Allowed

PNB Housing Finance Limited v. M/S Cyrus Diagnostic Centre

DRAT2 Sept 2025MISC APPEAL/87/2024

Case brief

AI extract

What is this about?

The tribunal set aside an order by DRT-I Hyderabad that directed redelivery of possession without assigning reasons, citing Supreme Court precedents requiring judicial decisions to be based on reasoned judgments to ensure transparency, accountability, and adherence to due process.

What did the court decide?

Impugned order dated 23.10.2024 by DRT-I Hyderabad set aside; I.A. No. 2186 of 2024 dismissing direct redelivery of possession is dismissed.

PNB Housing Finance Limited versus M/S Cyrus… — Contract and Commercial Disputes | DRAT (2025)

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Reportable / not reportable

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IN THE DEBT RECOVERY APPELLATE TRIBUNAL - KOLKATA

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HON'BLE Justice Anil Kumar Srivastava, Chairperson

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MISC APPEAL No. 87 of 2024

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(Arising out of I.A. 2186 of 2024 in SA 329 of 2024 – DRT-I Hyderabad)

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02.09.2025

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PNB Housing Finance Ltd., having registered office at 9^th floor, Antriksh Bhawan, 22, Kasturba Gandhi Marg, New Delhi – 110001 and Branch office at 7, Kyd Street, 5^th floor, Kankaria Mansion, Kolkata – 700016.

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... Appellant

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M/s Cyrus Diagnostic Centre at H. No.18-107/1, Road No.5, Hanumanpet Medichal, Malkajgiri, Dist. Telengana – 500047.

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M/s. Vishwashanti Enterprises at 16-6-687, Chanderghat, Hyderabad, 500003.

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... Respondents

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For Appellant For Respondent : None

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: Ms. Kasturi Dasgupta, ld. Adv.

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The Appellate Tribunal

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Heard learned counsel for the appellant. Despite service, respondents are not represented.

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Instant appeal has arisen against the order dated

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23.10.2024 passed in I.A. 2186 of 2024 arising out of S.A. 329 of

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2024 (M/s. Cyrus Diagnostic Centre Vs. PNB Housing Finance

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Ltd.) whereby learned DRT-I Hyderabad allowed the I.A. with the direction to redeliver the possession with certain conditions to the

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securitization applicant to deposit the rent in the loan account

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and vacate the schedule property to the auction purchaser.

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Feeling aggrieved by the impugned order, appellant financial institution preferred the appeal.

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Learned counsel for appellant at the very outset submits that impugned order suffers from material illegality and irregularity wherein learned DRT has not given any reason while arriving at a conclusion. It is further submitted that there are material issues which should have been considered by the learned DRT regarding creation of mortgage as well as execution of lease

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deed dated 02.05.2018 and 30.01.2021 respectively. It is submitted that lease deed, allegedly, a registered document, but

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the same is an un-registered document. These contentions are

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also to be looked into.

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Perusal of the impugned order reflects that learned DRT has

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simply recorded the submissions made by the parties and finally passed the impugned order to redeliver possession to the securitization applicant without assigning any reason for the same.

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It was held by the Hon'ble Apex Court in Union of India &

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Another -vs- Baroda Pharmaceuticals Limited [(2003) 11

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SCC 688] that if the High Court has not given any reason of its

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own in allowing an application, there is no option left but to set

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aside the order under challenge. It means that reasons have to be assigned for arriving at a conclusion by the Court. An order

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without reason is nothing but an arbitrary exercise of powers.

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7 . In Brijmani Devi -vs- Pappu Kumar and another

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(2022) 4 SCC 497 , a three judges Bench of the Hon'ble Apex

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Court has placed reliance upon a judgment of the Hon'ble Apex

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Court in Kranti Associates Private Limited and another -vs-

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Masood Ahmed Khan and others (2010) 9 SCC 496 wherein

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it was held that -

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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.

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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.

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32.4. Reasons have virtually become as indispensable a component of decision-making process as observing principles of natural justice by judicia quasi-judicial and even by administrative bodies.

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32.5. The ongoing judicial trend in all countries committed to rule law and constitutional governance is in favour of reasoned decisions base on relevant facts. This is virtually the lifeblood of Judicial decision-making justifying the principle that reason is the soul of justice.

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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 o common purpose which is to demonstrate by reason that the relevant fact have been objectively considered. This is important for sustaining the litigants' faith in the justice delivery system.

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32.7 Insistence on reason is a requirement for both judicial accountability and transparency.

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32.8. If a Judge or a quasi-judicial authority is not candid enough about his/her decision-making process then it is to know whether the person deciding is faithful to the precedent or to principles of incrementalism. impossible doctrine of precedent or to principles of incrementalism.

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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.

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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 (See David Shapiro in Defence of Judicial Candor19) scrutiny.

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(See David Shapiro in Defence of Judicial Candor 19)

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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 "due process".

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"34. The Latin maxim "cessantic ratione legis cessat ipsa 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."

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8 . Hon'ble Apex Court has specifically held that if a judge or a

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quasi-judicial authority is not candid enough about his/her

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decision-making process, then it is impossible to know whether a

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person deciding is faithful to the doctrine of precedent or to principles of incrementalism.

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9 . Though the judgment of the Hon'ble Apex Court was rendered in a matter of bail to an accused but the Hon'ble Apex

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Court has laid down the principles for recording of reason for a decision arrived at by a Court or for that matter even a quasijudicial authority. Hence, the law laid down by the Hon'ble Apex

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Court in the above case is binding upon all the Courts including

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the quasi-judicial Authority.

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10 . In a recent judgment by the Hon'ble Apex Court in State

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Project Director, UP Education for All Project Board & Ors.

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-vs- Saroj Maurya & Ors. [2024 SCC OnLine SC 2602] decided

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on 21^st August, 2024, Hon'ble Apex Court has placed reliance

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upon its own judgment in CCT -vs- Shukla & Bros [(2010) 4

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SCC 785] wherein the Hon'ble Apex Court has held that -

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24. Reason is the very life of law. When the reason of a law once ceases, the law itself generally ceases (Wharton's Law Lexicon). Such is the significance of reasoning in any rule of law. Giving reasons furthers the cause of justice as well as avoids uncertainty. As a matter of fact, it helps in the observance of law of precedent. Absence of reasons on the contrary essentially introduces an element of uncertainty, dissatisfaction and give entirely different dimensions to the questions of law raised before the higher/ appellate courts. In our view, the court should provide its own grounds and reasons for rejecting claim/ prayer of a party whether at the very threshold i.e. at admission stage or after regular hearing, howsoever concise they may be.

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25. We would reiterate the principle that when reasons are announced and can be weighed, the public can have assurance that process of correction is in place and working. It is the requirement of law that correction process of judgments should not only appear to be implemented but also seem to have been properly implemented. Reasons for an order would ensure and enhance public confidence and would provide due satisfaction to the consumer of justice under our justice dispensation system. It may not be very correct in law to say, that there is a qualified duty imposed upon the courts to record reasons."

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11 . In Sailesh Bhansali -vsAlok Dhir (2025 SCC OnLine SC

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512) Hon’ble Apex Court held that whether or not there was application of mind can only be disclosed by reason howsoever

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briefly alluded to. If any authority is required one may profitably

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refer to a decision of this Court in Rani Lakshmi Bai Kshtriya

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Gramin Bank -vsJagdish Sharan Varshney) [(2009) 4 SCC

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240].

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12 . Bare perusal of the impugned order would reveal that it does

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not reflect as to what persuaded the Learned DRT to pass a direction to redeliver the possession. Reasons for an order would

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ensure and enhance public confidence and would provide due

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satisfaction to the consumer of distress under our justice

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dispensation system as reason is the very life of law. Absence of

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reasons, on the contrary, essentially introduces an element of

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uncertainty, dissatisfaction and give entire dimensions to the question of law raised before higher/appellate authority. Court should provide its own grounds and reasons for passing an order at the admission stage or regular hearing; howsoever concise

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they may be. Learned DRT has not recorded any reason for passing the impugned order.

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