Calcutta High Court
Akshat Commercial Pvt. Ltd. & Anr vs Kalpana Chakraborty & Ors on 30 April, 2010
Equivalent citations: AIR 2010 CALCUTTA 138, (2010) 3 CAL HN 95, (2010) 4 BANKCAS 267, (2010) 2 CAL LJ 656, (2010) 2 CALLT 582
Author: Bhaskar Bhattacharya
Bench: Bhaskar Bhattacharya
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IN THE HIGH COURT AT CALCUTTA
Civil Appellate Constitutional Jurisdiction
(Original Side)
Present:
The Hon'ble Mr. Justice Bhaskar Bhattacharya
And
The Hon'ble Mr. Justice Prasenjit Mandal
G.A. No. 2729 of 2008
A.P.O.T. No. 315 of 2008
W.P. No. 131 of 2008
Akshat Commercial Pvt. Ltd. & Anr.
Versus
Kalpana Chakraborty & Ors.
For the Appellant: Mr. Suresh Agarwal (in person)
For the Respondent: Mr. Pratap Chatterjee,
Mr. Aniruddha Roy,
Ms. S. Roy Chowdhury,
Mr. A. Guha.
For the Allahabad Bank: Mr. Soumen Sen.
Heard on: 01.04 2010.
Judgment on: 30th April, 2010.
Bhaskar Bhattacharya, J.:
This appeal is at the instance of the respondent Nos.3 and 4 in a writ- application and is directed against an order dated 5th and 6th May, 2008 passed by a learned Single Judge of this Court by which His Lordship set aside the order dated January 11, 2008 passed by the Presiding Officer, Debts Recovery Tribunal No.1, Kolkata, in O.A./SARFAESI 70/07 rejecting an application under Section 5 2 of the Limitation Act filed by the writ petitioner for condonation of delay in filing the application under Section 17(1) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. ("SARFAESI Act").
The writ-petitioner, in the writ-application, out of which the present mandamus-appeal arises, challenged the aforesaid order passed by the Debts Recovery Tribunal.
The facts given rise to filing of the said writ-application may be summed up thus:
The property involved in the writ-application was sold by the Allahabad Bank by taking recourse to Section 13(4) of the SARFAESI Act and was purchased by the present appellants. Disputing the legality of the notice under Section 13(4) of the SARFAESI Act dated September 21, 2007 the writ-petitioner moved this High Court by filing a writ-application in the past which was disposed of by an order dated October 23, 2007 by permitting the writ petitioner to move the Tribunal under Section 17 of the SARFAESI Act with further direction that till November 5, 2007 the operation of the possession-cum-sale notice would remain stayed. However, the application under Section 17(1) of the Act was filed on December 20, 2007 along with an application under Section 5 of the Limitation Act.3
As indicated earlier, the learned Tribunal dismissed such application for condonation of delay thereby holding that Section 5 of the Limitation Act had no application to the proceeding under Section 17(1) of the SARFAESI Act.
Being dissatisfied, the writ-petitioner challenged the said order before the Writ-Court and as indicated earlier, the learned Single Judge by the order impugned herein has set aside the said order passed by the Tribunal and directed the Tribunal to dispose of the application for condonation of delay on merit.
Being dissatisfied, the respondent Nos.3 and 4 of the writ- application have come up with the present appeal.
Therefore, a pure question of law arises for determination in this appeal as to whether an application for condonation of delay in preferring an application under Section 17(1) of the SARFAESI Act beyond the period of 45 days prescribed under the said Act can be allowed by exercising power under Section 5 of the Limitation Act.
In order to appreciate the aforesaid question, it will be profitable to refer to the Sections 17, 35, 36 and 37 of the SARFAESI Act and Section 24 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 and also Section 29 of the Limitation Act, 1963 which are quoted below:4
"17. Right to appeal.--(1) Any person (including borrower), aggrieved by any of the measures referred to in sub-section (4) of section 13 taken by the secured creditor or his authorised officer under this Chapter, may make an application along with such fee, as may be prescribed to the Debts Recovery Tribunal having jurisdiction in the matter within forty-five days from the date on which such measures had been taken:
Provided that different fees may be prescribed for making the application by the borrower and the person other than the borrower. Explanation.--For the removal of doubts it is hereby declared that the communication of the reasons to the borrower by the secured creditor for an having accepted his representation or objection or the likely action of the secured creditor at the stage of communication of reasons to the borrower shall not entitle the person (including borrower) to make an application to the Debts Recovery Tribunal under sub-section (1) of section 17.
(2) The Debts Recovery Tribunal shall consider whether any of the measures referred to in sub-section (4) of section 13 taken by the secured creditor for enforcement of security are in accordance with the provisions of this Act and the rules made thereunder.
(3) If, the Debts Recovery Tribunal, after examining the facts and circumstances of the case and evidence produced by the parties, comes to the conclusion that any of the measures referred to in sub-section (4) of section 13, taken by the secured creditor is not in accordance with the provisions of this Act and the rules made thereunder, and require restoration of the management of the secured assets to the borrower or restoration of possession of the secured assets to the borrower, it may by order, declare the recourse to any one or more measures referred to in sub-section (4) of section 13.
(4) If, the Debts Recovery Tribunal declares the recourse taken by a secured creditor under sub-section (4) of section 13, is in accordance with 5 the provisions of this Act and the rules made thereunder, then, notwithstanding anything contained in any other law for the time being in force, the secured creditor shall be entitled to take recourse to one or more of the measures specified under sub-section (4) of section 13 to recover his secured debt.
(5) Any application made under sub-section (1) shall be dealt with by the Debts Recovery Tribunal as expeditiously as possible and disposed of within sixty days from the date of such application.
Provided that the Debts Recovery Tribunal may, from time to time, extend the said period for reasons to be recorded in writing, so, however, that the total period of pendency of the application with the Debts Recovery Tribunal, shall not exceed four months from the date of making of such application made under sub-section (1).
(6) If the application is not disposed of by the Debts Recovery Tribunal within the period of four months as specified in sub-section (5), any party to the application may make an application, in such form as may be prescribed, to the Appellate Tribunal for directing the Debts Recovery Tribunal for expeditious disposal of the application pending before the Debts Recovery Tribunal and the Appellate Tribunal may, on such application, make an order for expeditious disposal of the pending application by the Debts Recovery Tribunal.
(7) Save as otherwise provided in this Act, the Debts Recovery Tribunal shall, as far as may be, dispose of application in accordance with the provisions of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (51 of 1993) and the rules made thereunder.
35. The provisions of this Act to override other laws.--The provisions of this Act shall have effect, notwithstanding anything inconsistent therewith contained in any other law for the time being in force or any instrument having effect by virtue of any such law.
36. Limitation.--No secured creditor shall be entitled to take all or any of the measures under sub-section (4) of section 13, unless his claim 6 in respect of the financial asset is made within the period of limitation prescribed under the Limitation Act, 1963 (36 of 1963).
37. Application of other laws not barred.--The provisions of this Act or the rules made thereunder shall be in addition to, and not in derogation of, the Companies Act, 1956 (1 of 1956), the Securities Contracts (Regulation) Act, 1956 (42 of 1956), the Securities and Exchange Board of India Act 1992 (15 of 1992), the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (51 of 1993) or any other law for the time being in force.
Recovery of Debts Due to Banks and Financial Institutions Act, 1993
24. Limitation.--The provisions of the Limitation Act, 1963 (36 of 1963), shall, as far as may be, apply to an application made to a Tribunal.
Limitation Act, 1963
29. Savings.--(1) Nothing in this Act shall affect section 25 of the Indian Contract Act, 1872 (9 of 1872).
(2) Where any special or local law prescribes for any suit, appeal or application a period of limitation different from the period prescribed by the Schedule, the provisions of section 3 shall apply as if such period were the period prescribed by the Schedule and for the purpose of determining any period of limitation prescribed for any suit, appeal or application by any special or local law, the provisions contained in sections 4 to 24 (inclusive) shall apply only in so far as, and to the extent to which, they are not expressly excluded by such special or local law. (3) Save as otherwise provided in any law for the time being in force with respect to marriage and divorce, nothing in this Act shall apply to any suit or other proceeding under any such law.
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(4) Sections 25 and 26 and the definition of "easement" in section 2 shall not apply to cases arising in the territories to which the Indian Easements Act, 1882 (5 of 1882), may for the time being extend." Mr. Agarwal, appearing in person, criticized the order passed by the learned Single Judge by contending that the learned Single Judge erred in law in holding that Section 5 of the Limitation Act had application to the proceeding under Section 17(1) of the SARFAESI Act. According to Mr. Agarwal, the Supreme Court in the case of Nahar Industrial Enterprises Ltd. vs. Hong Kong and Shanghai Banking Corporation reported in 2009 (10)JT 109 having specifically held that the Debts Recovery Tribunal is not a Court, Section 5 of the Limitation Act could not have been invoked to a proceeding under Section 17(1) of the SARFAESI Act. Mr. Agarwal further contends that the legislature having prescribed a time-limit of 45 days in filing an application under Section 17(1) of the SARFAESI Act, the learned Single Judge erred in law in holding that Section 5 of the Limitation Act had the application to such proceedings. Mr. Agarwal further contended that an application under Section 17(1) of the Act is original in nature and as such, Section 5 cannot have any application to such original proceeding even if we assume for the sake of argument that the Limitation Act in general has the application to such proceedings.
Mr. Chatterjee, the learned senior advocate appearing on behalf of the writ petitioner/respondent, has, however, opposed the aforesaid submissions of Mr. Agarwal and has contended that in view of the specific provision contained in 8 Section 17(7) of the SARFAESI Act read with Section 24 of the Recovery of Debts Due to Banks and Financial Institutions Act, there is no scope of doubt that all the provisions of the Limitation Act including Section 5 thereof would be applicable. According to Mr. Chatterjee, even by virtue of the provisions contained in Section 29 of the Limitation Act, the power under Section 5 thereof can be invoked by the Tribunal. Mr. Chatterjee, therefore, by supporting the order passed by the learned Single Judge prays for dismissing the appeal.
Therefore, the only question that arises for determination in this appeal is whether the provision of Section 5 of the Limitation Act for condonation of delay applies to a proceeding under Section 17 of the SARFAESI Act.
In view of sub-section (7) of Section 17 of the SARFAESI Act, the Debts Recovery Tribunal shall, as far as may be, dispose of the application in accordance with the provisions of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 and the rules made thereunder.
It further appears that according to Section 24 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, the provisions of the Limitation Act, 1963 shall, as far as may be, apply to an application made to a Tribunal.
The conjoint effect of Section 17(7) of the SARFAESI Act and Section 24 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 is that 9 in a proceeding under Section 17(1) of the SARFAESI Act which is entertained by a Debts Recovery Tribunal, the provisions of the Limitation Act, 1963 shall, as far as may be, apply.
Although Section 17 of the SARFAESI Act has been described in the said Act as the one conferring right of appeal, as held by the Supreme Court in the case of Mardia Chemicals Ltd. & Anr. vs. Union of India & Ors. reported in 2004 (4) SCC 311 and also in the case of M/s. Transcore vs. Union of India & Anr. reported in AIR 2007 SC 712, the proceedings under Section 17 of the SARFAESI Act in fact are not appellate proceedings and it seems to be a misnomer. According to the Supreme Court, in fact, it is the initial action which is brought before a forum as prescribed under the Act, raising grievance against the action or measures taken by one of the parties to the contract. Therefore, according to the Supreme Court, it is the stage of initial proceeding like filing a suit in Civil Court. It has further been pointed out by Supreme Court that as a matter of fact the proceedings under Section 17 of the Act are in lieu of a civil suit which remedy is ordinarily available but for the bar created under Section 34 of the Act.
After the decision of the Supreme Court in the case of Mardia Chemicals Ltd. (supra), the language of Section 17 of the SARFAESI Act was amended and instead of appeal the word "application" was introduced in the section, although, the marginal note was not changed.
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In the subsequent decision of the Supreme Court in the case of M/s. Transcore (supra), the Supreme Court after taking into consideration the amended provisions of Section 17 pointed out that the marginal note to Section 17(1) of the SARFAESI Act could not control the text content of Section 17(1) and by following the earlier decisions of the Mardia Chemicals Ltd. (supra) reiterated that the section exercises original jurisdiction. The following observations of the Apex Court in the above two cases are quoted below:
"We may like to observe that proceedings under Section 17 of the Act, in fact, are not appellate proceedings. It seems to be a misnomer. In fact it is the initial action which is brought before a forum as prescribed under the Act, raising grievance against the action or measures taken by one of the parties to the contract. It is the stage of initial proceeding like filing a suit in civil court. As a matter of fact proceedings under Section 17 of the Act are in lieu of a civil suit which remedy is ordinarily available but for the bar under Section 34 of the Act in the present case." (Paragraph 59 of Mardia (supra)).
"It is true that Section 17(1) of the NPA Act states inter alia that a borrower aggrieved by action taken under Section 13(4) may make an application along with fees, as may be prescribed to the DRT having jurisdiction in the matter. It is true that, the marginal note states that Section 17(1) is a right to appeal. In our view, the marginal note to Section 17(1) cannot control the text and the content of Section17 (1) which, as stated above, states that the borrower aggrieved by any of the measures in Section 13(4) may make an application to the DRT. The judgment of this Court in Mardia Chemicals (supra) states that the DRT acts in an Original Jurisdiction under Section 17 of the NPA Act. In our opinion, as far as the levy of fee is concerned, the terminology makes no difference. In fact, the proviso to Section 17(1) 11 indicates that different fees may be prescribed for making an application by the borrower. The reason is obvious. Certain measures taken under Section13 (4) like taking over the management of the fee vis-a-vis the secured creditor taking possession of financial assets have to bear different fees. Each measure is required to be separately charged to the borrower (applicant) for which different fees could be prescribed. The said proviso indicates that the tribunal under Section17 (1) exercises Original Jurisdiction and, therefore, as far as the fees are concerned, the terminology of original or appellate jurisdiction in the context of fees is irrelevant." (Paragraph 60 of M/s. Transcore(supra)).
In view of the decision of the Supreme Court in the aforesaid two matters there is no controversy that a proceeding under Section 17(1) is in the nature of original proceeding and in such a case, even though the other relevant provisions of the Limitation Act applies, Section 5 thereof at least has no application in view of the fact that the said section is not applicable to the original proceeding like suit. We have already pointed out that the Limitation Act in general will be applied in the proceedings under Section 17(1) of the SARFAESI Act "as far as may be".
We, therefore, hold that although in a proceeding under Section 17(1) of the SARFAESI Act, the provisions of the Limitation Act applies in general "as far as my be", yet, Section 5 of the Limitation Act in particular, however, has no application in view of the fact that the proceeding is original in nature like suit and Section 5 of the Limitation Act has no application to a suit. 12
At this stage, we may profitably refer to the decision of the Supreme Court in the case of Gopal Sardar vs. Karuna Sardar reported in 2004(4) SCC 252 where the question was whether the provision of Section 5 of the Limitation Act applied to a proceeding for preemption under Section 8 of the West Bengal Land Reforms Act which is initiated by an application. In that context, the Supreme Court by relying upon the Division Bench decision of this Court in the case of Serish Maji vs. Nishit Kumar Doloi reported in (1999(1) CHN 365) held that a proceeding initiated by an application under Section 8 of the West Bengal Land Reforms Act is to be construed as a suit for the purpose of Limitation Act. Applying the said principle to the facts of the present case, we are of the view that the nature of proceeding under Section 17 of the SARFAESI Act being original in nature like suit as held by the Supreme Court in two different decisions indicated earlier, although it is initiated by an application, it should be deemed to be a suit like an application under Section 8 of the West Bengal Land Reforms Act as held in the case of Serish Maji (supra). In this connection, the following observations of the Apex Court are relevant:
"The Division Bench of the Calcutta High Court in Serish Maji after elaborate consideration, referring to various decisions and on analysis of different provisions, in paras 25 to 50 of the judgment has concluded that a proceeding initiated by an application of Section 8 is to be construed as a "suit" for the purpose of the Limitation Act. We have good reason to approve the said view. This being the position, Section 5 of the Limitation Act is not attracted to the proceedings initiated under Section 8 of the Act."13
At this stage it will be profitable to refer to those paragraphs of the Division Bench decision of this court in the case of Serish Maji (supra), approved by the Apex Court which are quoted below:
24. The words "application" and "suit" have been defined in section 2(b) and 2(1) of the Limitation Act as follows:
(b) "application" includes a petition;
(1) "suit" does not include an appeal or an application;
25. Both are judicial proceedings. The word "proceeding" refers not only to a complete remedy but also to a step that is part of a larger action or special proceeding. The definition of the word "proceeding" in Black's Law Dictionary, 5th Edition at page 1083 gives a description of the characteristics of a suit:
" The word may be used synonymously with 'action' or 'suit' to describe the entire course of an action at law or suit in equity from the issuance of the writ or filing of the complaint until the entry of a final judgment, or may be used to describe any act done by authority of a court of law and every step required to be taken in any cause by either party. The proceedings of a suit embrace all mattes that occur in its progress judicially."
26. Following from the definition it may safely be said that there are two broad categories of proceedings; first, a proceeding which is the entire course of action and second, a proceeding which is a step ancillary to or taken in course of the first. A suit is a complete or independent proceeding falling within the first class of proceedings. Applications, according to the Limitation Act, are governed by Article 118 to 137. Characteristically, they are in connection with or ancillary to a suit, its decree or execution. They are not, in this sense, an independent or complete proceeding. An application in the sense used in the Limitation Act thus falls within the second class of proceeding.
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27. An application under the Limitation Act also does not initiate an action. The sections of the Limitation Act namely, sections 4, 6, 7, 11, 15, 16, 17, 21 and 31 all talk of institution of suits and making of applications. An appeal is preferred. The meaning of the word "institute" is to begin or originate. Therefore a proceeding under the Limitation Act can be initiated or begun and the machinery of law set in motion only by a suit not by an application.
28. The other distinction between suits and applications which appears from the Limitation Act is that suits primarily decide issues or causes of action. For example, section 14 of the Limitation Act grants exclusion of time in suits when the same matter is in issue or prosecuted in good faith in a Court which from defect of jurisdiction etc. is unable to entertain it. Sub-section (2) of section 14 however allows an exclusion of time in an application, if the applicant has been prosecuting another civil proceeding for the same relief (See, S.K. Dutt vs. Purnachandra Sinha AIR 1949 Cal 24, 43 para 57).
29. I would therefore conclude that for the purpose of the Limitation Act a suit may be defined as an independent proceeding which must be initiated for the final determination of an issue or issues of fact or law between the parties.
30. This definition finds support in Black's Law Dictionary, 5th Edition, where "suit" has been defined as:
"Suit. A generic terms, of comprehensive signification, referring to any proceeding by one person or persons against another or others in a court of justice in which the plaintiff pursues, in such court, the remedy which the law affords him for the redress of an injury or the enforcement of a right, whether at law or in equity."
31. The words "application" and "petition" often refer to the form and not to the substance of the proceeding. This interchangeability has led to 15 semantic confusion and the substantive right has been defined with reference to the procedure prescribed for enforcement of the right.
32. The procedure cannot define the right and no distinction can be made between the same substantive rights merely on the basis of the procedure involved. If this were so then by choosing a particular procedure a party could determine the period for enforcing the right.
33. The applicant has however contended that only those proceedings which are initiated by a plaint can be termed to be a suit for the purpose of the Limitation Act. If we were to accept this submission of the applicant we would fall into the semantic trap noted above and also come to a conclusion contrary to the authorities on the point.
34. In construing the word "Suit" in section 11 of the Code of Civil Procedure the Supreme Court in Pandurang Ramchandra Mandlik vs. Shantibai Ramchandra Ghatge 1989 Supp (2) SCC 627 said :
"In its comprehensive sense the word 'suit' is understood to apply to any proceeding in a court of justice by which an individual pursues that remedy which the law affords. The modes of proceedings may be various but that if a right is litigated between parties in a court of justice the proceeding by which the decision of the court is sought may be a suit."
(Emphasis supplied)
35. There are several instances where suits are initiated otherwise by filing a plaint. Section 20(2) of the Arbitration Act, 1940 provides that an application to file an arbitration agreement in Court shall be registered and numbered as a suit and the parties are described as plaintiff and defendant respectively. Similarly, matrimonial suits under the Indian Divorce Act, 1869 are originated by filing a petition (Vide Chapter XXXVA of the Original Side Rules of this Court). A testamentary suit is also initiated by an application for grant of probate or letters of administration [Vide Rules 4(i) and 28 of Chapter XXXV of the Original Side Rules of this Court]. An Originating Summons suit is initiated by summons supported by an 16 affidavit and is filed and numbered as an ordinary suit (Vide Chapter XIII of the Original Side Rules of this Court).
36. Even section 26 of the Code of Civil Procedure, 1908 provides that "every suit shall be instituted by the presentation of plaint or in such other manner as may be prescribed".
37. It is true that the Privy Council decision in Hansraj vs. Dehradun- Mussorie Electric Tramway Co. Ltd. AIR 1933 PC 63 said:
"The word 'suit' ordinarily means, and apart from some context must be taken to mean, a civil proceeding instituted by the presentation of a plaint".
38. The decision was rendered in the context of the Limitation Act, 1908. Besides the observation expressly recognises that a suit in a certain context need not necessarily be instituted by a plaint. It would depend on the context whether the proceeding is a suit or not.
39. Thus in Balram Singh vs. Dudh Nath AIR 1949 All 100, a Division Bench of the Allahabad High Court held that an application under section 12 of the U.P. Agriculturists Relief Act, 1934 was a suit and that the decision whether the proceedings under the 1934 Act were a suit or not would not depend merely on the fact that the proceeding were initiated by an application.
Conversely in considering whether an application for execution was barred under Article 182 of the Limitation Act, 1908, the Supreme Court said that "it may be plausibly argued that the plaint, which makes a request to the court, is an application".
40. The decisions cited by the appellants viz. Antala Gope vs. Sarbo Gohain AIR 1962 Patna 489; Pausy Fernandes vs. M.F. Queoros AIR 1963 All 153 and Mst. Puinbasi Majhiani vs. Shiba Bhue AIR 1967 Orissa 41 are not relevant. The first decision was in respect of the applicability of the Court Fees Act, 1970 to proceedings under the Hindu Marriage Act, 1955. In the second and third decision the applicability of the Court Fees Act to 17 the Succession Act, 1925 was considered. The Courts were considering the nature of proceedings for the purpose of levying Court Fees. The context, the object and the language of the Court Fees Act are materially different from the Limitation Act.
41. There is another aspect of the matter. A preemptive right under the Limitation Act, 1963 is one which is enforceable only by way of a suit. Thus section 8 provides:
8. Special exceptions. - Nothing in section 6 or in section 7 applies to suits to enforce rights of preemption, or shall be deemed to extend, for more than three years from the cessation of the disability or the death of the person affected thereby, the period of limitation for any suit or application.
42. Article 97 of the Limitation Act provides for the period to enforce a right of pre-emption and is contained in the first division of the schedule to the Limitation Act, 1963 which deals with suits.
43. In fact, a pre-emptive right is ordinarily enforced by way of a suit [vide Sk. Mohammed Rafiq vs. Khalilul Rehman : AIR 1972 SC 2162; Rampher vs. Ayodhya Singh : AIR 1925 Outh 369; Ramjilal & Ors. vs. Chisaram & Ors. : 1996 (7) SCC 507]. It appears from Prem Singh & Ors. vs. Joginder Singh & Ors. : 1997 (10) SCC 195 that the right of pre-emption under the Punjab Pre-emption Act, 1913 is to be filed by making an application for pre-emption. Significantly holding that the right of pre-emption in favour of Kingsfolk was unconstitutional in Atamprakash vs. State of Haryana :
1986 (2) SCC 249 the proceedings have been referred to as suits [see also Rakjilal vs. Ghisaram (supra)].
44. The distinction between "suit" and "application" do not appear to have ben argued and as such not decided in the Kerala State Electricity Board, Trivandrum vs. T.P. Kunhalliumma : AIR 1977 SC 282 when it observed :
"The changed definition of the words 'applicant' and application' contained in section 2(a) and 2(b) of the 1963 Limitation Act indicates the object of the Limitation Act to include petitions, original or otherwise, under special laws."18
45. The appellant has exphasised the use of the word "original" in this sentence. The sentence cannot be construed as a statute [See M/s. Amar Nath Omprakash vs. State of Punjab : AIR 1985 SC 218; Gasket Radiators Private Limited vs. Employees State Insurance Corporation : 1985 (2) SCC 68]. The observation must be read in the context of the issue which was being decided in that case. The only issue was whether Article 137 applied to application which were not under the Code of Civil Procedure. The Supreme Court held that Article 137 was not confined to applications under the Code. This ratio has in fact been followed in several decisions e.g. The Additional Special Land Acquisition Officer vs. Thanboredas : AIR 1994 SC 2227.
46. In this background and coming more specifically to proceedings under section 8 of the WBLRA, it is not in dispute that it is an original and independent proceeding initiated before the Munsif which culminates finally in his order. It does not matter that this final order is not called a decree. Merely because civil proceedings before Courts are normally conducted according to the Civil Procedure Code does not mean all civil proceedings must be so conducted or that the terminology of the Code should be seen as defining the nature of proceedings under other statutes. In any event a "decree" according to the Code means :
"the formal expression of an adjudication which, so far as regards the Court expressing it, conclusively determines the rights of the parties with regard to all or any of the matters in controversy in the suit."
47. The decision of the Munsif on the right of the applicant to claim preemption subject to appeal under section 9, is final and in that sense is a decree.
48. In fact an application under section 8 was treated as a suit in Debabrata Bhowmick vs. Nani Bala Some : 83 CWN 82 (DB). The question whether an additional ground for pre-emption could be introduced in an application under section 8 by way of amendment was resolved with 19 reference to principles governing amendments of causes of actions in suits. Allowing the application, it was said :
"When an application for amendment is made beyond the period of limitation, the Court is to consider whether by refusing such amendment an injustice will be made to the party seeking the amendment and also whether by granting such amendment an injury would be caused to the other side."
49. If section 5 of the Limitation Act were applicable to applications under section 8 of the only consideration would have been whether the applicant had sufficient cause for not applying on the additional ground of preemption earlier.
50. It was then said by the applicant that under section 8 every application pending before the Revenue Officer after the commencement of section 7 of the West Bengal Land Reforms Act, 1972 (Amendment Act) stood transferred to and was to be disposed of by the Munsif having jurisdiction in relation to the area in which the land is situated and on such transfer every such application is to be dealt with from the stage at which it was so transferred and shall be disposed of in accordance with the provisions of the WBLRA, as amended by the West Bengal Land Reforms (Amendment) Act, 1972. It was submitted that it is clear therefore that the application before the Munsif is nothing but the same application or nature of application before the Revenue Officer, otherwise the phrase "from the stage at which it was so transferred" would not have been used. It is said that this clearly proves that the said application under section 8 is not a suit.
The submission is misconceived. A proceeding may change its nature with the forum. For example with the creation of Administrative Tribunals under the Administrative Tribunals Act, 1985 all pending proceedings including application under Article 226 covering matters over which the Tribunals had jurisdiction were transferred to the Tribunal under section 29 of the Act. The writ proceedings ceased to be applications under Article 20 226 by such transfer (See : L. Chandra Kumar vs. Union of India : AIR 1997 SC 1125).
Indeed it was argued by the appellant himself that the provisions of the Limitation Act now apply to proceedings under Section 8 because the Munsif is a Court. As already held civil proceedings before a Court can be a suit or application. That being so, it would follow that section 8 of the WBLRA will have to be construed to see which of the provisions of the Limitation Act apply to such proceedings.
For the reasons stated we hold that the view expressed by Chatterjee, J. in Minor Subir Rajan Mondal vs. Sitanath Mukherje that section 5 does not apply to proceedings under section 8 of the WBLRA to a correct view and also hold that the view held by Guha, J. in Chandra Sekhar vs. Baidyanath Ghosh (supra) does not correctly represent the law. On the same analogy, the proceedings under Section 17(1) should also be treated as a suit and thus, Section 5 of the Limitation Act at least does not apply to such proceedings although other relevant provisions of the said Act may apply.
So far as the Division Bench decision of the Bombay High Court in the case of Uco Bank vs. M/s. Kanji Mandji Kothari & Co. & Ors. reported in 2008(1) Bank CLR 773 is concerned, which was strongly relied upon by Mr. Chatterjee, the learned senior advocate appearing on behalf of the writ-petitioner, we find that the Division Bench in the said case did not take note of the aforesaid decision of the Supreme Court in the case of Gopal Sardar vs. Karuna Sardar (supra) as also the point as to whether a proceeding under Section 17(1) of the SARFAESI Act should be treated to be suit for the purpose of application of 21 Section 5 of the Limitation Act. Therefore, the said decision cannot be relied as a precedent in the facts of the present case.
The learned Single Judge, as it appears from the order impugned, turned down the aforesaid point by placing reliance upon two Supreme Court decisions relied upon by Mr. Chatterjee viz., Kerala State Electricity Board vs. T.P. Kunhaliumma reported in AIR 1977 SC 282 (Paragraph 21 of the report) and Asia Resorts Limited vs. Usha Breco Ltd. reported in (2001) 8 SCC 710 (paragraph 18 of the report).
In the case of Kerala State Electricity Board (supra), the question before the Supreme Court related to the period of limitation for filing an application under Section 16 of the Telegraphs Act. According to the Supreme Court, no period of limitation having been prescribed in the said Act, Article 137 of the Limitation Act would be applicable. While arriving at such conclusion, the Supreme Court rejected the contention that Article 137 applied only to an application filed under the Code of Civil Procedure. According to the Apex Court, Article 137 of the 1963 Limitation Act would apply to any petition or application filed under any Act to a civil court if no period of limitation was fixed for such application under the said Act. Their Lordships disagreed with the view taken by the two-judge bench of that Court in Athani Municipal Council case reported in (1969) 1 SCC 873 and held that Article 137 of the 1963 Limitation Act was not confined to applications contemplated by or under the Code of Civil Procedure. In the case before us, specific period of limitation is fixed in the Act itself being 45 days and the Debts Recovery Tribunal is not a civil court as held by the Supreme 22 Court in the case of Nahar Industrial Enterprises Ltd (supra). Therefore, the decision in the case of Kerala State Electricity Board (supra), is not at all applicable for the purpose of deciding the question whether Section 5 of the Limitation Act would be applicable to a proceeding filed before a Tribunal which is not a civil court. In the context of a case where the proceedings were admittedly before a Civil Court, the Apex Court in paragraph 21 of the judgement observed that the changed definition of the words "applicant" and "application" contained in Sections 2(a) and 2(b) of the 1963 Limitation Act indicated the object of the Limitation Act was to include petitions, original or otherwise, under special laws, meaning thereby, that if any application whether original or interlocutory, is made under the Special Law before any civil court for which no period of limitation is prescribed, the Article 137 of the Limitation Act would be applicable for the purpose of deciding the period of limitation of that application. Their Lordships in that case had no occasion for deciding the question of maintainability of an application under Section 5 of the Limitation Act to an original proceeding before a tribunal, which is not a civil court, and for which specific period of limitation has been prescribed in the Special Law itself.
In the case of Asia Resort Ltd. (supra), an application under Section 20 of the Arbitration Act was filed before a learned Single Judge of the High Court who held that the period of limitation for filing such application is governed by Article 137 of the Limitation Act and that in view of acknowledgement made by the defendant within the meaning of Section 18 of the Act, the application was not barred by limitation. On appeal, the Division Bench of the High Court overruled 23 the said finding and held that there was no acknowledgement within the meaning of Section 18 of the Limitation Act, and thus, dismissed the application as barred by limitation. The applicant under Section 20 of the Act approached the Supreme Court and filed a fresh application under Section 5 of the Limitation Act for condonation of delay in filing the application under Section 20 and in such circumstances, the Apex Court by relying upon the decision of Kerala State Electricity Board (supra), opined that Article 137 of the Act governed the period of limitation and by relying upon a division bench decision in the case of Union of India vs. Vijay Construction Co. reported in AIR 1981 Del 193 held that Section 5 of the Limitation Act was also applicable to such proceedings under Section 20 of the Arbitration Act.
By taking a clue from the said decision, the learned Single Judge was of the opinion that a proceedings under Section 20 of the Arbitration Act is also an original proceeding and if Section 5 of the Limitation Act applies to such original proceedings there is no reason why it should not be made applicable to the original proceedings under Section 17(1) of the Act.
With great respect to His Lordship, we are unable to subscribe to the said view for the following reasons:
His Lordship totally overlooked the fact that in the case of Asia Resorts (supra), the question before the Supreme Court was whether Article 137 of the Limitation Act was applicable to a proceeding under Section 20 of the Arbitration 24 Act and the Court answered that question in affirmative. Thereafter, the Bench by relying upon the Division Bench decision of the Delhi High Court held that Section 5 of the Limitation Act was applicable to such proceeding and thus, allowed the said application; but there was no discussion as to whether Section 5 could be applicable to the original proceedings like the one under Section 20 of the Arbitration Act which is treated as a suit, either in the said case, or in the Delhi decision relied upon by the Supreme Court. The following observation in paragraph 18 of the Judgement of the Supreme Court is quoted below:
"The appellant herein has filed an application under Section 5 of the Limitation Act praying that the delay in filing the application under Section 20 of the Act be condoned. Section 5 of the Limitation Act says any appeal or any application, other than the application under any of the provisions of Order 21 of the Code of Civil Procedure, 1908, may be admitted after the prescribed period, if the appellant or the applicant satisfies the court that he had sufficient cause for not preferring the appeal or making the application within such period. The applicant can show sufficient cause for not filing the application in time. It appears that this Court had no occasion to consider whether Section 5 of the Limitation Act, 1963 could be applied in the case of an application to be filed under Section 20 of the Arbitration Act, 1940. The Division Bench of the High Court of Delhi in Union of India v. Vijay Construction Co.5 held that the benefit of Section 5 of the Limitation Act can be availed by the applicant for an application under Section 20 of the Arbitration Act. Going by the provision contained in Section 5 of the Act, we are also of the view that in an appropriate case the court can extend the benefit of the said section."25
The relevant portion of the judgement of the Delhi High Court dealing with the question of applicability of the Section 5 of the Act, apparently relied upon by the Supreme Court is also quoted below:
"Mr. Kumar at this stage orally prayed for being given the benefit of Section 5 of the Limitation Act as, according to him, there was sufficient cause for filing the application late. He says that application under Section 20 was filed on 4th September, 1978, in the bona fide belief that limitation would run from the date of the issue of the notice on 17th November, 1976. Considering that the learned single Judge has not only in the present case but in other cases also held the same view, we cannot say that the belief of the respondent was in any way unreasonable. The learned single Judge has already directed the appointment of the arbitrator as provided by the arbitration agreement. We may, however, note the concession which was made by Mr. Kumar regarding the claim which was filed along with the application. Mr. Kumar has stated that he does not intend to pursue claims Nos. 6 and 7. The same, therefore, may be deemed to be deleted from the list of claims. The dispute and the claim which the respondent is claiming will be now restricted to the claim filed by him except items 6 and 7 which stands deleted. We are not happy that the Government Agency, like the Railways, should deny the citizens right by taking the plea of limitation. Governmental agencies should normally have the matter adjudicated on merits and succeed or fail on the justification or otherwise of the claim."
Therefore, it is apparent, that in neither of those two decisions, there was any question raised as to whether Section 5 should be applicable to a proceeding, which is treated as a suit, whereas such question was specifically dealt with in Gopal Sardar (supra).
26
Therefore, in our view there was no justification of ignoring the decision of Gopal Sardar (supra) specifically dealing with the aforesaid question by relying upon Asia Resort (supra), which is, at the most, an authority for the proposition of law that Section 5 applies to a proceeding under Section 20 of the Arbitration Act although the question whether section 5 of the Act applies to a proceedings which is, in essence, a suit was not dealt with. The said decision is thus not a precedent for the proposition that Section 5 applies to an application under Section 17(1) of the Act before the Tribunal.
Secondly, the learned Single Judge in the present case, in relying upon the aforesaid two decisions, did not follow the well-established principles of law that a decision is an authority for what it actually decides and not what can be logically deduced from it. In this connection we may appositely refer to the following observations of the Apex Court in the case of R. L. Jain vs. DDA reported in (2004) 4 SCC 79 while dealing with the question of application of a decision as a precedent:
"It is well settled that a decision is an authority for what it actually decides. What is of the essence in a decision is its ratio and not every observation found therein nor what logically follows from the various observations made therein. (See Krishena Kumar v. Union of India, Municipal Corpn. of Delhi v. Gurnam Kaur and Orient Paper and Industries Ltd. v. State of Orissa.)"27
Therefore, the learned Single Judge did not appreciate the specific law laid down in the case of Gopal Sardar vs. Karuna Sardar (supra), approving Serish Maji (supra), and erred in law in holding that Section 5 of the Limitation Act applies to a proceedings under Section 17(1) of the Act by placing reliance upon the principles laid down in the decisions of the Apex court in the case of Kerala State Electricity Board and Asia Resorts Ltd (supra) which have no application to a proceeding before the Tribunal.
We have already pointed out that the by virtue of the provisions contained in Sections 17(7) of the SARFAESI Act and Section 24 of the Recovery of the Debts Due to Banks and Financial Institutions Act, the provisions of the Limitation Act would "as far as may be" applicable but not all the provisions of the said Act. The legislature having consciously applied the provisions of the Limitation Act "as far as may be" by conjoint effect of Sections 17(7) and 24 of the two Special Acts, there is no scope of further application of Section 29(2) of the Limitation Act to the proceedings before the Tribunal so as to apply Sections 4 to 29 thereof over again.
Our aforesaid interpretation of Section 17(1) gets support from the intention of the legislature as reflected in the said Section itself where in sub- section (5) thereof, a time-limit of 60 days has been given for the disposal of such application and according to sub-section (6), if the application is not disposed of by the Tribunal within 4 months, any party to the application may make an application, in such form as may be prescribed, to the Appellate Tribunal for 28 directing the Debts Recovery Tribunal for expeditious disposal of the application pending before the Debts Recovery Tribunal.
Therefore, there being specific time-limit of 45 days for invoking the original jurisdiction of Section 17 of the SARFAESI Act, which has been found to be, in essence, a suit and a further tentative time-limit of 60 days for disposal of the proceedings, and giving a right to the party to complain before the appellate forum for compliance of such provisions alleging violation thereof if not completed within four months, it was never the intention of the legislature to apply Section 5 of the Limitation Act to such original proceeding by giving power to entertain the application under Section 17(1) of the SARFAESI Act by merely showing sufficient cause for the delay without putting any restriction upon the Tribunal and we, therefore, hold that the time period of 45 days provided in Section 17 of the SARFAESI Act which is original in nature cannot be extended by taking aid of Section 5 of the Limitation Act.
Once we hold that the proceedings under Section 17(1) of the Act is like that of a suit and that the Limitation Act applies as far as may be applicable by virtue of Sections 17(7) and 24 of the two Special Laws, Section 29(2) of the Limitation Act has no application and thus, the various decisions cited on behalf of the respondent by showing the applicability of Section 29(2) of the Limitation Act cannot have any application to the original proceedings like a suit before a tribunal. The other provisions of the Limitation Act, for instance, Sections 4, 6, 7, 9, 10, 11, 12, 14, 15, 16, 17, 18 etc. should, however, apply in appropriate cases. 29
We, therefore, hold that the learned Single Judge erred in law in holding that Section 5 of the Limitation Act applies to a proceeding under Section 17 of the SARFAESI Act.
We, consequently, set aside the order impugned and hold that the learned Debts Recovery Tribunal rightly refused to condone the delay in filing the application under Section 17 of the SARFAESI Act before it and any subsequent order passed in the said proceedings are liable to be quashed for want of authority of the Tribunal to enter into the merit on condonation of delay.
The writ-application is dismissed with the aforesaid observation. In the facts and circumstances, there will be, however, no order as to costs.
(Bhaskar Bhattacharya, J.) I agree.
(Prasenjit Mandal, J.) Later :
After this order is passed Mr. Roy appearing on behalf of the writ petitioners/respondents prays for stay of operation of our aforesaid order.30
After hearing the parties we stay the operation of our aforesaid order for a period of four weeks from date to enable the writ petitioners/respondents to move before the higher forum against our order.
Let Photostat certified copy of this judgment and order be given to the parties by Tuesday next, if applied for, upon compliance of all requisite formalities.
(Bhaskar Bhattacharya, J.) (Prasenjit Mandal, J.)