Dismissed

Mrs S Pankajam v. Central Bank of India

DRT22 Jan 2026MA/266/2024

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal rejected a Motion for Leave to Appeal praying for condonation of a 580-day delay in filing a set-aside petition alleging fraud and lack of notice, holding strict statutory limitations apply.

What did the court decide?

Motion for condonation of delay (MA.No.266/2024) and connected set-aside applications were rejected/dismissed.

Mrs S Pankajam versus Central Bank of India — Banking and Recovery | DRT (2026)

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MA 266/24 in OA No.682/2017

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22.01.2026

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IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

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Dated this the 22^nd day of January, 2026

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Present: SMT. S.V. GOWRAMMA Presiding Officer

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M.A. No.266 of 2024 in O.A. No.682 of 2017

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Dharsini Fish Farm Rep. by its Proprietor Mr.S.Balaji Kanchipadi Village and Post Thiruttani Taluk Thiruvallore – 631 204.

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S.Balaji S/o. Subramani Kanchipadi Village and Post Thiruttani Taluk Thiruvallore – 631 204.

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Mrs.S.Pankajam W/o.Mr.M.Subramani Kanchipadi Village and Post Thiruttani Taluk Thiruvallore – 631 204 ....Petitioner/Defendants -Vs- Central Bank of India Pattarai Perumbudur Branch Thiruvallore – 601 001 ….Respondent

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Counsels on record / appeared:

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Counsel for Petitioner : M/s A. Ramaswamy

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Counsel for Respondent : Sh. C. Ramaiah

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: - ORDER ON MA NO. 266 of 2024 - :

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The defendants No.1 to 3 have filed MA.No.266/2024 a petition under Section 5 of Limitation Act praying to condone delay of 580 days in filing set aside petition.

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MA 266/24 in OA No.682/2017

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22.01.2026

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The Defendant No.2 filed affidavit by swearing himself and on behalf of Defendant No.1 and Defendant No.3, contending that the applicant bank has filed the OA against the defendants claiming a sum of Rs.34,31,182/- as of 20.10.2017 from petitioners 1 to 3 / Defendants 1 to 3 together with interest.

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The defendants submitted that in the OA the petitioners were called absent and placed ex-parte and ex-parte final order came to be passed by this Tribunal on 02.02.2023. Consequently, a Recovery Certificate No.22 of 2023 was issued on 17.02.2023 in favour of Respondent / Applicant bank.

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It is further submitted that Defendant No.1 had availed a sum of Rs.20 lakhs as Term Loan to develop the business and Defendant No.3 stood as Guarantor to the said Term Loan and also offered her immovable property as security for due repayment of the loan thus availed by Defendant No.1 and executed Memorandum of Deposit of Title Deeds Doc No.6434 of 2011 dated 24.10.2011 before SRO, Thiruttani. It is contended that even though the Term Loan was sanctioned to Defendant No.1, the respondent / applicant bank did not fully disburse the amount as per Loan Sanction letter dated 21.09.2011.

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In view of non-disbursement of Term Loan of Rs.20 lakhs, the Defendant No.2 gave a Police complaint before Superintendent of Police, Thiruvallur District which was forwarded to Inspector of Police, District

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MA 266/24 in OA No.682/2017

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22.01.2026

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Crime Branch, Thiruvallur District. Upon enquiry, the Inspector of Police registered a case against the then Branch Manager of applicant bank in Crime Number 21 of 2014 for the offense under Section 406, 420 of IPC. As a consequence, the applicant bank’s Senior Regional Manager had conducted an inquiry into fraud committed by the then Branch Manager and submitted a detailed report on 09.02.2015 to the Field General Manager, Zonal Office, Chennai with findings to declare that the 16 Loan accounts as fraud and to file police compliant against the Branch Manager.

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After confirming that the then Branch Manager, in his official capacity committed fraud, hence on 23.02.2015, the Branch Manager of the applicant bank had given a Police Complaint before the Superintendent of Police, Thiruvallur District. The then Branch Manager, was arrested and remanded in judicial custody before Judicial Magistrate No.1, at Thiruvallur. The applicant bank had supressed all the above facts and clandestinely created an Exhibit A-5 document, as if the Defendant No.2 had executed the said document, only to save Limitation to and in favour of the bank. But in any situation, Defendant No.2 had not executed Exhibit A-5, as claimed by the respondent / applicant bank and the said document is forged.

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After completing a full-fledged investigation, the Investigation officer had filed a final report on 26.09.2017 before the Judicial Magistrate No.1 at Thiruvallur against the then Branch Manager as 1^st accused and Mr.

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MA 266/24 in OA No.682/2017

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22.01.2026

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Sathiyamoorthi as the 2^nd accused and the same was taken on file in CC No.118 of 2018 of the offense under Section 406, 409 and 420 of IPC, which is pending adjudication.

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In the above backdrop, during 1^st Week of June, 2024, a person claiming as Recovery Officer from this Tribunal visited the immovable property of defendants and issued Sale Proclamation Notice to bring the schedule property for sale. The pendency of the criminal complaint was also brought to the notice to the Recovery Officer.

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It is contended by the petitioners that no notice was served to them from this Tribunal. Due to ill health of 3^rd Petitioner and 2^nd Petitioner’s daughter, who was undergoing medical treatment, the petitioners could not file the set aside application immediately. Hence there is a delay of 580 days in filing set aside petition. The delay is neither wilful nor wanton but only to the aforesaid Bonafide reasons.

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It is submitted that Defendants have very good case on merits hence IA may be allowed as no prejudice would be caused to the applicant on the other hand irreparable loss and hardship would be cause to the defendants.

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Notice in MA was ordered to respondent / applicant bank by this Tribunal. Accordingly, the petitioner had issued notice and filed acknowledgment card evidencing service of notice to the respondent /

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MA 266/24 in OA No.682/2017

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22.01.2026

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applicant bank. Despite receipt of notice and appearing on 18.07.2025, 29.08.2025 and 06.11.2025, respondent bank did not choose to file counter. Hence opportunity to file counter by respondent bank was closed on 19.01.2026.

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Heard the submission of counsel on MA and perused the records.

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The bank has filed OA have recovery a sum of Rs.34,31,182/from the Defendant No.1 to 3 jointly and severally along with interest and cost till the date of realization. After filling OA on 21.10.2017, the Tribunal ordered summons on Defendant Nos.1 to 3. The bank has taken summons as directed by the Tribunal and summons sent to Defendant No.1 to 3. The Defendant No.2 had appeared before the Registrar on 22.01.2018 for himself and on behalf of Defendant No.1 and 3 also. It was represented on behalf of defendants that the matter is under the process of settlement. However, no settlement has been reported despite availing several adjournments viz., 22.02.2018, 27.03.2018, 04.05.2018, 13.06.2018, 19.07.2018 and 28.07.2018 nor any written statement has been filed. Hence, the defendants were placed ex-parte on 04.10.2018

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The records of the case clearly reflects that subsequent to setting them ex-parte, the defendants filed Vakalath through their counsel on 04.12.2018 along with petition to set aside the ex-parte order. But the defendants failed to prosecute the IA and get it numbered. After the

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MA 266/24 in OA No.682/2017

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22.01.2026

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applicant bank filed PA and OD, Ex-parte Final order was passed on 02.02.2023 and DRC No.22/2023 came to be issued.

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It is the matter of fact that the affidavit filed along with MA.266/2024 does not support case as the defendants have not justified the reason or cause in not filing the WS on time, despite receipt of summons. On the other hand, the applicant bank has taken summons as directed by this Tribunal following due procedures in taking out summons/ service of summons as prescribed under the law.

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The contention of the defendants regarding the pendency of CC No. 118 of 2018 cannot be considered as a reason for delay in approaching this Tribunal after issuance of DRC, as it is the duty of the defendants who after entering appearance, to file WS countering the contentions/claim of the applicant bank. Having entered appearance, there is no reason put forth as to why the defendants could not file the written statement on time. Nothing prevented the defendants to file the WS on time raising all the contentions that is being raised now in the MA. On the other hand, there is no valid reason that has been put forth by the defendants for nonparticipation in the proceedings and allowed the OA to go ex-parte and after issuance of DRC when the Recovery Officer started initiating steps for sale of property, now the defendants have come up with this MA, which is not a justifiable cause nor even on equity.

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MA 266/24 in OA No.682/2017

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22.01.2026

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The further contention as raised in the affidavit with regard to the fraud committed by the then Branch Manager are all pertaining to the year 2014 and 2015 and admittedly, the OA is filed on 21.10.2017. The defendants have received the summons and second defendant had entered appearance on 22.01.2018 before the Registrar on behalf of himself and on behalf of D1 and D3 also and submitted that matter is under settlement and sought time for reporting settlement.

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In the affidavit filed to condone the delay, there is no justifiable reason given explaining each day’s delay. However the reason put forth is of a medical reason of 3^rd petitioner and 2^nd petitioner’s daughter, which is supported by medical records pertaining to the year 2018, 2019 and 2023, 2024 respectively. Nothing prevented the 2^nd petitioner, who has represented 3^rd petitioner also before the Registrar on 22.01.2018, to file written statement and contest the case on merits.

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On the other hand, the defendants now their affidavit have come out with the plea of fraud being committed, which is matter of record and the law would take its course. Inspite of being aware of the alleged crime, the defendants haven not chosen to put up appearance and bring the facts before this Tribunal. Further, although the defendants have filed petition for condonation of delay, there is no reason put forth as to why they did not pursue the set aside petition filed during pendency of OA itself,

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MA 266/24 in OA No.682/2017

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22.01.2026

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being fully aware that the bank has filed OA for recovery of debt due from the defendants.

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It is apt to mention at this point that defendants have come forward to contest the matter at a belated stage without any reasonable and justifiable grounds with a delay of 580 days, only with an intention to frustrate the proceedings.

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It is a settled legal proposition that law of limitation may harshly affect a particular party but it has to be applied with all its rigour when the statute so prescribes. The Tribunal has no power to extend the period of limitation on equitable grounds and has no power to ignore that provision to relieve what it considers a distress resulting from its operation as per the Judgement of Hon’ble Supreme Court in the matter of P.K. Ramachandran vs. State of Kerala , reported in (1997) 7 SCC 556, the Hon’ble Supreme Court has held thus:-

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"Law of limitation may harshly affect a particular party but it has to be applied with all its rigour when the statute so prescribes and the courts have no power to extend the period of limitation on equitable grounds".

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Hence, the legal maxim “dura lex sed lex” which means “the law is hard but it is the law”, stands attracted in such a situation.

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It is axiomatic that condonation of delay is a matter of discretion of the Court. However, while there is no sufficient cause has been satisfactorily assigned by the petitioner for the inordinate delay of 580 days

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MA 266/24 in OA No.682/2017

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22.01.2026

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in preferring the application, the Tribunal is not inclined to condone the delay.

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In the instant matter the Defendants has not justified the reasons for each day’s delay and the Tribunal is not inclined to condone the delay even on equitable grounds. The Tribunals opinion is justified by the judgement of Hon’ble Supreme Court in the case titled Lingeswaran vs Thirunagalingam in SLP 2054-2055/2022 where it is held that the Limitation Period Cannot Be Extended On Equitable Grounds.

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The Hon’ble Supreme Court in the is the said judgement observed that an application for condonation of delay has to be dismissed if it is found that the delay is not properly explained and that the period of limitation cannot be extended on equitable ground. Otherwise, it would be giving a premium to a person who fails to explain the delay and who is guilty of delay and laches.

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The Tribunal reminds itself that the RDDB Act is a special enactment, enacted with the purpose of providing expeditious adjudication and recovery of debts due to Banks and Financial Institutions. Time is the essence in quick disposal of Original Applications to avoid locking up of huge amount of public money in litigation which prevents proper utilization and recycling of the funds for the economic development of the country.

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25. For better understanding S.19[5] is reproduced reads as under:

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MA 266/24 in OA No.682/2017

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22.01.2026

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"The defendant shall within a period of thirty days from the date of service of summons, present a written statement of his defence including claim for set-off under sub-section (6) or a counter-claim under sub- section (8), if any, and such written statement shall be accompanied with original documents or true copies thereof with the leave of the Tribunal, relied on by the defendant in his defence:

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Provided that where the defendant fails to file the written statement within the said period of thirty days, the Presiding Officer may, in exceptional cases and in special circumstances to be recorded in writing, extend the said period by such further period not exceeding fifteen days to file the written statement of his defence"

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26. Thus, a reading of S.19(5) clearly shows that the written statement/ counter-claim is required to be filed mandatorily within 30 days from the date of service of summons. Another period of 15 days maximum can be granted, only in exceptional cases and in special circumstances, which are to be found and recorded in writing by the Presiding Officer while granting extension by up to 15 days. These strict timelines of 30 days, and 15 days as mandated in section 19(5) are in consonance with the objective sought to be achieved by the Recovery of Debts and Bankruptcy Act, 1993.

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27. The strict timelines for filing written statement and counter claim is that DRT is adjudicating on disputes involving huge amounts of public money, and if any delay is permitted in the adjudication of those disputes, the same will result in locking up of huge amounts of public money which further would prevent utilization and recycling of those funds for the development of the country.

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28. In the instant matter the defendants have not chosen to file

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MA 266/24 in OA No.682/2017

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22.01.2026

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vakalath, despite entering appearance on the first date of hearing itself before the Registrar nor had reported any settlement in terms of their undertaking. Further, in the MA for condonation of delay of 580 days in filing petition to set aside the ex-parte, the defendants are coming up with untenable, frivolous and vexatious reasons.

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29. For the foregoing reasons the MA filed for condonation of delay of 580 days in filing petition to set aside the ex-parte order cannot be considered and the same stands rejected. Accordingly, MA.No.266/2024 stands dismissed. Consequently, MA SR Nos.13884/2024 and 14443/2024 filed by the petitioners to set aside the ex-parte final order dated 02.02.2023 and to set aside the DRC No.22/2023 also stands dismissed.

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Sd/-

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(S.V. GOWRAMMA) PRESIDING OFFICER DRT-III, CHENNAI

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(Dictated to PS, transcribed by her, corrected, signed and pronounced by me on this the 22^nd day of January, 2026)

Mrs S Pankajam v. Central Bank of India

Case brief

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Mrs S Pankajam v. Central Bank of India

Case brief

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