9911796707
TMI Blog1999 (9) TMI 1005X X X X Extracts X X X X X X X X Extracts X X X X ..... 3.83 and 2.7.84 respectively. During the pendency of the suits, Recovery of Debts due to Banks and Financial Institutions Ordinance, 1993 was promulgated by the President of India on 24.6.1993. It was replaced by the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (for short referred to as 'the Act'). After Debt Recovery Tribunal was constituted under the Act at Jaipur, the appellants made two applications on 20.9.94 to the Court for getting the two suits transferred to the Debt Recovery Tribunal. The Court by two separate orders allowed the applications and directed transfer of those suits to the Debt Recovery Tribunal at Jaipur but retained the counter claim filed by the respondents in Civil Suit No. 152 of 198 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ver-looked the relevant provisions of the Act and erroneously allowed the revision applications. He submitted that the suits being proceedings for recovery of debts alleged to be due, the Civil Court ceased to have any jurisdiction to deal with them on merits. 5. It is not in dispute that the respondents, under the export credit facility with the appellant bank, was obtaining advances from the appellant-bank from time to time against pre-shipment and post-shipment exports of precious stones, jewellery, diamonds etc. It is also not in dispute that there was nonpayment to the bank by the foreign buyers of the bills mentioned in the two suits. The defence of the respondents is that under the insurance cover obtained at the instance of the b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ertain and decide applications from the banks and financial institutions for recovery of debts due to such banks and financial institutions. Section 18 has created a bar that no Court or other authority can thereafter exercise any jurisdiction, powers or authority (except the Supreme Court, and a High Court exercising jurisdiction under Article 226 and 227 of the Constitution) in relation to the matters specified in Section 17. In respect of pending cases Section 31 provides as under : Transfer of pending cases.--(1) Every suit or other proceeding pending before any court immediately before the date of establishment of a Tribunal under this Act, being a suit or proceeding the cause of action whereon it is based is such that it would have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in cash or otherwise. It would be immaterial whether the liability is secured or unsecured or whether it is payable under a decree or an order of any Civil Court or otherwise. However, it should be subsisting and legally recoverable on the date on which proceedings are initiated for recovering the same. 9. The important words in the definition alleged as due have been over looked by the High Court and, therefore, it has erroneously held that unless the amounts claimed by the bank are determined or decided by a competent forum they cannot be said to be due and would not amount to 'debt' under the Act. What was necessary for the High Court to consider was whether the bank was alleged in the suits that the amounts are due to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ations for forwarding the records of the suits to the Tribunal. In our opinion, the trial Court rightly understood the correct position of law and passed correct orders on those applications. The High Court took an erroneous view of the law and wrongly set aside the orders passed by the trial Court. 11. The High Court also failed to appreciate that the defence raised by the respondents does not prime facie show that the liabilities stood discharged either under the insurance cover/guarantee or otherwise. The defence raised by the respondents is that the insurance cover/guarantee provides that delivery by the exporter to the insured of documents of export of goods for which the credit has been given or advance has been made shall be de ..... X X X X Extracts X X X X X X X X Extracts X X X X
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