CMA/1173/2009 of ICICI Bank Limited Vs M/s. Southern Rocks and Minerals (P) Limited on 29 December 2009

THE HON’BLE SRI JUSTICE V.V.S.RAOAND

THE HON’BLE SRI JUSTICE B.N.RAO NALLA

CIVIL MISCELLANEOUS APPEAL No.1173 of 2009

29.12.2009

Between:

ICICI Bank Limited and others

… Appellants

AND

M/s.Southern Rocks and Minerals (P) Ltd., and others … Respondents THE HON’BLE SRI JUSTICE V.V.S.RAOANDTHE HON’BLE SRI JUSTICE B.N.RAO NALLA

CIVIL MISCELLANEOUS APPEAL No.1173 of 2009

JUDGMENT: (per Hon’ble Sri Justice V.V.S.Rao)

This miscellaneous appeal is by defendants, namely, ICICIBank Limited and its two branches. Aggrieved by order, dated01.10.2009, passed by Hon’ble II Additional Chief Judge, City CivilCourts, Hyderabad, in I.A.No.2164 of 2008 in O.S.No.340 of 2008directing “status quo in all respects to be maintained by both theparties”, present appeal is filed.

The respondents herein instituted the suit praying fordeclaration and consequential permanent injunction restrainingappellants from initiating proceedings for recovery of the amounts. Thedeclaration sought is in respect of ISDA Master Agreement dated06.03.2007 between the parties as void ab initio and ultra vires the RBIGuidelines and consequential injunction restraining the appellants inenforcing and recovering the amounts under the said agreement andschedule thereunder. The respondents also filed interlocutoryapplication for ad interim injunction restraining the appellants frominitiating any recovery proceedings against them. The appellants opposed the application inter alia on the ground that civil Court has noterritorial jurisdiction and the jurisdiction is barred under the provisionsof Recovery of Debts Due to Banks and Financial Institutions Act,1993 (Recovery Act, for brevity) as well as Section 41(b) of theSpecific Relief Act, 1963. The Court below by impugned order directedstatus quo to be maintained.

When connected miscellaneous applications in this appealwere listed before this Court, we passed orders suspending theimpugned order. The respondents have now movedC.M.A.M.P.No.2203 of 2009 for vacating the same. At that stage, it hasbeen brought to the notice of this Court that recovery proceedingsinitiated by appellants before the Debts Recovery Tribunal-III, Mumbai,being O.A.No.391 of 2009 has been taken cognisance of by DRT andnotices are ordered, pursuant to which respondents also appearedbefore DRT. Apart from the question of territorial jurisdiction, havingregard to Section 41(b) of the Specific Relief Act, an injunctionrestraining to initiate proceedings in the Court of law would not havebeen issued. Be that as it is, now that DRT is ceased of the matter, andalso having regard to the fact that Court below also directed the partiesto get ready with the trial, we are of considered opinion that the order ofstatus quo in I.A.No.2164 of 2008 can no more be enforced nor itsubsists as of today. Therefore, we dispose of this appeal giving libertyto the parties to pursue their remedies as advised. We also give libertyto the appellants to file appropriate application under Order XIV Rule2(2) of the Code of Civil Procedure, 1908 for trying the question ofterritorial jurisdiction and the jurisdiction to entertain the suit as per theprovisions of Recovery Act. As and when such application is filed, theCourt below is directed to deal with such application and passappropriate orders.

The civil miscellaneous appeal is accordingly disposed of. Nocosts.

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(V.V.S.RAO,J)

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(B.N.RAO NALLA, J)