Document Fragment View
Fragment Information
Showing contexts for: debt defined in Eureka Forbes Ltd. vs Allahabad Bank And Ors. on 28 December, 2006Matching Fragments
42. Let us now move to the heart of the matter for a harder look.
43. There is hardly any disputing the proposition that jurisdiction of the Tribunal with reference to the definition of DEBT under Section 2(g) of the RDDBFI, Act 1993, hold the center-stage for the controversy. In fact, the whole lot of legal exercise by the parties has been one of defining and re-defining, squeezing or stretching the definition including seeing or not the "damage" in the "debt".
44. Section 2 (g) of the RDDBFI Act, 1993, defines "debt" as follows:
45. The controversy in this regard being what it is, the following lines of the definition may be highlighted.
(i) that 'debt' means any liability;
(ii) which is alleged as due from any person by a Bank;
(iii) during the course of any business activity undertaken by the Bank;
(iv) subsisting on, and legally recoverable on, the date of the application.
46. How do they fit in to the fact-situation of the case already discussed? Pleadings or the plain averments in the plaint by the Bank only do build up the facts that make for interpretation or application of the law in this case. It is true that appellant Eureka has chosen to leave it at that. There is no deposition or evidence on their side. Nevertheless, it is maintained by the learned Advocate for the appellant that there is actually no need for the appellant to adduce any evidence because the pleadings disclose facts or allegations which by themselves are sufficient to sustain the conviction that no liability in terms of the 'debt' can be fastened to the appellant. Or, in other words, it is contended that no 'debt' as defined in Section 2(g) of RDDBFI Act was due to and payable by the appellant to the Bank and, therefore, the purported claim of the plaintiff-Bank against appellant was outside the scope of jurisdiction, power and authority of the D.R.T. under Section 17 of the RDDBFI Act. Consequently, it is submitted that the D.R.T. could not have passed the decree against the appellant,
56. Much reliance has been placed by the Bank on a judgment of the Hon'ble Court in Cosmosteels Pvt. Ltd. v. Union of India (supra) (Amilava Lala, J.) to say that although damages cannot be construed as 'debt' as per meaning of the Act, but it cannot be included as claim for adjudication. But the point is, whether it is a "debt" of Section 2(g) or "debt" inclusive of a claim of damages, one of the basic-ingredients of debt as defined in Section 2(g) of the Act, namely that the liability of the 'debt' must-arise of any "business activity undertaken by the Bank" with the appellant cannot be done away with. After all, hardly does the Bank contend or allege that there was any business activity or privity of contract, between the Bank and the appellant. As has been rightly pointed out by the learned Advocate for the appellant, even assuming for the sake of argument but not admitting that a claim for damages is included within the term "debt" as used in Section 2(g) of RDDBFI Act, it is clear from the definition itself that for the D.R.T. to assume jurisdiction such claim must arise "during the course of any business activity undertaken by the Bank" with the defendant against whom such claim is made, I think that the question of damage in general as a claim within the scope and ambit of the definition of 'debt' in Section 2(g) not detached or divorced from it, opened up the issue for determination in Cosmostcels Pvt. Ltd. as referred to above-
whether the claim of damages can be construed as debt" (page 59, para 16 of the judgment). The essential ingredient of "debt" in Section 2(g), namely that the debt liability or claim must arise during the course of any business activity undertaken by the Bank remains where it is for application in a given factual aspect of a case even in seeing damage in the 'debt' defined. This particular aspect of the matter did not come up for consideration in Cosmosteels. Also, the learned Advocate for the appellant has pointed out that in Cosmosteel case the Supreme Court judgment and decision in AIR 1999 SC 1381 as discussed above was not in consideration by the Hon'ble Court and as such the Hon'ble High Court decision is per incuriam. The decision, I am afraid, does not assist the respondent-Bank either in terms of the peculiar fact-situation of our case.