UNITED BANK OF INDIA Vs. DEBTS RECOVERY TRIBUNAL

JUDGEMENT

(1.) Leave granted.

(2.) The appellant, United Bank of India filed a suit in the High Court of Calcutta which was registered as Suit No. 276 of 1991, claiming different reliefs against the three defendants. While the suit was pending, the Parliament enacted the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (hereinafter referred to as 'the Act') to provide for the establishment of tribunals for expeditious adjudication and recovery of debts due to Banks and Financial Institutions and for matters connected therewith or incidental thereto. The Act came into force on 24th of June, 1993. By operation of Section 31 of the Act, the suit in question stood transferred to the Debts Recovery Tribunal, established under the Act and was renumbered as Transferred Application No. 163 of 1996. The respondents moved an application before the tribunal contending thereunder that the tribunal had no jurisdiction to entertain suit in question in view of the nature of the reliefs prayed for and as such, plaint should be returned to the plaintiff for being filed in the High Court itself. The tribunal disposed of the applications filed by the defendants holding that the tribunal has the jurisdiction to decide the claim of the plaintiff. The three defendants, thereafter filed three separate applications under Article 227 of the Constitution of India, challenging the orders passed by the tribunal. By the impugned order, the High Court set aside the order of the tribunal on a finding that under the Act, the tribunal gets jurisdiction to entertain and decide applications from the banks and financial institutions for recovery of debts due to such banks and financial institutions but the plaintiff's claim in question cannot be held to be a 'debt' as defined in Section 2(g) of the Act inasmuch as the claim is of an undetermined sum, which is required to be ascertained upon an inquiry to be conducted by the tribunal. The High Court was also of the view that the suit as framed, is one for damages and compensation which is required to be quantified before a decree to be passed and such a suit will not be within the purview of the provisions of the Act in question. With these conclusions, the applications of the defendants having been allowed, the plaintiff has approached this Court.

(3.) Mr. G.L. Sanghi, the learned Senior Counsel, appearing for the plaintiff-appellant contends that the plaint read as a whole on the basis of averments made and the reliefs sought for, it cannot be held to be a suit for damages but on the other hand, it is essentially a suit for realisation of money due to a bank which has become due in course of the business activity undertaken by the bank and as such it is a suit for recovery of a debt under Section 2(g) of the Act and the High Court committed error in holding that the tribunal had no jurisdiction. Mr. Sanghi, further contended that while deciding the question as to whether the claim in question can be adjudicated upon by the tribunal constituted under the Act, the substance of the matter has to be looked into. According to Mr. Sanghi a suit for recovery of debt from one of the defendants does not cease to become so merely because certain ancillary and incidental relief has been sought for against some other defendants. Mr. Sanghi, lastly urged that the very purpose and object of the Act will be frustrated if the suit in question is not allowed to be disposed of by the tribunal constituted under the Act and on the other hand is relegated to the ordinary Civil Court as has been ordered by the High Court in the impugned judgment. According to Mr. Sanghi, the expression 'debt' in Section 2(g) is of wide amplitude and there should be no justification to give a narrower meaning and thereby limiting the jurisdiction of the tribunal.