Gujarat High Court
Gaurangbhai Bipinbhai Pandya vs Bank Of Baroda Thro' & on 9 December, 2014
Author: K.M.Thaker
Bench: K.M.Thaker
C/CA/6707/2013 ORDER
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
CIVIL APPLICATION (FOR STAY) NO. 6707 of 2013
In
SPECIAL CIVIL APPLICATION NO. 22089 of 2007
With
CIVIL APPLICATION NO. 6709 of 2013
In
SPECIAL CIVIL APPLICATION NO. 22093 of 2007
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GAURANGBHAI BIPINBHAI PANDYA....Applicant(s)
Versus
BANK OF BARODA THRO' & 1....Respondent(s)
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Appearance:
MR JAL SOLI UNWALA, ADVOCATE for the Applicant(s) No. 1
MS NALINI S LODHA, ADVOCATE for the Respondent(s) No. 1
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CORAM: HONOURABLE MR.JUSTICE K.M.THAKER
Date : 09/12/2014
COMMON ORAL ORDER
1. Heard Mr.Unwala, learned advocate for the applicant.
2. Ms.Taruna Makwana, learned advocate for Ms.Lodha, learned advocate for the respondent is present.
3. Mr.Unwala, learned advocate, submitted that Page 1 of 13 C/CA/6707/2013 ORDER the respondent has served advance copy of the application in view of the fact that the opponent has already entered appearance in the main petition.
4. Mr.Unwala, learned advocate for the applicant, also submitted that upon advance service of copy of the application, the respondent bank has already filed reply affidavit.
5. However, having regard to the fact that formal order issuing notice to the respondent is not passed, following order is passed.
6. Issue Notice for final hearing and decision to the respondents.
7. At this stage, Ms. Lodha, learned advocate has entered the Court and appeared in the hearing of this application.
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8. At the request of Mr.Unwala, learned advocate for the applicant, and Ms.Lodha (who just entered the Court and has appeared for the respondent bank) and with consent of Ms. Lodha, learned advocate for the respondent, notice is made returnable today. Ms. Lodha, learned advocate, has waived service of notice for the respondents. At the request of learned advocate for the petitioner and with consent of learned advocate for the bank and since reply is already filed and considering the subject matter of the application, the matter is taken up for orders today.
9. The main petition being Special Civil Application No.22089 of 2007 (wherein this application is taken out) came to be allowed vide order dated 18.3.2008. The Court (Coram: Hon'ble Mr.Justice Jayant Patel) observed and held, inter alia, that:
"26. In my view the as action of the bank is found without authority, more particularly when the money Page 3 of 13 C/CA/6707/2013 ORDER held by it was as the trustees. The lawful obligation was created to return money, but if not returned, the interest by way of compensatory measure is required to be awarded. The fact remains that bank has retained money and has enjoyed money, and the petitioners are deprived of the legitimate amount of interest at the rate prevailing for the minimum investment of one year in all nationalised bank. Hence, I find that by way of compensatory measures, the interest can be awarded at the rate of 8 percent per annum. Therefore, the said contention of learned Counsel for the respondent bank cannot be accepted.
27. In view of the above, the action of the bank of not returning amount of Rs. Rs.16,75,890.75 ps. and of retaining the same can be said as without right, or authority and consequently the bank will be required to return amount of Rs. Rs.16,75,890.75 ps. with interest at the rate of 8 percent per annum, which is prevailing rate of interest on the FDR investment. As the bank has already deposited the amount with this Court, pursuant to the order dated 18.2.2008, the petitioner would be entitled to withdraw the same from this Court. The amount of accrued interest shall be paid by the bank to the petitioner within the period of four weeks from today by A/c payee cheque.
28. It is clarified that the aforesaid order shall not prejudice the right of the either side in the proceedings of OA No. 110 of 2004, pending before the Debt Recovery Tribunal for the loan transaction with the company, nor the same shall prejudice the right of the bank, if available, under the law for any interim order in such proceedings. Suffice to state that if such application is made, the right of both the sides as may be available in law shall remain open.
29. The petitions are allowed to the aforesaid extent. Rule made absolute accordingly.
30. Ms. Lodha learned Counsel for the respondent bank prayed that the operation of the order of this Court be stayed for some time so as to enable respondent bank to approach before the higher forum.
31. Considering the facts and circumstances, the said request is declined. However, it is only observed that payment if any, made shall be subject to the further orders, as may be passed by the higher forum."
10. The said order was carried in appeal by the Page 4 of 13 C/CA/6707/2013 ORDER bank. The appeal came to be registered as Letters Patent Appeal No.390 of 2008. Hon'ble Division Bench partly allowed the said appeal vide order dated 11.12.2012 and remanded the petition for fresh hearing and fresh decision. In the said order in the appeal, Hon'ble Division Bench observed and directed, inter alia, that:
"... ... ... ... ... ... That the original petitioners to deposit the entire amount withdrawn by them pursuant to the impugned common Judgement and Order passed by the learned Single Judge with the registry of this Court within a period of three months from today (as stated by their advocate) without prejudice to the rights and contention of the respective parties in the main Special Civil Applications and on such deposit, registry is directed to invest the same in the name of the Registrar General, Gujarat High Court, initially for a period of one year and to continue to renew the same till final disposal of the main Special Civil Applications and thereafter the registry to place the main Special Civil Applications before the Court taking up such matters for final hearing and the learned Single Judge is requested to finally decide and dispose of the main Special Civil Applications at the earliest, however, only after the aforesaid amount is deposited by the original petitioners. Both these Letters Patent Appeals are accordingly allowed to the aforesaid extent. In the facts and circumstances of the case, there shall be no order as to costs.
11. It appears that certain proceedings are pending before the learned Tribunal and in the said pending proceedings before learned Tribunal, the opponent bank filed an application before the Page 5 of 13 C/CA/6707/2013 ORDER learned Tribunal.
12. The said application came to be registered as RP No.116/2012 in OA No.110/2004.
13. In the said application, the applicant bank has prayed, inter alia, that:
"9(A) That the Hon'ble Recovery Officer be pleased to apply to the Hon'ble High Court for payment of Rs.16,87,278/ lying with the registry of Hon'ble High Court pursuant to the common judgment and order dated 11.12.2012 passed in Letters Patent Appeal Nos.390 and 391/2008 filed by the CH Bank with interest earned thereon towards payment of debt due as per RC in terms of subSection (4) of Section 28 of RDDB Act."
14. When the bank moved the said application and prayed for abovequoted relief/direction from the learned Tribunal, the original petitioner preferred present application and prayed that:
"5(a) Pending the hearing and final disposal of the writ petition being SCA No.22089/2007, this Hon'ble Court may be pleased to stay the proceedings of Application being RP No.116/2012 in O.A. No.110/2004 pending before the learned Debts Recovery TribunalI, Ahmedabad dated 30.4.2013 filed under section 28(4) of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993;"
15. During the hearing, Mr.Unwala, learend advocate for the applicant - petitioner submitted Page 6 of 13 C/CA/6707/2013 ORDER that Hon'ble Division Bench has passed certain directions in the order dated 11.12.2012 and that the said order dated 11.12.2012 is still in operation and the main petition being Special Civil Application No.22089 of 2007 is still pending in this Court.
16. Learned advocate for the applicant further submitted that when the directions passed by Hon'ble Division Bench are still in operation, the application submitted by the bank and the reliefs prayed for in the said application are not maintainable and the learned Tribunal has no authority and would not be justified in entertaining the application and granting the relief as prayed for.
17. He also submitted that since the learned Tribunal considered appropriate to hear the said application, the petitioner was constrained to prefer present petition.
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18. Ms. Lodha, learned advocate has opposed the application. She reiterated the details mentioned in the affidavit. In the reply affidavit in this civil application the bank has averred and stated that:
"I state that the secured assets have already been sold by the official liquidator attached to this Hon'ble High Court in Company Petition No.134/2000 and after disbursement of the sale proceeds, the respondent bank has still to recover huge outstanding certified / decreetal dues of more than Rs.7 crores. I further state that the Ld. RO is entitled to recover the certified / decreetal amount in terms of 28(4) of the RDDB Act by applying to the Hon'ble High Court for payment of Rs.16,87, 278/ lying with the registry of this Hon'ble Court with interest earned thereon. I further state that the respondent bank, during the course of hearing of LPA 390 and 391/2008 had submitted before the Hon'ble Division Bench of this court that apart from the right of lien, the bank is entitled to appropriate the said amount in execution proceedings as the OA has already been disposed of. The said submission is recorded in para 2.05 of the judgment dated 11.12.2012 of this Hon'ble Court which is reproduced herebelow:
"2.05. Ms.Lodha, learned advocate appearing on behalf of the appellant Bank has stated that even subsequently O.A. No.110 of 2004 instituted by the bank against the company M/s.Printpack Industries Limited (as principal debtor) and even the original petitioners (as guarantors), has been decreed and therefore, even otherwise, now the Bank can recover and/or appropriate the said amount under the execution of the said order. To that Mr.Unwala, learned advocate appearing on behalf of the original petitioners has submitted that as on today, no execution petition has been instituted by the Bank and therefore, he has requested not to make any observations on the same."
I state that in view of the execution proceedings i.e. RP having been already commenced and demand notice Page 8 of 13 C/CA/6707/2013 ORDER having been already served upon the CDs, the Ld. RO is empowered to recover the decretal amount in the manner stated in Section 25 and 28 of RDDB Act. In the above context, I state that the civil application filed by the applicant is misconceived and untenable."
19. It emerges from the relief prayed for by the bank by virtue of the application being RP No.116/2012 that according to the petitioner the bank has claimed before the learned Tribunal that the amount which is deposited by the petitioner pursuant to the order passed by Hon'ble Division Bench and the interest thereon, should be paid to the applicant bank.
20. According to eh petitioner the bank is not justified in claiming the said amount deposited by it, i.e. the applicant herein.
21. In this context, it is relevant to take into account observation and direction by Hon'ble Division Bench in the order dated 11.12.2012. In the said order, Hon'ble Division Bench has observed and directed that:
Page 9 of 13 C/CA/6707/2013 ORDER
"... ... ... ... ... ... on such deposit, registry is directed to invest the same in the name of the Registrar General, Gujarat High Court, initially for a period of one year and to continue to renew the same till final disposal of the main Special Civil Applications and thereafter the registry to place the main Special Civil Applications before the Court taking up such matters for final hearing...."
22. It was in pursuance of the order passed by Hon'ble Division Bench that the original petitioner - present applicant deposited the entire amount (which was withdrawn pursuant to the order dated 18.3.2008 in the main petition) with the Registry within three months.
23. The said deposit was directed to be made without prejudice to the rights and contentions of the petitioner.
24. Accordingly, the original petitioner, i.e. present applicant deposited the amount in question.
25. Now, the bank has filed abovementioned application before the learned Tribunal, without Page 10 of 13 C/CA/6707/2013 ORDER first approaching Hon'ble Division Bench and without requesting Hon'ble Division Bench to modify the said order dated 11.12.2012 and/or without seeking permission from Hon'ble Division Bench, to withdraw of the amount.
26. In this view of the matter, this Court is of the view that without getting the order dated 11.12.2012 passed by Hon'ble Division Bench modified and and without seeking permission from Hon'ble Division Bench to withdraw the amount and to move appropriate application before the learned Tribunal for such purpose, the bank could not have taken out such application and the learned Tribunal would not be justified in entertaining and allowing the application in absence of modification of the order dated 11.12.2012 by Hon'ble Division Bench and permission by Hon'ble Division Bench.
27. The bank may move appropriate application and seek appropriate relief with regard to the amount Page 11 of 13 C/CA/6707/2013 ORDER deposited by present applicant pursuant to order dated 11.12.2012 by Hon'ble Division Bench, but not without first requesting the Hon'ble Division Bench to modify the order dated 11.12.2012 and grant permission to prosecute the application.
28. In that view of the matter, present application is disposed of with following observations and clarifications.
29. The relief prayed for in paragraph no.5(a) is granted.
30. The proceedings related to the application being R.P. No.116/2012 in O.A. No.110/2004 are stayed until Hon'ble Division Bnech may pass appropriate order. It would be open to the bank to file appropriate application before Hon'ble Division Bench and seek modification of the order dated 11.12.2012 or to seek permission to prosecute the said application and seek appropriate relief/direction from the learned Tribunal with regard to the amount deposited by Page 12 of 13 C/CA/6707/2013 ORDER the original petitioner pursuant to the said order dated 11.12.2012 by Hon'ble Division Bench.
31. Until appropriate order is passed by Hon'ble Division Bench and the same is placed before the learned Tribunal, the proceedings of the application bearing R.P. No.116/2012 in O.A. No.110/2004 filed by the bank shall remain stayed.
32. Thereafter, the learned Tribunal will conduct the proceedings of the said application in the light of and in accordance with order that may be passed by Hon'ble Division Bench.
With the aforesaid clarifications and observations, the application is disposed of.
(K.M.THAKER, J.) Bharat Page 13 of 13