S.A. Shah, J.
1. All these three petitions raise a common question of law as to the interpretation of clause (b)of sub-section (1) of section 3 of the Gujarat Public Moneys (Recovery of Dues) Act, 1979 (hereinafter referred to as 'the Act'). Therefore, at the request of the advocates of the parties, all these petitions are heard together and disposed of by this common judgment.
2. The respondent-banks in these petitions have filed suits against the petitioners and others for recovery of various amounts. The petitioner who were the defedants in the respective suits raised a contention that a view of the provisions of clause (b) of sub-section (1) of section 3 of the Act, in respect of the suits started after the coming into force of the Act, the civil court had no jurisdiction to proceed with the same in view of the judgment of this court (N. H. Bhatt J.) in Special Civil Application No. 1702 of 1984, decided on October 9, 1985.
3. When Special Civil Application No. 5712 of 1985 came up for interim orders before A. P. Ravani J., he did not agree with the view expressed by N. H. Bhatt J. and by his order dated November 28, 1985, directed the office to place the matter before the Hon'ble Chief Justice for being placed before a Division Bench.
4. Similarly, Special Civil Applications Nos. 5985 of 1985 and 5986 of 1985 came up before M. B. Shah J. and he also did not agree with the view expressed by N. H. Bhatt J. since he himself had taken a contrary view in Bank of Baroda v. Thakkar Chandulal Ishwarlal [1986] GLH 1204 and requested the learned Chief Justice to refer these two petitions to the Division Bench for hearing of interim relief. That is how all these three petitions have come up before us for decision.
5. We will make a short reference to the facts of Special Civil Application No. 5712 of 1985 which is earlier in point of time. Respondent No. 1. State Bank of Saurashtra, Porbandar Branch, Porbandar, filed a suit against the petitioner-firm, M/s. Rasiklal and Bros. Ahmedabad, for recovery of a sum of Rs. 13,435.73 with interest. Similarly, the other banks have filed suits against the petitioners of other two petitions. Instead defending the suits in the civil court, the defendants of the respective suits have filed these petitions under article 227 of the Constitution of India in this court for appropriate orders or directions to hold and declare that in view of the provisions of the Act, the suit filed by the respective banks in the civil court at Porbandar were not maintainable and, therefore, the proceedings in those suits were required to be quashed and set aside. None of the petitioners in these petitions has entered into the merits of the suits filed by the respondent-banks; all of them have raised a legal contention as to the interpretation of clause (b) of sub-section (1) of section 3 of the Act.
6. In order to appreciate the respective contentions of the parties, it will be necessary to reproduce section 3 and section 7 which is renumbered as section 6(4)(i) of the Act. They read as under :
'3(1) Where any person is a party -
(a) to any agreement relating to a loan, advance or grant given to him or relating to credit in respect of, or relating to hire-purchase of goods sold to him by State Government, the corporation or, as the case may be, the Government company by way of financial assistance; or
(b) to any agreement relating to a loan, advance or grant given to him or relating to credit in respect of, or relating to hire-purchase of, goods sold to him by a bank or a Government company, as the case may be, under a State Sponsored Scheme; or
(c) to any agreement relating to a guarantee given by the State Government or the corporation in respect of a loan raised by an industrial concern; or
(d) to any agreement providing that any money payable there under to the State Government or the corporation shall be recoverable as arrears of land revenue; and such person -
(i) makes any default in payment of the loan or advance of any instalment thereof; or
(ii) having become liable under the conditions of the grant to refund the grant or any portion thereof, makes any default in the refund of such grant or portion or any instalment thereof, or
(iii) otherwise fails to comply with the terms of the agreement -
then, in the case of the State Government, such officer as may be authorised in that behalf by the State Government by notification in the Official Gazette, in the case of a corporation or a Government company, the managing director thereof or where there is no managing director, the chairman thereof, by whatever name called, and in the case of a bank, the local agent thereof, by whatever name called, may send to the Collector a certificate as early as possible in the prescribed form mentioning the sum due from such person and requesting that such sum may be recovered as if it were arrears of land revenue.
(2) The Collector, on receiving the certificate, shall, after making such inquiries (including giving hearing to the party affected) as he deems fit, proceed to recover the amount stated therein as aforesaid as arrears of land revenue.
(3) On recovery of any amount under sub-section (2), the same shall be paid over to the State Government, corporation, Government company, or, as the case may be, bank after deducting, except in the case of amount to be paid to the State Government, such portion of the amount realised, as cost of collection as the Collector may deem to be reasonable.
(4) No suit for the recovery of any such dues as aforesaid shall lie in a civil against any person referred to in sub-section (1), and no injection shall be granted by a civil court in respect of any action taken or intended to be taken in pursuance of the right conferred by this section.'
'6(4)(i) (originally section 7). All suits of the nature referred to in sub-section (4) of section 3 pending in any civil court immediately before the commencement of this Act shall abate upon such commencement so however that such abatement shall be without prejudice to the right of the State Government, corporation, Government company or bank, as the case may be, to recover any sum which may be the subject-matter of such suit in accordance with the provisions of this Act, or any other law for the time being in force.'
7. Reading the scheme of section 3 of the Act as a whole, it appears that with regard to certain dues of the State Government, the corporation, a Government company and a bank, a new procedure has been prescribed for the recovery of such dues treating them as arrears of land revenue. Sub-section (4) of section 3 of the Act prohibits recovery of such dues by filing a suit in the civil court and also prohibits the civil court from granting injection in respect of any action taken or intended to be taken in pursuance of the right conferred by this section. Further, clause (i) of sub-section (4) of section 6 (originally section 7) of the Act provides that even in a case where such suit is pending for recovery of such dues in respect of which remedy has been provided for in sub-section (1) of section 3 of the Act, such suit shall abate without prejudice to the rights of the authorities (creditors) to recover such sum in accordance with the provisions of the Act, or any other law for the time being in force. In other words, only those suits which fall within the scope of sub-section (1) of section 3 of the Act will abate. It is settled law that when a provision excludes the jurisdiction of a civil court, the same should be construed strictly. Thus, the suits which are fully covered by the provisions of sub-section (1) of section 3 of the Act will only be excluded from the purview of the civil court.
8. Sub-section (1) of section 3 of the Act applies to the agreement between a person (debtor) and various authorities. Clause (a) of sub-section (1) deals with an agreement between a person and the State, the corporation or, as the case may be, the Government company, in relation to a loan, advance or grant, or in relation to credit in respect of, or hire-purchase of, the goods sold to the person by way of financial assistance. Clause (b) relates to an agreement between a person and a bank or a Government company, in relation to a loan, advance or grant given to him or in relation to credit in respect of, or in relation to hire-purchase of, goods sold to him under a State-Sponsored Scheme. Clause (c) provides for an agreement between the parties to which a guarantee is given by the State Government or the corporation in respect of a loan raised by as industrial concern. Clause (d) provides for an agreement relating to money payable thereunder to the State Government or the corporation which shall be recoverable as arrears of land revenue. So, in clause (D), there is n qualifying clause like clauses (a) and (b) and it is applicable to all agreements under which money are payable by the parties to the State Government or the corporation as arrears of land revenue. Whereas, clause (c) relates to the guarantee given by the State Government or the corporation in respect of the loan raised by an industrial concern, clause (b) relates to the dues of the bank or a Government company under the State-Sponsored Scheme. Clause (a) is in respect of the dues of the State Government, the corporation or the Government company by way of financial assistance. It would thus be seen that the scheme under each of the aforesaid clauses is different. However, we are in the instant case concerned with the dues of the bank under an agreement as provided in clause (b) of sub-section (1) of section 3 of the Act.
9. It is a well-known fact that banks enter into various types of commercial transactions and a remedy for recovery of dues of loans given under such transactions is available by way of civil suits to all the banks under the general provisions of law. Here also the 'bank' includes 'all the companies' as defined in the Banking Regulation Act, 1949, and is not restrivted only to the nationalised banks. In our country, banks are the biggest financial institutions entering into transactions of corers of rupees. The transactions which are covered by clause (b) of sub-section (1) of section 3 of the Act are transactions of loan, advance or grant, or of credit in respect of, or relating to hire-purchase of, goods sold only under State Sponsored Schemes.
Now, 'State-sponsorted Scheme' is defined in section 2(L) of the Act as under :
'2. In this Act, unless the context otherwise requires, -
(L) 'State-sponsored scheme' means a scheme sponsored or adopted by the State Government or an officer authorised by it in this behalf for development of agriculture or industry and notified as such by the State Government or the authorised officer, by a notification in the Official Gazette for the purposes of this Act.'
10. All the agreements with the parties relating to a loan, advance or grant given to them or credited in respect of or relating to hire-purchase of goods sold to them by a bank or a Government company under a State Sponsored Scheme only are covered by clause (b) of sub-section (1) of section 3 of the Act. No other meaning is possible. This section is not ambiguous and, therefore, the first golden rule of interpretation has to be applied to construe the provision in its grammatical sense or meaning. Reading of clause (b) leaves no doubt that it covers the dues of the banks given to parties under a State Sponsored Scheme as defined under section 2(L) of the Act.
11. We have perused the judgment of N. H. Bhatt J. in Special Civil Application No. 1702 of 1984 decided on October 9, 1985. The grounds that weighed with him in allowing that petition were those stated in paragraphs 27(A), 27(B) and 27(C) of that petition, and they are reproduced by him in his judgment. Paragraph 27(A) is in respect of the preamble of t he Act, whereas paragraph 27(A) is in respect of the preamble of the Act, whereas paragraph 27(B) reproduces section 2(3) of the Act, whereas paragraph 27(B) reproduces section 2(3) of the Act which provides that after the amount has been recovered from the deflator as arrears of land revenue, the same shall be paid over to the State Government, Corporation, Government company, or, as the case may be, bank after deducting the cost of collection, etc. In our opinion, this provision of point at issue. Sub-section (4) of section 3 and section 7 (which is numbered as section 6(4)(1) of the Act which are also reproduced in the said paragraph 27(E) are also consequential provisions and will be attracted only if the suit falls within the purview of any of the clauses (a), (b), (c) or (d) of sub-sectioin (1) of section 3 of the Act. In our opinion, therefore, the petitioners of that case had not drawn the attention of the court to the relevant provisions of the Act for the decision whether the suit is one of the suits as contemplated by the sub-section (1). and if it falls within the purview of one of those clauses of sub-section (1), then and only, the suit will abate or the jurisdiction of the civil court may be excluded. It is, therefore, not possible to agree with the view taken by N. H. Bhatt J. and, with respect, we prefer the view taken by A. P. Ravani J. and N. B. Shah J. The learned advocates for the petitioners have not disputed that the dues of t he banks were commercial dues and not dues under the State Sponsored Scheme as defined in section 2(L) of the Act. If the dues of the banks for which the banks have filed suits are not dues under agreements of the type contemplated by sub-section (1)(b) - under the State Sponsored Scheme - the jurisdiction of the civil court would not be ousted. Thus, the suits cannot be said to have abated under section 6(4)(1) (originally section 7) of the Act, and the civil court had jurisdiction t hear and decide the same according to law.
12. We, therefore, hold that none of the suits has abated, and the civil court has jurisdiction to proceed with the respective suits filed by the banks. In view of our aforesaid finding, none of the petitioners is entitled to any relief as prayed for. Learned advocates for the petitioners in all the three petitions state that since this is the only issue involved is the petitions, and since the issue has been answered against the petitioners in all the three petitions, the petitions will stand finally disposed of by this order. In view of this statement made by the learned advocates for the petitioners, we dismiss these petitions and discharge the rule, with no order as to costs.
13. Mr. Oza states that in view of the dismissal of the petitions, the petitioners, who are the original defendants, will have to file applications for leave to defend in the trial court, and for that reasonable time may be granted. The petitioners, original defendants, are granted two weeks' time from today to file their applications for leave to defend the suits.