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2018 DIGILAW 1020 (KER)

Nirmal Job A. v. Federal Bank Limited

2018-12-07

DEVAN RAMACHANDRAN

body2018
JUDGMENT : 1. I see a rather uncommon factual scenario in this writ petition, wherein the petitioners impugn an order issued by the Debts Recovery Tribunal attaching the salary of the 1st petitioner before judgment, which order is then followed immediately-almost simultaneously, by a Final Order in the Original Application itself. 2. Under challenge herein is Ext.P3 order issued by the Debts Recovery Tribunal, Ernakulam (DRT for short), as per which 50% of the net salary of the 1st petitioner, drawn by him from the 2nd respondent-Cochin University of Science and Technology (CUSAT for short), has been directed to be attached before judgment and remitted into the loan account availed of by the petitioners from the 1st respondent-Federal Bank. 3. The petitioners fervently assert that the DRT has acted without statutory competence and without purpose; particularly because the Original Application, in which the interim application was filed by the Bank, was also finally disposed of on the same day, virtually within a time difference of minutes of each other. 4. The specific contentions of the petitioners is that the impugned order, which is purportedly issued under Section 22(2)(h) of The Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (hereinafter referred to as Act for short), has been issued without jurisdiction and in confutative exercise of power by the DRT and thus contends that it is null and void. 5. I have heard Sri. George Mathew, learned counsel for the petitioners; Sri. Jacob P. Alex, the learned Standing Counsel appearing for the Federal Bank and Sri. S.P. Aravindakshan Pillai, the learned Standing Counsel for the 2nd respondent. 6. The learned Standing Counsel appearing for the Federal Bank commenced his submissions in support of the impugned order, by predicating that the DRT has sufficient power under Section 22 (2)(h) of the Act to issue an order like the one impugned herein and he says that this power, coupled with the sanction of Rule 18 of the Debts Recovery Tribunal (Procedure) Rules 1993 (hereinafter referred to as the “Rules” for brevity), allows it to issue any direction which is necessary and expedient to give effect to its orders or to prevent abuse of its powers or to secure substantial justice. He submits that Ext.P3 order was issued by the DRT since the petitioners had not remitted any amount in the loan account even though, as is clear from Ext.R1(b) salary certificate, produced along with the counter affidavit of the Bank, the total monthly salary of the first petitioner is Rs.1,56,753/- and axiomatically, therefore, to protect the Bank from further prejudice on account of the obdurate default from the petitioners. 7. As is perspicuous from the afore short narration of the facts and contentions, two broad issues prop up for the consideration of this Court; namely, as to the power of the DRT to issue an order of attachment before judgment and as to whether it was prudent and permissible for it to have issued such an order simultaneous to the Original Application itself being disposed of through a Final Order. 8. To obtain a grip of these issues the relevant forensic provisions of the Act will certainly require a look. 9. Firstly, Section 22(2) of the Act is end rafted as under: (2) The Tribunal and the Appellate Tribunal shall have, for the purpose of discharging their functions under this Act, the same powers as are vested in a Civil Court under the Code of Civil Procedure, 1908(5 of 1908), while trying a suit in respect of the following matters, namely:- (a) summoning and enforcing the attendance of any person and examining him in oath; (b) requiring the discovery and production of documents; (c) receiving evidence on affidavits; (d) issuing commissions for the examination of witnesses or documents; (e) reviewing its decisions; (f) dismissing an application for default or deciding it ex parte; (g) setting aside any order of dismissal or any application for default or any order passed by it ex parte; (h) any other matter which may be prescribed. 10. It is thus luculent that this Section prescribes that the Tribunal, for the purpose of discharging its functions under it, will have the same powers as are vested in a Civil Court under the code of Civil Procedure, while trying a suit in respect of the matters enumerated therein; and sub clause (h) then stipulates that such powers can also be used for any other matter as may be prescribed. 11. 11. As noticed earlier, it is the firm assertion of the learned counsel for the Bank that the learned DRT is fully empowered by the terms of this Section to issue an order of attachment before judgment akin to Ext.P3. I am afraid that I cannot accede to this contention of the Bank because I see no specific power under Section 22(2)(h) of the Act which enables the DRT to issue an order of attachment before judgment, since a reading of the said Section makes it indubitable that it only sanctions certain powers to the DRT while discharging its functions under the act, namely, while dealing with the Original Applications and Appeals before it. I, therefore, fail to understand how the Bank can assert that this Section offers jurisdiction and power to the DRT to order attachment even before judgment. 12. Next, coming to Rule 18 of the Procedure Rules it certainly says that “The Tribunal may make such orders or directions as may be necessary to give effect to its orders or to prevent abuse of its process or to secure ends of justice”. Tested from the touchstone of the specific mandate of this Section, there cannot arise any doubt that though Ext.P3 has neither been issued by the DRT with the intent to give effect to any of its earlier orders or to prevent abuse of its process, it certainly assumes the character of an order issued for the purpose of securing the ends of justice, especially when the Bank asserts that the 1st petitioner is drawing a large salary but still recalcitrant in paying off the dues to the Bank. That being so, I am in affirmation with the Bank to the extent of their contention that Ext.P3 order, having the nature of an attachment before judgment, is certainly one that can be issued by the DRT validly under this Rule to obtain equity and to secure the ends of justice and I, therefore, repel the challenge of the petitioner against the impugned order, that it has been issued without jurisdiction. 13. However, even I hold so, I have serious reservations about the manner in which Ext.P3 order, which can, at the best, be seen to be one ordering attachment of salary before judgment, has been phrased. 13. However, even I hold so, I have serious reservations about the manner in which Ext.P3 order, which can, at the best, be seen to be one ordering attachment of salary before judgment, has been phrased. As is unmistakable there from, the DRT has directed the salary of the 1st petitioner to be attached and has further directed the 2nd respondent to remit it into the loan account maintained with the Bank. This limb of the order, directing the 2nd respondent- University to remit the attached portion of the salary into the loan account with the 1st respondent, is clearly in error, since the DRT appears to have virtually treated this as a process in execution. 14. It is now well settled that an attachment before judgment is essentially different in character from an attachment made after decree (see for support Ouseph Sakaria and Others v. Cherian Joseph and another (AIR 1971 Kerala 159) and Ittaman Nair v. Andy ( 1951 KLT 601 )). The distinction between these two concepts are now too well defined for re-statement: An attachment before judgment does not stand in the same footing as an attachment in execution proceedings since the former does not necessarily ensure the property to the person who attaches it; he only becomes entitled to proceed against it, if he eventually gets a decree. 15. The words of Mitter, J. in Sri Ram Manil v. Tincouri Rai (4 B.L.R. 63) is the most famous when delving on these concepts and I, therefore, extract it as under: “An attachment prior to a decree is not an attachment for the enforcement of the decree but it is a step taken merely for the purpose of preventing the debtor from delaying or obstructing such enforcement when the decree subsequently passed shall be sought to be executed. An attachment after decree is, on the other hand an attachment made for the immediate purpose of carrying the decree into execution and it presupposes an application on the part of the decree holder to have his decree executed.” 16. Perspicuously therefore, an attachment before judgment has a completely different effect from an attachment in execution, although, going by the provisions of the Order XXXVIII Rules 11 and 11A of the CPC, it may not be necessary for a Civil Court to re-attach the property in execution when it has been attached before judgment. 17. Perspicuously therefore, an attachment before judgment has a completely different effect from an attachment in execution, although, going by the provisions of the Order XXXVIII Rules 11 and 11A of the CPC, it may not be necessary for a Civil Court to re-attach the property in execution when it has been attached before judgment. 17. In the case at hand, the DRT unfortunately directed not merely attachment of salary of the petitioner before judgment, but then; as if it is an executing court, has further directed the 2nd respondent-University to remit it into the loan account maintained by the 1st respondent-Bank. Going by the principles afore narrated, it becomes impossible for me to approve Ext.P3 and I, therefore, am constrained to hold that it has been issued by the DRT, to the above extent, without authority. 18. Once my opinion as above is indited, the next immediate and axiomatic question is how and why the DRT should have issued an order of attachment before judgment on the same date as concededly the O.A. was disposed of; and admittedly within minutes of each other. This makes the whole procedure rather ineffable because, once the Original Application itself was allowed on the same day, there was no purpose that could have been served by an interim order before attachment, as has been ordered through Ext.P3. 19. It, consequentially does not require further elaboration that an order akin to Ext.P3 could have been issued only in the pending O.A., and that once the DRT proceeded to coetaneously allow the O.A, then the Bank could only execute the final order, after obtaining a Recovery Certificate, in the manner as is provided under Section 28 of the Act. This is more so because, the powers of recovery are vested with the Recovery Officer, who is mandated to act as per the provisions of the 2nd schedule of the Income Tax Act and by no stretch of imagination can the DRT be seen to be obtaining any jurisdiction or competence to execute its own Final Order for the purpose of recovery of amounts due to a Bank or a financial institution. 20. In the afore circumstances, I cannot find Ext.P3 to obtain favour in law and I am certainly of the view that the order has now become completely unnecessary and incapable of further operation, once the Original Application had been finally allowed. 20. In the afore circumstances, I cannot find Ext.P3 to obtain favour in law and I am certainly of the view that the order has now become completely unnecessary and incapable of further operation, once the Original Application had been finally allowed. This is because once the Original Application itself stood allowed by the DRT on the same day, the Bank obtained the competence to have the consequential Recovery Certificate executed as per Section 28 of the Act, through the aegis of the Office of the Recovery Officer attached to the DRT, under the provisions of the 2nd schedule to the Income Tax Act. Resultantly, this original petition is allowed and I quash Ext.P3 order, however, leaving full liberty to the Bank to execute the award issued in TA No.176/2017 (O.A.171/2016) of the DRT-II, Kerala at Ernakulam in terms of law.