PRASANNA MANOHAR PARDHI vs PUNJAB NATIONAL BANK on 22 January 2020

J U D G M E N T

(Delivered on this 22 nd day of January, 2020)

01.00 Applicants filed present M.A. to condone the delay of 212 days caused in filing the Securitization Application.

Gvp/- 02.00 Application averments: It is submitted applicants availed housing loan from the respondent bank in August, 2014 and since 2014 are regularly paying the monthly installments. Applicants on 25.09.2019 received notice dated 17.9.2019 issued by Respondent no.1 intimating that physical possession of secured assets is scheduled on 27.9.2019 and called upon applicants to handover physical possession of the secured assets. In notice dated 17.9.2019, reference of order dated 30.1.2019 rendered by the District Manager, Nagpur is made, which was never served upon the applicants at any point of time. Applicants came to know about the order passed by Ld. DM on 30.1.2019 from the notice dated 17.9.2019. Thereafter, applicant approached the office of Ld DM and obtained certified copy of order dated 30.1.2019 and then approached their lawyer. The applicants also required arranging necessary funds to prepare the demand draft of the court fees so as to file the Securitization Application. It is submitted that by virtue of the notice dated 17.9.2019 served upon the applicants on 25.9.2019 for the first time came to know about passing of the impugned order dated 30.01.2019 and they were never served with copy of order dated 30.01.2019. Thus, considering the date of knowledge of order dated 30.01.2019, the application U/s 17 of the Act filed by the applicants is well within limitation as prescribed under the Securitization Act. However, in order to avoid technical and procedural aspects, the applicants are praying for condonation of 212 days delay in filing the S.A. 03.00 Reply averments: Respondent bank filed reply vide Exh.7 wherein it is inter-alia averred that applicant is chronic defaulter and had not paid the installments on time and, therefore, the account was classified as

Gvp/- NPA and that the bank also filed O.A. before this Tribunal, which has been allowed and the Recovery Certificate is already issued against the applicant. It is denied that the order dated 30.01.2019 was never served upon the applicants at any point of time. It is submitted that the aforesaid applicants after receiving the notice U/s 13(2) of SARFAESI Act had given one time proposal to the bank. Hence, it is false that the said applicants does not have any knowledge about the SARFAESI action initiated by the respondent bank. It is false and hence denied that considering the date of knowledge of order dated 30.1.2019 and looking into the facts and circumstances, the application U/s 17 of the Act is filed by the applicants well within limitation. The applicants had failed to explain day to day delay which has been categorically held in various judgement of Hon’ble Supreme Court. It is submitted that the applicants miserably failed to explain the delay and hence this application is liable to be rejected. 04.00 Arguments heard. 05.00 Now, the points for determination are:

(i) Whether the delay can be condoned?

(ii) To what reliefs? 06.00 Point no.(i):- This is an application to condone the delay of 212 days in challenging the Ld. DM’s order dated 30.01.2019, which was issued under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter to be referred as SARFAESI Act) and Security Interest (Enforcement) Rules, 2002 (hereinafter to be referred as SARFAESI Rules) in which it was shown that said DM’s order was sent to both the applicants. Applicants are further contending that

Gvp/- for the first time they came to know about the DM’s order dated 30.01.2019 only on 25.9.2019 and then after certain time they filed this application on 4.11.2019 with a delay of 212 days. Sub-section 1 of Section 17 of the SARFAESI Act reads as follows:- “Any person (including borrower), aggrieved by any of the measures referred to in sub-section (4) of section 13 taken by the secured creditor or his authorized officer under this Chapter, may make an application alongwith such fee, as may be prescribed, to the Debts Recovery Tribunal having jurisdiction in the matter within forty-five days from the date on which such measures had been taken.” 06.01 Admittedly, both the applicants have not chosen to challenge the SARFAESI action within 45 days as stipulated under Sub-section 1 of Section 17 of the SARFAESI Act. They are simply contending that they came to know about DM’s order dated 30.01.2019 on 25.09.2019. The Learned Advocate for the Respondents’ bank specifically contended that the Ld. DM sent copies of his order dated 30.01.2019, as can be seen on the said order and even obtained signatures of certain parties to whom the copies are sent on the original order itself. He further submits that the applicants are having knowledge about DM’s order dated 30.01.2019 since the beginning but still they failed to challenge the SARFAESI action within 45 days as stipulated and mandated under Sub-section 1 of Section 17 of the SARFAESI Act. In order to further strengthen his contention, he submitted that the applicants submitted OTS proposal to the respondents’ bank immediately after receipt of demand notice U/s 13(2) of the SARFAESI Act. He drew attention of this Tribunal to the OTS proposal dated 14.3.2019 submitted by the 2nd applicant, a copy of which is enclosed as document no.1 to respondents’ bank reply. In

Gvp/- the said OTS proposal dated 14.3.2019, 2nd applicant addressed AGM of the Respondents stating that the 2nd applicant took housing loan from the respondents and have to pay in installments. But, it became NPA on 29.7.2017. 2nd applicant further stated that 2nd applicant wants to repay the amount under special OTS Scheme and offered to pay the amount under OTS Scheme and deposited the following cheques drawn on Punjab National Bank of Applicant’s Account:- Sr.No. Cheque No. Date Amount (Rs)

677579 31.03.2019 2,00,000/-

677580 30.04.2019 98,00,000/-

2nd applicant mentioned that the whole amount will be paid by 30.04.2019 and requested the AGM of the Respondents to accept the OTS offer. A copy of above mentioned cheques drawn in favour of Respondent bank in the account of 1st applicant were also enclosed to the reply alongwith OTS offer letter in hand-writing dated 14.3.2019. In pursuance of the 2nd applicant’s OTS proposal vide document no.1, the AGM of Respondent bank accepted the OTS proposal for Rs.1.13 Crore on 6.7.2019, as can be seen from AGM’s letter vide document no.3 annexed to the reply, whose copies were mentioned as sent to both the applicants. So, by the date of 2nd applicant’s OTS proposal dated 14.3.2019, the Ld. DM had already passed an order dated 30.01.2019 to take possession of the secured asset. So, it has to be construed that the original of 2nd applicant’s OTS proposal dated 14.3.2019 is submitted to the AGM of the Respondent bank only after the order passed by the Ld. DM on 30.01.2019 and that both the applicants had knowledge of the same as its copies were mentioned as sent to both the

Gvp/- applicants. Both the applicants are also not specifically denying acceptance of the OTS proposal by the AGM of the Respondent as per AGM’s letter dated 6.7.2019 i.e. original of document no.3 attached to the respondent bank’s reply. These aspects clearly show that though the applicants are having knowledge about the action initiated by the respondent bank, they have not chosen to challenge the same within 45 days as stipulated under Sub-section 1 of Section 17 of the SARFAESI Act. The Ld. Advocate of the respondents contended that when once the challenge to the SARFAESI action is not made within the stipulated period and when once it is filed beyond 45 days; the delay, ‘may be short or long’, has necessarily to be explained as public money is involved in the case, which serves public at large. 06.02 As per the settled legal proposition, when once the right is not exercised by filing a case within the prescribed period of limitation and if there is a delay, the applicant resorts to Section 5 of the Limitation Act, 1963. When once a party is resorting to the relief U/s 5 of the Limitation Act, the party is supposed to explain the day to day delay. There are catena of decisions in the regard, which are being quoted in brief as follows:-

(i) (1977) 4 Supreme Court Cases 69; Mahant Vs. Financial Commissioner – In the said judgment, Hon’ble Apex Court has categorically stated that Sec. 5 of Limitation Act is a hard task master and a litigant who is not vigilant about his rights must explain each day’s delay.

(ii) AIR 1993 Delhi 132; M/s Democratic Builders Vs. Union of India – A ratio has been laid down that the applicant must explain each day’s delay. Defendant no. 1 has failed to explain each day’s delay.

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(iii) 2008 (6) Mh. L.J. 239, State of Maharashtra Vs. Vithu – Vague averments in the application cannot be the basis for denying a substantial benefit of law to the respondent.

(iv) 2008 (5) MH L.J. 618, Novita Vs. Saibaba – to find out the truth about reasons given for condonation of delay, the court can find out from reply the correctness of reasons furnished for condonation of delay.

Above rulings are cited for elucidating actual legal position in this field of Law to determine the point in controversy. When those rulings are applied, it can be specifically held that the applicants failed to explain the day to day delay of inordinate period of 212 days that caused in filing this case. Hence, the applicants are legally not entitled for the relief claimed. 06.03 The other point urged by the Ld. Advocate for the applicants is to the effect that the officer of the respondents who applied for DM’s order is only a Chief Manager as can be seen from Pg. No.26 to 31 of the documents furnished by the applicants and that he is not an Authorized Officer, who alone has to initiate SARFAESI action. In order to substantiate that contention, he drew the attention of this Tribunal to the definition of ‘Authorized Officer’ as defined in Rule 2(a) of the SARFAESI Rules, which reads as follows:- “authorized officer” means an officer not less than a chief manager of a public sector bank or equivalent, as specified by the Board of Directors of Board of Trustees of the secured creditor or any other person or authority exercising powers of superintendence, direction and control of the business or affairs of the secured creditor, as the case may be, to exercise the rights of a secured creditor under the Act.”

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As can be seen from page nos.26 to 31 of the application filed before the Ld. DM, one Shri Anil Kumar Sharma, Chief Manager of Respondents’ bank filed application U/s 14 of the SARFAESI Act before the Ld. DM to permit him to take possession of the secured asset. 06.04 Ld. Advocate for the respondents categorically stated that said Shri Anil Kumar whose designation is mentioned as Chief Manager of the Respondent bank filed the application U/s 14 of the SARFAESI Act before the Ld. DM and he is authorized officer of the respondent bank. Rule 2(a) of the SARFAESI Rules defines that ‘Authorized Officer’ shall not be less than Chief Manager’s rank of a public sector bank. Admittedly, respondent bank is a public sector bank and the applicant who gave solemn application to the Ld. DM is Mr. Anil Kumar Sharma, Chief Manager of the Respondent bank and he is stated to be the Authorized Officer by Respondents’ Advocate during the course of his arguments. Hence, this Tribunal feels that as the applicant who filed the application U/s 14 of the SARFAESI Act is in the rank of Chief Manager, there is no defect in said application and in obtaining the DM’s order on 30.01.2019. Anyhow, it will be a point for adjudication, if the delay is condoned, but in the present case when the inordinate delay of 212 days is not condoned, hence applicants cannot hang on these trivial issues. Therefore, the applicants’ contention in this regard is hereby negatived. As the applicants failed to explain the day to day delay of inordinate 212 days, they are not entitled to claim any reliefs in this case. Hence, this application is liable to be dismissed and dismissed accordingly.

In the result, this M.A. is dismissed.

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Interim protection / pending IAs, if any, are deemed to have been vacated / closed.

Each party do bear their own costs.

Nagpur

Dt.: 22.01.2020 (Chikkam Vijay Mohan) Presiding Officer Debts Recovery Tribunal Nagpur.