsel for the respondent has relied on two decisions of the Hon'ble Supreme Court in support of his argument reported in Sagufa Ahmed Vs. Upper Assam Plywood Products Pvt. Ltd. And Ors. MANU/SC/0697/2020 and V. Nagarajan Vs. SKS Ispat and Power Ltd. And Ors MANU/SC/0956/2021, Wherein it is held that the Appellants can take refuge under the order of the Hon'ble Supreme Court in Sou Moto Writ Petition No. 3 of 2020, only for extending the period of limitation, and not the period up to which delay can be condoned in exercise of discretion conferred by the statute. It is also observed that the order passed by the Hon'ble Supreme Court was intended to benefit vigilant litigants who were prevented due to the pandemic and the lockdown, from initiating proceedings within the period of limitation prescribed by general of special law. The learned counsel also relies upon the aforesaid decisions to argue that the Appellants had not chosen to file a copy application and await the receipt of the copy of the order.

The decisions relied upon by the learned counsel for the respondent comes under the provisions of the NCLT and NCALT Rules. I do not think that an analogy can be drawn to the facts of the present case. On going through the application for condonation of delay and the accompanying affidavit and also on hearing, Mr Charles D'Souza, the learned counsel appearing for the Appellant, and Mr Puneet Gogad, the learned counsel for the Respondents, I find that the delay needs to be condoned. Given the restrictions in filing applications during the pandemic break, the Hon'ble Apex Court had extended the period of limitation for any applications. To be filed during the period mentioned above. The present application squarely falls within the said period which has been excluded by the judgment of the Hon'ble Apex Court. I find no reason to decline the prayer for condonation of delay. Hence the application is allowed and the delay of 107 days in filing the appeal stands condoned.

I.A. No. 233 of 2022 is allowed for the reasons stated above. The registry is directed to take the appeal on file in case there are no other defects to be cured.