i.C.i.C.i. Ltd. Vs. Veena Textiles Limited and ors. - Court Judgment

Excerpt:
company - transfer of proceedings - sections 3, 17, 18 and 31 of recovery of debts due to bank and financial institutions act, 1993 - plaintiff sought order for direction to court receiver to pay them all amounts of ad hoc royalty deposited by debts - proceedings transferred to debt recovery tribunal (drt) - court receiver appointed during pendency of same - receiver asked to take formal possession from defendant as his agent on usual royalty without security - rights of receiver to manage properties questioned - appointment of receiver was interim arrangement limited to directors regarding management of property - further directions in respect of matter through notice of motion cannot be granted - held, directions sought by petitioner stands dismissed. - section 10: [swatanter kumar, c.j., a.p. deshpande & smt. nishita mhatre, jj] admission to professional colleges - technical courses - publication of brochure on basis of which candidates seek admission to various institution keeping in mind their merit and preference of colleges held, for ensuring adherence to proper appreciation of an academic course, it is essential that the method of admission is just, fair and transparent. the first step in this direction would be publication of a brochure on the basis of which the applicants are supposed to aspire for admission to various institution keeping in mind their merit and preference of college. brochure, firstly has to be in conformity with law and the statutory scheme notified by the competent authority. it is a complete and composite document as it deals with the scheme for conducting their entrance examinations, declaration of results, general instructions and method of admission, etc. this brochure is binding on the applicants as well as the authorities. this brochure or admission notification issued by the state or other competent authority cannot be altered at a subsequent stage particularly once the process of admission has begun. there is hardly any exception to this accepted rule of law. section 10: [swatanter kumar, c.j., a.p. deshpande & smt. nishita mhatre,jj] admission to professional colleges - technical courses - approval to additional seats or to start new course - cut off dates held, the settled principle of law is that merit of the applicant is the primary criteria which would determine his rank as well as the college where he would be entitled to admission. this rule should not be frustrated as it will tantamount to entirely upsetting the object of admissions based on merit oriented method and would cast cloud on the fairness and transparency of the method of admission. one of the ways in which merit can be defeated is allowing increase in the intake strength or commencement if new colleges beyond cut-off date and admissions beyond the last date specified in the notification/calendar issued by the concerned authorities. this can be illustrated by giving an example. college a which is running a professional course like engineering or mba etc. has an intake capacity of 60 seats which has duly been notified in the information brochure. however, after the cut-off date, approval is granted by the aicte and thereafter, the process is taken up by the state and the intake capacity of the college is increased by 30 more seats. these seats would obviously, not be notified in the information brochure and the candidate who are meritorious and for whom college a; be the college of reference could not get seats or give preference as the seats were limited. none had the proper knowledge about the increase in intake of seats though at a much subsequent stage and may be even after the last date of admission is over either by themselves or under the order of the court even it is put on the internet or given in the newspaper, the candidates of higher rank or meritorious candidates would not be able to avail of that benefit because they have already submitted the testimonial, have paid their fees and the courses have commenced. in that situation, for variety of reasons, they may not be able to take admission in the institution of their higher preference while the candidates of much lower merit will be admitted to that course. besides defeating the merit, it has been commonly noticed that the late admissions made by the colleges directly effect notified candidates who have questioned it more than often as their admission process is not so just, fair and transparent which has given rise to the litigation. it is also a kind of back door entry method. another serious consequence that result from such admissions is shortening of the academic courses in an undesirable manner. it is expected of other candidate selected to a professional course that he or she would complete the course in its entirety and not by missing more than a month or so in joining the said course. this results in lowering the excellence of education as well as harms the academic standard of professional education. admission to professional colleges: [swatanter kumar, c.j., a.p. deshpande & smt. nishita mhatre, jj] technical courses - held, in process of admission to professional colleges relating to technical courses, primarily three institutional bodies are involved. (i) all india technical council for technical education, (ii) state of maharashtra through director of technical education and (iii) university to which such institution is affiliated the role of all these institutions in distinct and different but for a common object. primary of the rule of all india council for technical education (aicte) is now well settled but that certainly does not mean that role of the state government and for that matter the university is without any purpose or of no importance. the council is the authority constituted under the central act with the responsibility of maintaining education standards and judging upon the infra-structure and facilities available for imparting such professional education. its opinion is of utmost importance and shall take precedence over views of the state as well as that of the university. the concerned department of the state and the affiliating university has a role to pay but it is limited in its application. they cannot lay down any guidelines or policies which would be in conflict with the central statute or the students laid down a by the central body. state can frame its policy for admission to such professional courses but such policy again has to be in conformity with the directives issued by the central body. while the state grants its approval and university its affiliation for increased intake of seats or commencement for a new course/college, its directions should not offend and be repugnant to what has been laid down in the condition of approval granted by the central authority or council. what is most important is that all these authorities have to work ad idem as they all have a common object to achieve i.e. of proper imparting of education an ensuring maintenance of proper standards of education, examination and ensuring proper infrastructure for betterment of educational system. only if all these authorities work in a co-ordinated manner and with co-operation they would be able to achieve the very object for which all these entities exist admission to professional courses: [swatanter kumar, c.j.,a.p. deshpande & smt. nishita mhatre, jj] admission schedule - interference by courts held, all the expert bodies viz. aicte as well as directorate of education in consultation with the departments of the state regulating the process of admission and maintenance of standards of education had notified a legal binding document specifying dates and schedule for various matters in relation to admission of students and commencement of courses. there has to be so compelling circumstances and grounds before the court to interfere with the prescribed schedule. it is neither so arbitrary nor so perverse, keeping in view the essential features relating to imparting education to professional courses that it should invite judicial chastisement to the extent of laying down entirely new schedule. merely because there has been some delay on the part of either of these authorities to timely grant of either of these authorities to timely grant or decline approval and permission to commence a course per se would not be sufficient ground for disturbing the notified schedule and timely commencement of courses. - [2001] 105 comp cas 18, this court has ample powers to pass orders sought by the plaintiffs and that the plaintiffs are ready to give an undertaking that, in case they fail in the suit, they will bring back the money so paid to them.r.k. batta, j.1. the plaintiffs seek judge's order for directions to the court receiver, bombay high court to pay them all the amounts of ad hoc royalty deposited and/or to be deposited by defendant no. 1 after deducting court receiver's commission costs, charges and expenses. the same is being contested by defendant no. 1.2. the proceedings already stand transferred to the debt recovery tribunal under the recovery of debts due to banks and financial institutions act, 1993 (hereinafter referred to as the 'said act') consequent to the notification dated july 16, 1999, by which, the central government has established debt recovery tribunal (hereinafter referred to as 'drt') under section 3 of the said act.3. while the proceedings were pending in this court, on a notice of motion, an order was passed on march 25, 1998, appointing the court receiver, bombay high court as the receiver of the immovable properties described in exhibits a-1 and a-2 and movable properties as described in exhibit b as also the banker's goods as described in exhibit c to the plaint without power to sell. the court receiver was asked to take formal possession from defendant no. 1 and appoint defendant no. 1 as his agent on usual royalty without security. in pursuance of the said order, the court receiver had fixed royalty and the royalty deposited so far is about rs. 1.37 crore as on today, for the withdrawal of which the judge's order has been moved.4. the learned advocates for the parties were heard at length. the learned advocate for the plaintiffs urged that in view of the judgment of the learned single judge of this court in suit no. 2784 of 1999 icici ltd. v. patheja brothers forgings and stampings ltd. [2001] 105 comp cas 18, this court has ample powers to pass orders sought by the plaintiffs and that the plaintiffs are ready to give an undertaking that, in case they fail in the suit, they will bring back the money so paid to them. the learned advocate for the plaintiffs drew my attention to the judgment of the supreme court in hiralal patni v. loonkaran sethiya, : [1962]1scr868 to which reference has been made by the learned single judge who held that the court receiver is still amenable to the court as its officer until he has complied with the court's direction as to the disposal of the funds which he has received during the course of his receivership. he further submitted that, though in the order the learned single judge has dealt with the question of management and protection of properties, yet, all the possible situations could not be contemplated and that the power of management does itself include the power to pay royalty. he has also relied upon the full bench judgment of this court in state bank of india v. trade aid paper and allied products (india) pvt. ltd. : air1995 bom268 and submitted that not only the properties are to be protected by the court receiver but the defendant is required to ensure to repay the amount, if he is desirous of enjoying the benefits secured by obtaining the loan. lastly, it was submitted by him that till machinery is created in the drt to deal with the situation, this court is empowered to pass orders of the nature as sought by the plaintiffs, otherwise, the plaintiffs would be left without any remedy.5. the learned advocate for the defendants drew my attention to sections 17 and 18 of the said act and urged that not only the main proceeding but also the application and motion on which the order of appointment was made has been transferred to the drt and as such it will not be possible for the parties to move for variation of the said order dated march 25, 1998, and that cannot be done indirectly by way of judge's order. he also urged that the orders which can be passed in pursuance of the judgment of the learned single judge are restricted to management and protection of the property in the custody of the receiver till the proper infrastructure is available in the drt. he also urged that in terms of the said order of the learned single judge, only the receiver can move the court for orders and the interested parties have no locus standi to move the court. he, therefore, urged that at this stage the request for judge's order is not maintainable.6. the question which arose before the learned single judge was relating to the rights of the court receiver to manage the properties after notification dated july 16, 1999, as also the question of deposit of royalty, which some of the parties had declined to deposit on the ground that the receiver stood discharged automatically due to transfer of proceedings to the drt. section 31 of the said act is clear on the subject and it provides that the proceeding shall stand transferred on the date of notification to the drt. the notification in this respect was issued on july 16, 1999. therefore, the proceedings stood transferred to the drt as on the date of the said notification. along with the proceedings, interim applications which were pending therein also stood transferred to the drt. as such, notice of motion no. 1189 of 1998 also stood transferred to the drt as on the date of the said notification. this position has been categorically stated by the learned single judge in the said judgment. in the said judgment, interim arrangement during the transitional period in the exigency of the situation referred to in the said judgment limited to directions regarding the management of property in order to preserve the same has been made. there is no doubt, a reference to the decision of the apex court in hiralal patni v. loonkaran sethiya : [1962]1scr868 , which deals with the question of directions of disposal of fund but the said ruling will not be directly applicable to the facts under consideration since the observation made by the apex court in the said ruling related to the powers of continuation of the duties of the receiver after final decree is made and even after that the receiver is still amenable to the court as its officer until he has complied with the court's directions as far as the disposal of the funds is concerned. the observations contained in paragraph 10 of the full bench judgment of this court on which reliance has been placed by the learned advocate for the plaintiffs would also not be attracted and cannot applied to the facts and circumstances of the case under consideration.7. what is sought by this judge's order is in fact, further directions in respect of the matter on which notice of motion had been moved wherein certain interim directions were given. i agree with the learned advocate for the defendants that what cannot be directly done cannot be permitted indirectly by way of judge's order. accordingly, there is no reason whatsoever to sign the judge's order as prayed for by the plaintiffs. the plaintiffs may, in case it so desires, seek remedy available under law. the request for passing the judge's order is accordingly rejected.