Dismissed

P S Prakash v. Indian Bank

DRT20 Oct 2023MA/9/2022

Case brief

AI extract

What is this about?

Debt Recovery Tribunal dismissed an application to condone delay and set aside an ex parte final order in a banking recovery suit. The court held that inactivity and lack of diligence proved gross negligence, rejecting the plea that bank officials advised against contesting the case.

What did the court decide?

Debts Recovery Tribunal dismissed the petitioners' application to condone delay and set aside the ex parte final order along with the application for condonation of delay.

P S Prakash versus Indian Bank — Banking and Recovery | DRT (2023)

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IN THE DEBTS RECOVERY^{TRIBUNAL . 1, KARNATAKA} AT BENGALURU

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PRESENT: SRI IMTI AZ^ALI

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PRESIDING OFFICER

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Dated the 20th day^{of October,2023}

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INTERLOCUTORY^{APPLICATION NO. 1260 OF 2019}

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MISCELLANEOUS^{APPLICATION NO.9OF 2022} IN

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ORIGINAL APPLICATION^{NO. 838 OF 2016}

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Between

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P S Prakash, S/o Siddalnagaqqa, GopPenahalli,^UrbaniHobli, Channagiri, Deveanagere, Karnataka - 577215.

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Jayamma, W/o P SiddalingaPPa, Goppenahalli,^UrbaniHobli, Channagiri,^Deveanagere, Karnataka -^571215. 3. Chidanand^Sarjee, S/o ChandraPPa, Goppenahalli,^UrbaniHobli, Channagiri,^Deveanagere, . . . . . ...Petitioners/Defendants Karnataka -^517215.

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And

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Indian Bank. having^{its head office at} 5555,^{254-260, Avwai'} Shanmugam^{Salai, RaYaPatt{t,} Chennai,^TamilNadu -⁶⁰⁰⁰¹⁴ and branch^{among other Places at} GoPPenahalli,^Channagiri'- --^ . Devanagere,^{Karnataka - 57 7215'} ' ,"Pr.rented^{bY its Zonal Manager'} . ResPondent/aPPlicant K Selvaraj' ThislnterlocutoryApplicationhavingbeenheardon0g.l|.2022inthepresence of Advocates^{rws Shivaraj N Arali andGirish R for the petitioners/defendants and the}

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IANo.1260 of 2019 inMA9l2022 in OA 838/2016 2

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respondent/applicant being absent, and stood over to this day for consideration, the Tribunal delivered the following:-

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ORDER

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The petitioners/defendants on 15.04.2019 filed a Miscellaneous Application (MA) 912022 under 5.22(2)(h) r/w S.l9(25) of the Recovery of Debts and Bankruptcy Act, 1993 (as amended from time to time) - for short 'the Act' - praying to set aside the final order dated 30.06.2018 passed in OA 83812016.1A 126012019 was filed on 15.O4.2Olg under S.5 of the Limitation Act, 1963 praying to condone the delay of 267 days in filing the aforesaid MA. The petitioners are none other than the defendants in the aforesaid oA.

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The case set out by the petitioners/defendants through the notary attested affidavit of the I't petitioner/l't defendant accompanying the IA in brief is as follows:The defendants had engaged a counsel to appear in the aforesaid OA to defend the same. They entered appearance through counsel on05.02.2018 in the proceedings and prayed for written statement. But the bank officials advised them that contesting the case would hamper the possibility of out of court settlement. Therefore, the defendants did not participate in the proceedings. But during February 2019 they could know that a final order had been passed in the matter on 30.06.2018. These defendants have valid defences against the claim of the bank. The respondent/applicant is harassing these defendants in the guise of the aforesaid final order and hence the MA. But there is a delay of 267 days in filing the same, which may be condoned.

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The respondent/applicant was duly served with notice. Though a counsel in the proceedings on 28.01 .2021 undertook to file vakalath for the respondent/applicant, the respondenVapplicant was neither present nor was it represented in the proceedings thereafter and thus it remained absent.

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IA No. 1260 of 2019 in MA 912022 in OA 83 8/201 6

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' 4. The only point arises for consideration is as to whether the petitioners/ defendants are entitled to the reliefprayed for?

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The Point:- The respondent/applicant on 27 .07 .2015 filed OA 838/2015 as against the petitioners/defendants for recovery of the aggregate sum of <44,50,216l- due under various accounts with interest and costs from the defendants^jointly and severally and by sale of 9 items of B schedule immovable properties and A schedule standing crops therein. The said OA was allowed as prayed for with costs as per the final order passed on 30.06.2018. Pursuant to the final order passed, recovery certificate bearing No.l4l79 wai issued on 02.08.2018 for recovery of the certificate amount from the certificate debtors/defendants.

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5.24 rlw S.2(b) of the Act says that the provisions of the Limitation Act, 1963, shall, as far as may be, apply to an OA filed under S.19(1) of the Act. Needless to say, the instant application is governed by Art.l23 of the Limitation Act, 1963, which reads as follows:-

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Article Description of suit Period of Time from which period begins to limitation run 123 To set aside a decree passed Thirty The date of the decree or where ex-parte or to re-hear an days the summons or notice was not appeal decreed or heard exduly served, when the applicant parte. had knowledge of the decree.

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A careful reading of Art.l23 of the Limitation Act, 1963 would clearly

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show that when summons is duly served on defendant, the period of limitation for filing an application for setting aside a decree passed ex-parte will begin to run not from the date of knowledge of the decree but from the date of the decree itself. A perusal of the OA records show that the petitioners/defendants were duly served with summons in the OA on 05.06.2017. Petitioners 1 and 2ldefendants I and 2 fied vakalath on 10.01.2017 and the 3'd petitioner/3'd defendant filed vakalath on 18.08.2017. Thereafter, the lst petitioner/l't defendant filed a change of vakalath on 10.01.2018. The oral prayer made

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IANo.l260 of 2019 inMA912022 in OA 838/2016

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by the counsels for the petitioners/defendants for enlargement of time for filing written statement was rejected vide proceedings dated 09.L0.2017 as they did not file their written statement despite the lapse of the statutory period. Thereafter, the petitioners/ defendants remained absent and they were not represented and thus they were declared ex-parte in the proceedings on 20.06.2018. The ex-parte final order was passed on 30.06.2018. Therefore, MA 912022 ought to have been filed on or before 30.07.2018. But they filed the above applications beyond such period i.e., only on 15.04.2019. Thus, there is a delay of 259 days in filing such application.

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5.22(2)(il of the Act r/w O.9 R.l3 of the Code of Civil Procedure, 1908 , provides for setting aside an ex-parte final order against a defendant, which provides for two reasons, namely (i) summons was not duly served and (ii) sufficient cause preventing the defendant from appearing when the suit was called on for hearing. Admittedly, the petitioners/defendants were duly served rvith summons in the OA on 05.06.2017. Though they entered appearance through counsel in the proceedings they in their full sense wilfully chose not to contest the mater and thus remained ex-parte in the proceedings. In the above circumstances, the contention raised by the petitioners/ defendants to the effect that the officials of the respondent/applicant advised them not to contest the matter is unbelievable for a prudent man, especially when they had engaged a counsel to defend their case in the proceedings. The petitioners/defendants submit that they have valid defences against the respondent/applicant. If that be so, they have not explained as to why did not file a written statement of defence but chose to remain exparte in the proceedings. If they had done so it was at their sole risk and responsibility only. They cannot blame others for their own laches and irresponsibility. Such a lackadaisical attitude nurtured by the petitioners/defendants in a judicial proceeding cannot be appreciated rather tolerated by this Tribunal in any manner to set aside a final order passed against them as they only attracted the same by their own mistakes and

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IA No. I 260 of 20 19 in MA 912022 in OA 83 8i20 I 6

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lapses. The explanation offered by them cannot be believed even for a moment and it is only a cock-and-bull story invented by them to cover up their laches in defending their case. No valid case was put forth by the petitioners/defendants to grant the relief prayed for. They have further submitted that the respondent/applicant is harassing them on the guise of a final order got passed as against them and hence they have filed the MA. It may be noted that this Tribunal is not the proper forum for that and filing an MA like the instant one is not the proper course of remedy for the same. They have also submitted that they could be aware of the final order passed on 30.06.2018 only in February 2019. But they have not divulged as to how they could be aware of the same. A perusal of the records in the file of the recovery certificate bearing No.l4l79 shows that the petitioners/ defendants were duly served with a demand notice therein on 09.02.2019. It only means that the petitioners/defendants remained idle and only when they knew that their immovable properties are being proceeded against for recovery of the amounts due from them, they awoke from their deep slumber.

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This Tribunal is required to weigh the explanations offered by the petitioners/defendants and the acceptability of the same. The delay in this case reflects the inactivity and the inaction on the part of the petitioners/defendants. The law does not permit one to sleep and to seek one's relief as and when one desires. The failure on the part of the petitioners/defendants in not showing due diligence in filing the Miscellaneous Application at the right time and the inordinate delay taken in filing the same can only be construed, in the absence of any valid explanation, as gross negligence and lack of bonafides on their part. If ex-parte final orders are set aside on flimsy grounds like these, there would be no finality to the applications filed before this Tribunal, which would adversely affect the avowed object of the Act. Thus, IA 126012019 is devoid of any merit \ and thus is liable to be dismissed. Suffice it to say that MA 912022 also fails and is liable to be dismissed.

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IA No.l260 of 2019 inMA912022 in OA 838/2016

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In paragraph IV of the aforesaid MA, the petitioners/defendants have declared that there is delay in filing the same and, therefore, a sepffate application for condonation of delay has been filed along with such application. The petitioners/ defendants filed an interlocutory application 126012019 to condone the delay of 267 days in filing the MA. In the scrutiny sheet (as per clause 12 therein) the Registry has noted that the application is not filed within the period of limitation as^prescribed under the Act and IA 126012019 has been filed for condonation of delay in filing the same. Despite all these, overlooking the delay noted, the Registry in a casual manner on25.07.2019 placed the MA before this Tribunal for hearing on26.07.2019 in the dairy stage itself. While being so, the Registry on 17.02.2022 ordered to register the same and place before the Tribunal-in-charge for hearing on 18.02.2022 and thus the MA in the diary stage was got numbered as MA 912022. The Registry ought to have placed IA 126012019 before this Tribunal and on getting an order therein only should have proceeded to register the MA. De'spite bringing this fact time and again to the notice of the Registry, it has occurred so in this case also. The Registry of the Tribunal is required to be maximum vigilant and diligent and shall take note of the same for future guidance.

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In the result, IA No.l260l20l9 and MA 912022 are dismissed. IA Nos.l26112019,512021 and 28112022 are closed. No costs.

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[Dictated^{to myPA, transuibedby him, correctedand pronounced by me in the openTribunal onthis the 2dh day of} October,2123l

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\ V

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t^rMrrhzALr l PRESIDINC dTPICEN

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IN THE DEBTS RECOVERY TRIBLINAL - I, KARNATAKA AT BANGALORE

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PRESENT: Szu IMTI AZ ALI PRESIDING OFFICER

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Dated the 20tl'day of October,2023

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INTERLOCUTORY APPLICATION NO. 1260 OF 2019 IN MISCELLANEOUS APPLICATION NO.9 OF 2022 IN ORIGINAL APPLICATION NO. 838 OF 2016

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Between

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P S Prakash, S/o Siddalnagappa, Goppenahalli, Urbani Hobli, Channagiri, Deveanagere, Karnataka - 577215 and two others.

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Petiti oners/de fendants

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And

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Indian Bank, having its head office at 5555,254-260, Avvvai, Shanmugam Salai, Rayapattah, Chennai, Tamil Nadu - 600014 and branch among other places at Goppenahalli, Channagiri, Devanagere, Karnataka - 577215, represented by its Zonal Manager, K Selvaraj.

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Respondent/applicant

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OITDEIT

P S Prakash v. Indian Bank

Case brief

What is this about?

What did the court decide?

P S Prakash v. Indian Bank

Case brief

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