Deepthi Trading Company, rep. v. Authorised Officer, ICICI Bank Limited, Chennai – 600 058
2013-11-26
PUSHPA SATHYANARAYANA, R.SUDHAKAR
body2013
DigiLaw.ai
ORDER MR. R. SUDHAKAR, J. 1. This revision petition is filed challenging the order dated 15.4.2013 passed by the Debts Recovery Tribunal-III, Chennai dismissing SARFAESI Application No. 245 of 2012, however with certain observations which are totally uncalled for and unwarranted for the purpose of disposing of the SARFAESI Application, which will prejudice the rights of the revision petitioners. 2. The facts leading to the filing of the SARFAESI Application are as under: The first petitioner is the borrower. The second and third petitioners are husband and wife. The second petitioner is running the business of the first petitioner/trading company. The third petitioner is doing some other business. According to the first respondent/bank, the amount that has been borrowed from the bank was declared as a non-performing asset and consequent to the same notice under Section 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for brevity, “SARFAESI Act”) was issued calling upon the petitioners to pay certain amount and since the said notice has not been properly responded and no amount was paid, possession notice under Section 13(4) of the SARFAESI Act was issued and that was challenged by the petitioners before the Debts Recovery Tribunal-III, Chennai in SARFAESI Application No. 245 of 2012. 3. According to the revision petitioners, the Court fee payable was paid and an order of interim stay was granted on 7.8.2012 in the SARFAESI Application, subject to the condition that the petitioners deposit a sum of Rs. 8,00,000/- with the first respondent/bank. It is stated by the petitioner that the said condition has been complied with and thereafter, the SARFAESI Application was taken up for final disposal. The Tribunal formulated the following two issues for consideration: (i) Whether the applicant in the above SARFAESI Application is entitled to get the relief as prayed for? (ii) Relief and costs? The Tribunal suo motu came to the conclusion that it had no jurisdiction over the subject matter of the case placing reliance on a Full Bench decision of the Delhi High Court in Amish Jain and Another v. ICICI Bank Limited, 2012 (6) CTC 369 : LNIND 2012 DEL 1504. The conclusion at paragraph (7) of the impugned order is that the Tribunal has no jurisdiction and therefore, it is legally bound to dismiss the SARFAESI Application. 4.
The conclusion at paragraph (7) of the impugned order is that the Tribunal has no jurisdiction and therefore, it is legally bound to dismiss the SARFAESI Application. 4. There is no dispute on the reasoning given by the Tribunal that the cause of action for filing the SARFAESI Application would be not before the Debts Recovery Tribunal-III, Chennai and it will before the Tribunal at Madurai. But what pinches the petitioners is the finding on merits in paragraph (7) of the order, where the Tribunal, on merits, comes to the conclusion on the validity of the challenge made to the notice issued under Section 13(4) of the SARFAESI Act. Once the Tribunal found that it had no jurisdiction to entertain the SARFAESI Application, it is bound to return the papers as such and it is not empowered to pass any order touching upon the merits of the case and therefore, the error, as pointed out by the revision petitioners, in the order under challenge deserves consideration, as a finding has been rendered on the merits of the case by a Tribunal which did not have jurisdiction to pass the order. 5. The above said view of this Court finds favour in a decision of the Supreme Court in Sri Athmanathaswami Devasthanam v. K. Gopalaswami Aiyangar, AIR 1965 SC 338 , wherein it was held as under: “18. The last point urged is that when the civil Court had no jurisdiction over the suit, the High Court could not have dealt with the cross-objection filed by the appellant with respect to the adjustment of certain amount paid by the respondent. This contention is correct. When the Court had no jurisdiction over the subject-matter of the suit it cannot decide any question on merits. It can simply decide on the question of jurisdiction and coming to the conclusion that it had no jurisdiction over the matter had to return the plaint.” 6. The Tribunal ought to have returned the papers to the revision petitioners for being presented before the competent forum, as is evident from a decision of the Supreme Court in Onge Ltd. v. Modern Construction and Co. (Civil Appeal Nos.8957 to 8958 of 2013, dated 7.10.2013), wherein it was held as under: “13.
The Tribunal ought to have returned the papers to the revision petitioners for being presented before the competent forum, as is evident from a decision of the Supreme Court in Onge Ltd. v. Modern Construction and Co. (Civil Appeal Nos.8957 to 8958 of 2013, dated 7.10.2013), wherein it was held as under: “13. Thus, in view of the above, the law on the issue can be summarised to the effect that if the Court where the suit is instituted, is of the view that it has no jurisdiction, the plaint is to be returned in view of the provisions of Order 7 Rule 10 CPC and the plaintiff can present it before the Court having competent jurisdiction. In such a factual matrix, the plaintiff is entitled to exclude the period during which he prosecuted the case before the Court having no jurisdiction in view of the provisions of Section 14 of the Limitation Act, and may also seek adjustment of Court fee paid in that Court. However, after presentation before the Court of competent jurisdiction, the plaint is to be considered as a fresh plaint and the trial is to be conducted de novo even if it stood concluded before the Court having no competence to try the same.” 7. In view of the law enunciated by the Supreme Court in the decisions referred supra, the observation of the Tribunal in paragraph (7) of the order touching on the merits of the SARFAESI Application are set aside and a direction is issued for transfer of the SARFAESI Application to the jurisdictional Tribunal for disposal of the same on merits from the stage at which the matter was finally taken up by the Tribunal at Chennai, that is to say the final disposal of the SARFAESI Application, as the conditional interim order already passed by the Tribunal was complied with by the petitioners. For the foregoing reasons, this civil revision petition is allowed and the order passed by the Debts Recovery Tribunal-III, Chennai is set aside with the above said direction. No costs. Consequently, M.P. No. 1 of 2013 is closed. Petition allowed.