Dismissed

Arcil v. M/S Bhanu Iron and Steel Ltd. and Ors.

DRT9 Dec 2024MA/42/2024

Case brief

AI extract

What is this about?

The Presiding Officer of the Debt Recovery Tribunal, Delhi, dismissed an applicant's application under Section 26(2) of the RDB Act seeking correction of the decretal amount. The court held that the Tribunal lacks power to correct the recovery certificate as the claimed error pertained to substantive calculation rather than clerical or arithmetical mistakes, precluding reappreciation of evidence.

What did the court decide?

Application MA no.4212024 dismissed.

Arcil versus M/S Bhanu Iron and Steel Ltd. and Ors. — Banking and Recovery | DRT (2024)

Debts Recovely Tribunal-Il, Delhi

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nAl42l2O24

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ARCrL VS. M/S BHANU rRON AND STEEL^LTD. AND ORS.

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Reserued on: 26.1L.2024

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Pronounced on : 09.L2.2024

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Present

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Shri Sudhir Kumar Makkar, Senior^Advocate along with Sh. R.P.Aggarwal, Ms.^Manisha \ Aggarwal, counsels for applicant FI. Shri Pallav Saxena, counsel for^respondent no.l & 2.

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Matter is taken through V.C./Hybrid mode.

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MA no.4212024 has been filed on behalf of^the appticant FI under Section 26⁽²⁾ of the^{RDB Act, 1993} r/w Section 152 of Code of Civil Procedure for^correction of the arithmeUcal mistake in the decretal^amount awarded by the Final order dated 06.01.2018^{in OA No.} L66l200L The applicant is filing the^{revised statement of} accounts and^praying for correction of^arithmetical mistake in the decretal amount mentioned in^{the Final} Order dated 06.01.2018 and for the^{consequential} correction of the amount mentioned in the^Recovery Ceftificate.

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The Ld. Sr. Advocate of the applicant^has submitted that an OA was fited by ICICI^{Bank for} recovery of Rs.35,03,84,516.4L as on 15.03.2001^which was the total outstanding in all the loans^includingthe amount claimed by the applicant bank^towards Liquidated Damages. The Ld. Tribunal^passed final^order dated 06.01.2018 in favour of the Applicant^{FI while} rejecting the claim of liquidated damage and^{directed the} Applicant FI to file a fresh statement^{of account, after} deduction of the amount liquidated damages

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and interest charged thereon the^liquidated darrg"r. However, on account of an^{inadvertent error,} the final order mentioned the amount^{recoverableas} Rs.35,03 ,84,5L6.4L as on 15.03.2001, which^evidently included the Liquidated Damages. The Hon'ble^Tribunal has expressly disallowed the claim of the Applicant^Bank towards Liquidated Damages, but the final order^passed mentioned the recoverable amount^as Rs.35,03 ,84,5L6.41 as on 15.03.2001, which appears to be an inadvertent error. In compliance with the^said direction, the Applicant FI had filed a Statement^{of Dues} dated 27.07.2018 before the Ld. Recovery Officer^after reducing the amount of the Liquidated Damages^from the OA claim amount of Rs.35,03 ,84,5L6.4L.^But however, the reaovely certificate was issued for the entire ctaim amount as^prayed for in the OA i.e.^{for a} sum of Rs.35,03,84,516.4L, inclusive of the^liquidated damages which was disallowed. Therefore, the^Applicant is required to move the instant applicaUon to^{rute out the} possibility of any confusion in as much as on account of an apparent contradiction in the language of^{the final} order the applicant has not been able to recover^the amount for which the OA was decreed, despite^{lapse of} nearly six years. The amount recovered from the^{sale of} shares of the Guarantor, is lying with the^{registry of this} Hon'ble Tribuna! and owing to frivolous objections^raised by the certificate debtors from time to time the^applicant bank has not been able to recover its lawful^{dues. Thus} without^prejudice to r:ights of the Applicant^{Bank to take} recourse to other legal remedies, the applicant^{has filed} the piesent application^praying for correction of^the amount in the final order, if^{granted shall have the effect} of obviating various frivolous objections^{raised by the} certificate debtors to stall of the decree. It

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is further submitted that the Applicant filed^TMA No.14l2022 before this Hon'ble Tribunal in line with^the issue about the statement of accounE and the same^was disposed of vide order dated 22.L2.2023 with^the obseruation that it is the duty of the applicant FI to^file the clear amount which was due on the date decided by this Tribunal and also specifically mention the amount of the liquidated damages on such date and also the interest charged on the liquidated damages on that date. It is submitted that the comptete details of date wise levying of liquidated damages as well as the details of charging of compound interest on the amount of liquidated damages has been^given in the Statement of Account of ICICI Bank filed in the OA. The calculation of dues as on 15.03.2001 after deduction of liquidated damages and interest on liquidated damages is filed as Annexure - B of the IA. Though the claim filed in the OA was as per the Statement of dues calcutated as on 15.03.2001 in terms of the said orders, the claim has been crystallized as on the dat€ of filing of the OA^i.e. 29.06.2001 only. Hence the dues calculated as on 15.03.2001 excluding the Liquidated damages and the interest charged thereon, has been based on the Statement of Accounts filed by ICIG Bank in the OA and this is the total outstanding dues as^per the^finai decree dated 05.01.2018 of the Hon'bte DRT^passedin the above OA. It is further submitted that loan^wise ledger sheets as maintained by ICICI under^Bankersi Books Evidence Act has been Rled in the OA. A separate similar statement as on 15.03.2001 cannot be^generated by IARC, as the account was stitl with ICICI^Bank at that time. This appticant could^generate a statement of account only from the date of the^{Decree/RC, and that} too based on the account of ICICI.

Statement of Account filed by ICIG^{Bank, the original} Applicant is the basis and the suppofting^{document on} the basis of which the calculation^{in Annexure- B filed} herewith has been^prepared. It^is fufther^{submitted that} the complete Statement of Account^{has already been} filed with the OA and the same^{was exhibitedas Exhibit} AW 2ll and Exhibit AW 213 in the^{above OA. This Ld.} Tribunal vide finat order dated 06.01.2018^{has already} dismissed the objections^raised by^{the defendantswith} respect to the said statement of account.^Accordingly, prayer is made for correction of arithmetical mistakeⁱⁿ the decretal amount menUoned in the^{Final Order dated} 06.01.2018 and for the consequential^{correction of the} amount menUoned in the Recovery^Certificate.

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The Ld. Counsel of the respondent^{no.l & 2 has} filed reply to the MA and submitted^{that the} respondent nos. 1 and 2 had^preferred a^Misc. Appfication bearing TMA No.t512022^beforethe Hon'ble Tribunal seeking recalling of final order^dated 06.01.2018. Vide order fted^{22.L2.2023,this Hontble} Tribunal disposed of the said TMA^{No.15/2022 while} holding that this Hon'ble Tribunal^{cannotre-appreciate} the evidence adduced by the^parties and^re-decideif the final order^passed by this Hon'ble^{Tribunal is bad in} law and requires any interuention, at this stage. It^is submitted that the applicant^{previously filed a TMA} no.L412022 wherein the applicant submitted^{that the} only issue that required clarification^{was with regardto} the amount recoverable under the^{recovery certificate} issued by this Tribunal vide final order^dated 06.01.2018 and vide order^{dated 22.L2.2022 this} Tribunal has already dismissed the^{TMA of the} applicant while holding that applicant stands in

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gross non compliance of the mandate of the final order^passed by this Tribunal and^{it is the duty of the} applicant FI to file the clear amount^{which was due on} the date decided by this Tribunat and^{also specifically} mention the amount of the liquidated damages^on such date and also the interest charged on^the liquidated damages on that.date. Fufther,^{the Ld. RO} vide order dated 05.07.202L has^{categorically} observed that the Applicant FI stands^{in continuous} and contemptuous non-compliance of the^{mandate of} the final order and referred the matter to^{this Hon'ble} Forum. The said order was also assailed by^the Applicant FI in an appeal bearing Transfer^Appeal No.212022 before this Hon'ble Tribunal.^{Vide order} dated 10.04.2024, this Hon'ble Tribunal^{observed and} came to a finding that the Applicant FI^indeedhas disobeyed the mandate of the finat order^{and has} failed to file the Statement(s) of account(s)^{before the} Ld.RO as well as this Hon'ble Tribunal. It^{is submitted} that the order dated 22.L2.2023 has not^{been assailed} by the Applicant FI in an appeal and^{the samehas} thus attained finality against the Applicant^FI. It^is submitted that the^present M.A. is also barred^{by the} doctrine of res^judicata, in Iight of orders^dated 22.L2.2023 and is liable to be dismissed on this^ground alone. Further, without^prejudice, by applying^the doctrine of approbation and reprobation, the^Applicant cannot be permitted to seek^{purported correctionsin} the final order dated 06.01.2018 while having already derived unlawful benefits in the execution^thereof. Therefore, the^present M.A. is liable to be^{dismissed on} this ground alone. It is submitted that by^{making the} impugned allegation as aforesaid, the applicant^has actually proceeded to and support the

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contention of the defendants 1 and 2 that this Hon'ble Tribuhal was hoodwinked by the Applicant into passing the final'order dated 06.01.2018. The applicant has raised the impugned allegation in order to cover up and camouflage its fraudulent ctaim and^its inability to support the same by^producing on record cogent documents and evidence, which finding^has been unequivocally returned by this Hon'ble^Tribuna! vide order dated 22.L2.2023 in TMA No.L412022. Fufthermore, an application for correction/modification would be patently barred by limitation. Even if residuary afticle L37 of the Limitation Act,^'1963 is to be applied, the application would be^patently barred by Iimitation. It is submitted that by virtue of^paras 17(iv) and 1S (ii) of the Final Order dated 06.01.2018, the Applicant is under an indefeasible obligation to file the revised statement(s) of account(s) by removal of debit entries relating to liquidated damages, which shall unambiguously result into reversa! of the aforesaid amount as also reversal of interest levied thereon. The reversal of debit entries would be value dated and, therefore, ary suggestion to numerically subtract a sum of Rs.4,41,11,959.00 from the suit amount of Rs.35,03 ,84,5L6.4L so as to arrive at the^purpofted base figure of Rs.30,62,72,921.41 is illegal, untenable, preposterous, unwarranted, misleading and misconceived. Til! date the Applicant has contemptuously and willfully not complied with^the mandate of the final order as also the Recovery Ceftificate. The said finding has been specifically^given by the Learned Recovery Officer in order dated 05.07.2021 and also by this Hon'ble Tribunal in order dated 22.t2.2023 and L0.04.2024. The Applicant^is indeed required to recast the re statement(s) of

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account(s) filed by it in the Origina! Applicationⁱⁿ terms of the mandate of Final Order dated^06.01.2018 so as to become entitled to^pursue the^Recovery Proceedings. It is submitted that the Applicant^has been dishonesty filing computation of dues^{instead of} extracts of ledgers (Statement(s) of Account(s))ⁱⁿ terms of the mandate of the Final Order^dated 06.01.2018 as also orders dated^12.03.2018, 07.01.2020, 03.02.2020 and 05.07.2021^{passed by the} Learned Recovery Officer. The Applicant is^{guilty of} committing wilful disobedience of the orders and^so has been categorically held by this Hon'ble^Tribunal vide order dated 22.t2.2023. The Applicant^has evaded filing the Statement(s) of Account(s) as^there is an apparent error in the computation of^dues claimed in the Original Application. The^{predecessorin} interest of the Applicant filed Affidavit by way of Evidence dated 16.10.2003 of Mr. Karobi^Acharjee (AWl) deposing therein the availment of only one foreign currency loan whereas the Affidavit by way of Evidence dated 30.10.2003 of Ms. Jyoti K.^(AW2) refers to two foreign currency loans. The Applicant^has realized the falsity of the claim afticulated in the Original Application and apprehends^{prosecution for} having committed fraud on this Hon 'ble Tribunal and it is to avoid punitive consequences that the Statemen(s) of account(s) have not been filed despite the oeress mandate of the Final Order dated 06.01.2018 and the various orders^passed by the learned Recovery Officer. Therefore, it is^prayed to dismiss the^present application with^exemplary, speciat,^punitive and compensatory cost and^{reject the} prayer clause of the apptication in toto. The Ld. Counsel of respondent no.l &2hasrelied upon^the

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judgements M. Nagabhushana Vs. State of Karnataka and Ors.⁽²⁰¹¹⁾ 3^{sec 408; b. Ajay} Mohan Vs. H. N. Rai 2OO8⁽²⁾ SCC 507,^{Bharti Cellular} Ltd. Vs. Union of India & Ors.^{(2010) 10 sec t74; b. M/} s Cauvery Coffee Traders, Mangalore^{Vs. M/ s Homor} Resources (Intem.) Co. 1td.2011(10)^{SCC 420,} Madhui Singh Vs. Pavik Lifestyle^{Ltd. 2016 (232) DLT} 11, Prestige Lights Ltd. Vs. State^{Bank of India (2007)} 8 SCC 49, Continental Construction^{Ltd. and Ors. Vs.} State Bank of India and Ors.^MANU/DD1OO37 l20L7z^I (2018) BC 1 (DRAT), Meghmala vs. G.^Narasimha Reddy (2010) 8 SCC 383, State of^{Orissa vs. Harapriya} Bisoi 2009 AIR(SC) 299L: 2009(12)^{SC 378, Hillcrest} Realty Sdn. Bh. vs. Hotel Queen^{Road htt. Ltd. 2009} . (3) AdDel 54L, Maruti Udyog Ltd. Versus Film^C-entre& Anr. 1994 SCC OnLine Del 572,^{Century Flour Mills Ltd.} Vs. S. Suppiah and Others^{1975 SCC OnLine Mad 73,} Clark and Ors. Vs. Chadbum^{and Ors.} [1985]^{1 WLR 78} and Sujit Pal Versus Prabir^{KumarSun and Ors. 1985} SCC Online Cal 146.

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Heard the Ld. Counsels of both^{the partiesand} perused the record.

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The main contention of the^{Ld. Sr.Advocateof the} applicant is that the applicant is filing^{the revised} statement of account and is^{praying for the correction of} the arithmetical mistake in the decretal^amount mentioned in the final order dated 06.01.2018^anq consequential correction of amount in^{the recovery} ceftificate. It is submitted that this^{Tribunalin its final} order dated 06.01.2018 has directed^{that the recovery} certificate may be issued for an^amountof Rs.35,03 ,84,5\6.41 together with^{pendenteliteand} future interest. It is also^{recorded in the order that the}

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applicant is directed to file the fresh statement^of account after deduction of the^{liquidated damages and} interest charged thereon. It is^{submitted that the} applicant has filed the revised^{statement of account} before the Ld. Recovery Officer but^{the same has not} been accepted by the^Ld.R.O. It^{is submitted that the} applicant has filed a TMA before^{this Tribunal which is} numbered as TMA no.1412022 for^{paftial withdrqwal of} the amount. It is submitted that^{the TMA has been} dismissed by this Tribunal vide^{order dated 22-L2.2023.} It is submitted that the applicant^{has filed the clear} statement regarding the amount of^{the damagesand} therefore, this Tribunal should^{considerthe statementof} account and on the basis of^{the statement of account} correct the mistake in the^{recoverycertificate.On the} other hand the Ld. counsel for^{the respondenthas} vehemently opposed the contention of^{the application} and has submitted that this Tribunal^{has no jurisdiction} to reappreciate the evidence^{filed in the OA or Rled} subsequently along with this^{MA and cannot correctthe} recovery ceftificate. It is submitted^{that as per provisions} contained under Section 26(2) of the^{RDB Act, only} arithmetical mistake may be^{corrected. It is submitted} that this Tribunal has no^{jurisdiction to calculate the} liquidated damages and correct the^{same. It is submitted} that the^prayer of the applicant^{has alreadybeen} rejected by the Ld.RO because^{the applicant has failed to} file correct statement of account and^{therefore, the} present application is liable to be dismissed.

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I have considered the^{rival contentions of both the} parties. From perusal of the record it is clear^{that the} present application has been moved under Section²⁶⁽²⁾

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of the RDB Act. The^provisions of^{Section 26(2)}

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are reproduced as below:-

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26(2) "Notwithstanding the issue of a^{certificate to a} Recovery Officer, the Pruiding Offrcer^{shall have} PWer to withdraw the ceftificate or corrxt^{any clerical or} arithmetical mrrtake in the certrficate by *nding^an intimation to the RuoverY Offrcer."

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From perusal of the above^provision it^{is clear that the} Presiding Officer shall have^power to^withdrawthe certificate and to correct any^{clerical or arithmetical} mistake in the ceftificate. From^{perusal of the above} provision it is clear that the DRT has been^{given power} to correct clerical or arithmetical^{mistakes. This provision} clearly specifies that the^{mistakes which are of clerical or} arithmeticat may be corrected.^{In the provisionthe word} mistake has been^qualified by^{the word clerical and} arithmetical, therefore, this^{provision authorizethe} Presiding Officer to conect the^{mistakesthat's are only} clerical or arithmetical. The^{mistakeswhich are not the} clerical or arithmetical cannot be^{corrected underthis} provision. Therefore, this Tribunal is of the view that^as per provisions contained under Section 26(2) of the^RDB Act, the Presiding Officer of the^{tribunal can onty correct} clerical or arithmetical mistake. Other^{types of mistake} which requires reappreciation of^{the evidencecannotbe} corrected under this^{provision. The question is whether} the Tribunal has any^power to^{go through the evidence} Rled by the^parties and can come^{to the conclusionthat} the amount mentioned in the^{recoverycertificateis in} fact not correct and can decide^{the amount which is to}

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be recovered from the defendants.^{This Tribunalis of the} constant view that the Tribunal^{has not been givenany} power to scrutinize the again filed by^the

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parties and decide the actual amount which is to be recovered from the defendants.

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8, On the basis of above^{legal positionI have perused} the contentions of the applicant.^{The contention of the} applicant is that the amount of^{liquidated damages has} been mentioned in the evidence^{filed by the applicant} bank. The Ld. counsel of the^{applicant has referredthe} page no.763, 764 and 814 to 816,^page no.730 to⁷³² and 753 & 753,^page no.840 to^{842 and 864 to 866,} page no.893 to 895, page no.925 to^g27 and^page no.972 to 974 and 1009 to^{1011. The Ld. counselof the} applicant has also referred the^{evidence filed by the} applicant in the OA with^{regard to the interest charged} on liquidated damages and^{has referred the page no.} 765 to 766 and 817 to 819,^{page no.733 to 735, page} 754 to 755,^page no.843 to 845 and 867^{to 869,page} no.896 to 898,^page no.928 to 930 and^{page no.975 to} 976 and L0L2 to 1014. I^{have gone} through^{the above} evidence filed by the applicant^{in the OA. If this Tribunal} takes in to, consideration of these^evidencesand calculate the actual amount that^is to be^{recoveredfrom} the defendants, it will come within the^{category of} reappreciation of the evidence filed by the^{applicant in} the OA. Under^provisions of the Section²⁶⁽²⁾ of^{the RDB} Act this Tribunat has no such^power to reappreciate^the evidence and come to a different^{conclusionthat has} been finally decided by allowing the^{OA. Therefore, this} Tribunal is of the view that the contentions of^the applicant and the referencc of the^{evidenceby the} applicant cannot be considered because it^{will come} within the category of the review of the order^finally passed by this Tribunal and this Tribuna! has no

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authority to review its own order under^the provisions of Section 26(2) of the RDB Act.

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The next contention of the^{Ld. counsel of the} applicant is that the OA was decreed^{in'the year 2018} and the rccovery ceftificate^{was issued and despite} issuance of the recovery certificate^{the applicant has} failed to recover any amount^{from the defendantsand} therefore, great^prejudice is being^{caused to the} applicant. It is submitted^{that the recovery certificate} may be corrected so that the^{applicantmay be able to} receive the^payment which^{has been recoveredfrom the} defendants by sale of the^{shares.From perusal of the} record it is clear that the OA of^{the applicant was} decreed but it was directed to^{the applicantto file the} revised statement of account deducting^{the liquidate} damages and interest thereon.^{The applicant has filed} the revised statement of account^{which has not been} accepted by the Ld.RO.^{This Tribunal has also held in} TMA no. L412022 that the applicant^{has failed to file the} correct statement of account along^{with the suppofting} statement. It has also been obserued^{in the order} passed in the above TMA that it is the duty of^the applicant to file ctear amount^{which was due on the date} decided by this Tribunal and also^{specificallymention the} amount of the liquidated damages^{on such date and also} the interest charged on Iiquidate damages^{on that date.} Therefore, it is clear that the contentions^{of the applicant} has already been considered by this^{Tribunal and the} Ld.RO. Merely because the applicant^{has failed to receive} the amount recovered from the^{defendants,the recovery} certificate cannot be corrected. It^{is the established} principle of taw that equity cannot substitute the^law. There is no^p rovision in the^{RDB Act that the recovery}

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certificate may be corrected^{merely because} the Secured Creditor has failed to^{recoverthe amount} from the defendants. Therefore, on the^{basis of the} equity, the recovery certificate^{cannot be corrected.}

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This Tribunal has very^{limitedpor rer to correct the} recovery certificate. The^{power is only with regardto the} clerical and^{'arithmetical mistakes.From perusalof the} record it is clear that the^{mistakewhich the applicantis} claiming does not come within^{the category of clerical or} arithmetica! mistakes and^{therefore,the same cannotbe} corrected under the Section^{26(2) of the RDB Act.}

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In the light of the above,^{the MA no.4212024 is liableto} be dismissed.

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ORDER

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MA no.4212024 is hereby^dismissed.

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Fite be consigned to records.

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Dated :09.L2.2024

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\ (SUSHIL KU RASTOGI) PRESIDING OFFICER DRT.II, DCIhi

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Arcil v. M/S Bhanu Iron and Steel Ltd. and Ors.

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Arcil v. M/S Bhanu Iron and Steel Ltd. and Ors.

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