LALITKUMAR JIVABHAI THAKKAR Vs. STATE BANK OF INDIA

JUDGEMENT

(1.) QUESTION that is posed for our consideration is whether a third party can invoke the provisions of sub-Section (25) of section 19 of the Recovery of Debts Due to banks and Financial Institutions Act, 1993 so as to prevent the abuse of the process of the Tribunal and to secure ends of justice.

(2.) DIVISION Bench of Bombay High court in Anil Nandkishor Tibrewala and Anr. v. Jammu and Kashmir Bank Ltd. [ 2007 (3)Bom. C. R. 941 ] interpreting Section 19 (25)of the Recovery of Debts Due to Banks and financial Institutions Act, 1993 (for short rdb Act') held as follows: "a reading of this provision would indicate that there is a power in the Tribunal to give orders or directions to prevent abuse of its process or to secure the ends of justice. It is open to the Tribunal to lay down its own procedure and it is not hide bound by the procedural provisions of Code of Civil Procedure. At the same time, certain provisions of the Code of Civil procedure, have been conferred on the tribunal. The expression "prevent abuse of its process" "or to secure the ends of justice" in our opinion would be wide enough to cover a case where a financial institution has obtained an order or the certificate pursuant to a mortgage created by the judgment debtor based on a fraudulent document, like for instance the property not belonging to the judgment debtor. If such party comes before the Court and points out to the Court that the mortgage created is sham and/or bogus, the tribunal to prevent abuse of its process, can assume jurisdiction under Section 19 (25) to decide that issue and for that purpose exercise powers conferred under section 22 of the Act. On a aggrieved person being allowed to participate in the proceedings, it will be open to the Tribunal to review the order or pass such other order to secure the ends of justice. We are, therefore, of the clear view that in those cases where the Recovery Officer cannot go beyond the certificate, a party like the petitioners who claims title in the property or interest in the property can move the tribunal by invoking jurisdiction of the tribunal under Section 19 (25), and in such cases if a prima facie case is disclosed before the Tribunal, the Tribunal is bound to consider the application so moved and dispose it according to law, after giving an opportunity to all parties before it. "

(3.) BOMBAY High Court on the basis of the above reasoning directed the Tribunal to dispose of the application preferred by a person who was not a party to the proceedings before the DRT.