Gujarat High Court
Bharat Cold Depot Thro Partners & 4 vs Veraval Peoples Cooperative Bank Ltd ... on 20 February, 2017
Author: C.L.Soni
Bench: C.L. Soni
C/SCA/6808/2013 ORDER
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
SPECIAL CIVIL APPLICATION NO. 6808 of 2013
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BHARAT COLD DEPOT THRO PARTNERS & 4
Versus
VERAVAL PEOPLES COOPERATIVE BANK LTD THRO MANAGER & 1
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Appearance:
MR SHIRISH JOSHI, ADVOCATE for the Petitioners No. 1 - 5
MR ASHISH H SHAH, ADVOCATE for the Respondent No. 1
NOTICE SERVED BY DS for the Respondent No. 2
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CORAM: HONOURABLE MR.JUSTICE C.L. SONI
Date : 20/02/2017
ORAL ORDER
[1] By the present petition filed under Articles 226 and 227 of the Constitution, the petitioners have challenged the order dated 15.03.2013 passed by the Gujarat State Cooperative Tribunal (the Tribunal) in Review Application No.16 of 2010 preferred by respondent no.1.
[2] It appears that respondent no.1 - original plaintiff filed Lavad Case No.111 of 1994 before the Board of Nominee seeking to recover Rs.8,53,033.71 paisa from the petitioners. The Board of Nominee by its award dated 06.10.2009 ordered the petitioners to pay Rs.1,75,706.09 paisa with 17% simple interest and cost of Rs.5080/- within 30 days and further ordered that on petitioners' failure to pay such amount, respondent no.1 - original plaintiff shall be entitled to recover the said amount with 17% compound interest. The Board of Nominee has also ordered that the amount of Rs.1,50,000/- paid by the petitioners pending the suit should be given set off Page 1 of 7 HC-NIC Page 1 of 7 Created On Sun Aug 13 19:57:58 IST 2017 C/SCA/6808/2013 ORDER / adjustment in payment of the above said amount of Rs.1,75,706.09 paisa. It appears that such award of the Board of Nominee was challenged before the Tribunal by respondent no.1. However, the Tribunal by its judgment and order dated 18.02.2010 dismissed the appeal. The respondent no.1 then preferred review application before the Tribunal which came to be allowed with an order that the order dated 18.02.2010 passed by the Tribunal in Appeal No.273 of 2009 is set aside and by reviewing the decision, it is ordered that the Appeal No.273 of 2009 is allowed and the award dated 06.10.2009 made by the Board of Nominee in Lavad Case No.111 of 1994 is declared illegal and set aside in part and by modifying the said award, the petitioners are ordered to pay an amount of Rs.8,53,033.71 paisa with 17% simple interest from the date of the suit i.e. 20.09.1994 till the amount is recovered.
[3] Learned advocate Mr.Shirish Joshi for the petitioners submitted that though no ground was made out for reviewing the order passed in appeal, the Tribunal allowed the review application. Mr.Joshi submitted that the grounds taken in the review application are the grievances against the award made by the Board of Nominee and the review was not sought for any error or mistake of the Tribunal apparent on the face of the record when the appeal was decided or on discovering of important and new material which require review of the order or for any sufficient reason. Mr.Joshi submitted that though no such grounds were taken by respondent no.1, the Tribunal allowed the review application as if it was, for the first time, deciding the appeal on merits and in review by finding fault with the award made by the Board of Nominee, the appeal was allowed. He submitted that such course adopted by the Page 2 of 7 HC-NIC Page 2 of 7 Created On Sun Aug 13 19:57:58 IST 2017 C/SCA/6808/2013 ORDER Tribunal is in excess of jurisdiction vested with the Tribunal in the context of powers of review available under section 151 of the Gujarat Cooperative Societies Act ("the Act"). He, therefore, urged to allow the petition and set aside the impugned order made by the Tribunal.
[4] Learned advocate Mr.Ashish H. Shah for respondent no.1 submitted that the powers of review available under Section 151 of the Act to the Tribunal could well be exercised for any other sufficient reason. He submitted that when the Tribunal decided and dismissed the appeal on merits, it overlooked important evidence as regards full liability of the petitioners for suit claim and for payment of 17% compound interest. He submitted that though the petitioners were required to discharge liability of the suit amount with interest, however, just because the petitioners had shown their readiness to pay an amount of Rs.1,50,000/-, the Board of Nominee endorsed such readiness of the petitioners and without much discussion, arrived at abrupt conclusion for making award of only Rs.1,75,706.09 paisa and even from such amount, the petitioners are given set off of Rs.1,50,000/-. He submitted that the Board of Nominee also ignored contract for payment of the compound interest at the rate of 17% and granted 17% simple interest. He submitted that such glaring error committed by the Board of Nominee was continued by the Tribunal which was when noticed at the time of deciding the review application, the Tribunal found that it was a fit case to exercise its review powers and exercise of such review powers could be said to be for the sufficient reason and, it is not correct to say that the Tribunal has exceeded in its jurisdiction by allowing the review application.
Page 3 of 7HC-NIC Page 3 of 7 Created On Sun Aug 13 19:57:58 IST 2017 C/SCA/6808/2013 ORDER [5] Having heard learned advocates for both the sides and having perused the impugned order made by the Tribunal in review application with the order made on the appeal by the Tribunal, it appears that the Tribunal when decided the appeal found that there was no error committed by the Board of Nominee in finding that the outstanding amount as on 30.06.1984 was Rs.1,75,706.09 paisa and that discretion was exercised by the Board of Nominee to award 17% simple interest. The conclusion reached by the Tribunal, while deciding the appeal reads as under:
"Looking to the observations we endorse the findings of the learned Nominee to allow 17% interest from the due date of repayment of the original loan in 1983 i.e. 30.06.1984 and the outstanding amount as on 30.06.1984 as per the statement of account is Rs.1,75,706.09 paisa. The operative part of the order tallies with the amount outstanding as on 30.06.1984 and, therefore, the amount is not reduced by the learned Nominee as per the allegation of the appellant and, therefore, the same cannot be interfered with. The operative part refers to 17% simple rate of interest which we have discussed above that the same is discretionary to the learned Nominee in view of the late filing of the Lavad Case and likewise disallowing of penal interest is also justified on the same ground."
[6] The above conclusion would go to show that the Tribunal agreed with the findings of the Board of Nominee and dismissed the appeal.
[7] The powers available to the Tribunal for review are under section 151 of the Act which reads as under:
" Review of orders of Tribunal :-
(i) The Tribunal may, either on the application of the Page 4 of 7 HC-NIC Page 4 of 7 Created On Sun Aug 13 19:57:58 IST 2017 C/SCA/6808/2013 ORDER Registrar, or on the application of any party interested, review its own order in any case, and pass in reference thereto such order as it thinks just:
Provided that, no such application made by the party interested shall be entertained, unless the Tribunal is satisfied that there has been 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 its order was made, or that there has been some mistake or error apparent on the face of the record, or for any other sufficient reasons:
Provided further that, no such order shall be varied or revised, unless notice has been given to the parties interested to appear and be heard in support of such order,
(ii) An application for review under sub-section (1) by any party, shall be made within ninety days from the date of the communication of the order of the Tribunal."
[8] The grounds taken by respondent no.1 in its review application read as under:
(a) That the learned board of Nominee at Rajkot has penalised the applicant bank for non-production of the loan documents demanded by the opponents during the suit. The learned board of Nominee at Rajkot in its order said that on non-production of the documents was injustice to the opponents herein. But the fact is the opponents at no stage have contested that they have not taken loan in the year 1983. And the Hon'ble High Court of Gujarat in its judgment dated 01.05.2007 (Coram : Hon'ble Mr.Justice D. A. Mehta) has observed at para-6 that the Tribunal has made it abundantly clear that in so far as the suit was concerned it shall not be prejudiced in manner whatsoever merely because the documents are not present on record. Though dishonouring the said direction of this Hon'ble Tribunal and Hon'ble High Court of Gujarat the Board of Nominee at Rajkot has made an error and the same point has not been brought to the notice of Hon'ble Tribunal at the time of appeal said order of Hon'ble High Court of Gujarat is annexed herewith and marked Annexure - C.
(b) The Board of Nominee has directed the opponents to get the documents at Exh.45, 46, 47, 48 and 59/3 to be examined by a hand writing expert recognised by the State Government Page 5 of 7 HC-NIC Page 5 of 7 Created On Sun Aug 13 19:57:58 IST 2017 C/SCA/6808/2013 ORDER on account of some over writing as well as correction in the documents and on application of the opponents. Though it is pertinent to mention that for the said documents were only for the examined of over writing and not for signature verification of the opponents. At this point the report submitted by the opponents was not of the State recognised hand writing expert, but in spite of the said fact the learned Board of Nominee has relied upon the said report and has made observation against the applicant bank and the same was made a reason for not granting the contractual interest. The said order of Board of Nominee directing to get the documents checked by hand writing expert and the report of hand writing expert are annexed herewith and marked Annexure - D Colly.
(c) In the said report of the hand writing expert the states that there is over writing on the documents and the same fact has been accepted by the applicants herein at the relevant time.
But though being prejudiced by the said over writing has penalised the bank by not granting the contractual interest. For this the applicant herein states that if the document is to be altered it has to be for some gain or with such objective, merely over writing in a document for no gain or objective but only a form of correction due to mistake is writing cannot be said to be false or fraud on part of the applicant. Even though any such correction was not amounting to save the applicant from any bar of limitation or was not to provide any gain whatsoever to the applicant as there is no limitation of time to approach the Board of Nominee by the bank. Again the said alteration or over writing in the document is in no manner damaging or injuring any body including the opponents.
(d) The Board of Nominee as well as the Hon'ble Tribunal has not considered section 34 of Civil Procedure Code, 1908, which specifically says that the interest must be granted at the contractual rate or where there is no contract at the rate at which the money is lent or advanced by the nationalized bank in relation to commercial transaction.
[9] The above grounds would clearly show that respondent no.1 mainly voiced its grievance against the award / order made by the Board of Nominee. Nowhere, it is stated in the application that any new material was discovered which would require review of the order made by the Tribunal in appeal or that there was any error committed by the Tribunal which was apparent on the face of the record. The respondent no.1 has Page 6 of 7 HC-NIC Page 6 of 7 Created On Sun Aug 13 19:57:58 IST 2017 C/SCA/6808/2013 ORDER also not spelled out any other reason which could be said to be sufficient reason so as to call for exercise of review power by the Tribunal. What appears is that respondent no.1 has taken up grievances against the award / order of the Board of Nominee for which the remedy of appeal was availed. Thus, it appears that the review powers were not invoked on the grounds available in Section 151 of the Act. If the review powers were not invoked on the ground available under Section 151 of the Act, the Tribunal was not justified in setting at naught its own order dated 18.02.2010 passed in the appeal by now finding fault with reasoning and conclusion reached by the Board of Nominee in its award. The Tribunal has decided the review application as if it was hearing appeal on merits which was not permissible as it was not open to the Tribunal to sit in appeal over its own decision.
[10] In such view of the matter, the Court finds that the impugned order passed in review application of respondent no.1 would not stand scrutiny of law and is, therefore, required to be set aside.
[11] In the result, the petition is allowed. The impugned order dated 15.03.2013 passed by the Tribunal in Review Application No.16 of 2010 is hereby quashed and set aside. Rule is made absolute.
(C.L.SONI, J.) vijay Page 7 of 7 HC-NIC Page 7 of 7 Created On Sun Aug 13 19:57:58 IST 2017