C.M MUPASIL @ SADDAM vs CORPORATION BANK on 16 June 2021

1. 1) C.M. Mupasil @ Saddam S/o. Sri.Choudary Ibrahim

2. 2) Smt. Seema Banu, W/o. Sri. C.M. Musail

Both are residing at No.38, Eksina colony, T.K. road, Bhadravathi - 577303

**...Applicants**

**AND:**

Corporation Bank, B.H. road, P.B. No.32, Bhadravathi – 577303, Represented by its Manager Sri. Laxman B. Bhajantri

**...Respondent**

**Counsels on record/appeared for:**

Applicant : Sri. H. Mallan Goud Respondent :

2I.A. No.911/2021 in M.A. No.56/2020**::ORDER ON IA 911/2021::**

The Miscellaneous Appeal [MA] No.56/2020 is filed on 05-12-2020 by the Borrowers (Applicants) aggrieved by the Order dated 30-11-2019 passed by the Tribunal in T.A. No.592/2017.

2. The Applicants are the Defendant No.2 and 3 in the T.A. No.592/2017 [OA No.2062/2016-DRT-I] and the Respondent is the financial Institution (Bank) in T.A. No.592/2017 filed by the Bank.

3. The M.A. is filed to set aside the ex parte Order dated 30/11/2019 passed by this Tribunal in T.A. No.592/2017, consequently to recall the Orders/action which taken, pursuant to the Order 30/11/2019 in TA.No.592/2017.

4. As there is delay in filing the MA, the applicant has filed I.A. No.911/2021 under S 22(g) of the RDBI Act read with section 5 of the limitation and to condone the delay of 341 days in filing the M.A.

5. In the MA it is contended by the applicant that they have not served with the notice of the OA and were placed ex-parte and an Order is passed for recovery of sum of

3I.A. No.911/2021

Rs.5,96,36,152/- with future interest at the rate of 17.5%p.a including penal interest at the rate of 2% is ordered by the Tribunal.

6. It is the case of the applicant that they have not aware of the proceedings initiated by the Tribunal and have not received any process and applicants have filed W.P.3429-331/2016 against the respondent bank for their arbitral actions. Though the respondent bank has appeared and filed their objections to the same they have not informed the pending of proceedings in this Tribunal.

7. The applicant made deposits sum of Rs.4,50,00,000/- pursuant to the directions issued and disposed the W.P on 13/02/2019, under this circumstance the Tribunal had passed final Order dated 13/11/2019 considering the applicant as exparte. If proceedings is continued the applicant would put to greater hardship and injury. On the other hand if this Hon'ble Tribunal were to give an opportunity to hear and set aside the exparte Order.

8. In the grounds of the MA, it is contended that they have not received process of this Hon'ble Tribunal and matter

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was pending between the parties in W.P.34329-331/2016. The respondent bank had not submitted before Hon'ble High Court of Karnataka that the pendency of the proceedings before this Hon'ble Tribunal, deliberately suppressed the facts and kept the applicant in dark. Hence prays for set-aside the Order dated 30/11/2019 in TA.No.592/2017 (OA.2062/2016 DRT-I); recall the Orders/actions pursuant to the Order 30/11/2019; to grant an opportunity to the applicants to hear in the proceedings.

9. The applicant has filed IA.911/2021 a petition to condone the 341 days delay in filing the MA only on 06.04.2021 after the MA came to be filed on 05.12.2021.

10. In the Affidavit filed along with the application it is submitted that the ex-parte order dated 30.11.2019 is passed behind the back of the applicant as the process were not served upon the applicant.

11. The Hon'ble High Court of Karnataka disposed the WP.No.34329-331/2016 on 13/02/2019 with a direction to consider the OTS representation to be filed by the borrower and to pass speaking order thereon, for the same loan and the applicant has deposited Rs.3.5 crores

5I.A. No.911/2021

12. The applicant came to know about the Order on only in the month of November 2020 and after obtaining the certified copy on 14.11.2020, the present MA is filed on 5.12.2020 and the delay is due to non-information about the passing of the decree. Hence prays for condonation of delay of 341 days.

*Heard the submission of the applicant counsel and perused the records.*

13. The issue for consideration is whether the applicant has made a case to condone the delay of 341 days in filing the application?

14. On perusal of the final order passed by this Tribunal in T.A. No.592/2017 (O.A. No.2062/2016-DRT-1) it is seen from the records that the OA summons were sent through RPAD and same were returned with postal shara as 'unclaimed', thereafter paper publications were made; and defendants remained absent. Hence, they were called and were paced exparte on 03.01.2017.

15. Consequent to setting the defendants as ex-parte, the applicant bank adduced the evidence along with documents

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and based on the records an Exparte Order is passed in T.A.No.592/2017 on 30-11-2019.

16. On further verification of the case papers in OA, it is seen from the unclaimed RPAD covers that the postal authorities have endorsed as evident as ID 29.12.2019, 'Absent'. Hence, the bank has taken out summons through substituted service by publishing the summons in Vijaya Karnataka and The Sunday Express on 03.02.2019. Hence, the contention of the applicant that no summons was served is fallacious and misguiding without any force of law or on facts.

17. The only contention in the present MA is that they have not received the summons and bank has proceeded without summons, resulting in the ex parte Order. On perusal of Annexure A final Order dated 13/11/2019, it is evident in the Para 6 of the Order that the summons has taken on the OA through RPAD and returned with postal shara as 'unclaimed', paper publication made in newspapers and defendants remained absent and they were called out and set exparte.

18. Going by the applicant admitted version, there is a delay of 341 days in approaching the Tribunal and as such,

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there is no explanation put forth by the applicant in filing the MA at a belated stage and has come out with untenable averments that no summons were served, hence could not contest the matter.

19. In the instant matter applicant has not given any valid and *bona fide* reasons nor made out sufficient cause for the delay in filing the application, where in the applicant is required to explain each and every day's delay as mandated under Section 5 of the Limitation Act and hence the explanation of the applicant that they were not aware of the proceedings is blatant lie as records reveal that summons sent by RAPD was initiated by the postal authorities on 29.12.2019 and they remained absent. Further the applicant has not made a justifiable case for condonation of 341 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.

20. 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 petitioner for the inordinate delay of 341 days without there being a locus in preferring the application praying to set aside the final order passed in the TA.

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21. It is the settled legal position that an ex-parte order against defendant has to be set aside if the party satisfies the court that summons had not been duly served or they was 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.

22. 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.

23. In so far as the delay of 341 days in preferring the MA and to set aside exparte order is concerned, the applicant has to show why they did not file the application on the last day of limitation prescribed. That may inevitably mean that the applicant will have to show sufficient cause not only for not

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filing the application on the last day but to explain the delay made thereafter day by day.

24. 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 has not come out with any cogent reason which prevented them to approach the Tribunal within limitation.

25. It is pertinent note that the applicant 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 are very vague which lacks bonofides and does not support their case and no iota of proof has been put forth by them to substantiate their contentions.

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26. For the foregoing reasons, the Tribunal finds no ground or any prima facie case to condone the delay of 341 days. Accordingly, IA 911/2021 a petition to condone the delay of 341 days is dismissed. Consequently, MA 56/2020 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 pronounced by me in the Open Court on this 16^th day June, 2021)*

Sd/- **PRESIDING OFFICER** **DRT-2, BENGALURU**

11I.A. No.2528/2019 in M.A. No.11/2020**APPENDIX****LIST OF DOCUMENTS PRODUCED BY THE APPLICANT**

<table border="1"><thead><tr><th><b>Sl. No.</b></th><th><b>Particulars</b></th><th><b>Annexure</b></th><th><b>Page. No.</b></th></tr></thead><tbody><tr><td>01</td><td>Certified copy of the Order in TA.No.592/2017 (OA.No.2062/2016)</td><td>A</td><td>10-17</td></tr><tr><td>02</td><td>Copy of the judgment in W.P.No.34329-331/2016</td><td>B</td><td>18-23</td></tr></tbody></table>

Sd/- **PRESIDING OFFICER DRT-2, BENGALURU**

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