Document Fragment View

Matching Fragments

5. The Presiding Officer of the DRT by order dated 11th June, 2010 set aside the order of the Recovery Officer which had reduced the fees from Rs.50 lacs to Rs.5 lacs without hearing the Receiver and the matter was remanded back to the Recovery Officer to decide the issue regarding the fees of the Receiver after hearing the Receiver. The Respondent Nos.1 to 5 being aggrieved by order dated 11th June, 2010 filed an Appeal before the DRAT. By the impugned order dated 20th June, 2013, the DRAT remanded the matter back to the Recovery Officer for settling the Receiver's fees after affording the Receiver an opportunity of being heard. It was clarified by the Chairperson of the DRAT that the amount of Rs.50 lacs kept aside by the Recovery Officer vide order dated 16th October, 2007 will not be treated as 'outer limit' WP-2864-2013.DOC for settling the Receiver's fees. The Petitioner being aggrieved by the impugned order has filed the present Writ Petition.

WP-2864-2013.DOC

7. Mr. Rafique Dada, learned Senior Counsel for the Petitioner has submitted that the Recovery Officer by order dated 16th October, 2007 had fixed the cap of Rs.50 lakhs for the fees / commission of the Receiver and that this order has attained finality upon the Petitioner giving up its challenge to this order. He has submitted that the Chairperson of the DRAT in the impugned order should not have disturbed the said order and / or clarified that the amount of Rs.50 lakhs kept aside by the Recovery Officer vide the said order was not to be treated as 'outer limit' for settling the Receiver's fees. He has submitted that the Respondent Nos. 1 to 5 belatedly had sought to challenge the order dated 16th October, 2007 by taking out amendment application in the Appeal before the DRT. This application was rejected by the DRT on the grounds that the Appeal was barred by the limitation under Section 30 of the said Act. Thereafter, the Appeal filed by the Respondent Nos.1 to 5 before the DRAT against the rejection of the amendment application was unconditionally withdrawn by these Respondents as recorded in the order dated 11th March, 2010 of the DRAT. He has submitted that the order dated 16th October, 2007 which had fixed the Receivers fees at Rs.50 lakhs merged into the DRAT order dated 11th March, 2010. He has submitted that in the light of the DRAT order, the order dated 16th WP-2864-2013.DOC October, 2007 is deemed to have attained finality and could not have been reopened as has been done by the impugned order. He has submitted that the order dated 16th December, 2007 had been passed pursuant to an application filed by the Petitioner and the specific prayer made therein to fix the fees payable to the Receiver. He has submitted that the Receiver in its report dated 31st October, 2007 filed before the Recovery Officer had made a prayer that the fees be paid at 1% of the sale proceeds, which clearly shows that the Receiver itself had accepted that fixation of fees was to be done by the Recovery Officer. He has relied upon the judgment of the Supreme Court in International Asset Reconstruction Company of India Ltd. Vs. Official Liquidator of Aldrich Pharmaceuticals Ltd & Ors.1 in support of his submission that the Receiver having failed to challenge the order dated 16th October, 2007 passed by the Recovery Officer within the prescribed period of 30 days under Section 30 of the said Act, the prescribed period cannot be extended by applying Section 5 of the Limitation Act, 1963 and hence the challenge to the said order had been correctly rejected by the DRT as being barred by the limitation. He has relied upon certain decisions of the Supreme Court, in particular M. Nagabhushana Vs. State of Karnataka & 1 (2017) 16 Supreme Court Cases 137.

14. The DRAT had in the operative part of the impugned order directed the Recovery Officer to only settle the Receiver's fee / commission after affording the Receiver an opportunity to be heard by inter alia, taking into consideration the order dated 9th May, 2002 passed by the Presiding Officer of the DRT which had WP-2864-2013.DOC directed the fees to be fixed as per this Court's Original Side Rules. We do not find any infirmity in the impugned order of the Chairperson of the DRAT. We find merit in the submissions made on behalf of Respondent Nos.1 to 5 that the fees are fixed as per this Court's Original Side Rules and can be varied by the Judge fixing the fees and that too in exceptional circumstances. In this context reliance has been placed on the decision of the Division Bench of this Court in J.K. Synthetic (Supra) which held as follows:-

15. It is thus clear from the above decision that in normal circumstances, the Receiver must charge fees as per the scales prescribed in Rule 591 and it is only by way of exception that the Court will exercise the discretion of reducing the fees prescribed by Rule 591 and that too by considering the peculiar facts of the case.

16. The Petitioner has relied upon the principles of res judicata in submitting that the order dated 16th October, 2007 having attained finality could not have been reopened by the DRAT. We WP-2864-2013.DOC do not accept this submission on behalf of Respondent Nos. 1 to 5 as in our view the order dated 16th October, 2007 had not decided the issue of fixing the fees of the Receiver by capping the fees at Rs.50 lakhs. We find from the record that there was no such issue framed and / or hearing held on the issue of fixing the fees of Respondent No.1 by capping it at Rs.50 lakhs. Thus the principles of res judicta or the judgements relied upon by the Petitioner would have no application in the facts and circumstances of the present case. Further in our view it was not necessary for the Petitioner to challenge the said order dated 16th October, 2007 as the fees of the Receiver had not been fixed and / or varied by the said order. The fees of the Receiver was to be fixed as ordered by the Presiding Officer of the DRAT at 1% of the sale proceeds in conformity with the Original Side Rules of this Court viz Rule 591. The Chairperson in the impugned order in paragraph 55 as held as under:-