M V Venkatesh and anr vs KARNATAKA GRAMIN BANK on 27 September 2024

1. M.V. Venkatesh Aged about 54 years S/o. Late M.Y. Venkate Gowda R/at. Malligematu Village and Post Maralavadi Hobli, Kanakapura Taluk, Ramnagara District – 562121

2. Sri. M Y Venkate Gowda (dead) S/o. Late Sri. Yalakki Gowda Since deceased rep. by Lrs 2(a). Smt. Marakka (Wife)(dead) 2(b). Sri. M.V. Venkatesh (Son)

... **APPLICANTS/ DEFENDANTS**

**AND**

1. Karnataka Gramin Bank Kanakapura Branch, Ramnagara District Rep. by its Asset Recovery Management Branch No.6, Sai Priya, 17^th Main Road, Munshwara Block, Sri Naagar, Bangalore – 560026 Rep. by its Chief Manager

2. Sri. Kabbale Gowda @ Mote Gowda S/o. Late Sri. Chikkadurga Gowda Tungani Village and Post, Kasaba Hobli, Kanakapura Taluk, Ramanagara District.

3. Sri. Shivaraju H K

S/o. Sri. Kempaiah Hebbidara Mettilu Grama, Bannikuppe Dhakale, Harohalli Hobli, Kanakapura Taluk, Ramangara District.

4. Sri. Kariappa S/o. Sri. Muddegowda R/at. Kuri Gowdanahalli village, Rayasandra Dhakale Tungani Post, Kasaba Hobli, Kanakapura Taluk, Ramanagara District.

5. Branch Manager Agriculture Credit Co-operative Bank Ltd., Kanakapura Branch, Ramanagara District.

6. Madhu T K S/o. Kabbala Gowda @ Mote Gowda Tungani Village and Post, Sampandoodi, Kasaba Hobli, Kanakapura Taluk, Ramanagara District.

7. Smt. Sandhya Ramesh Kamapalapur W/o. Venkatesh Pratap N #123, 8^th Main, 13^th B Cross, BTM Layout 2^nd stage, Bangalore - 560076

... RESPONDENTS/ APPLICANTS

**Counsels on record/appeared for:**

Applicant : Sri. Sharanjith Shetty K Respondent No.1 : Sri. Lokesh Murthy G

**ORDER on IA No.1083/2024**

The present miscellaneous application is filed by the defendant Nos.2 and 1 , in OA No.36/2019 u/s.22(2)(G)(H) of the Recovery of Debts and Bankruptcy Act, 1993 r/w 26,19(20), 19(21) of the Recovery of Debts and Bankruptcy Act, 1993, with a prayer to recall the impugned exparte final Order dated 28.12.2019 passed ✓

by this Tribunal in OA.No.36/2019 and to quash the RC in OA.No.36/2019.

2. The, case as put forth by the applicants is that the applicants are the defendant Nos.2 and 1 in the OA and has filed this miscellaneous application for recall the Order passed in OA.No.36/2019 but the same is not filed within the period of 30 days from the date of passing the order. Hence, the applicants have filed IA.No.1083/2024 under section 5 of the Limitation Act to condone the delay of 1602 days.

3. In the Affidavit filed by the applicants, it is contended that the applicants have challenged the impugned exparte order passed by this Tribunal without hearing them in the OA. The applicants are agriculturist. The respondent No.1 Bank have not followed provisions of the Recovery of Debts and Bankruptcy Act. The applicants were not heard before passing the final order by this Tribunal and has also not received the final order dated 20.12.2019 as well as the RC passed in OA.No.36/2019 in favour of the respondent No.1 bank.

4. It is submitted that based on the exparte order passed in OA.No.36/2019, subsequently an RC No.485/2020 was issued without hearing the applicants herein and thereafter, the Recovery

Officer has issued paper publication of proclamation of sale cum E-auction sale notice dated 16.03.2024, published in English Daily newspaper.

5. It is contended that the applicant No.1 father is the owner of the lands and the applicant No.1 father has sought financial assistance from the bank for agricultural cash credit and agricultural term loan. During the pendency of the credit facility, the applicant No.1 father and mother passed away.

6. It is contended that the applicants have challenged the measure taken by respondent No.1 bank before Hon'ble High court of Karnataka who granted conditional interim order initially and subsequently disposed the Writ Petition directing the applicants to approach this Tribunal. Hence, the applicants prays to condone the delay of 1602 days.

7. The respondent No.1 bank has filed objections to IA No.1083/2024 for condonation of 1602 delay inter alia contending that the present application is not maintainable and liable to be dismissed in limine.

8. It is contended that as per the S.20 of RDB Act it provides that any aggrieved party can file an appeal within a period of 30 days from the date of the final order. In the present MA, the said period has already expired way back. After expiration of inordinate delay of 1602 days delay, the applicants have preferred this Miscellaneous Application. Hence, the present MA is barred by limitation for which no explanation has been given by the present applicants.

9. It is submitted that the OA.No.36/2019 has been filed by the present respondent No.1 bank before this Tribunal on 16.11.2018. Immediately, the suit summons were issued to the present applicants (defendants No.1(a), (b) and defendant No.2 in OA) and present respondents No.3 to 6 (defendants No.3 to 6 in OA). The suit summons were duly served to the present applicants and the presents respondents No.3 to 5 and summons issued to the respondent No.6 by newspaper publication as a substitute service. In spite of service of suit summons against the present applicants, they failed to appear before this Tribunal and it is mentioned in the Final order dated 28.12.2019 at Page No.8, Para No.6.

10. It is submitted that the applicants have not given any sufficient reason why they have not appeared even after receipt of suit summons within the stipulated period as prescribed by law. After giving sufficient time only, this Tribunal has passed the final order on 28.12.2019 and issued Recovery Certificate No.485/2020 in favour of the respondent No.1 bank.

11. It is submitted that before filing the Original Application, the respondent No.1 bank issued several demand notices to the present applicants for regularization of the loan accounts on 21.8.2010. The said demand notice was duly acknowledged by the present applicants, which is produced by the respondent No.1 bank in OA as Document No.15 and 16. Due to non-response from the present applicants, the bank has issued two different legal notices dated 13.12.2010 and 20.05.2011 and informed them to regularize the poultry loan which was duly served upon them, which is produced in OA as Document No.17 and 18 and Document No.19(a) and (b).

12. It is contended that after the death of M.Y. Venkate Gowda the father of present applicant No.1, the respondent No.1 bank had issued legal notice dated 10.12.2014 & 07.06.2018 to the present applicants and the mother of applicant No.1, is produced in OA as documents No.25 and 28 respectively.

13. It is contended that in the Recovery proceedings also, the Recovery Officer has given sufficient opportunities to redeem the schedule properties, but the applicants have not utilized the opportunity. Finally, the Recovery Officer issued Proclamation of Sale cum E-Auction Sale Notice dated 13.03.2024 which was duly served to them and the said notice has been duly published in the newspaper also. Even after receipt of Proclamation of Sale notice, the applicants failed to redeem the schedule properties.

14. It is contended that after the auction of the schedule serial No.1 and 3, the applicants have filed WP.No.12707/2024 before the Hon'ble High Court of Karnataka, against the Proclamation of Sale cum E-Auction Sale Notice dated 13.03.2024, wherein the applicants claimed to have paid the entire liability of the bank with upto date interest and other charges including the compensation to the auction purchasers as per Rule 60 of the Second schedule of the Procedure for Recovery of Tax. Accordingly, the Hon'ble High Court has granted an interim Order of stay on 09.05.2024 subject to compliance under Rule 60(1) of the Second Schedule of the procedure for Recovery of Tax. However, the applicants failed to comply the Order of the Hon'ble High court of Karnataka. Wherefore the Hon'ble High Court disposed of the Writ Petition on 11.06.2024 by directing the applicants to file appeal before the DRAT Chennai or DRAT Bangalore. Hence, the respondent No.1 bank prays to dismiss the interim application with an exemplary costs.

*Heard the submissions of both the counsels and perused the available records.*

15. The present miscellaneous application is filed by the defendants No.2 and 1 in the OA.No.36/2019. It is admitted fact that the applicants side herein had availed various loans. There is no dispute with regard to the availing of loans. As the applicants side defaulted to repay the loan amount, the respondent bank has filed OA.No.36/2019 for recovery of an amount Rs.41,60,723/- (Rupees Forty One Lakh Sixty Thousand Seven Hundred Twenty Three only).

16. The OA came to be registered and summons were ordered to be served on defendants No.1 to 6 which was sent through RPAD as the same were duly served on 30.09.2019 and Defendant No.5 entered appearance through counsel by filing Vakalath, but did not file the written statement. Hence, the stage of filing written statement of defendant No.5 was closed. Even after giving sufficient opportunity, when defendants were called, the applicant/defendant remained absent and were placed exparte and the Final Order in OA.No.36/2019 came to be passed on 28.12.2019 and the Recovery Certificate was issued accordingly.

17. It is pertinent to note that all along the applicants who are the defendant No.2 and 1 in the OA have not disputed with regard to the credit facility and the default in the repayment towards the credit facility. As there was no representation from the ✓

applicants/defendants, hence they were placed ex parte. Considering the documents produced by the bank and the evidence adduced and the documents came to be marked which clearly established the case of the bank. Hence, OA came to allowed directing the defendants to pay entire OA amount of Rs.41,60,723/- (Rupees Forty One Lakhs Sixty Thousand Seven Hundred Twenty Three only) along with interest and costs.

18. The issue for consideration is whether the applicants/defendants have made a case to condone the delay of 1602 days in filing the present application?

19. On perusal of the final order passed by this Tribunal in O.A. No.36/2019, it is seen from the records in the OA that the Defendants were duly served with the OA summons as seen recorded in the Final Order dated 20.12.2019 and there was no representation for defendants even after due service of the summons, as such, the Defendants remained exparte. The applicant bank adduced the evidence and based on the records, an Exparte Order in OA.No.36/2019 was passed on 20.12.2019. Hence, the contention of the applicants/defendants that they have not received the Final order dated 20.12.2019 and the Recovery Certificate by this Tribunal is unsustainable.

20. Going by the applicants' admitted version, there is a delay of 1602 days in approaching the Tribunal and as such, there is no explanation put forth by the applicants/defendants in filing the MA at a belated stage. Further, there are no reasons put forth by the applicants for each day's delay in filing the MA. It is a settled legal proposition that law of limitation may harshly affect a particular party, but it has to be applied with all its rigour when the statute so prescribes.

21. In the instant matter applicants have not given any valid and *bona fide* reasons, even the applicants could not make out sufficient cause for the delay in filing the application. In the application, the applicants are required to explain each and every day's delay as mandated under Section 5 of the Limitation Act and hence, the explanation of the applicants that they are not aware of the proceedings is blatant lie as records reveal that summons were duly served on the applicants. Further, the applicants have not made a justifiable case for condonation of 1602 days' delay and it is settled position of law that each day's delay has to be justified or a proper cause be made out to condone the delay.

✓ 21. It is axiomatic that condonation of delay is a matter of discretion of the Court. However, while there is no sufficient cause assigned by the applicants for the inordinate delay of 1602 days without there being a locus in preferring the application praying to set aside the final order passed in the OA.

22. It is the settled legal position that an ex-parte order against defendants have to be set aside if the party satisfies the court that summons had not been duly served or they were prevented by sufficient cause from appearing when the suit was called on for hearing; however, the court shall not set aside the said order on mere irregularity in the service of summons or in a case where the defendant had notice of the date and sufficient time to appear in the court.

23. Further, it is a settled legal proposition that law of limitation may harshly affect a particular party but it has to be applied with all its rigour when the statute so prescribes. The Tribunal has no power to extend the period of limitation on equitable grounds and has no power to ignore that provision to relieve what it considers a distress resulting from its operation as per the Judgment of Hon'ble Supreme Court in the matter of P.K. Ramachandran vs. State of Kerala, reported in (1997) 7 SCC 556, the Hon'ble Supreme Court has held thus:- *"Law of limitation may harshly affect a particular party but it has to be applied with all its rigour when the statute so*

*prescribes and the courts have no power to extend the period of limitation on equitable grounds".*

Hence, the legal maxim "dura lex sed lex" which means "the law is hard but it is the law", stands attracted in such a situation.

24. In absence of explanation for each day's delay, the delay application cannot be condoned on equitable grounds. The delay is not properly explained and there are no merits in the application for condonation of delay. The Tribunal's view is fortified by the judgment of the Hon'ble Supreme Court in the case titled Lingeswaran etc v/s. Thirunagalingam where it is held that, an application for condonation of delay has to be dismissed if it is found that the delay is not properly explained and that the period of limitation cannot be extended on equitable ground.

25. Sub-section (24) of S.19 of the Recovery of Debts and Bankruptcy Act 1993 prescribes the time-limit of 180 days within which an application made under S.19 is required to be disposed of. The proviso to this sub-section envisages extension of time, but the outer limit for adjudication of an application is six months. It is thus evident that the remedies available to an aggrieved person under the Act are both expeditious and effective.

✓ 26. In so far as the delay of 1602 days in preferring the MA and to set aside exparte order is concerned, the applicants have to show why they have not filed the application on the last day of limitation prescribed. That may inevitably mean that the applicants will have to show sufficient cause not only for not filing the application on the last day but to explain the delay made thereafter day by day. In other words, in showing sufficient cause for condoning the delay, the party may be called upon to explain for the number of days delay covered by the period between the last day prescribed for filing the application and the day on which the application is filed. In the instant case, the applicants have not come out with any cogent reason which prevented them to approach the Tribunal within limitation.

27. It is pertinent note that the applicants herein being aggrieved by the final order passed by the Tribunal under S.19 of the RDDBFI Act ought to have challenged the final order before the Appellate Tribunal or to have filed petition to set aside the final order within the period of limitation as prescribed under the Act before this Tribunal. The delay in filing an application to set aside the exparte order and the reason for non-filing of written statement is very vague which lacks bonafides and does not support the case and no iota of proof has been put forth by them to substantiate their contentions.

29. For the foregoing reasons, the Tribunal finds no ground or any prima facie case to condone the delay of 1602 days. Accordingly, IA.No.1083/2024, a petition to condone the delay of 1602 days is dismissed. Consequently, MA.No.18/2024 stands dismissed. Pending IA/s, if any also dismissed in terms of this Order. No order as to costs.

*(Dictated to the Stenographer (PR), after its transcription and necessary corrections, signed and Order is passed on this day 27^th day of September 2024)*

(IMTIAZ ALI) PRESIDING OFFICER I/c DRT-2, BENGALURU

APPENDIX

LIST OF DOCUMENTS PRODUCED BY THE APPELLANT

<table border="1"> <thead> <tr> <th>SI No.</th> <th>Particulars</th> <th>Annexure</th> </tr> </thead> <tbody> <tr> <td>1</td> <td>Final Order dated 28.12.2019 passed by this Tribunal in OA.No.36/2019</td> <td>A1</td> </tr> </tbody> </table>

(IMTIAZ ALI) PRESIDING OFFICER I/c DRT-2, BENGALURU