2011 (10) TMI 518 - HC - Indian Laws

Recovery of Debts Due to Banks and Financial Institutions Act 1993 - Condonation of delay appeal against order passed by Debts Recovery Tribunal - application filed under section 5 of the Limitation Act for condonation of delay period of limitation Held that - delay cannot be condoned on ground of equity and hardship - application for condonation of delay in preferring an application under section 30(1) of RDDBFI Act beyond period of 30 days prescribed under said provision can be allowed by Debts Recovery Tribunal (DRT) by exercising power to condone delay as understood under section 5 of Limitation Act - provisions of section 5 of Limitation Act or its principles are not applicable to appeal filed under section 30 of RDDBFI Act application dismissed

Issues Involved:
1. Applicability of the Limitation Act, 1963 to appeals under Section 30 of the RDDBFI Act.
2. Definition and scope of "application" under the RDDBFI Act and related rules.
3. Legislative intent regarding the exclusion of Section 5 of the Limitation Act in the RDDBFI Act.
4. Jurisdiction and powers of the Debts Recovery Appellate Tribunal (DRAT) concerning condonation of delay.

Issue-Wise Detailed Analysis:

1. Applicability of the Limitation Act, 1963 to Appeals under Section 30 of the RDDBFI Act:
The primary issue was whether the provisions of Section 5 of the Limitation Act or its principles are applicable to appeals filed under Section 30 of the RDDBFI Act. The court examined the legislative intent and concluded that the RDDBFI Act is a self-contained code that explicitly excludes the applicability of Section 5 of the Limitation Act to appeals under Section 30. The court noted that the legislature consciously omitted the provision for condoning delays in Section 30, unlike in Section 20(3) of the RDDBFI Act, which allows for condonation of delay in certain circumstances.

2. Definition and Scope of "Application" under the RDDBFI Act and Related Rules:
The term "application" is defined in Section 2(b) of the RDDBFI Act as an application made to the Tribunal under Section 19. The court observed that this definition does not include appeals under Section 30. However, Rule 2(c) of the Debts Recovery Rules, 1993, expands the definition to include appeals under Section 30(1). The court found that this expanded definition in the rules could not override the principal Act's definition, emphasizing that the RDDBFI Act's context and legislative intent must prevail.

3. Legislative Intent Regarding the Exclusion of Section 5 of the Limitation Act in the RDDBFI Act:
The court highlighted the legislative intent to provide a speedy mechanism for the recovery of debts due to banks and financial institutions. The RDDBFI Act aims to ensure expeditious adjudication and recovery, which is critical for financial reforms. The court cited various Supreme Court rulings, such as Commissioner of CC&CE v. Hongo India (P.) Ltd. and Gopal Sardar v. Karuna Sardar, to support the view that the exclusion of Section 5 of the Limitation Act can be implied from the scheme and purpose of the RDDBFI Act.

4. Jurisdiction and Powers of the Debts Recovery Appellate Tribunal (DRAT) Concerning Condonation of Delay:
The court concluded that the DRAT does not have the power to condone delays in filing appeals under Section 30 of the RDDBFI Act. The court emphasized that the power to condone delay must be explicitly provided by the statute, and in the absence of such a provision in Section 30, the DRAT cannot apply Section 5 of the Limitation Act. The court set aside the impugned orders of the DRAT, which had allowed the condonation of delay, holding that these orders were unsustainable in law.

Conclusion:
The court held that the provisions of Section 5 of the Limitation Act are not applicable to appeals filed under Section 30 of the RDDBFI Act. The legislative intent, as reflected in the RDDBFI Act, is to exclude the applicability of Section 5 to ensure the expeditious disposal of appeals. The DRAT, therefore, does not have the jurisdiction to condone delays in such appeals. The impugned orders allowing the condonation of delay were set aside, and the rule was made absolute accordingly.

← Previous Next →