K R SUBBAIAH Vs. INDIAN BANK

JUDGEMENT

(1.) THE judgment-debtors are in appeal, by special leave. Indian Bank-respondent (for short, `the bank') sued the appellants for recovery of a sum of Rs. 14,06,152.80 with interest and costs before the Principal Sub Court, Madurai. On January 7, 1986, a preliminary decree was passed by the trial court against the appellants ex-parte, as prayed for by the bank, and one month's time was given for payment. On November 12, 1986, an ex-parte final decree was passed against the appellants in terms of the preliminary decree. THE bank levied execution of the decree wherein two properties belonging to the first appellant were sold and a sum of Rs. 4,07,000/- was realized from that sale. During the pendency of the execution proceedings, the Recovery of Debts due to Banks and Financial Institutions Act, 1993 (for short, `the 1993 Act') came into force and the execution proceedings were transferred to the Debt Recovery Tribunal, Chennai (for short, `the Tribunal'). On April 26, 2000, the Tribunal issued recovery certificate in favour of the bank for a sum of Rs. 15, 66,731.49 with future interest @ 18% p.a. on Rs. 11,95,200/- from the date of decree till the date of realization with costs and for sale of the properties mentioned in the schedule. THE proceedings before the Tribunal also remained ex-parte. It appears that pursuant to the recovery certificate dated April 26, 2000, initially an order of attachment of the judgment-debtors' two properties was passed on August 9, 2002 and then the order of proclamation of sale was made on October 11, 2002. THE Debt Recovery Officer fixed November 15, 2002 as the date for auction of these two properties.

(2.) THE appellants approached the High Court of Judicature at Madras by filing a civil revision petition challenging the debt recovery certificate, the order of proclamation of sale and the proceedings before the Debt Recovery Officer. THE High Court, however, dismissed the civil revision petition on February 3, 2003 as not maintainable as the appellants had a statutory remedy of appeal under Section 20 of the 1993 Act. It may be noted here that while dismissing the civil revision petition, the High Court observed about the appellants' willingness to pay Rs. 15,00,000/- in full and final settlement of the bank's claim. As regards the rate of interest, the High Court observed that the appellants may raise this aspect before the Debt Recovery Appellate Tribunal, (for short, `the Appellate Tribunal'), if so advised.

(3.) ON May 7, 2004 before this Court an amount of Rs.16 lakhs was handed over by the appellants to the bank by way of bank drafts. The Court noticed this fact and passed the following order: