Dismissed

M/s Arohi Pharmaceutical Distributors v. Hdfc Bank

DRAT18 Nov 2025

Case brief

AI extract

What is this about?

The DRAT dismissed an appeal challenging the DRT's rejection of an application to recall an ex-parte order. The core issue was the maximum time limit for filing a written statement under the RDB Act. The court held that the statutory period is 45 days (30 days plus a maximum extension of 15 days) and cannot be extended further to ensure speedy recovery.

What did the court decide?

No order passed in favour of the appellant. The impugned order of the DRT dismissing the application for recalling the ex-parte order was confirmed.

M/s Arohi Pharmaceutical Distributors versus Hdfc Bank — Banking and Recovery | DRAT (2025)

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Reportable/Non-Reportable

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Reserved on 4.11.2025

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Pronounced on 18.11.2025

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Misc. Appeal Dy. No.1167 of 2025 -DRAT-Kolkata

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IN THE DEBTS RECOVERY APPELLATE TRIBUNAL AT

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KOLKATA

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HON’BLE MR. JUSTICE ANIL KUMAR SRIVASTAVA CHAIRPERSON

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Misc. Appeal Dy. No. 1167 of 2025 (Arising out of I.A. No. 284 of 2024 in O.A. No. 428 of 2022 in DRT-Guwahati)

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M/s Aarohi Pharmaceutical Distributors, a proprietorship firm represented by its proprietor, Mr. Amit Bhattacharjee: LDB Building, Ground Floor, G. S. Road, P. S. Sadar, Shillong, District - East Khasi Hills, Meghalaya, PIN-793001.

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Mr. Amit Bhattacharjee, son of Jyotirindra Bhattacharjee, Earle Holiday Home, Oakland, Police Station Sadar, Shillong, District - East Khasi Hills, Meghalaya, PIN-793001

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Mrs. Mitalee Bhattacharjee, daughter of Benoy Kumar Bhattacharjee, Earle Holiday Home, Oakland, Police Station Sadar, Shillong, District - East Khasi Hills, Meghalaya, PIN-793001

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.…Appellants

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-Versus-

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HDFC Bank Limited, Shillong Police Bazar Branch, P.S. – Sadar, Shillong, District – East Khasi Hills, Meghalaya, PIN -793001, Registered office at HDFC Bank Limited, HDFC Bank House, Senapati Bapat Mart, Lower Parel (West), Mumbai, PIN – 400013.

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….Respondents

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Counsel for Appellants Mr. Sreyash Basu Dasgupta Counsel for Respondents None JUDGMENT : 18^th November, 2025

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THE APPELLATE TRIBUNAL :

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Misc. Appeal Dy. No.1167 of 2025 -DRAT-Kolkata

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Heard the Learned Counsel for the Appellant and perused the record.

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2. Instant Appeal has arisen against an order dated 04.08.2025 passed by Learned Debts Recovery Tribunal Guwahati whereby Learned DRT dismissed the I.A. No. 284 of 2024 arising out of O.A. No. 428 of 2022. (HDFC Bank Limited versus M/s Aarohi Pharmaceutical Distributors & Ors). I.A. No. 284 of 2024 was filed by the defendants under Section 22 (2) (g) read with Section 19(25) of the Recovery of Debts and Bankruptcy Act, 1993 read with Rule 18 of the Debts Recovery Tribunal (Procedure) Rules, 1993 for recalling/ vacating the ex-parte order dated 06.06.2023 passed in O.A. No. 428 of 2022. 3. O.A. No. 428 of 2022 was filed by the Bank against the defendants wherein notices and summons were issued to the defendants which were duly served through publication of summons in newspaper namely “U Nongsain Hima’ dated 18.03.2023. But the defendants were not represented. Matter was listed for 06.06.2023 on which date the matter was ordered to be proceeded exparte and was listed on 14.08.2023. It is alleged that the order dated 06.06.2023 came to the notice of the defendants on 23.04.2024 after inspection of the records. Thereafter, Application for setting aside the order dated 06.06.2023 were filed. Learned DRT dismissed the Application holding that the DRT has no jurisdiction to extend the period of filing the written statement from the statutory period of 30 days which may

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Misc. Appeal Dy. No.1167 of 2025 -DRAT-Kolkata

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be extended to 15 days more. Learned DRT placed reliance upon a judgment of DRAT Kolkata wherein it was held in the case of M/s Crest Steel and Power Private Ltd. & Ors. versus Punjab National Bank (Appeal No. 296 of 2017) that the period cannot be extended beyond 30 days and in exceptional circumstances of 15 days more which was upheld by the Hon’ble High Court as well as Hon’ble Apex Court.

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4. Learned Counsel for the Appellant would submit that the Appellant has no knowledge about the publication of the notice in newspaper. No notices were ever served upon him. Hence, he was not able to put in appearance. He came to know about the same on 09.04.2024 from the officials of the Police Bazar Branch of the Bank and thereafter on 23.04.2024 on inspection of records.

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5. As far as issue of period of filing of written statement is concerned, I find it appropriate to reproduce the provision of Section 19(5) (1) of the Act as under:

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“19(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 copies thereof with the leave of the Tribunal, relied on by the defendant in his defence:

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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;”

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Misc. Appeal Dy. No.1167 of 2025 -DRAT-Kolkata

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6. Hence, the question for determination is as to whether the provision of section 19(5)(i) of the Act is mandatory or directory in nature?

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7. Learned Counsel for the Respondent has placed reliance upon Kailash Vs. Nanhku [(2005) 5 SCC 480] and Bharat Kalra versus Raj Kishan Chabra [Civil Appeal No. 63 of 2022]. It is settled legal proposition that when any provision of the Act does not state any exception to a particular point of law, then other provision akin to the relevant provision of law is important. This view is fortified by the view taken by Hon’ble Madhya Pradesh High Court in M/s. Crest Steel (supra) which was duly approved by the Hon’ble Apex Court by dismissing the SLP.

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8. In Para 7 of the judgement in M/s Crest Steel (supra) following observation made by the Hon’ble Madhya Pradesh High Court :

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“On the other hand, learned counsel for the Bank referred to Three Judge Bench judgment of the Supreme Court reported as New India Assurance Company Limited Vs. Hilli Multipurpose Cold Storage Private Limited, (2015) 16 SCC 22 (for short 'Hilli I'), wherein the judgment in Kailash's case (supra) was found to be not correct view as the earlier Three Judges Bench judgment in the case reported as Dr. J.J. Merchant and others Vs. Shrinath Chaturvedi, 2002 (6) SCC 635 was not noticed by the Bench.”

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9. Hence, the Respondent cannot take any advantage of Nanhku case (supra).

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10. In view of the observation of the Hon’ble Division Bench of Madhya Pradesh High Court, it is to be seen as to whether the provisions of Section of 19(5)(i) of the Act are mandatory or directory in nature?

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Misc. Appeal Dy. No.1167 of 2025 -DRAT-Kolkata

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11. In Para 8 of Crest Steel (supra), Hon’ble Division Bench of Madhya Pradesh High Court has placed reliance on Central Bank of India Vs. State of Kerala [(2009) 4 SCC 94] wherein it was held that :

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“92. An analysis of the above noted provisions makes it clear that the primary object of the DRT Act was to facilitate creation of special machinery for speedy recovery of the dues of banks and financial institutions. This is the reason why the DRT Act not only provides for establishment of the Tribunals and the Appellate Tribunals with the jurisdiction, powers and authority to make summary adjudication of applications made by banks or financial institutions and specifies the modes of recovery of the amount determined by the Tribunal or the Appellate Tribunal but also bars the jurisdiction of all courts except the Supreme Court and the High Courts in relation to the matters specified in Section 17. The Tribunals and the Appellate Tribunals have also been freed from the shackles of procedure contained in the Code of Civil Procedure. To put it differently, the DRT Act has not only brought into existence special procedural mechanism for speedy recovery of the dues of banks and financial institutions, but also made provision for ensuring that defaulting borrowers are not able to invoke the jurisdiction of civil courts for frustrating the proceedings initiated by the banks and financial institutions.

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93. The enactment of the Securitisation Act can be treated as one of the most radical legislative measures taken by the Government for ensuring that dues of secured creditors including banks, financial 10 institutions are recovered from the defaulting borrowers without any obstruction. For the first time, the secured creditors have been empowered to take measures for recovery of their dues without the intervention of the courts or tribunals."

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12. Further, reliance is placed upon the judgement of Hon’ble Apex Court in Pegasus Assets Reconstruction (P) Ltd. Vs. Haryana Concast Ltd. [(2016) 4 SCC 47] wherein it is held that :

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“21. The RDB Act is of 1993 i.e. later to the Companies Act. Its avowed object is to provide for the establishment of tribunals for expeditious adjudication and recovery of debts due to banks and financial institutions and for matters connected therewith or incidental thereto. This Act creates a special machinery for speedy recovery of dues of banks and financial institutions which, by an amendment of 2004 now includes a registered securitisation company or

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Misc. Appeal Dy. No.1167 of 2025 -DRAT-Kolkata

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reconstruction company envisaged under the SARFAESI Act. Section 18 bars the jurisdiction of ordinary courts or authority in respect of matters falling within the jurisdiction of the Tribunal as specified in Section 17. An Appellate Tribunal is provided under Section 20. The power of the Tribunal extends to determining the debt due as well as its realisation. Section 34 confers overriding effect upon this Act over any other law in force."

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13. It was also held in Para 13 of the judgement in M/s Crest Steel (supra) that-

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“13- A reading of the Act would show that it is a complete Code providing for a Forum for adjudication of claim of the secured creditors and also to the procedure to be followed by the Adjudicating Authorities under the Act. It also mandates to ensure that there is expeditious disposal of the claim of the secured creditors, as huge public money is locked up on account of defaults of borrowers. Subsection (4) of Section 19 of the Act provides for a show cause within thirty days of service of summons as to why relief prayed for should not be granted. In terms of sub-section (5), the defendant has to file written statement of his defence within a period of thirty days, including claim for set-off under sub-section (6) or a counter-claim under sub-section (8). The first proviso contemplates that the Presiding Officer in exceptional cases and in special circumstances can extend the period for filing of written statement, but not exceeding 15 days. In other words, the time prescribed for filing of written statement is normally thirty days, but can be extended in certain circumstances by another fifteen days. The argument of petitioners is that such provisions are directory relying upon Kailash's case.”

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14. It was further held that in Crest Steel (supra) it was held that provisions of Order VIII Rule 1 CPC is not mandatory but directory in nature.

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15. In Hilli Multipurpose case (supra) it was held that in no case period beyond 45 days can be granted to the opposite party for filing its version of the case. In J.J. Merchant & Ors. Vs. Shrinath Chaturvedi [2002 (6) SCC 635] issue relates to the applicability of the provision in Section 13 of the Consumer Protection Act, 1986 regarding failing to file

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Misc. Appeal Dy. No.1167 of 2025 -DRAT-Kolkata

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reply to the complaint were in issue wherein it was held that in Para 15 and 17 are as under :

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“15. Under this Rule also, there is a legislative mandate that written statement of defence is to be filed within 30 days. However, if there is a failure to file such written statement within stipulated time, the court can at the most extend further period of 60 days and no more. Under the Act, the legislative intent is not to give 90 days of time but only maximum 45 days for filing the version by the opposite party. Therefore, the aforesaid mandate is required to be strictly adhered to.” “16. In view of the aforesaid provisions, the Commission can certainly refer to Order VII Rule 14 which provides that where a plaintiff sues upon a document or relies upon document in his possession or power in support of his claim, he shall enter such documents in a list, and shall produce it in the Court when the plaint is presented by him and shall, at the same time deliver the document and a copy thereof, to be filed with the plaint. It appears that this mandatory requirement is not followed and thereafter, there is complaint of delay in disposal. Similarly, in case of written statement under Order VIII Rule I-A, defendant is required to produce the documents relied upon by him when written submission is presented. The Commission can always insist on production of all documents relied upon by the parties along with the complaint and the defence version.”

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16. Further, the same judgement was relied upon by the Hon’ble Apex Court in the case of New India Assurance

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Co. Ltd. Vs. Hilli Multipurpose Cold Storage Pvt. Ltd., 12 [(2015) 16 SCC 20] wherein Para 16 Hon’ble Apex Court has held that :

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“16 - In the aforestated circumstances, we have now to consider whether in a case under the provisions of the Act, where a complaint has been filed and the opposite party has not filed its version to the case within 30 days or within extended period of 45 days, which at the most could have been granted by the District Forum, the version given by the opposite party can be accepted.”

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17. In Para 24 of the judgement of Hon’ble Apex Court the Three Judges Bench decision in J. J. Merchant case (supra) was followed wherein it was held in Para 13 that :

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Misc. Appeal Dy. No.1167 of 2025 -DRAT-Kolkata

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“13 - The question arose in the case of Dr. J.J. Merchant (supra) whether the Forum can grant time beyond 45 days to the opposite party for filing its version. After considering the aforestated section in the light of the object with which the Act has been enacted, a three Judge Bench of this Court came to the conclusion that in no case period beyond 45 days can be granted to the opposite party for filing its version of the case.”

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18. Further, it was held that judgement delivered in J.J. Merchant case (supra) followed the field and therefore, we are agreed the view that the District Forum can grant a further period of 15 days to the opposite party for filing of version or reply and not beyond that. Ultimately, in Para 29 of the judgement it was held that law laid down by the Three Judges Bench of Hon’ble Apex Court J.J.Merchant case (supra) should prevail.

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19. In Crest Steel (supra) at Para 11, Hon’ble Madhya Pradesh High Court has held as under :

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“11- The experience of more than 20 years to speed up recovery of public dues, the Act was amended while enacting The Insolvency and Bankruptcy Code, 2016 published on 28th of May, 2016. The Act was 13 also amended by another Central Act No.44 of 2016 "The Enforcement of Security Interest and Recovery of Debts Laws and Miscellaneous Provisions (Amendment) Act, 2016." The later Act has inter-alia amended Section 19 of the Act. The amended Act (Section 31B) gives priority to the dues of the secured creditors over all other debts and Government dues including revenues, taxes, cesses and rates due to the Central Government, State Government or Local Authority. 12- With this back ground, the relevant provisions of Act need to be extracted before the arguments raised by learned counsel for the parties are dealt with. The provisions read as under:- (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 copies 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

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Misc. Appeal Dy. No.1167 of 2025 -DRAT-Kolkata

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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; (24) The application made to the Tribunal under sub-section (1) or sub-section (2) shall be dealt with by it as expeditiously as possible and every effort shall be made by it to complete the proceedings in two hearings, and to dispose of the application finally within one hundred and eighty days from the date of receipt of the application.”

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20. On the basis of the discussion made above we are of the considered view that the written statement was required to be filed within 30 days and in exceptional cases or in special circumstances be extended by the DRT by another 15 days. In the present case written statement was not filed either in 30 days or in extended 15 days. Provisions of the Act have to be assigned meaning thereby keeping in view the objective of the Act rather that to frustrate the object. Accordingly, I am of the considered opinion that defendant/respondent have no right to file written statement.

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21. In view of the above, I am of the considered view that the period for filing the written statement cannot be extended beyond the period of 30 days and thereafter in exceptional cases, 15 days. Accordingly, I am of the view that Learned DRT has committed no illegality in passing the impugned order. Appeal lacks merit and is liable to be dismissed.

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ORDER

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Misc. Appeal Dy. No. 1167 of 2025 is dismissed. Impugned order dated 04.08.2025 passed by Learned Debts

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Misc. Appeal Dy. No.1167 of 2025 -DRAT-Kolkata

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Recovery Tribunal Guwahati in O.A No. 428 of 2022 in I.A. No. 284 of 2024 is confirmed.

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No Order as to costs.

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