High Court dismissed a writ petition filing under Article 226 challenging the DRT and DRAT order denying leave to cross-examine bank officials. The Court held the petition was not maintainable due to delay and found the Tribunal correctly applied summary procedure rules.
Writ petition and connected miscellaneous petition dismissed with no costs.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 11.11.2019
CORAM
THE HONOURABLE DR.JUSTICE VINEET KOTHARI AND THE HONOURABLE MR.JUSTICE C.SARAVANAN
W.P.No.30879 of 2019
and
W.M.P.No.30972 of 2019
M/s.Kumar Constructions, rep. by Mr.P.V.R.S.Mani Kumar, residing at No.32 (Old No.6), Jamalia Nagar, Perambur High Road, Chennai 600 012. Petitioner/1st Defendant
Versus
Stressed Assets Management Branch, No.2, Jehangir Street, Chennai 600 001. ... 1st Respondent/Applicant Bank 2. Mrs.P.Bhuvaneswari 3. Mrs.P.Satha Keerthy ... 2 & 3rd Respondents/2 & 3rd Defendants 4. The Hon'ble Debts Recovery Appellate Tribunal, 4th Floor, Indian Bank Circle Office, 55, Ethiraj Salai, Chennai 600 002. ... 4th Respondent
Prayer: Writ Petition filed under Article 226 of the Constitution of India seeking issuance of a writ of certiorarified mandamus to call for the records of the 4th respondent pertaining to the order dated 15.10.2019 passed in AIR No.248/2019 and quash the same and direct the DRT-1, Chennai to provide an opportunity to the Petitioner/1st Defendant for cross examination of A.W.1 in O.A.No.182 of 2007.
For petitioner : Mr.T.V.Suresh Kumar
ORDER
(Order of the court was made by Dr.VINEET KOTHARI, J.)
The Petitioner, M/s.Kumar Constructions, the borrower filed an Application in I.A.No.546 of 2019 seeking leave of the court
to cross examine the Official of the Bank which came to be dismissed by the learned DRT by its order dated 3.6.2019. While, the learned DRT rejected the Application filed by the Petitioner/borrower had observed as under:-
"10. While it is the firm contention of the Respondent Bank that the petitioners/defendants having categorically admitted availing of the credit facilities, creation of equitable mortgage over the application schedule mentioned properties to serve the same security for the due discharge of the credit facilities are not entitled to question the said mortgage, the petitioners/defendants would contend that the original documents pertaining to the application schedule mentioned properties are always in the custody of the first petitioner/defendant, as such there cannot be any valid mortgage by deposit of title deeds in favour of the Respondent Bank.
Para 3... that signatures of the defendants were taken in blank forms which have been later filled up by the bank officials to suit their convenience, without the knowledge of the defendants. These made-up documents are also unregistered and are said to create security for the due repayment of amounts advanced. .... These documents are not executed on the date they are purported to have been executed..."
Para 14 .... The Agricultural lands which were given as additional security to the bank may fetch only a maximum of Rs.25 lakhs. In fact most of the lands are under encroachment. Then the total value of the properties (barren land and agricultural lands) is Rs.75+Rs.25 lakhs = 100 lakhs"
Para 18 .... To pass an order of adjudication dereeing the sum of Rs.1,85,00,000/- in favour of the Indian Bank, which the first defendant will pay in full discharge of the loan amount, as agreed to in the O.T.S. within a time frame of 4 weeks of the date of the decree...."
mortgage over the application schedule mentioned properties in clear and unambiguous terms. Therefore, creation of equitable mortgage over the application schedule mentioned properties, being clear and categorical, I do not hesitate to hold that the petitioners/defendants are estopped under law from pleading contra, for the following reasons.
(i) There is no pleading whatsoever in the reply statement that the first petitioner, all through is in possession of the original title deeds of the properties over which the Respondent Bank claimed mortgage right.
(ii) It is clear and categorical from the statements, supra, that the defendants have admitted creation of equitable mortgage in favour of the Respondent Bank over the aforesaid properties.
(iii) The petition for leave to file additional reply statement with almost similar contentions vide I.A.No.197/2008 was dismissed, and W.P.No.15092 of 2011 filed by the petitioners/defendants challenging the same was also dismissed by the Hon'ble High Court of Madras, vide Order in W.P.No.15092 of 2011 and M.P.No.1 of 2011 dated 03.12.2018.
"In view of the fact that both parties have filed their Proof Affidavits and Counter Proof Affidavits and matter is more than 20 years old, it appears that this delay has been caused on account of some stay orders by this Tribunal or Hon'ble High Court. Ultimately, fact remains that more than 20 years old O.A. needs to be adjudicated.
Counsel for Appellant places reliance on i) I (2005) BC 258 (DB) (M/s.Allied Chemical Laboratories, Jagatpur, Cuttack Vs. Presiding Officer, Debts Recovery Tribunal, Cuttack & Anr.) and ii) Hon'ble High Court of Madras order dated 24.1.2007 in W.P.No.12801/2006 (S.M.Mohammed Siddique & Ors. Vs. UCO Bank & Ors.)"
Borrower. We strictly deprecate this practice.
Sd/-
Assistant Registrar (Insp Cell)
//True Copy//
Sub Assistant Registrar
ssk.
To:
1. Indian Bank,
Stressed Assets Management Branch,
No.2, Jehangir Street,
Chennai 600 001.
2. The Debts Recovery
Appellate Tribunal,
4th Floor, Indian Bank Circle Office,
55, Ethiraj Salai, Chennai 600 002.
+1cc to Mr.Genicon & Associates, Advocate, S.R.No.93257
W.P.No.30879 of 2019
CA(CO)
GN(27/11/2019)
2 issues framed by the court
Whether the writ petition seeking leave to cross-examine bank officials in a long-pending recovery proceeding is maintainable at this stage.
Whether the Tribunal is justified in denying leave to cross-examine based on the nature of the summary proceedings and the admit of creation of equitable mortgage.
Colour shows how this judgement treated each authority
M/s.Allied Chemical Laboratories, Jagatpur, Cuttack Vs. Presiding Officer, Debts Recovery Tribunal, Cuttack & Anr.Referred¶34
I (2005) BC 258 (DB) (M/s.Allied Chemical Laboratories, Jagatpur, Cuttack Vs. Presiding Officer, Debts Recovery Tribunal, Cuttack & Anr.)
S.M.Mohammed Siddique & Ors. Vs. UCO Bank & Ors.Referred¶34
Hon'ble High Court of Madras order dated 24.1.2007 in W.P.No.12801/2006 (S.M.Mohammed Siddique & Ors. Vs. UCO Bank & Ors.)
W.P.No.15092 of 2011Referred¶29
W.P.No.15092 of 2011 and M.P.No. 1 of 2011
2 provisions across 2 enactments
M/s.Kumar Constructions
Indian Bank
Mrs.P.Bhuvaneswari
Mrs.P.Satha Keerthy
The Hon'ble Debts Recovery Appellate Tribunal
VINEET KOTHARI
C.SARAVANAN
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
