Disposed

Ms Moti Baba Filling Station v. State Bank of India

DRT13 Dec 2023SA/613/2023

Case brief

AI extract

What is this about?

This order addresses an interlocutory application seeking condonation of delay in physically filing e-filed pleadings regarding a challenge to a bank asset sale. The court analyzed the date of filing under e-filing rules, evaluating whether the conditional benefit of electronic filing dates applied despite a 14-day delay in submitting the hard copy.

What did the court decide?

The interlocutory application seeking condonation of delay is disposed of; the Registry is directed to register the main application if otherwise in order and to pass final orders within three weeks o

Ms Moti Baba Filling Station versus State Bank of India — Banking and Recovery | DRT (2023)

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IN THE DEBTS RECOVERY TRIBLTNAL^{- 1, KARNATAKA} AT BENGALURU

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PRESENT: Szu IMTI AZ ALI PRESIDING OFFICER

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Dated the l3th day of December,2023

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INTERLOCUTORY APPLICATION^{NO.696OF 2023}

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UNREGISTERED SECURITISATION^{APPLICATION (USA) DY NO. l42OF 2023}

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Between

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IWs Moti Baba Filling Station, (Proprietor, Basha Mahaboob), 116, HES Road, Old ESI Hospital, AmbedkarNagar,TBDam, Hosapete, Kamataka - 583225.

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Shanu Begam, Wo Basha Mahaboob, 116, HES Road, Old ESI Hospital, AmbedkarNagar,TBDam, Hosapete, Kamataka - 583225. . . ...Petitioners/applicants

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And

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The authorised officer, State Bank of India, Station Road, Main Branch, Hospet, Vijayanagar, Karnataka. ... Respondent/defendant

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, This Interlocutory Application having^{beenheard on20.06.2023in the presence}

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of Advocates M/s M A^{Rajendrb and RavikumaraP for the petitioners/applicantsand}

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Advocate Shri Nandish N J^{for the respondent/defendant, and stoodover to this day for} consideration, the Tribunal delivered^{the following:-}

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ORDER

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IA 69612023 was filed on 29.03.2023 under^{5.22(2)(h)of the Recoveryof Debts} and Bankruptcy Act, 1993^{(as amended from time to time)} -^{for short 'the RDB Act' -} \ praying to condone the delay of 20 days in^physical filing^{of the pleadings before the} Tribunal. The petitioners are none other^{thanthe applicantsin the aforementionedUSA.}

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IA No.696 of 2023 in USA Dy^No.l4212023

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The case set out by the petitioners/applicants through the notary attested affidavit of the 1't petitioner/l't applicant accompanying the IA in brief is^as follows:-^An application under 5.17(1) of the Securitisation and Reconstruction of^{FinancialAssets} and Enforcement of Security Interest Act,2002^(as amended^from time^{to time)} -^for short 'the Act' - challenging the sale held on 06.01.2023^{pursuant to the salenoticedated} 02.12.2022 was filed before this Tribunal by filing the^pleadings through e-filing on 16.01.2023 by paying the requisite fee of <42,7051- well within the^period of limitation^as prescribed under S.17(1) of the Act. However, the physical filing of the pleadings could not be filed immediately thereafter due to ill-health and hospitalisation of the family members of this applicant and as the applicants could not meet with the counsel to^give necessary instructions. There is a delay of 20 days in physical filing of the pleadings, which may be condoned.

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The respondent/defendant filed statement of objection refuting the prayer and contending as follows:- The application is not maintainable and hence the delay of 20 days cannot be condoned. There is a delay of 113 days in physical filing of the pleadings. On the above contentions, the respondent/defendant^prayed for dismissal of the^petition.

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The only point arises for consideration is as to whether the petitioners/ applicants are entitled to the relief^prayed for in the interim application?

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' 5. The Point:- The petitioners/applicants on 07.02.2023 filed an application under S.17(l) of the Act^praying to^set aside the sale held on^06.01 .zlz3,pursuant to the sale notice dated 02.12.2022. The applicants are none other than the borrowers of^a financial assistance availed on 2l .10.201 7 in the form of cash credit^{(hypothecation)} limit of 1100 lakhs from the State Bank of India under MSME scheme.

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The petitioners/applicants have a different version in paragraph 4 of the USA under the head 'limitation'. It reads as below:-

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"The applicants declares and confirm that this application is filed challenging the e-auction sale notice dated 02.12.2022, the copy of which is received as on 05.12.2022, wherein it is informed to the

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IA No.696 of 2023 in USA Dy No.14212023

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general public that auction will be held on 06.01.2023. Hence, from the date of the^quction sqle notice dated 02.12.2022, received as on 05.12.2022, this application is filed wilhin 45 days."

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Since the relief prayed for is to be granted with respect to the pleadings set forth in the application, the pleadings under the head 'limitation' has become immaterial and irrelevant. What really challenged is the sale held on 06.01.2023. Therefore, an application under S.l7(1) of the Act challenging the same ought to have been filed on or before 20.02.2023. However, the petitioners/applicants filed such application on 07 .02.2023 under Dy No.14212023 well before the stipulated period of limitation.

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The Registry on scrutiny of the application noted a few defects vide report of the scrutiny hand dated 13.02.2023. The Registrar vide order dated 14.02.2023 granted time up to 28.02.2023 for re-submission of the application after curing the defects, which was extended up to 15.05.2023 from time to time. In the meantime, the file was resubmitted along with IA 69612023 on29.03.2023. But the date of representation cannot be inferred from the file as there is no seal of representation. The scrutiny hand thereafter on 12.04.2023 noted that all defects cured except serial number (7), which was the defect of delay noted. Thereafter, the Registrar, instead of finally deciding the question arising out of the scrutiny of such application, vide order dated 12.04.2023 placed the matter before the Tribunal in the diary stage itself for hearing on the question of delay. The order reads as below:-

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"The date of e-filing is on 16.01.2023. I{hereas, the hard copy of the pleadings isfiled in this Tribunal , on 07.02.2023. There is a delay infilingphysical copy. Hence, the case is posted in diary stage for^{hearing before theHon'blePresiding Officeron 13.04.2023."}

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As per the scrutiny sheet, the date of receipt of the pleadings of the application in e-filing form in the Tribunal is 16.01.2023. A physical copy of the pleadings was filed on 07.02.2023 before this Tribunal. In exercise of the powers conferred by clause (ccd) of 5.36 of the RDB Act, the Central Government vide notification GSR 43(E) dated 22.01.2020 (made applicable with effect from22.01.2020) made the Debts Recovery Tribunals and Debts Recovery Appellate Tribunals Electronic

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IA No.696 of 2023 in USA Dy^No. I^4212023

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Filing Rules, 2020 (as amended from time to time) - for short 'the e-filing rules'^- for^e- filing of pleadings under the provisions of the Act and the RDB Act and for other matters. The e-filing of pleadings by the applicants was made mandatory and the pleadings filed in any other form was made not acceptable vide amendment of sub-rule (2) of R.3 of the e-filing rules by virtue of Debts Recovery Tribunals and Debts Recovery Appellate Tribunals Electronic Filing^(Amendment) Rules, 2023 dated31.01.2023. R.4 of the e-filing rules deals with the procedure for e-filing and it reads thus:-

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"(l) Pleadings as prescribedfor specific purposes under the Recovery of Debts and Bankruptcy Act, 1993, the Securitisation and Reconstructionof Financial Assets and Enforcement of Security Interest Act, 2002, may befiled by an applicant in electronicform, through the e-DRT system;

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@ After e-filing, the applicant shallfile a hard copy of the said pleading, along with a copy of the ocknowledgement for e-/iling within seven working days of the day of e-filing in^person or by his agent or by a duly authorized legal practitioner before the Registry ofthe Tribunal;

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(3) Llthere the pleading is filed in electronicform and in paperform by the applicant, before the Registry, the date of filing of the pleadings in the Tribunal shall be the date of submission of the last page of a pleading through the e-DRT system;

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' (4) The Tribunal may exercise its discretion to allow certain related documents to be filed only in the conventional manner, even when the applicant has made the^pleading by e-filing."

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The object of the e-filing rules is to give an easy access to the applicants to file their applications without delay within the period of limitation as prescribed under the respective Acts. Sub-rule⁽³⁾ of R.4 of the e-frling rules says that where the pleading is hled in electronic form and in paper form by the applicant, before the Registry, the date of filing of the pleadings in the Tribunal shall be the date of submission of the last page of a pleading through e-DRT system. Therefore, for all purposes, the date of presentation of an application before the Tribunal shall be the date of submission of the last^page of^a pleading through e-DRT system. However, this benefit is conditional and sub-rule (2) thereto prescribes a condition for the srune, which states that after e-filing, the applicant shall file a hard copy of the said pleading along with a copy of the acknowledgement for e-filing within seven working days of the day of e-filing. In the instant case, the petitioners/applicants filed the pleadings in USA Dy No.14212023 in e-DRT, as per the Registry, on 16.01 .2023. Therefore, in terms of sub-rule⁽²⁾ of R.4 of the e-filing rules, a

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IA No.696 of 2023 in USA^{Dy No.l4212023}

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hard copy of the same ought to have been^{filed on or before 24.01.2023but,as per the} seal of this Tribunal, the same^{was filed beforethis Tribunal only on 07.02.2023with a} delay of l4 days. Though^{a defaultclauseis not madeapplicablein the e-filingrules, it is} expressly made clear^{thereunderthat the benefit of the date of presentation of the} pleadings can be obtained by the^{applicant only if he satisfies the condition prescribed} under sub-rule⁽²⁾ of R.4^{of the e-filing rules without which, naturally,the date of} presentation of the pleadings shall^{go to the dateof presentationof the hard copy of the} pleadings before the Tribunal only. As stated^{above, an applicationunderS.l7(1) of the} Act challenging the sale held^{on 06.01.2023 ought to have been filed on or before} 20.02.2023 but the^{petitioners/applicantsfiled such application on 07 .02.2023 well before} such date. In the above^{circumstances, the benefit of date of presentationof the} application as under the e-filing^{rules is not applicableto the facts of this case. The} petitioners/applicants themselves have lapsed^{their right.}

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I 1. No original document has been^{producedby the petitioners/applicants} before this Tribunal in evidence^{along with IA 69612023.Even the photocopyof the} medical certificate^{producedin respectof the 1tt petitioner/l'tapplicantdoes not bear any} outpatient/inpatient number of the^{patient registered with the clinic. The medical} certificate does not bear any date^{of issuance.It is obvious that the same had been issued} at request. Even otherwise,^{he had been advisedto resumehis duties witheffect from} 04.10.2022 and the pleadings in^{physical form was filed beforethe Tribunalonly on} 07:02.2023. Therefore, no reliance^{can be placed on such medicalrecords.}

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Notwithstanding to the medical^{grounds,thoughthe provisionof law} quoted in the application is wrong, the IA^was, in^{fact, filed under S.5 of the Limitation} Act, 1963. It may be noted^{that by virtue of S.24 of the RDBAct the provisionsof the} Limitation Act, 1963 are, as^far as^{may be, made applicable to an applicationmade to a} The word 'application' as^per S.2(b) of^{the RDBAct takesin an application} :::r*,

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IA No.696 of 2023 in USA Dy No.14212023

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made to a Tribunal under S.19 of RDB Act only. Therefore, it may be noted that the provisions of the Limitation Act, 1963 are not applicable to an application filed under S.l7(1) of the Act. Moreover, vide order dated 12.07 .2023 in Miscellaneous Application IR No.10l ll20l9 in Securitisation Application IR No.3708/2018 this Tribunal categorically held that the Debts Recovery Tribunal has no power to condone the delay in filing application under S.17 (l) of the Act, which has become absolute and final.

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In the above facts and circumstances of the case, though the delay of 14 days in filing the hard copy of the pleadings before this Tribunal cannot be condoned, this Tribunal observed that the same had been filed well within the period of limitation as prescribed under 5.17(1) of the Act. Therefore, the delay of 14 days in filing the hardcopy of the pleadings before the Tribunal is immaterial. The IA is only to be disposed of accordingly with a direction to the Registry to register the application, if otherwise in order.

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' 14. In the result, IA No.69612023 is disposed of accordingly. The Registry is directed to register the USA Dy No.14212023, if otherwise in order. As the matter is pending for passing of final orders on merits of the case, the application, after registration, if any, shall be placed before the Tribunal for^passing of final orders^within three weeks from the date of registration, if any. Posted before the Registrar, for the needful, on 20.12.2023. No costs.

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[Dictated^{to my PA, transcribed by him, correctedand pronounced by mein the openTribunal on rhisrthe l3'h day of} December,2\23J \

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t^rMrlAZALr l PRESIDING OFFICER

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IN THE DEBTS RECOVERY^{TRIBLJNAL. 1,} KARNATAKA AT^BANGALORE

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PRESENT: SRI IMTI^{AZ ALT} PRESIDING OFFICER

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Dated the 13th daY of^{December,2023}

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INTERLOCUTORY^{APPLICATION NO.696 OF 2023}

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UNREGISTERED^{SECURITISATIONAPPLICATION} (usA) DY NO. 142 OF²⁰²³

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Between

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M/s Moti Baba Filling^Station, (Proprietor, Basha Mahaboob), 116, HES Road, Old ESI^HosPital, AmbedkarNagar,TBDam, Hosapete, Karnataka -⁵⁸³²²⁵ and another.

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.....Petitioners/applicants

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And

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The authorised officer, State Bank of India, Station Road, Main^Branch, Hospet, Vijayanagar, Kamataka.

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'..^{Respondent/defendant}

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ORDER

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),,,,

Ms Moti Baba Filling Station v. State Bank of India

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Ms Moti Baba Filling Station v. State Bank of India

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