J U MANSUKHANI AND CO Vs. PRESIDING OFFICER

JUDGEMENT

(1.) The petitioners are seeking quashing of the order passed on 21.8.1998 by Debt Recovery Tribunal, New Delhi (for short the Tribunal) declining to dismiss or reject the Original Application of respondent No. 2 - Indian Bank (for short 'the Bank') for a decree of Rs. 2,43,50,000.00 (Rupees two crores forty three lakhs an fifty thousand only) against the petitioners and other respondents, instituted under the Recovery of Debts Due to the Banks and Financial Institutions Act, 1993 (for short the Act).

(2.) The Bank filed an Original Application against the petitioners (respondent No. 1 and 2 the Original Application) and others before the Tribunal for recovery decree of the above amount, inter alia, pleading therein:-

(3.) After service of summons the petitioners filed an application praying for rejection of the Bank's Original Application, inter alia, alleging that the proceedings before the Tribunal were without jurisdiction; bank drafts in question were received by the petitioners from one Jai Prakash Singh of Money Multiplier Services (for short the MMS) in the normal course of their business and were deposited with the Housing Development Finance Corporation (HDFC) and Canara Bank (respondents no. 3 and 4) and thus they were bona fide purchasers; no document was produced by the Bank with their Original Application to prima facie establish that the petitioners had any business activity with them; the petitioners never requested the Bank to issue drafts in question. It was alleged that the averments made in the Original Application alone cannot form the basis of an action before the Tribunal and that the alleged transaction was not a "debt" within the meaning of Section 2(g) of the Act, which was legally recoverable on the date of institution.