ORDER 1. Respondent 1 is the borrower firm of which Respondent 2 is the Managing Director. The loan was taken from the appellant Bank. The claim a of the appellant was allowed by the Debts Recovery Tribunal (for short "DRT") by ex parte order dated 31-10-2000. The application for its setting aside was dismissed by the Tribunal on 3-1-2003 and the appeal was dismissed by the Debts Recovery Appellate Tribunal (for short "the Appellate Tribunal") on 10-4-2003. 2. The High Court, by the impugned judgment and order dated 1-5-2003, in a petition filed under Article 226 of the Constitution by the borrower firm and its Managing Director, has set aside the orders dated 3-1-2003 and 10-42003. The Bank is in appeal on grant of leave. 3. In brief, the facts are that the appellant Bank filed a suit against the borrower firm, its Managing Director and other partners in the year 1993 for recovery of more than rupees fifty-six lakhs. The written statement was filed in November 1995. The suit was transferred to DRT at Bangalore and thereafter to DRT at Hyderabad. In the written statement, only vague pleas were taken. Before DRT, on 12-10-2000, one witness was examined and certain documents were exhibited and the case was adjourned to 19-102000. On this date, Mr D.K. Murthy, Advocate, appeared and filed fresh vakalatnama on behalf of the borrowers. Mr G.V. Shivaji, Advocate, had earlier filed the vakalatnama. On request of the counsel, the case was adjourned to 27-10-2000 giving last opportunity to the borrowers. On 27-10-2000, neither the counsel nor any of the defendants appeared. The evidence was closed and the matter was posted for 31-10-2000 on which date the application of the Bank was allowed on the basis of the material on record. The order dated 31-10-2000 is said to have been received by the Managing Director of the borrower on 28-11-2000. On 3-1-2001, application for setting aside the ex parte order dated 31-10-2000 was made with a delay of thirty-two days. The said application was returned by the Registry with objections. It was resubmitted on 9-5-2002 with a delay of 472 days after removing the objections. On resubmission, the Registry pointed out that the f application for setting aside the ex parte order was not accompanied by an application for condonation of delay. That application was filed on 16-72002.
The said application was returned by the Registry with objections. It was resubmitted on 9-5-2002 with a delay of 472 days after removing the objections. On resubmission, the Registry pointed out that the f application for setting aside the ex parte order was not accompanied by an application for condonation of delay. That application was filed on 16-72002. In the intervening period between 3-1-2001 and 16-7-2002, demand notices had been served on the respondents on 28-8-2001 and 1-10-2001 and attachment order was served on 19-4-2002. The sale proclamation was issued on 5-8-2002 and publication for sale appeared in the newspaper on 8-8-2002. The application filed for condonation of delay was dismissed by DRT on 9-92002 and, consequently, application for setting aside the ex parte order was also dismissed. On 18-9-2002, the property was auctioned for Rs 2.86 crores. The respondents filed a writ petition in the High Court challenging the auction-sale. The High Court directed them to deposit rupees fifty lakhs in two instalments but the order was not complied with. Be that as it may, the Appellate Tribunal dismissed the appeal filed against the order dated 9-92002. The sale was confirmed by the Recovery Officer of DRT on 20-11- 2002. Respondents 1 and 2 challenged the orders of DRT and the Appellate Tribunal, whereby the application seeking condonation of delay had been dismissed, in a writ petition filed before the High Court. The High Court, by order dated 27-11-2002 passed in the said writ petition, taking a liberal view, condoned the delay and directed DRT to take up the application for setting aside the ex parte order on merit. 4. Pursuant to the aforesaid order dated 27-11-2002, the application for setting aside the ex parte order dated 31-10-2000 was taken up and, ultimately, was dismissed by DRT on 3-1-2003. DRT has examined in detail the application and the conduct of the respondents. It has been noticed in the order that, apart from the earlier non-appearance of the respondents, except on one date i.e. 19-10-2000, they did not take any step for either appearance of other defendants or for appearance of the counsel despite the fact that, on 19-10-2000, last opportunity had been granted to them. The appeal filed against the order dated 3-1-2003, as already noticed, was dismissed by the Appellate Tribunal on 10-4-2003. 5.
The appeal filed against the order dated 3-1-2003, as already noticed, was dismissed by the Appellate Tribunal on 10-4-2003. 5. We have heard the learned counsel for the parties and have perused the record, including the application which was filed seeking to set aside the ex parte order dated 31-10-2000. On 19-10-2000 last opportunity was granted to the respondents to appear and adduce evidence on 27-10-2000. Assuming that the Managing Director suffered leg fracture, as claimed, that by itself could not be a ground for absence on 27-10-2000. It may be noticed that the alleged fracture had, in fact, taken place, according to the Managing Director himself, on 29-9-2000 i.e. before 19-10-2000. Therefore, the fracture which took place on 29-9-2000, could not be a ground for absence on 27-10-2000. Further, a perusal of the application does not state any reason, except a vague averment about the leg fracture suffered by the Managing Director; no date has been given; it has not been stated as to why other defendants were not asked to appear. It has also not been stated as to why the advocate was not informed about the leg fracture and why the advocate was absent. In fact, the date of fracture has, for the first time, come up in the order of the Appellate Tribunal. 6. The only ground on which the High Court has set aside the orders in question, which contain the concurrent findings of fact, is the order dated 27-11-2002, whereby delay had been ordered to be condoned. We are afraid, that by itself could not be the basis for setting aside the orders dated 3-12003 and 10-4-2003. That order was limited to the question of condonation of delay. The High Court, taking liberal view, had come to the conclusion that delay deserves to be condoned and the application for setting aside the order deserves to be considered on merit. We are unable to sustain the view of the High Court that the spirit of the said order was to set aside the order dated 31-10-2000. The record clearly demonstrates that the respondents have been utterly negligent right from the initial stage of the case and did not take care to appear even despite the last opportunity having been granted and it seems evident that the intention was to delay the matter, having regard to the nature a of defence that had been taken.
The record clearly demonstrates that the respondents have been utterly negligent right from the initial stage of the case and did not take care to appear even despite the last opportunity having been granted and it seems evident that the intention was to delay the matter, having regard to the nature a of defence that had been taken. In the meanwhile, the interest of third party has cropped up. They have purchased the property in question and are in possession of it. Be that as it may, having regard to the facts and circumstances abovenoticed, we see no reason to sustain the order of the High Court setting aside the well-considered order dated 3-1-2003. We may also note that on 27-10-2000, admittedly, no application for adjournment was filed bringing to the notice of DRT the reasons for the absence of the respondents or their counsel. 7. In view of the aforesaid, we set aside the impugned judgment and order of the High Court and restore the order of the Tribunal dated 3-1-2003 and that of the Appellate Tribunal dated 10-4-2003. 8. The civil appeal is, accordingly, allowed with costs.