MR ARUN KUMAR M vs KOTAK MAHINDRA BANK LIMITED on 11 July 2024

ORDER

Review Application No.2/2023 was filed on 26.04.2023 under R.5A of the Debts Recovery Tribunal (Procedure) Rules, 1993 (as amended from time to time) - for short 'the Rules' - r/w 5.17(7) of the Securitisation and Reconstruction and Financial Institutions Act, 2002 (as amended from time to time) - for short 'the Act, - praying to review and set aside the final order dated 31.03.2023 in SA 325/2022.

2. The case set out b)' the review pet itioner/applicant in the memorandum accompanying RA No.2/2023 in brief is as follows:- Aggrieved by the sale held on 23.11.2021 by the l't respondent/l't defendant in favour of the 3.d respondenV3'd defendant in respect of the schedule immovable property, the petitioner/applicant on 20.05.2022 filed SA 325/2022 under S.l7(l) of the Act before this Tribunal praying to set aside the sale. However, this Tribunal as per the final order dated 31.03.2023 dismissed the said application as barred by limitation. The observation of the Tribunal is an error apparent on the face ofthe records in the SA.

3. The l't respondent/l't defendant filed a statement of objection submitting as follows:- The review application is not maintainable. A review can be entertained only to correct the clerical error or mistake which is apparent on the face of the record. Review cannot be exercised on the ground that the decision was erroneous on merits. :fr"rr, under the present review is seeking for substituting the view taken by the

\ Tribunal which is impermissible in law. on the above contentions, the I't respondent/ I st defendant prayed for dismissal ofthe review application.

4. The 2nd respondent/2d defendant filed a memo on 20.07.2023 stating that the Hon'ble National company Law Tribunal, Bengaluru Bench vide order dated 04.11.2022 approved the resolution plan and sripriya Kumar stands discharged as the resolution professional.

5. The 3d respondent/3d defendant though entered appearance through counsel and filed vakalath did not file any statement ofobjection. 6' lhe onry point arises tbr consideration is as to whether the review petitioner/applicant is entitled to the reliefprayed for?

7. The Point:- The review petitioner/applicant filed sA 32512022 rnder s.l7(l) of the Act on 20.05.2022 aggrieved by the sale held on 23.11.2021 by the lsr rcspoDdcnt,/l't defendant in favour of the 3.d respondent/3rd defendant in respect of the schedule immovable property. As per the limitation period stipulated under s.17(1) ofthe Act, an application thereunder challenging the sale held on 23.11.2021 ought to have been presented before this Tribunal on or before 07 .01.2022 but the same happened to be filed on 20.05.2022 with a delay of 133 days in filing the same. The said SA was dismissed as per the final order dated 31.03.2023. The operative portion ofthe said final order reads as below:- . "Appellant hos not filed any apprigation for condonation of deray in fring rhe seclttitizorion application challenging the auction sale conducted on 23. t t.zoz t by ti" 1", rispoidenibank. tt * ,iiiiria that the qppellant has filed the sec'uritizqtion application on 20.'05.2022 aid the auction was held in 23 ll202l The appellant hos nor preferred th,e securitizqtion opplication within 45 days /rom tniaiiii the.auction sale qnd there is a delay of more lhqn r32 days. Even lf the appeltant hadfled condonation if delay application, the Tribunal has no power to extend the period of timiiation on eiritabl" groinds an:d has no power lo ignore lhat provision to relieve what it considers a distress resultingfron its-operation as per the Judgment of the Hon'ble supreme court in the matter of p K Ramachaniian t, sti of Kerola [reported in (1997) 7 SCC 556], wherein the Hon,ble Supreme Court has held thus:_ . "Low of limitation may harshly a/fect a particalar pqrty b ir has to be applied with all its rigor when the statute so prescribes and the courts have no powei to ixtend the period ofiinitata" oi "qritiit" grounds. Hence, rhe legal maxim 'dura lex sed lex'which means 'the law is hari but it is *e tonl stiii attrocted"

\ Furthermore, in a special law when the statute also does not arise. s.14(3) of the SARFAESI Acl excludes the application of ie Limilation Act, 1963 and that lhe statute does not give exPress power lo the DRTs to condone delaY. The Tribunql relies on the iudgment of the Hon'bte High court of Kerala in the case titled K P Jayan v Hong Kong & Shanghai Bankiig Corporation Ltd and others decided on i1.08.2015, wherein the Hin,hle Dn i-sion Bench hos categoricolh' heli that power to condone delay in entertqining an qpplicalion under S.17 of the SARFAEST Act is not conferred on the Debts Recovery Tribunal. It has funher held that the Debts Ricovery Tribunal cannot consider an application for condonation of deltrl in dn application under S.l7 of the SARFAESI Act. . lt is seen in the present single securitization applicalion, the appellant has sought nultiple reliefs.. fi" oppntt*t has nor )referred ie aboue mentionid securitization dpplication within the_-prescribed oerio)'of limitation witi respect to the quction sqle conducted on 23.1 1.2021. The appellant ffirms receipt 'oJ roticet issued by the t', iespondent bank under the Act, bul hqs not approached the Tribunal within the. iiulited period irescribed inder the Act. Therefore, the impugned auction sale qnd the qction of fie I't ,iponder't bank pursuqnl lhercto cqnnot be legally fauked. As such, the appellant has not mqde -oul any, gr:,ir,|1u, tnr"rlirence t! this lribunulJbr ullowinS, the uppeol as prayed' The appeol' therefore' fails and is liable to be dismissed and is hereby dismissed.''

8. The review petitioner/applicant in paragraph IV of the SA under the head .limitation' had declared that the application had been filed within the period of limitation as permitted by the Hon'ble supreme court. The averments read as below:- ,'lt is submitted that the presenl application has been rtkd within the period of limitation prescribed under s.l7 of the Act. It is pertinent to poinl out lhat in view of the order of the Hon'ble 'supfeme court in the case of In Re : Cognizance lor Extension or Limitation (2022) 3 SCC I 17, the period fron 15.03.2020 - 28.02.2022 shall be excluded for the purpose of linitation. Furthermore, the Supreme "Court in the above decision hqs qlso directed thot in cqses where limitation would hqve expired between 15.03.2020 - 28.02.2022, all persons shall hwe an additional limitation period of 90 days fron 01.03.2022. Hence, the present applicqtion is well wilhin limitqtion. "

9. The Hon'ble Supreme Court in In Re : Cosnizance.for Extension of taking into consideration the impact of the surge of covid viruses on public health and the adversities faced by the litigants directed that the period from 15.03.2020 till 28.02.2022 shall stand excluded for the purpose of limitation as may be pfescribed under any general or special laws in respect of all judicial or quasi-judicial proceedings and that in cases where the limitation would have expired during the period between 15.03.2020 till28.02.2022, notwithstanding the actual balance period of limitation remaining, all person shall have a limitation period of 90 days from 01.03.2022, and the relevant portion reads as below:- luLrttg uttg c1tuitlerulon the ufgumenrs udvunced by counsel und the impact of the surge of the virus on publii health and qdversities faced by litiganls in the prevailing conditions, v,/e deem il appropriite to dispose of the MA No.2 t of2022 with thefollowing directions: The order dated 23.03.2020 isiesiored and in continlation ofthe subsequent orders dated 08.03.2021, 27.04.2021 and 2i.09.2021, it is directed that the periodfron 15.03.2020 ti\\28.02.2022 shall stand excluded for the purposes oflirnitation os may be prescribed under any general or special laws in rcspect of all judicial or quasi-iudicial Limitdtion freported in 2022(D ELTL]J-ISe

notwithstanding to the merits application, the delay of 133 of the grounds urged by the petitioner/applicant in the days in presenting the SA comes within the outer limit proceedings. Consequently, the balance period of limitotion remqining as on 03.10.2021, d any, shall become available with elfect from 01 .03.2022. ln cases where the limitqtion would have expired during the period between 15.03.2020 till 28.02.2022, notwithstanding the actuql bolance period of linitation reuuitirtg, ull pcrsotts shull lu,oe u linitulion period of 90 duys fron 01.03.2022. ln the event the actual balance period of limitation remdining, with efect from 0l .03.2022 is greqter thdn 90 dqys, that longet period shall apply. It is further clariJied that the period fron I 5.03.20920 ti 28.02.2022 shall also stand ucluded in computing the periods presoibed under 5s.23(4) and 29A of the Arbitration and Conciliation Act, 1996, S.l2A of the Commerciql Courts Act, 2015 and provisos (b) and (c) of 5.1i8 of ,he Negotiable lnstruuents Act, 1881 and any other laws, which prescribe period(s) of limitation for irctituting proceedings, outer limits (within which lhe court or tribunal con condone delcy) and termindtion of proceedings."

10. In view of the above direction by the Hon'ble Supreme Court, the petitioner/applicant was entitled to present an application under S.17(l) of the Act aggrieved by the impugned sale dated 23 .1 1 .2021 on or before 30 .05 .2022 as the limitation (stipulated date of '07.01.2022') had expired during the period between 15.03.2020 artd 28.02.2022. However, he presented the same 0120.05.2022, well before such date prescribed by the Hon'ble Supreme Court. In the above circumstances, wfthin which this Tribunal can condone as directed by the Hon'ble Supreme Court in the decision supra. This went unnoticed of this Tribunal at the time of passing of the final order on 3l .03.2023 . I 1. R.5A ofthe Rules deals with review of an order passed by the Tribunal on account of some mistake or eror apparent on the face of the records, and it reads as below:- "(1) Ary party considering itself aggrieved by an order made by the Tribunal on account of some mistake or error appqrent on the /ace of the record desires to obtain a review of the order made agairct hin, mry apply for a review of the order to the Tribunal which had made the order. -

(2) No application for review shall be nade afler the expiry ol a period o/ thirty days fron the daie of the order and no such application shall be entefiained unless it is accompanied by an afidavit v erifying t he app I i cat i on.

(3) ll/herc it appears to tha Trihunql lhat lhere is no sulficient groundfor a review, it shall reject the application but where the Tribunal is of opinion thal the applicalionlor review should be granted, shall grunt lhe same. PROVIDED that no such application shall be granted without previous notice lo the opposite parly to enable him lo appear and to be heard in support of the order, a reyiew ofwhich is appliedfor."

A *.i"o.rrro, in sA No.325r2o22 \ 1L. Going by R.sA of the Rules. any order passed by the Tribunal is liable to be reviewed on account of some mistake or error apparent on the face of the record. Even taking to the larger extent, O.47 R.l of the Code of Civil Procedure, 1908 provides for review of a Judgement on the grounds, namely:- (i) discovery of new and important matter of evidence which after the exercise of due diligence, was not within the knowledge of the applicant or could not be produced by him at the time when the decree wis passed or order was made, or (ii) some mistake or enor apparent on the face of the record; or (iii) for any other sufficient reason (which has been interpreted to be analogous to the other reasons specified above).

13. Accordingtothereviewpetitioner/applicant,theTribunaldismissedSA 32512022as per the final order dated 31.03.2023 as barred by limitation without looking into the direction issued by the Hon'ble Supreme Court in In Re : Cosnizance for Extension of Limitation lreoorted in 2022 (]| KLT 3]5 6C\], which had been pleaded by him in the limitation column. The only ground available as per R'5A of the Rules made ap!ficable by virtue ofS.17(7) ofthe Act for review is on account ofany mistake or enor apparent from the record. It is trite law that only those mistakes or errors which are apparent from the face of record could be reviewed' There are two types of erroneous decisions. They are:- (i) erroneous decisions in view of the error commiued in appreciatingthetruefactsofthecaseandapplyingthelawrelatingthereto,whichcannot berectifiedbyinvokingthepowerunderreview;and(ii)decisionerroneousinviewof the error apparent on the face of the records, which can be cured and rectified invoking the power under review.

14. The ltt respondent/ l't defendant raised a contention that the review application is not maintainable. But it has not furnished any reason for the same' The l't respondent/ l.t defendant could not point out and this Tribunal could not find out any :]:rr, *.*" rvhich hits the maintainability of the review application' This Tribunal \ R{ No.2/2023 in SA No.32512022 finds that the review application is well maintainable and this Tribunal has jurisdiction to entertain the same.

15. Ld counsel for the I't respondenr l st defendant at the time of hearing advanced arguments to stress the point that a review can be entertained only to correct the clerical error or mistake which is apparent on the face of the record, that review cannot be exercised on the ground that the decision was erroneous on merits and that the applicant under the present review is seeking for substituting the view taken by the Tribunal which is impermissible in law. To buttress the view, he has relied on the decision of the Hon'ble Supreme Court in Parison Devi and Others v Sumitri Devi and Others freported in (1997) I SCC 7151, wherein the Hon'ble Supreme Court has dealt with the scope of jurisdiction for review and held that ajudgment may be open to review, inter-alia- ifthere is a mistake or an error apparent on the face of the record. It is further held that an error which is not self-evident and has to be detected by a process of reasoning can hardly be said to be an error apparent on the face of the record justifuing the court to exercise its power of review. He also relied on the decision of the Hon'ble Supreme Court in Slri Ram Sahu (dead) throush Lesal reoresentatives and others v Vinod Kumar Rowat and Others lreported in (20211 t3 SCC ll wherein the Hon'ble Supreme Court has dealt with the grounds for and power of review and held that an error which is not self-evident and which can be discovered only by a long process ofreasoning cannot be treated as an error apparent on the face of record justiffing exercise of review power.

16. This Tribunal has gone through the aforesaid Judgments and found that it is ofno avail to the lst respondent/l't defendant to fortify its contention. Rather, the facts of the present case is going in line with the finding of the Hon'ble Supreme Court in the aforesaid cases in respect of jurisdiction and power of this Tribunal to entertain the present review application. It only fortifies the view of the Tribunal upon the point of error apparent on the face ofthe record taken in this matter'

17. The Hon'ble Supreme Court in Thunsabhadra Industries Ltd. v. Govt. of A.P freoorted in AIR 1964 SC 1372] has distinguished an erroneous decision and a decision which could be characterised as vitiated by 'error apparent' and held that where without any elaborate argument one could point to the error and say that there is a substantial point of law which stares one in the face, and there could reasonably be no two opinions entertained about it, a clear case of error apparent on the face of record is made out. The decision reads thus:- " [TJhere is q distinction which is real, though it might not alwsrs be capable o/ exposilion, between a mere erroneots decision and a decision which could be characterised qs vitiated by 'error oryarent'. A review by no mean:t an appeal in disguise whereby an etoneous decision is reheard and corrected bul lies only for patent error ... ..-... .... where without any elaborate argument one could point lo the error and soy here is a substantial point of law which stares one in lhe face, and there could reasonably be no two opinions entertained about it, a clear case oferror apparent on theface ofrecordwould be made out. "

18. The Hon'ble Supreme Court in Meera Bhanja v. Nirmala Kumari choudhury freoorted in AIR 1995 SC 4551 followed the decision in Aribam Tuleshwar and reiterated that an error apparent on the face of record for acquiring jurisdiction to review must be an enor which may strike one on a mere looking at the record and would not require any long- drawn process of reasoning and it reads thus:- "8. It is wel! set ed that the revian proceedings are not by way o/ an appeal and have lo be strictly conlined to the scope and ambil of Order 47 Rule I CPC. ln conneclion with lhe limitation of lhe powers olihe court under Order 47 Rule l, while dealing with similqr iurisdiction ovailable to the H_igh -Court while seeking to reyiew the orders under Article 226 of the Conslilution, this Court, in Aribam Tuleshwar sharma v. Aribam Pishak sharma speaking through Chinnappa Reddy, J has made the following pertinenl observqtions : 'h is trtrc lhere i.\ nothing in Article 226 of the Conslitlttion to preclude the High Court lront exercising the power of review which inheres in etery court of plenary jurisdiction to prevent miscarriage ofjustici or ti correct grave and palpable efiors committed by it. Bul, there are definitive limils to the erLrcise of the power if review- The power of review may be exercised on the discovery of new and importani mauer or evidence which, after the acercise of due diligence was not within the knowledge of the pirson seeking the review or co d not be produced by him at the time when lhe order was made; it may be 'exercised whie some mistake or error apparent on the face of the rccord is found, it tnqy also be exercised on any analogous ground. But, il may nol be exercised on the ground lhat the decision was erroneous on neriri. Thqt iouli be the prot ince of a court of appeal. A Power of review is not to be confused with appellate power which may enable qn appellate court lo cofiecl qll manner of errors committed by lhe t hordinole courl"' \

19. The Hon'ble Supreme Court in Kamlesh Verma v Mavawati freported iry 0013) I SCC 3201 has summarised the principles relating to maintainability of review and it reads thus:- "The principles relating to review jurisdiction may be summarised as follows: llhen the review will be mqintainable:

(i) Discovery of new and importonl malter or evidence which, artet the acercise of due diligence, was not v/ithin knowledge of the petitioner or could not be produced by him; (i, Mislake or error appment on the face ofthe record;

(iii) Ary other sulficient reason."

20. The Hon'ble High Court of Kerala in Marakkara Gramapanchqvat & Anr v lbrahim [reoorted in 2021 (1) KLI 805 : 2020 ICO 4193] has held that even if a gnund taken in the review petition is a new ground, however, the ground being a point of law there cannot be any impediment to seek review of the judgement on that ground, and it reads thus:- "True, the ground on which lhe respondents seek review of the iudgement is nol a ground that was urged at the lime of hearing of the writ petilion. However, the ground being a Point of low, according to me, there cannot be any impediment for the resPondents to seek review of the iudgement on that ground. "

21. The Hon'ble Supreme Court in Goel Gansa Develooers India Pvt Ltd v lJnion oj lndia [reported in 20]8 (3) KLT 782 (SOl has held that if a party urges that some of the contentions urged by it have not been taken into consideration then it has to file a review application and it is but obvious that such review application should be heard by the same Bench which had originally heard the matter, and it reads thus:- "lt is trall lttottn thut purties roise vtrious conlenlions in lheir pleadings or in their evidence. On many occasions when arguments are head many of the pleas are nol urged. Atty judicial authority including the NGT which is presided over by a judicial member who may be a retired Judge of this Court or of a -High Court is expeited to deal with all conlentions raised before it. There is s Presumption lhat judicial a*horities must have dealt \./ith all the contentions raised before then. If a party urges lhat some -of the contentions urged by it have not been tqken into consideration then il has ,o file d review aPplication ind it is bur obvious that such refiew application should be hard by the sqme Bench which had originally heard the mater. "

22. It was also held by the Hon'ble Supreme Cowl in Union of India v Sandur that review power can be ex€rcised on discovery ofnew and important matter or evidence which, after the exercise of due diligence, was not within knowledge ofthe petitioner or could not be produced by \

him, mistake or elror apparent on the face of the record or any other sufficient reason, $,hich means ' a reason sulficient on grounds, at least analogous to those specified in the Rgle'- "Thus, in view ofthe abwe, the following grounds of review are mainlainable as sriPulated by lhe slatute: Discovery of new and important nqler or evidence which, after lhe exercise of due diligence, was not within the knowledge of the petitioner or could not be produced by him. Mistake or error apparent on the face of lhe record. Aw other sufficienl reason. The words 'a4v other s4fficient reason to mean 'a reason suficient on grounds, ql least analogous to those speclied in the rule'. "

23. It is nobody's case that SA 325/2022 was dismissed as per final order dated 31.03.2023 on merits of the case and that the decision of the Tribunal was erToneous on merits of the case. The error occulTed is self-evident and apparent on the facc of the records and no long drawn process of reasoning is required and if the same is no'i reviewed the same will result in miscarriage ofjustice and will prejudicially affect the petitioner/applicant. No need to be fished out and searched out to find such error occured. The mistake occurred on the part of the Tribunal is prima facie visible from the records and the same does not require any detailed examination. The mistake committed by this Tribunal and pointed out by the petitioner/applicant is not on merits of the case but only on the point of question of law, which amounts to the error apparent on the face of the record.

24. In such circumstances, the aforesaid facts and grounds brought on record through the memorandum of review petition by the review petitioner/applicant can be a legitimate basis for setting aside the impugned order and re-adjudication of the matter in dispute. Suffice it to say that the relief prayed for which goes to the root of appreciation of question of law is within the scope of R.5A of the Rules before this Tribunal. It implies that this Rule can be pressed into service as the review sought for is built on the foundation of the question of law amounting to the eror apparent on the face of the records. l0 \

. RA No.2i2023 in SA No.325/2022 il

25. In the above circumstances, this review application is found to be sustainable in the eye of law and thus is liable to be allowed. 26 In the result, RA No.2/2023 is allowed. IA Nos.89512023 and 106512023 are closed. The final order dated 31.03.2023 is set aside. SA 32512022 is restored to file. Parties on both sides are directed to appear before the Tribunal for hearing on 12.08.2024. No costs. [Dictated to tny PA, transcribed by him, corrected and pronounced by me in the open Tribunal on this\te I lh day of July,2024l \ , t IMTIAZ ALI ]

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? IN THE DEBTS RECOVERY TRIBI.INAL - I' KARNATAKA AT BANGALORE PRESENT: SRI IMTIAZ ALI PRESIDING OFFICER Dated the 1 lth daY of JulY, 2024 REVIEW APPLICATION NO. 2 OF 2023 IN SECURITISATION APPLICATION NO.325 OF 2022 Between Arun Kumar, S/o Marisonnappa, 100, 4th Main, Amaraiyothi Layout, R T Nagar, Bangalore, Kamataka - 560032. . .. . . ... Review Petitioner/Applicant And Kotak Mahindra Bank, having its registered office at C27 , Bmdra Kurla ComPlex, Bandra (E), Mumbai - 400051 and branch among other Places at 22, Ground Floor, Kotak House, Mahatma Gandhi Road, Bengaluru, Kamataka - 560001, represented by its President and two others. Respondents/delendants

ORDER