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Mrs. Mangalabai Vs. the Sangli Bank Limited and ors. - Court Judgment

SooperKanoon Citation
SubjectBanking
CourtKarnataka High Court
Decided On
Case NumberWrit Petition No. 25644 of 1997
Judge
Reported inAIR2003Kant76; [2003]115CompCas764(Kar); ILR2002KAR4601; 2002(6)KarLJ362
ActsCode of Civil Procedure (CPC) , 1908 - Sections 151 - Order 47, Rule 1; Recovery of Debts Due to Banks and Financial Institutions Act, 1993 - Sections 17, 18 and 31; Constitution of India - Articles 226 and 227
AppellantMrs. Mangalabai
RespondentThe Sangli Bank Limited and ors.
Appellant AdvocateSuresh S. Joshi, Adv.
Respondent AdvocateG.N. Jayaraju, Adv. for Respondent-1, ;Respondents-4, 5 and 6(a) to (c) served, ;Respondent-2(a), (b), (d) and (e), 3 and 6(d) dismissed, ;Respondent-2(c) service held sufficient
DispositionPetition dismissed
Excerpt:
banking - transfer of suit - code of civil procedure, 1908 and recovery of debts due to banks and financial institutions act, 1993 - respondent-bank filed suit for recovery of money due from petitioner and other persons - suit against petitioner came to be dismissed but suit against others decreed - respondent filed application for recalling entire proceedings against petitioner and transferring same to tribunal under act of 1993 - petitioner challenged said application in writ petition - all suits or proceedings for recovery of debt filed by financial institutions defined under act got transferred by operation of law tribunal - transfer of suit does not take place by volition of parties but by operation of law - petitioner had alternative remedy under code of 1908 to contest application..........decree was pronounced, the bank made an application, i.a. no. 21 under section 151 of the code of civil procedure for recalling the entire proceedings subsequent to 30-11-1994 including the judgment and decree in view of the provisions of the recovery of debts due to banks and financial institutions act, 1993 ('act', for short). this application came to be contested. by an order dated 12th february, 1997, the trial court recalled the judgment and decree and ordered the suit papers to be transferred before the debt recovery tribunal constituted under the said act. 3. this order is under challenge. sri suresh s. joshi, learned counsel appearing for the petitioner, while assailing the said order firstly contended that in a situation where the facts as stated by the first respondent in i.a......
Judgment:
ORDER

H. Rangavittalachar, J.

1. The 6th defendant to the suit O.S. No. 182 of 1986 has filed this writ petition under Articles 226 and 227 of the Constitution of India, challenging the order of the Additional Civil Judge, Bijapur passed on I.A. No. 21.

2. Briefly stated, the facts are as under.--The Sangli Bank, respondent 1 herein has filed a suit in O.S. No. 182 of 1986 against the respondents 2 to 6 herein and also the petitioner for recovery of Rs. 18,05,562.88. The suit came to be decreed by judgment and decree dated 31st January, 1995 against the respondents herein. So far as the petitioner is concerned, the same came to be dismissed. After the judgment and decree was pronounced, the Bank made an application, I.A. No. 21 under Section 151 of the Code of Civil Procedure for recalling the entire proceedings subsequent to 30-11-1994 including the judgment and decree in view of the provisions of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 ('Act', for short). This application came to be contested. By an order dated 12th February, 1997, the Trial Court recalled the judgment and decree and ordered the suit papers to be transferred before the Debt Recovery Tribunal constituted under the said Act.

3. This order is under challenge. Sri Suresh S. Joshi, learned Counsel appearing for the petitioner, while assailing the said order firstly contended that in a situation where the facts as stated by the first respondent in I.A. No. 21 existed, the first respondent could have only filed review petition under Order 47, Rule 1 of the Code of Civil Procedure and no application under Section 151 of the Code of Civil Procedure was maintainable; elaborating the said contention learned Counsel submitted by relying on the following decisions of the Supreme Court and this Court that if the specific provision is made under the Code of Civil Procedure, the Civil Courts cannot invoke the inherent jurisdiction under Section 151 of the Code of Civil Procedure and pass orders like the one on hand. The decisions cited are, (1) Dwarka Das v. State of MadhyaPradesh, : [1999]1SCR524 Nainsingh v. Koonwarjee and Ors., : [1971]1SCR207 R. Rathinaval Chettiar and Anr. v. Sivaraman and Ors., : [1999]2SCR313 M. Narayanappa v. Hemavathi, : ILR1987KAR715 .

4. In answer to the said contentions, learned Counsel for the first respondent Mr. G.N. Jayaraju submitted that when the Trial Court passed judgment and decree by mistake, without taking note of the existence of the provisions of the Act, on and from the appointed date the Civil Courts totally lacked any jurisdiction to deal with cases covered under the Act and the orders are passed overlooking the said provisions. Such orders can only be corrected by exercise of inherent jurisdiction. Learned Counsel relied upon the decision of this Court in Palghar Rolling Mills (Private) Limited v. Visveswarayya Iron and Steel Limited, : AIR1985Kant282 . He also submitted that whenever Civil Courts pass orders in exercise of the powers under the Code of Civil Procedure, the aggrieved party can only resort to remedies available under the Code of Civil Procedure which is a complete and exhaustive Code and powers under Article 226 cannot be invoked.

5. In order to appreciate the rival contentions, it is necessary to refer to some of the provisions of the Act and the admitted facts in this case.

6. The admitted facts being, that the first respondent herein, Sangli Bank, is a Scheduled Bank within the meaning of the provisions of the Act; that a suit for recovery of monies advanced by the Bank was filed in the year 1986 in O.S. No. 182 of 1986 against the respondents and the petitioner herein and the suit came to be decreed on 31st January, 1995.

7. During the pendency of the suit, Act 51 of 1993, i.e., Recovery of Debts Due to Banks and Financial Institutions Act, 1993 was enacted by the Parliament which came into force with effect from 24th June, 1993. The main purpose or object of establishing the Tribunals was for an expeditious adjudication in the matter of recovery of debts due to Banks and financial institutions as the experience showed that public money was not properly safeguarded on account of delay caused in civil litigation. Under Section 3 of the Act 'Debt Recovery Tribunal' was constituted on and from the appointed day; Section 18 of the Act which is relevant reads as under:

'18. Bar of jurisdiction.--On and from the appointed day, no Court or other authority shall have, or be entitled to exercise, any jurisdiction, powers or authority (except the Supreme Court, and a High Court exercising jurisdiction under Articles 226 and 227 of theConstitution) in relation to the matters specified in Section 17'.

8. Insofar as a pending proceeding before the Civil Courts, a specific provision for transfer has been made under Section 31 of the Act. Section 31 reads as under:

'31. 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 been, if it had arisen after such establishment, within the jurisdiction of such Tribunal, shall stand transferred on that date to such Tribunal:

Provided that nothing in this sub-section shall apply to any appeal pending as aforesaid before any Court. (2) Where any suit or other proceeding stands transferred from any Court to a Tribunal under Sub-section (1).-

(a) the Court shall, as soon as may be after such transfer, forward the records of such suit or other proceeding to the Tribunal; and

(b) the Tribunal may, on receipt of such records, proceed to deal with such suit or other proceeding, so far as may be, in the same manner as in the case of an application made under Section 19 from the stage which was reached before such transfer or from any earlier stage or de novo as the Tribunal may deem fit'.

9. Thus, by combined reading of Sections 18 and 31 two consequences flows. On and from the appointed date, i.e., 24th June, 1993, the Civil Courts constituted under the Code of Civil Procedure totally lacked the jurisdiction in relation to matters to be adjudicated by the Tribunal under Section 17 of the Act.

10. All suits or proceedings for recovery of debts filed by the Banks or financial institutions, as defined under the Act, got transferred by operation of law to the Debt Recovery Tribunals. In other words, the transfer of suit does not take place by volition of the parties but by operation of law.

11. In the facts of the case, it is obvious, having regard to the provisions of the Act on and from 24th June, 1993, the proceedings in O.S. No. 182 of 1986 before the Civil Court for all intent and purposes got by operation of law transferred to the Tribunal. But, unfortunately, the Civil Court proceeded to adjudicate the suit by overlooking the said provisions as if it had jurisdiction where it totally lacked and passed the decree. Under the circumstances, the Bank which is the repository of public money, in order to protect its interest had to move an application, I.A. No. 21, otherwise, the decree would have become non-executable. It is at that stage, the Court noticed the mistake and only ordered for correction of the said mistake. The question is whether the Court could do so only in exercise of its powers under Order 47, Rule 1 of the Code of Civil Procedure or it could invoke its inherent power under Section 151 of the Code of Civil Procedure.

12 . The argument of Mr. S. Joshi is when specific provision in the form of Order 47, Rule 1 of the Code of Civil Procedure is provided unless the grounds under which review can be made existed Court could not have exercised the power under Section 151 of the CPC.

13. Section 151 of the Code of Civil Procedure saves the inherent power of Court, it reads:

'Nothing in this Code shall be deemed to limit or otherwise affect the inherent power of Court to make such orders as may be necessary for the ends of justice or to prevent abuse of the process of Court'.

This inherent power is in addition and complimentary to the express powers granted under the Code. It can be exercised amongst other things to correct its own wrong; or to recall its earlier order, if the proceedings culminated in the order suffered from inherent lack of jurisdiction. No doubt inherent power cannot be exercised if it were to operate either expressly or impliedly against any of the other power granted to the Court under other provisions of the Code of Civil Procedure.

14. The grounds under which a judgment and decree can be reviewed as stated in Order 47, Rule 1 being,

(i) That a party to the proceedings discovers a new and important matter or evidence, which after the exercise of due diligence was not within his knowledge or could not be produced by him at the time when the decree is passed or order ismade.

(ii) A mistake or error apparent on the face of record. (iii) Or for any other sufficient reason.

Thus, by a combined reading or understanding of the provision of Order 47, Rule 1 and Section 151 of the Civil Procedure Code, it cannot be said that 'when the Court recalls an order or judgment and decree passed by it on the ground that it lacked total jurisdiction to even try the suit, in exercise of its inherent power', the said exercise of the power in any way will not be in conflict with the power under Order 47, Rule 1 of the CPC. Per contra in the circumstances, it only supplements, or adds to the said power, even if it is conceded that there may be some overlapping between the exercise of the powers under Order 47, Rule 1 and Section 151 of the CPC.

15. Therefore, I do not find that the Trial Court lacked any power under Section 151 in the facts of the present case to pass the impugned order as contended by Joshi. Insofar as the authorities cited by the learned Counsels of the Supreme Court and this Court, they are only authorities for the proposition: that when once specific provision is made under the Code of Civil Procedure, the Civil Court should not invoke the inherent power under Section 151. There cannot be any two opinions about the proposition of law laid down. In the light of what is discussed above they are distinguishable.

16. Besides what is stated above and as rightly contended by the learned Counsel for the first respondent the Civil Procedure Code is a complete Code, and it in detail provides the procedure for dealing with substantial rights. Code also has in detail provided remedy in respect of every conceivable order, that may be passed by the Courts while exercising their power under the provisions of the Code. The petitioner has to avail of such remedies only as are provided under the Code in respect of orders passed by the Civil Courts while exercising its powers under the Code. He cannot travel beyond the remedies provided under the Code or overlook the said remedies and approach this Court under Articles 226 and 227 of the Constitution of India. Therefore, it is not a case for exercise of powers under Articles 226 and 227 against the impugned order.

17. Looking from any angle, the writ petition deserves to be dismissed and is dismissed accordingly, with costs of Rs. 1,500/-.


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