R NATESAN Vs. CITY UNION BANK LTD

JUDGEMENT

(1.) Second petitioner in O.A.No.400 of 2001 on the file of the Debts Recovery Tribunal-I, Chennai is the revision petitioner in both the Revisions filed under Article 227 of the Constitution of India. In C.R.P.No.1786/2002, the petitioner challenges the conditional order passed by the Debts Recovery Tribunal. In C.R.P.No. 1787/2002, the same petitioner challenges the final order dated 26-6-2001 passed in O.A.No. 400/2001 in and by which the Debts Recovery Tribunal issued a recovery certificate in favour of the applicant Bank to realize the sum as claimed.

(2.) Heard Mr. P.L. Narayanan, learned counsel for the petitioner and Mr. Chandramouli, learned senior counsel for first respondent-City Union Bank, the only contesting party in both these cases.

(3.) The first respondent-City Union Bank filed a civil suit in C.S.No.1994/1994 on the file of the Original Side of this Court against Messrs. Ferrodeal Private Limited and other defendants, including the petitioner herein for recovery of a sum of Rs.6,42,523-37 together with interest thereon in respect of various credit facilities availed by the defendants. The defendants entered appearance through counsel and the matter was pending. Subsequently, on enhancement of City Civil Court's jurisdiction, the said suit was transferred to the III Additional Judge, City Civil Court, Madras and was renumbered as O.S.No. 12273 of 1996. The petitioner entered appearance through his counsel. After setting them ex parte, preliminary decree was passed on 26-2-1999 directing the defendants to pay a sum of Rs.6,42,523.37 with further interest and costs. Since the decreed amount exceeds Rs.10,00,000/-, the first respondent Bank as per the provisions of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (in short "the Act"), filed an original application under Section 31-A of the said Act before the Debts Recovery Tribunal for issuance of recovery certificate under the Act. The Tribunal on consideration of the facts and materials, ordered for issuance of recovery certificate in O.A.No.400 of 2001 by its order dated 26-6-2001. This order was duly served on the petitioner and all other respondents. A recovery certificate in DRC No.112/01 dated 29-8-2001 was issued by the Tribunal and a copy of the same with demand notice dated 5-9-2001 was sent by the Recovery Officer by Registered Post with A.D. to the petitioner and the respondents. It is further seen that in pursuance of the recovery certificate, Recovery Officer in accordance with the second schedule to the Income Tax Act, brought the property mortgaged by petitioner herein to sale and sale was conducted on 12-7-2002, after due publication. One M. Balasubramaniam had purchased the said property through Court auction, and deposited the entire sale consideration of Rs. 43 lakhs. After the recovery certificate was issued, the petitioner herein along with 8th respondent herein filed I.A.Nos. 8954 and 8955 of 2002 on the file of the III Additional City Civil Court, Chennai in June, 2002 for setting aside the ex parte decree dated 26-2-99 with an application for condonation of delay of 1175 days. The bank filed its counter. After hearing both sides, the learned III Additional Judge, by order dated 19-6-2002, transferred the said application to Tribunal and was numbered as M.A.No. 224 of 2002. After the sale taken place, the petitioner along with 7th and 8th respondents filed M.A.Nos. 283 to 286/2002 to issue specific instructions regarding the amount to be recovered by the Recovery Officer and consequently stay all further proceedings. The Tribunal by its common order dated 11-10-2002, directed the petitioner to pay 50 per cent of the amount mentioned in the recovery certificate within 4 weeks, since an opportunity was given to the respondents 2 and 3 to deposit the balance 50 per cent of the amount. The Tribunal also held that in default of compliance of the order, the stay granted in respect of the confirmation of sale shall automatically stand vacated. The petitioner did not comply with the order of the Tribunal but instead, without notice to the first respondent filed an application for extension of time. The Tribunal also extended further time for payment of the amount till 19-12-2002. At this stage, the petitioner has filed the above Revisions before this Court.