V.K. SINGHAL Vs. DENA BANK

JUDGEMENT

(1.) THIS appeal impugns the order dated 21.2.2011 of the Presiding Officer of DRT -I, Delhi whereby Appeal No. 3/2011 filed against the order of the Recovery Officer (RO) in T.R.C. No. 42/2009 has been ordered to be returned to the appellants with the liberty to file it before the DRT Allahabad, as the Recovery Certificate (RC) was issued by the said DRT, which has the jurisdiction with regard to the relief in the matter. The facts giving rise to this appeal, in brief, are that respondent No. 1, Dena Bank, had advanced a term loan of Rs. 47.20 lacs to respondent No. 2, M/s. Hygienic Foods Pvt. Ltd., with the appellants as its Directors, to set up a project for the manufacture of potato chips at its factory at village Manthana, Chaubeypur, Tahsil Bilhaur, District Kanpur Dehat (U.P.) and as a security for the repayment of the loan, movable assets were hypothecated and immovable properties, being land Khasra Nos. 25 and 26 measuring 6 Bighas 11 Biswas, situated in village Sandila, Tehsil Bilhaur, District Kanpur Dehat were mortgaged in favour of the Bank by deposit of title deed with it and the appellants and another stood as guarantors for the repayment of the said loan. As the borrower company could not repay the loan, the Bank filed a mortgage suit (Suit No. 198/92) in the Court of Civil Judge, Kanpur Dehat under Order 34, CPC for the recovery of the outstanding amount of Rs. 73,85,526.65 along with interest against the borrower company, mortgagors and guarantors, arraying them as defendant Nos. 1 to 6. The said suit was decreed vide order dated 25.9.1995 for the recovery of the claimed amount together with pendent lite and future interest @ 23.75% per annum and cost of Rs. 5,60,126.52 against the said defendants and a preliminary decree dated 6.10.1995 was accordingly drawn.

(2.) SINCE the preliminary decree remained unsatisfied, the Bank filed an application dated 17.3.1998 before the said Court for passing the final decree. During the pendency of the Original Suit (No. 198/92) before the Civil Judge, the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (for short, the RDDBFI Act) came into force. As a DRT having jurisdiction within the area of U.P. was established at Jabalpur, the case for the preparation of final decree was, accordingly, transferred to the DRT, Jabalpur in April, 1998. However, since a DRT was later established at Allahabad with jurisdiction within the area of U.P., the said case was transferred from DRT, Jabalpur to DRT, Allahabad, which was ultimately withdrawn by the Bank on 1.8.2007. The Bank, thereafter, filed an application under Section 31A of the RDDBFI Act for issuing the RC in accordance with the preliminary decree dated 6.10.1995 passed by the Civil Judge, Kanpur Dehat. The said application was allowed by the DRT Allahabad and an RC for the recovery of Rs. 21,68,88,343.67 along with cost and interest was issued on 13.5.2008.

(3.) CD Nos. 2 to 5 of the RC (the appellants herein), thereafter, besides filing an application under Order 9 Rule 13, CPC before the DRT for setting aside the decree dated 25.9.1995 also filed an application before the RO on 5.7.2010 for dismissing the proceedings of the RC on the ground of being without jurisdiction. The RO, however, observing that he could not go beyond the mandate issued by the PO through RC, dismissed that application, vide order dated 27.12.2010. Feeling aggrieved with that order, the applicants filed Appeal No. 3/2011, under Section 30 of the RDDBFI Act, before DRT -I, Delhi, which has ordered its return by the order impugned dated 21.2.2011, as mentioned above. This appeal has been filed against the said order.