Dismissed

Punjab State Industrial Development Corporation v. Union of India and Others

Punjab & Haryana HC13 Aug 2024CWP/16170/2024

Case brief

AI extract

What is this about?

Challenge to vires of Rule 7(2)(b) of the DRT (Procedure) Rules, 1993 imposing ad valorem fee on recovery certificate applications and to Section 31-A of the RDB Act, based on an old concession by Union counsel. Court held a concession cannot render subordinate legislation unconstitutional; no ground of incompetence, inconsistency or arbitrariness was shown.

What the court decided

AI extract

Punjab State Industrial Development… — Banking and Recovery | Punjab & Haryana HC (2024)

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CWP-16170-2024 (O&M)

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Sr. No.113

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IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH

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CWP-16170-2024 (O&M) Date of Decision : 13.08.2024

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Punjab State I n dustrial Development Corporation …Petitioner

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Versus

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Union of Indi a and others …Respondents

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CORAM : HON’BLE MR. JUSTICE ANUPINDER SINGH GREWAL HON’BLE MS. JUSTICE LAPITA BANERJI

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Present : M r. Vikas Mohan Gupta, Advoc a te and M r. N.S.Aulakh, Advocate, f o r the petitioner.

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ANUPINDER SINGH GREWAL, J. (Oral)

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The petitioner has challenged th e vires of Rule 7 (2) (b) of the Debt Recover y Tribunal (Procedure) Rules, 1 9 93 as notified on 20.08.1993 (Annexure P- 3 ) whereby a fee is chargeable on an application seeking a recovery certi f icate. He also seeks directions t o the respondents to consider his applicati o n under Section 31-A of t h e Recovery of Debts and Bankruptcy A c t, 1993. A further challenge h a s also been made to the vires of Section 31-A of the Recovery of Debts an d Bankruptcy Act, 1993 to the extent it limit s the jurisdiction of the Tribun a l to issue recovery certificate prior to the co m mencement of the Amended A ct, 2000. 2. Learned counsel for the petition e r submits that the Union of India-respond e nt No. 1 in CWP-10124-200 8 decided on 07.05.2009 had taken a cate g orical stand in the written stat e ment that Rs.250/- would be the charging fe e for execution of the arbitrati o n award and therefore the ad valorem cour t fee for execution of the awar d cannot be imposed and the VANDANA 2024.08.21 16:43 Page 1 of 3 I attest to the accuracy and integrity of this document

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CWP-16170-2024 (O&M)

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Rule No.7(2)(b) to this effect is arbitrary and in violation of Article 14 of the Constitution of India.

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Heard. 4. It is apt to notice that the vires of the Parent Act or Subordinate Legislation can be challenged on three grounds. Firstly, that the legislature/rule making authority did not possess the necessary competence to frame the impugned act/rule. Secondly, that the impugned rule is inconsistent with the provisions of the Parent Act itself, or contrary to the provisions of any other Statute. Thirdly, that the impugned rule is manifestly arbitrary or is in contravention of the fundamental rights enshrined in part-III or other provisions of the Constitution of India. Reference can be made to the judgments of the Hon’ble Supreme Court in the cases of ‘ Indian Express Newspapers (Bombay) (P) Ltd. Vs. Union of India’ AIR 1986 SC 515 and ‘ State of Tamil Nadu Vs. P. Krishnamurthy’ (2006) 4 SCC 517.

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Learned counsel for the petitioner has not been able to point out that the authority was not competent to frame the impugned provisions or that they are in violation of the provisions of the Parent Statute or any other Statute or the Constitution of India. His sole argument is based on the concession made by the Union of India in a writ petition in the year 2008 to the extent that they will be charging Rs.250/- as court fee. A concession in a case 16 years ago cannot be the basis for declaring a rule to be ultra vires the Constitution of India. We do not know as to how and under what circumstances the concession had been made. Even otherwise, a concession on a point of law by the state counsel would not bind the State as has been held by the Supreme Court in the case of ‘ B.S.Bajwa Vs. State of Punjab and others’ reported in (1998) 1 SCC 217.

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VANDANA 2024.08.21 16:43 I attest to the accuracy and integrity of this document

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Page 2 of 3

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CWP-16170-2024 (O&M)

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