Allowed

Bank Of Baroda v. Aaj Ka Anand Papers Ltd.

DRT15 Jul 2023MA/25/2022

Case brief

AI extract

What is this about?

In this Miscellaneous Application, the Debts Recovery Tribunal, Pune allowed a Bank of Baroda's request to restore an original deb recovery application dismissed for want of prosecution. The Tribunal held that the dismissal was due to a bona fide error by the advocate regarding newly amended RDB Act provisions, and the public interest in recovering the loan justified restoration.

What did the court decide?

The Original Application No.896/2016 was restored to its original file subject to the payment of Rs. 50,000 costs to the Prime Minister's Relief Fund within two weeks.

Bank Of Baroda versus Aaj Ka Anand Papers Ltd. — Banking and Recovery | DRT (2023)

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Presented on: 21.09.2018 Registered on: 18.04.2022 Decided on: 15.07.2023 Duration: Y M D 4 9 25

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IN THE DEBTS RECOVERY TRIBUNAL AT PUNE (Before Shri Dilip G Murumkar, Presiding Officer)

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MISCELLANEOUS APPLICATION No.25/2022

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Bank of Baroda,

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A Body Corporate constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 having its Head Office at Baroda House, Mandvi, Baroda-390 006 and a Branch Office amongst other places at Lanjekar Building, Second Floor, Market Yard Road, Gultekdi, Pune-411 037 known as Asset Recovery Management Branch, Pune.

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… Applicant

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Versus

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Aaj Ka Anand Papers Limited,

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1. Registered Office Aaj Ka Anand Building, 365, Shivajinagar, Pune-411 005

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: 2) Branch Office Survey Nos.236 aand 237, Village: Hinjewadi, Taluka: Mulshi, District : Pune.

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Mr. Shyam Gyaniram Agarwal,

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Age-Adult, Occupation: Business, Residing at: 365/6, Shivajinagar, Pune411 005.

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Mr. Anand Shyam Agarwal, Age: Adult, Occupation: Business, Residing at: 365/6, Shivajinagar, Pune411 005.

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Mr. Navin Shyam Agarwal, Age: Adult, Occupation: Business, Residing at: 365/6, Shivajinagar, Pune411 005.

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Mrs. Vidya Shyam Agarwal, Age: Adult, Occupation: Business, Residing at: 365/6, Shivajinagar, Pune411 005.

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Mrs. Ritu Anand Agarwal, Age: Adult, Occupation: Business, Residing at: 365/6, Shivajinagar, Pune411 005.

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State Bank of India, Industrial Finance Branch, Pune [Lead Bank and Member Bank of The State Bank of India Consortium] Branch Office: Tara Chambers, Mumbai-Pune Road, Pune-411 003.

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Axis Bank Limited, [Member of The State Bank of India Consortium] Branch Office:

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214-215, City Mall, 2^nd Floor, Plot No.1, Survey No.132, Ganeshkhind

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(University) Road, Pune-411 007.

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SBICAP Trustee Company Limited [The Security Trustee], : Registered Office Appejay House, 6^th Floor, 3, Dinshaw Wachha Road, Churchgate, Mumbai400 020.

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… Opponents

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APPEARANCES

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For the Applicant Mrs. Sanobar S. Irani - - Advocate For Defendants Mrs. Priti Bhat – Advocate

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JUDGMENT

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(Delivered on 15^th July, 2023)

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This is an Application filed by the applicant Bank for restoration of Original Application No.896/2016 (hereinafter referred to as Original Application’) dismissed for want of prosecution on 30<sup>th</sup> August, 2018 u/s 22(2) r/w Sec.19(25) of The Recovery of Debts and Bankruptcy Act, 1993 (hereinafter referred to as RDB Act’).

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The facts elucidated in the application can be summarized as under:

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The applicant Bank which is one of the joint lenders of the member Banks of State Bank of India Consortium, comprising of Bank of India (Lead Bank) and Axis Bank

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Ltd. (Member Bank), who had advanced loan to the present Opponents. As Opponents failed to repay the loan, the present applicant Bank filed Original Application No.896/2016 on 10^th November, 2016 for recovery of Rs.21,96,26,128.24Ps. (Rupees Twenty-One Crores NinetySix Lakhs One Hundred Twenty-Eight and Paise TwentyFour only).

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Summonses were issued. The present Opponent Nos.1 and 2 appeared on 29^th March, 2017 and filed an Interlocutory Application bearing No.441/2017 for dismissal of Original Application No.896/2016, on the ground that Original Application is not as per Format prescribed by amended RDB Act. Therefore, the applicant Bank filed Interlocutory Application No.557/2017 dated 28^th April, 2017 for making amendments in Original Application in accordance with amended provisions of RDB Act. Further, Interim Applications (No.557/2017 and 1255/2017) have been withdrawn by both parties due to discrepancy. Thereafter, again the applicant Bank filed fresh Interlocutory Application No.1255/2017 for making amendments in Original Application and Opponent Nos.1

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and 2 filed Interlocutory Application No.112/2018 claiming same reliefs as claimed in earlier Interlocutory Application No.112/2018.

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On hearing both Interim Applications, Predecessor of this Tribunal dismissed Interlocutory Application No.1255/2017 for amendments filed by the applicant Bank and allowed Interlocutory Application No.112/2018 of Opponents Nos.1 and 2. So also Original Application No.896/2016 has been dismissed for want of evidence by Order dated 30^th August, 2018.

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Being aggrieved by this Order, the applicant Bank has filed this application for restoration of Original Application No.896/2016 on the following grounds:-

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Original Application has been dismissed for want of prosecution as Affidavit of Evidence is not filed by the applicant Bank along with the Original Application at the time of filing the same. The learned Advocate appearing for the applicant Bank was under a bonafide impression that Affidavit of Evidence would be filed once the pleadings were perfected on amendment, as the pleadings were incomplete one. The non-filing of

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Affidavit of Evidence by the applicant and its Advocate was not a deliberate act, but was a bonafide error on the part of learned Advocate for the Applicant for which applicant should not be made to suffer.

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Therefore, the applicant Bank has claimed relief that Order dated 30^th August, 2018 of dismissal of Original Application No.896/2016 for want of prosecution may be set aside and Original Application may be restored. So also the Application for Leave to file Claim Affidavit by the applicant may be taken on record along with Claim Affidavit (Affidavit of Evidence) of the applicant and supporting documents.

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The Opponent Nos.2 to 6 by filing Reply (Exhibit-12) resisted the Application.

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It is contended that since Original Application No.896/2016 has been dismissed by Order dated 30^th August, 2018, Debts Recovery Tribunal, Pune has become Functus Officio having no powers in the said matter. Thus, further Application/Evidence cannot be entertained in this matter.

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It is further contended that the Original Application

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No.896/2016 has been dismissed for want of evidence and not for default and therefore, it is final Judgement which cannot be modified or set aside.

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Therefore, Application may be rejected.

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The applicant has filed Written Notes of Arguments (Exhibit-13) in which contentions in the Application are reflected.

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Further, the learned Advocate for the applicant relied on the following Authorities produced along with List (Exhibit-11):

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1) 2014 SCC Online Bom 152 – Bombay High Court Harsukh B. Gohel – Plaintiff Vs.

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Vinod Kumar Bindlish & Ors. [Restoration of Suit];

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2) Madras High Court – 13.07.2017 M/s. Kamatchi Envelops Vs.

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Corporation Bank & Ors.

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[Judgement of the Madras High Court upheld by the Hon’ble Supreme Court on 27.09.2021] and

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3) (1994) 4 Supreme Court Cases 710 Industrial Credit And Investment Corporation of India Limited Vs.

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Grapco Industries Limited and Others [Paras 10 and 11 on Page 7]

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Per contra, the learned Advocate appearing for defendant No.2 to 6 filed Written Notes of Arguments (Exhibit-7) in which contentions in the Reply are reflected.

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Further, the learned Advocate appearing for Opponents relied on following Authority: R.B. Agarwalla & Company & Another vs.

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Union Bank of India and Others [A.P.O.T. No.376 of 2012, G.A. Nos.2150, 2252 of 2012 & W.P. No.631 of 2008].

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The following points arise for my determination: (1) Whether the grounds for restoration of Original Application No.896/2016 are adequate and sufficient for restoration?

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(2) What Order?

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FINDINGS:

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(1) In the Affirmative.

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(2) As per final Order below.

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REASONS

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Point Nos.1 and 2:

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I have considered submissions of both the parties and Authorities cited on behalf of both applicant and Opponents.

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I have perused the impugned Order dated 30^th August, 2018 passed in Interlocutory Application No.1255/2017 and Interlocutory Application No.122/2018 in Original Application No.896/2016. My Predecessor by relying on findings recorded in aforementioned Interlocutory Applications has dismissed Original Application No.896/2016 for want of Evidence. My Predecessor had taken into consideration the amendments in Sec. 19(3) and 19(10) of RDB Act made on 04^th November, 2016.

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As per the amendment in Sec.19(3), the applicant when files Original Application for recovery of amount, he has to file it in specific Format and particulars required to be mentioned in the Application are elucidated by introduction of Sub section 3A to Sec.19. So also by the amendment in Sec.19(10A), it has made mandatory to the parties to Original Application that Application or Written Statement with Application shall be supported by an Affidavit sworn in by the applicant or defendant verifying all the facts and pleadings, the statements pleading documents and other documentary evidence.

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Further, it is mandatory to the parties that if there is

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any evidence of witness to be led by any party, the Affidavits of such witness shall be filed simultaneously by the party with the Application or Written Statement.

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Further, sub section (10B) has been introduced to Section 19 which provides that if any of the facts or pleadings in the Application or Written Statement are not verified in the manner provided under sub section (10A), a party to the proceedings shall not be allowed to rely on such facts or pleadings as evidence or any of the matters set out therein.

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At this juncture, it is to be noted that before amendment, parties were not required to file Affidavit or Evidence of witnesses along with Application or Written Statement. Further, particulars as mentioned in amended sub-Rule (3A) of Section 19 were not mandatory before amendment.

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Most pertinent is that the amendment to aforementioned Section 19 has been made on 04^th November, 2016 and present Original Application was filed on 10^th November, 2016 i.e. within a week after introduction of new provisions in RDB Act.

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Taking into consideration these facts, an inference could be drawn that neither litigants nor their Advocates were well acquainted with amended provisions as they were new amendments. Therefore, in the present case, the possibility that Advocate for the applicant Bank was not acquainted with aforementioned amended provisions of RDB Act cannot be ruled out. Thereafter, when present Opponents took objection, the applicant Bank tried to rectify the mistake by filing Interlocutory Application for amendments.

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It is to be noted that this Tribunal has an experience that in many Original Applications filed after amendment are filed without Claim Affidavit of Evidence and documents and Interlocutory Applications for taking those documents on record are being filed.

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In view of these facts, I am of opinion that client should not suffer for mistake of his Advocate as made in the present case. The amount to be recovered from the Opponents is more than Rs.21 Crores which is public money. Further, Opponents will get an opportunity to contest Original Application filed by the applicant Bank in which substantial

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justice would be rendered.

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That apart, impugned Order is not final order as Original Application No.896/2016 has not been disposed of on merits.

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At the finale, I hold that grounds mentioned in the Application are adequate and suffice to restore the Original Application No.896/2016. Therefore, application deserves to be allowed.

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Before parting with Order, I mention with great regard that Authorities cited supra on behalf of present Opponents are not helpful to them whereas Authorities cited supra on behalf of applicant Bank are applicable to present case.

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Now, I proceed to pass the following final Order:-

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ORDER

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(A) The Miscellaneous Application No.25/2022 is allowed.

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(B) The Original Application No.896/2016 be restored to its Original File subject to payment of costs of Rs.50,000/- (Rupees Fifty Thousand only) to be paid by the applicant Bank to Prime Minister’s

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Relief Fund, within two weeks from today.

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(D) The applicant Bank shall take necessary steps for bringing the Original Application No.896/2016 in line with the Format of Original Application as per amended RDB Act, after its restoration.

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(E) This Application is disposed of.

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Pronounced in open Court.

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Sd/- (Dilip G Murumkar) Place : Pune Presiding Officer Date : 15.07.2023 Debts Recovery Tribunal, Pune

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(MA No.25/2022)

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Bank Of Baroda v. Aaj Ka Anand Papers Ltd.

Case brief

What is this about?

What did the court decide?

Bank Of Baroda v. Aaj Ka Anand Papers Ltd.

Case brief

What is this about?

What did the court decide?

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