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TMI Blog2011 (1) TMI 1143X X X X Extracts X X X X X X X X Extracts X X X X ..... bunal with the power to decide an application before it like a suit. It has power to decide set off and counter claims. Then in section 19(13A), the Tribunal has the power to pass an order asking for security, attachment of property and the like. If the Tribunal has the power to order attachment of property, the power to decide the title to that property is incidental to it, Recovery Officer does not have any such power, Recovery is underway. Misfeasance proceedings have not reached that stage before this court, recovery proceedings against applicant/respondent No. 2 will remain suspended till determination of this question by the Tribunal. This order is conditional upon the applicant X X X X Extracts X X X X X X X X Extracts X X X X ..... at the first two properties in New Delhi do not belong to the applicant and the third property in Kolkata belongs to his advocate on record, Mr. K. R. Das. 6. Further, in these misfeasance proceedings pending before this court, it ought to decide the above question as to whom these properties belong and that till it decides this question the Debts Recovery Tribunal should not adjudicate the issue at all. The foundation for making this argument is in section 543 of the Companies Act, 1956. In misfeasance proceedings the court has the power to, inter alia, assess the damage caused to the company by any director. The applicant was the director of the company in liquidation. Therefore, if the court finds that this director had caused loss to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dgment that the jurisdiction of the Debts Recovery Tribunal to adjudicate debts payable to banks and financial institutions is exclusive and the company court should not interfere. Discussion and conclusion 9. This case raises very interesting questions. The applicant as well as the company in liquidation are debtors before the Debts Recovery Tribunal. Before it the applicant is liable as a guarantor. The same applicant is a respondent-director in the misfeasance proceedings started in connection with the liquidation proceedings. He is respondent No. 2 there. If the official liquidator succeeds there is likely to be an order against him for payment of money. If he defaults, the same type of execution proceedings can be levied by the compa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecial procedure for recovery prescribed in Chapter V of the Act, and section 34, execution of the certificate is also within the exclusive jurisdiction of the Recovery Officer . . . For the aforesaid reasons, we hold that at the stage of adjudication under section 17 and execution of the certificate under section 25 etc., the provisions of the RDB Act, 1993, confer exclusive jurisdiction in the Tribunal and the Recovery Officer in respect of debts payable to banks and financial institutions and there can be no interference by the company court under section 442 read with section 537 or under section 446 of the Companies Act, 1956. In respect of the monies realised under the RDB Act, the question of priorities among the banks and financial ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , proceedings regarding which were also pending before the Debts Recovery Tribunal. The distribution had to be made under section 529A of the Companies Act, 1956, while the Debts Recovery Tribunal and the company court were empowered to sell the assets in their respective jurisdiction. But, the court said that there should be consultation between the official liquidator and the Debts Recovery Tribunal. 14. Although the basic principles have been formulated by the hon'ble Supreme Court those cases do not provide an answer to the issues here, as they were not before the said court. 15. The Recovery of Debts Due to Banks and Financial Institutions Act, 1993, says that the Recovery Officer will make recovery of the debts. There is no provisio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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