ANJULATA YOGI vs GRUH FINANCE LIMITED on 1 October 2020

BEFORE THE DEBTS RECOVERY TRIBUNAL, JABALPUR SITTING AT CUTTACK

PRESENT: -SRI P. RAVI KIRAN, B. Com, M.L.. PRESIDING OFFICER.

Application for condonation of delay and MA No.-65/2020 (SA No.-361/2019)

<table border="1"><thead><tr><th>Sl. No.</th><th>Date of order.</th><th>Order with the signature.</th><th>Action (if any) taken on the order.</th></tr></thead><tbody><tr><td></td><td>01.10.2020</td><td><p><b><u>Application for condonation of delay</u></b></p><p>Counsel for the applicant filed an application for condonation of delay in filing MA No.-65/2020.</p><p>Counsel for the Respondent Company vehemently opposed to condone the delay and submitted that there is no valid ground for condonation of delay in filing MA-65/2020 and prayed for dismissal of the application for condonation of delay.</p><p>Heard both the Counsels through Video Conferencing and perused records.</p><p>Considering the submissions of both the Counsels and taking principles of natural justice into consideration and pandemic situation due to Covid-19, application for condonation of delay is condoned in filing MA No.-65/2020</p><p><b><u>MA No.-65 of 2020</u></b></p><p>Counsel for the applicant filed MA No.-65/2020 for modification of order dated 25.09.2019 passed in SA No.361/2019.</p></td><td></td></tr></tbody></table>

*P. Ravi Kiran*

In the petition it is stated that the applicants had filed a securitization application under Section 17 of the SARFAESI Act, 2002 and after hearing the parties this Tribunal was pleased to dispose of the said application and directed the applicants to deposit an amount of Rs.1.00 lakh and clear the entire outstanding on or before 31.12.2020. Since the order passed by this Tribunal till February 2020 applicants had duly complied the order and had deposited the amount as per the direction of this Tribunal. Due to Covid 19 pandemic since March 2020 the restaurant which is the sole livelihood of the applicants got closed and still there is no way of earning Due to lock down, the applicant are not able to deposit the loan amount as per the direction of this Tribunal. The applicant are willing to clear the dues and ready to deposit the amount, but seeking relaxation in the direction and prayed this Tribunal to relax the amount from one lakh to Rs.50,000/- and extend the time from 31.12.2020 to 31.12.2021. Hence prayed this Tribunal to review/modify the order dated 25.09.2019 passed in SA No.361/2019.

Counsel for the Respondent company filed reply and contended that the applicants have not pointed out any error which warrants the interference of this Tribunal, in the aforesaid order.

This Tribunal vide its order dated 25.09.2019 has taken a lenient view and directed that in case, the applicants deposit a minimum amount of Rs.2.00 lakhs on or before 10.10.2019 in each account and further deposit a minimum amount of Rs.50,000/- in each account on or before 31.10.2019 and thereafter continues to deposit minimum of Rs.50,000/- in each account before end of every month and clear the entire dues along with interest on reducing balance on or before 31.12.2020, the execution of order dated 21.06.2019 passed by the D.M., Balod shall be kept in abeyance. It was further directed on the failure of the applicants to deposit the amount in the aforesaid manner the interim order shall automatically be deemed to be vacated and the Respondent No.1 may proceed further for recovery of its dues in accordance with law. As the applicants have not deposited the amount as per the directions of this Tribunal, hence interim order was already vacated.

The applicants are not having bonafide

P. Rao intention of repayment of their dues and they are only borrowing time to avoid the repayment of the Respondent No.1. Hence the relaxation claimed by them cannot be granted to them looking to their past conducts. Hence the order dated 25.09.2019 passed in SA No.-361/2019 has attained finality and cannot be interfered by this Tribunal.

Heard both the sides and perused the records.

Considering the submissions of both the Counsels and Pandemic situation due to Covid-19 and taking principles of natural justice into consideration as per the decision reported in **AIR 1999 SC 3426 between Radha Krishna Maity Vrs. Allahabad Bank.**

**"Rule 18: Orders and directions in certain cases. The Tribunal may make such orders to give such directions as may be necessary or expedient to give effect to its orders or to prevent abuse of its process or to secure the ends of justice.**

It will be noticed that Section 22(1) deals with the powers of the Tribunal and Section 22(2) deals with certain specified powers. Rule 18 also deals with the power of the Tribunal to pass orders.

In a recent decision of this court under this Act in Industrial Credit and Investment Corporation of India Ltd. Vs. Grapco Industries Ltd. and Ors. (1994(4) SCC 710), this Court considered the provisions of the

P. Prabu

Act and the powers of the Tribunal. The question that arose in that case was whether the Tribunal could pass an order granting ex-parte injunction. In that context, reference was made to Section 22 of the Act. This Court observed that the Tribunal's powers were (except as stated in sub-clause (2)), wider than the power of a Civil Court and the only limitation was that it should observe principles of natural justice. Wadhwa, J. stated as follows: (P. 716, Para-11).

"We, however, do not agree with the reasoning adopted by the High Court. When Section 22 of the Act says that the Tribunal shall not be bound by the procedure laid down by the code of Civil procedure, it does not mean that it will not have jurisdiction to exercise powers of a Court as contained in the Code of Civil procedure. Rather, the Tribunal can travel beyond the Code of Civil Procedure and the only fetter that is put on its powers is to observe the principles of natural justice".

After contrasting the provisions of the Act with the restriction imposed upon certain other Tribunals under other statutes, this Court observed: (P. 717)- "It will, thus, be seen that while there are no limitations on the powers of the Tribunal under the Act, the Legislature has thought fit to restrict the powers of the authorities under various enactments while exercising certain powers under those enactments. Further, when power is given to the Tribunal to make an interim order by way

P. Jain of injunction or a stay, it inheres in it the power to grant that order even ex-parte, if it is so in the interest of justice.

It is true that in the above case this Court was not concerned with the power of the Tribunal to pass an order of injunction or stay (or an ex-parte interim order or stay) other than the type of injunction or stay enumerated in Sub-clause (6) of Section 19 of the Act. But that in our opinion makes no difference, for the following reasons.

The Code of Civil Procedure but shall be guided by principles of natural justice. As stated in Grapco by this Court, the Tribunal can exercise powers contained in the Code of Civil Procedure and can even go beyond the Code as long as it passes orders in conformity with principles of natural justice. We may add that Section 19(6) does not in any manner limit the generally of the powers of the Tribunal under Section 22(1). It merely states that certain types of injunction or stay orders may be passed by the Tribunal. It is to be noticed that Sub-clause (6) of Section 19 starts with the words – "The Tribunal may make and interim order ... "The provision is an enabling provision and merely state that certain types of injunction or stay orders mentioned therein can be passed by the *P. Rao*

"Tribunal but such an enumeration cannot, in our opinion, be deemed to be exhaustive nor restricting the Tribunal's powers only to those types of injunction or stay orders. The width and amplitude of the powers are to be gathered from Section 22(1) as stated in Grapco. In addition, Rule 18 enables the Tribunal to pass orders to secure the ends of justice. Thus, we are of the view that the Tribunal certainly has powers to pass other types of injunction orders or stay orders apart from what is stated in Section 19(6). It may issued notice and after hearing the opposite side, pass orders Or, it may pass ad interim orders without hearing the opposite side and then give a subsequent hearing to the opposite party and pass final orders. We may also point out that Section 22(2) too does not limit the general powers referred to in Section 22(1). All that Section 22(2) states is that in respect of the type of applications falling under (a) to (h), the Tribunal has only powers as are vested in a Civil Court. On the facts of the case before us, we have already stated that the counsel for the respondents refused to accept notice and that therefore

P. Anil K. 2

the Tribunal proceeded to pass the impugned order. Thus, the Tribunal had conformed to principles of natural justice. The Tribunal was, therefore, very much within its powers in passing the order in question." and due to closure of the restaurant which is the livelihood of the applicants, MA No.-65/2020 is allowed and the order dated 25.09.2019 is modified to the extent that the applicants shall clear the dues of the bank by 31.03.2021 and the prayer of the applicants with regard to relax the amount from Rs.1.00 lakhs to Rs.50,000/- is not acceded to by this Tribunal and the applicants are granted time till 31.03.2021 to pay the entire dues of the bank as per the order dated 25.09.2019, failing which the Respondent Company is at liberty to proceed as per law to recover their dues. No further applications shall be entertained for extension of time for compliance of the order of this Tribunal dated 25.09.2019.

(P. Ravi Kiran)

B. Com., M.L.

Presiding Officer

DRT, Cuttack Jabalpur(M.P.)

in charge of DRT,