MR PRAGNESH MAHENDRABHAI SUBA vs Jana Small Finance Bank Ltd on 18 May 2024

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CASE NO. MA/28/2024

DEBT RECOVERY TRIBUNAL-II

<table border="1"><thead><tr><th data-bbox="38 86 176 111">DATE</th><th data-bbox="176 86 818 111">DESCRIPTION OF THE ORDER</th><th data-bbox="818 86 953 111">REMARK</th></tr></thead><tbody><tr><td data-bbox="38 111 176 978">18.05.2024<br/><br/>Present</td><td data-bbox="176 111 818 978"><p style="text-align: center;">MR. PRAGNESH MAHENDRABHAI SUBA &amp; ANR.<br/>Vs.<br/>JANA SMALL FINANCE BANK LTD.</p><hr/><p>Mr. Tejas Patel, Id. Counsel for Applicants.</p><p>Ld. Counsel for Applicants.</p><p>Arguments of Ld. Counsel for Applicants have been heard on the application for condonation of delay in filing SA, at the admission stage itself and perused the file.</p><p>Ld. Counsel for Applicants submitted that he has filed the above application for condonation of <b>delay of 39 days</b> from the date of taking physical possession of secured asset on 15.02.2024 in furtherance of notice dated 29.01.2024 issued by Court Commissioner for taking physical possession of disputed property, in filing above SA on 08.05.2024, on the ground that after taking of physical possession of disputed property on 15.02.2024 by Respondent bank, Applicants came to know about passing of the order u/s 14 by Id.ACJM, Surat. Thereafter, Applicants approached Respondent Bank for amicable settlement as the Applicants have availed the Working Capital Loan, however, it could not be materialised due to non-cooperation by the authorised officer/officials of Respondent bank compelling Applicants to obtain copy of order u/s 14 from the office of the Id.ACJM, Surat and other documents and to file above SA on 08.05.2024 before this Tribunal.</p><p>He further submitted that the delay caused, if any, in filing SA, is not intentional and the Applicants will suffer great hardship in case, delay is not condoned and that the above application may be allowed and delay, if any, in filing the above SA, may be condoned.</p><p>According to Section 17 (1) of SARFAESI Act 2002, a Secueritization Application has to be filed <b>within 45 days from the date on which measures referred to under sub-section (4) of Section 13 have been taken</b> by secured creditor or his Authorised Officer under this Section. There appears to be no provision made for condonation of delay in filing SA according to above Section.</p><p>Hon'ble High Court of Judicature at Madras in CRP (NPD) nos. 3785 to 3787 of 2012, WP (31251) of 2018, <b>Velar Engineering Works Pvt Limited Vs. Authorized Officer, Indian Bank</b>, MANU/TN/5046/2019 decided on 05.09.2019, and affirmed by Hon'ble Supreme Court in <b>SLP Civil (Dairy No) 7023/2020 decided on 09.07.2020 in the same matter and reported in MANU/SCOR/32577/020</b> has held that proceedings of SA are akin to the Original Civil Suit, to which section 5, Limitation Act does not apply and this Tribunal has no power to condone the delay, if any, in filing the above SA u/s 5, of Limitation Act read with section 17 (7) of SARFAESI Act 2002 and section 24 of RDB Act, 1993. As according to section 17 (1), an application u/s 17 of Act, 2002, may be filed within 45 days from the date for which measures have been undertaken by secured creditor u/s 13(4) and there is no provision for condonation of delay in filing SA u/s 17(1) beyond this period. Further, Hon'ble High Court of Judicature at Madras in <b>Velar Engineering . Surpa</b> in para 7, 8 &amp; 9 has</p></td><td data-bbox="818 111 953 978"></td></tr></tbody></table>

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<table border="1"> <thead> <tr> <th data-bbox="35 82 173 111">DATE</th> <th data-bbox="173 82 818 111">DESCRIPTION OF THE ORDER</th> <th data-bbox="818 82 958 111">REMARK</th> </tr> </thead> <tbody> <tr> <td data-bbox="35 111 173 978"></td> <td data-bbox="173 111 818 978"> <p>held as follows:</p> <p><i>7. On a perusal of Section 17 of the SARFAESI Act, it is clear that there is no provision made under the said Section for condoning the delay in filing the SARFAESI Application. The SARFAESI Application must be filed within 45 days.</i></p> <p><i>8. There being a specific time-limit of 45 days for invoking the original jurisdiction of Section 17 of the SARFAESI Act, which has been found to be, in essence, a suit and a further tentative time-limit of 60 days for disposal of the proceedings, and giving a right to the party to complain before the Appellate Forum for compliance of such provisions alleging violation thereof if not completed within four months, it was never the intention of the legislature to apply Section 5 of the Limitation Act to such original proceedings by giving power to entertain the application under Section 17(1) of the SARFAESI Act by merely showing sufficient cause for the delay without putting any restriction upon the Tribunal and we, therefore, hold that the time period of 45 days Page <a href="http://www.judis.nic.in">http://www.judis.nic.in</a> 12 / 24 C.R.P.(NPD) Nos.3785, 3786, 3787 of 2012 and W.P.No.31251 of 2018 provided in Section 17 of the SARFAESI Act which is original in nature cannot be extended by taking aid of Section 5 of the Limitation Act.</i></p> <p><i>9. The SARFAESI Application filed under Section 17(1) of the Act is like that of a suit and that the Limitation Act applies as far as may be applicable by virtue of Sections 17(7) and 24 of the two Special Laws, therefore, Section 5 of the Limitation Act has no application in the original proceedings like a suit before Debts Recovery Tribunal. Going by the amended Section, the proceedings under Section 17 of the Act is not an appellate proceeding, but rather an original proceeding, which is brought before a Forum prescribed under the Act and is like a suit under the Code of Civil Procedure, 1908. Thus, as a matter of fact the proceedings under Section 17 of the Act are in lieu of the Civil Suit, which remedy is ordinarily available, but for the bar under Section 34 of the SARFAESI Act and an application under Section 19(1) of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 are similar provisions in its non-applicability of Section 5 of the Limitation Act. The Debts Recovery Tribunal exercises original jurisdiction while entertaining an application filed under Section 17(1) of the SARFAESI Act.</i></p> <p>Thus, it is clear from the above observations and finding of Hon'ble Madras High Court that provision u/s 17 are like that of a regular Civil Suit in which section 5 of Limitation Act is not applicable.</p> <p>It may also be noted that the above findings of Hon'ble Madras High Court have been affirmed by Hon'ble Supreme Court in SLP Civil Dairy No 7023/2020 as above in which Hon'ble Supreme Court, vide its order dated 09.07.2020 was not inclined to interfere with impugned order passed by the Hon'ble High Court of Madras the above SLP was dismissed accordingly.</p> </td> <td data-bbox="818 111 958 978"></td> </tr> </tbody> </table>

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<table border="1"><thead><tr><th data-bbox="35 82 175 110">DATE</th><th data-bbox="175 82 818 110">DESCRIPTION OF THE ORDER</th><th data-bbox="818 82 959 110">REMARK</th></tr></thead><tbody><tr><td data-bbox="35 110 175 978"></td><td data-bbox="175 110 818 978"><p>It may also be noted that notice dated 29.01.2024 has been issued by Court Commissioner for taking physical possession of disputed property on 15.02.2024. However, the above SA has been filed online on 08.05.2024. Thus, a delay of 39 days has been alleged by Applicants. The reason for delay is said to be efforts made by Applicants for mutual settlement of dispute with Respondent bank. However, at one place in their MA, Applicants have alleged that they came to know about order of Id. ACJM, Surat passed u/s 14 on 24.01.2024 after the possession of disputed property was taken by Court Commissioner on 15.02.2024, but at other place, it is alleged that, Applicants came to know about impugned order dated 24.01.2024, after the receipt of notice dated 29.01.2024 issued by Court Commissioner for taking possession on 15.02.2024. Thus, there appears a contradiction in the knowledge of date of impugned order dated 24.01.2024 passed by Id.ACJM, Surat u/s 14 to Applicants and thus, the grounds so taken by Applicants do not appear to be sufficient cause from preventing the Applicants from filing the above SA within limitation.</p><p>In view of the above discussion &amp; ratio as laid down by Hon'ble Madras High Court and affirmed/not interfered by Hon'ble Supreme Court, this Tribunal is of the view that application for condonation of delay in filing the above SA is not maintainable and delay in filing SA cannot be condoned u/s 5 of Limitation Act r/w section 17(7) of SARFAESI Act, 2002 and 24 of RDB Act, 1993 and no sufficient cause has been shown by Applicants, thus the above application <b>MA 28/2024 (Dairy No. 704/ 2024)</b> for condonation of delay in filing SA as well as <b>Dairy No.703 of 2024 (SA)</b> and pending I.A. if any, deserves to be dismissed and disposed-off <b>at the admission stage itself.</b></p><p>Order Accordingly,</p><p>Let file be consigned to records.</p></td><td data-bbox="818 110 959 978"></td></tr></tbody></table>

(ANIL KUMAR GUPTA) I/c. PRESIDING OFFICER DRT-II, AHMEDABAD 18.05.2024