Andhra Pradesh Chemicals and Minerals, Public Limited Company and Others Vs. State Bank of India and Others - Court Judgment

Excerpt:
banking - recovery of money - section 5 of limitation act, 1963 - respondent bank filed suit for recovery of sums - suit was dismissed - bank filed interlocutory application for setting aside order of dismissal - bank did not take steps to represent interlocutory application - after four years again filed fresh interlocutory application for condoning delay and to set aside dismissal order - court allowed petition against which petitioner filed present revision petition - respondent bank in suit of recovery of money should have been vigilant at all time - because respondent is a bank discretion need not to be exercised in its favour - court must satisfy that delay has been satisfactorily explained - held, order of court below set aside. - - but however for the reasons best known to the bank, it appears that the bank did not take any steps to represent the interlocutory application. but for the reasons best known to it, even those ias. however, it is not possible to lay down precisely as to what facts or matters would constitute 'sufficient cause' under section 5. but those words should be liberally construed so as to advance substantial justice when no negligence or any inaction or want of bona fides is imputable to a party, i.order1. the crp is filed against the orders of the learned additional chief judge, city civil court, hyderabad, dated 23-6-1995 in ia no.71 of 1993 in os no.866 of 1985.2. the petitioners are the defendants. the 1st respondent/plaintiff filed the suit for recovery of certain sums from the defendatns. the suit was dismissed for default on 30-6-1986. thereafter, the 1st respondent - state bank of india filed interlocutory application in the year 1989 after a period of 3 years for setting aside the order of dismissal and also to condone the delay in filing the application to set asidethe dismissal order. they were returned by the office for representation; but however for the reasons best known to the bank, it appears that the bank did not take any steps to represent the interlocutory application. but after a lapse of about four years, the bank filed fresh ias, for condoning the delay and seeking to set aside the orders of dismissal dated 30-6-1986. in ia no.71 of 1993 application was filed for condoning the delay of six years 2 months and 15 days in filing the application to set aside the dismissal order. the said application was allowed by the court below by order dated 23-6-1995, against which the petitioners filed the present revision petition challenging the order of the lower court.3. the learned counsel for the 1st respondent/bank was not present even though his name was printed and there was no representation on his behalf. therefore, the matter was heard on merits of the case.4. the learned counsel for the petitioners submits that the order of the court below is wholly erroneous and contrary to law settled by the supreme court of india in respect of condonalion of delay under section 5 of the limitation act. he submits that the 1st respondent/bank having filed applications in the year 1989 to set aside the order of dismissal did not take any steps to represent the matter and get the ias., heard finally, but it slept over for a considerable time and after a period of four years, fresh ia., were filed for setting aside the order of dismissal, with condonation of delay.5. he further submitted that the lower court did not consider the matter in proper perspective and simply passed an order on the ground that it is the state bank of india, a public sector undertaking, and therefore, in the interests of justice, the delay should be condoned. the saidreasoning, according to the learned counsel for the petitioner, is wholly erroneous and the court below ought not to have condoned the delay on that ground. he also relied on the judgment of the supreme court reported in sandhya rani v. sudha rani, : [1978]2scr839 .6. i have perused the order under revision. i find that there is total lack of dedication on the part of the bank in pursuing the matters. admittedly, the suit was dismissed for default in the year 1986. the court gave more than half a dozen opportunities, yet there was no representation, and, therefore, the court below had no option except to dismiss the suit for default. that was not even realised by the bank. it is only after four years, the bank realised that the suit was dismissed for default and then took steps and filed the ias., to set aside the order of dismissal. but for the reasons best known to it, even those ias., were not properly pursued and when they were returned, no action was taken to resiibmit for obtaining appropriate orders. but surprisingly, after lapse of a period of 4 further years, again in the year 1993, fresh applications were filed seeking to set aside the order of dismissal and also to condone the delay of 6 years 3 months and 15 days. the court below did not consider these facts at all and on the premise that the respondent/bank is a nationalised bank, it took a sympathetic view and condoned the delay. paras 4 and 5 of the order is extracted below:'it is needless to mention that the plaintiff is a nationalised bank, constituted under the state bank of india act. the delay in question seem to have occasioned on account of negligence in not prosecuting the earlier petitions properly by the counsel for the plaintiff. it is a golden rule that the parties should not suffer for the lapses of the advocates. at the same time, as rightly claimed by the defendants counsel the right accrued to them byvirtue of delay cannot be simply brushed aside, because the plaintiff is a state bank of india.in the given facts and circumstances,i feel that the interest of justice would be met if the delay in question is condoned, on condition that the plaintiff is disentitled to claim any future interest for the said period of delay of 6 years2 months and 15 days, now condoned by this order. the point is answered accordingly.'7. i am of the view that the reasoning given by the court below is absolutely unwarranted. it may be a nationalised bank or a private bank, but for the purpose of consideration of the matter under section 5 of the limitation act, the petitioner has to explain each day's delay. even though some lee way can be given to the government and organisations such as corporations and public sector undertakings, they cannot exhibit total negligence in dealing with the matter. the officers of the bank, a statutory creation under the act, are expected to be more diligent in discharge of their duties. the bank advances the public money to the borrowers and if timely action is not taken to pursue the recoveries, the loss is not to the bank, but to the public exchequer.8. having filed the applications in the 1989, there is no reason why they were not pursued further, and, giving a go-bye to the earlier las., the respondent/bank has simply chosen to file fresh applications. this itself shows any amount of negligence and lackadaisical attitude on the part of the officers. what transpired between the bank and its counsel is not the concern of the court and it need not evoke sympathy of the court. the bank has to conduct its affairs in a bona fide manner before the court and here is a case where the delay has not been explained at all and clear latches arc writ at large in the affidavits filed in support of theapplications seeking to condone the delay in filing the application to set aside the dismissal order.9. even though the supreme court on number of occasions has held that section 5 of the limitation act has to be liberally construed provided the party establishes that he was vigilant and has taken all necessary steps to bona fide prosecute the case, but a non-vigilant party has no right to invoke liberality of the court in dealing with the matters under section 5 of the limitation act.10. the bank being a public sector undertaking may, in certain circumstances, claim certain leniency while dealing with the matters relating to condonation of delay; but, at the same time, the steps that are taken by the bank, are also to be mentioned in the affidavit. admittedly, this case was dealt with by the bank in most negligent manner. the first respondent/bank which is the plaintiff in the suit for recovery of certain sums, ought to be vigilant at all times. it cannot afford to attribute any reasons to the conduct of its counsel. it is a matter between the counsel and the party, which cannot be a ground to condone the delay. absolutely, i do not find any ground to condone the delay. of course the court is entitled to exercise discretion in such matters, but at the same time, the discretion has to be exercised fairly, rcasonally for advancing the cause of justice and in favour of the party provided he approaches the court with clean hands and in a bona fide manner.11. the supreme court in sandhya rani's case (supra), observed :'it is undoubtedly true that in dealing with the question of condoning the delay under section 5, the party seeking relief has to satisfy the court that he had sufficient cause for not preferring the appeal or making the application withinthe prescribed time and this has always been understood to mean that the explanation has to cover the whole period of delay. however, it is not possible to lay down precisely as to what facts or matters would constitute 'sufficient cause' under section 5. but those words should be liberally construed so as to advance substantial justice when no negligence or any inaction or want of bona fides is imputable to a party, i.e., the delay in filing an application should not have been for reasons which indicate the party's negligence in not taking necessary steps which lie would have or should have taken. what would be such necessary steps will again depend upon the circumstances of a particular case.discretion is conferred on the court before which an application for condoning delay is made and if the court after keeping in view relevant principles exercises its discretion granting relief unless it is shown to be manifestly unjust or perverse, the supreme court would be loathe to interfere with it.''12. in the instant case, the discretion exercised by the court below cannot be said to be reasonable. simply because the first respondent is a bank, the discretion need not be exercised in its favour. the court must satisfy that the delay has been satisfactorily explained. therefore, i have to necessarily set aside the order of the court below in condoning the delay in filing the application to set aside the dismissal order. accordingly, the order passed by the court below is set aside.13. that is not the end of the matter. this court sees any amount of negligence on the part of the officers of the bank. their negligence has caused the bank an enormous loss, which has to be replenished by the persons who are found to beresponsible for their indolent and reclacitrant attitude. the officers who are looking after the case must be held to be responsible for this eventuality. therefore, it is necessary that the 1st respondent-bank shall initiate enquiry under the provisions of the conduct regulations and fix the responsibility on the officers concerned. it is open for the 1st respondent bank to recover the loss sustained on account of this situation from the officers who are responsible for this situation. a copy of this order shall be transmitted to the head office and local head office of 1st respondent-bank for taking necessary action.14. the crf is accordingly allowed. no costs.

Judgment:
ORDER

1. The CRP is filed against the orders of the learned Additional Chief Judge, City Civil Court, Hyderabad, dated 23-6-1995 in IA No.71 of 1993 in OS No.866 of 1985.

2. The petitioners are the defendants. The 1st respondent/plaintiff filed the suit for recovery of certain sums from the defendatns. The suit was dismissed for default on 30-6-1986. Thereafter, the 1st respondent - State Bank of India filed interlocutory application in the year 1989 after a period of 3 years for setting aside the order of dismissal and also to condone the delay in filing the application to set asidethe dismissal order. They were returned by the office for representation; but however for the reasons best known to the Bank, it appears that the Bank did not take any steps to represent the interlocutory application. But after a lapse of about four years, the Bank filed fresh IAs, for condoning the delay and seeking to set aside the orders of dismissal dated 30-6-1986. In IA No.71 of 1993 application was filed for condoning the delay of six years 2 months and 15 days in filing the application to set aside the dismissal order. The said application was allowed by the Court below by order dated 23-6-1995, against which the petitioners filed the present revision petition challenging the order of the lower Court.

3. The learned Counsel for the 1st respondent/Bank was not present even though his name was printed and there was no representation on his behalf. Therefore, the matter was heard on merits of the case.

4. The learned Counsel for the petitioners submits that the order of the Court below is wholly erroneous and contrary to law settled by the Supreme Court of India in respect of condonalion of delay under Section 5 of the Limitation Act. He submits that the 1st respondent/Bank having filed applications in the year 1989 to set aside the order of dismissal did not take any steps to represent the matter and get the IAs., heard finally, but it slept over for a considerable time and after a period of four years, fresh IA., were filed for setting aside the order of dismissal, with condonation of delay.

5. He further submitted that the lower Court did not consider the matter in proper perspective and simply passed an order on the ground that it is the State Bank of India, a public sector undertaking, and therefore, in the interests of justice, the delay should be condoned. The saidreasoning, according to the learned Counsel for the petitioner, is wholly erroneous and the Court below ought not to have condoned the delay on that ground. He also relied on the judgment of the Supreme Court reported in Sandhya Rani v. Sudha Rani, : [1978]2SCR839 .

6. I have perused the order under revision. I find that there is total lack of dedication on the part of the Bank in pursuing the matters. Admittedly, the suit was dismissed for default in the year 1986. The Court gave more than half a dozen opportunities, yet there was no representation, and, therefore, the Court below had no option except to dismiss the suit for default. That was not even realised by the Bank. It is only after four years, the Bank realised that the suit was dismissed for default and then took steps and filed the IAs., to set aside the order of dismissal. But for the reasons best known to it, even those IAs., were not properly pursued and when they were returned, no action was taken to resiibmit for obtaining appropriate orders. But surprisingly, after lapse of a period of 4 further years, again in the year 1993, fresh applications were filed seeking to set aside the order of dismissal and also to condone the delay of 6 years 3 months and 15 days. The Court below did not consider these facts at all and on the premise that the respondent/Bank is a Nationalised Bank, it took a sympathetic view and condoned the delay. Paras 4 and 5 of the order is extracted below:

'It is needless to mention that the plaintiff is a Nationalised Bank, constituted under the State Bank of India Act. The delay in question seem to have occasioned on account of negligence in not prosecuting the earlier petitions properly by the Counsel for the plaintiff. It is a golden rule that the parties should not suffer for the lapses of the advocates. At the same time, as rightly claimed by the defendants Counsel the right accrued to them byvirtue of delay cannot be simply brushed aside, because the plaintiff is a State Bank of India.

In the given facts and circumstances,I feel that the interest of justice would be met if the delay in question is condoned, on condition that the plaintiff is disentitled to claim any future interest for the said period of delay of 6 years2 months and 15 days, now condoned by this order. The point is answered accordingly.'

7. I am of the view that the reasoning given by the Court below is absolutely unwarranted. It may be a Nationalised Bank or a Private Bank, but for the purpose of consideration of the matter under Section 5 of the Limitation Act, the petitioner has to explain each day's delay. Even though some lee way can be given to the Government and organisations such as Corporations and public sector undertakings, they cannot exhibit total negligence in dealing with the matter. The officers of the Bank, a statutory creation under the Act, are expected to be more diligent in discharge of their duties. The Bank advances the public money to the borrowers and if timely action is not taken to pursue the recoveries, the loss is not to the Bank, but to the public exchequer.

8. Having filed the applications in the 1989, there is no reason why they were not pursued further, and, giving a go-bye to the earlier lAs., the respondent/bank has simply chosen to file fresh applications. This itself shows any amount of negligence and lackadaisical attitude on the part of the officers. What transpired between the Bank and its Counsel is not the concern of the Court and it need not evoke sympathy of the Court. The Bank has to conduct its affairs in a bona fide manner before the Court and here is a case where the delay has not been explained at all and clear latches arc writ at large in the affidavits filed in support of theapplications seeking to condone the delay in filing the application to set aside the dismissal order.

9. Even though the Supreme Court on number of occasions has held that Section 5 of the Limitation Act has to be liberally construed provided the party establishes that he was vigilant and has taken all necessary steps to bona fide prosecute the case, but a non-vigilant party has no right to invoke liberality of the Court in dealing with the matters under Section 5 of the Limitation Act.

10. The Bank being a Public Sector Undertaking may, in certain circumstances, claim certain leniency while dealing with the matters relating to condonation of delay; but, at the same time, the steps that are taken by the Bank, are also to be mentioned in the affidavit. Admittedly, this case was dealt with by the Bank in most negligent manner. The first respondent/Bank which is the plaintiff in the suit for recovery of certain sums, ought to be vigilant at all times. It cannot afford to attribute any reasons to the conduct of its Counsel. It is a matter between the Counsel and the party, which cannot be a ground to condone the delay. Absolutely, I do not find any ground to condone the delay. Of course the Court is entitled to exercise discretion in such matters, but at the same time, the discretion has to be exercised fairly, rcasonally for advancing the cause of justice and in favour of the party provided he approaches the Court with clean hands and in a bona fide manner.

11. The Supreme Court in Sandhya Rani's case (supra), observed :

'It is undoubtedly true that in dealing with the question of condoning the delay under Section 5, the party seeking relief has to satisfy the Court that he had sufficient cause for not preferring the appeal or making the application withinthe prescribed time and this has always been understood to mean that the explanation has to cover the whole period of delay. However, it is not possible to lay down precisely as to what facts or matters would constitute 'sufficient cause' under Section 5. But those words should be liberally construed so as to advance substantial justice when no negligence or any inaction or want of bona fides is imputable to a party, i.e., the delay in filing an application should not have been for reasons which indicate the party's negligence in not taking necessary steps which lie would have or should have taken. What would be such necessary steps will again depend upon the circumstances of a particular case.

Discretion is conferred on the Court before which an application for condoning delay is made and if the Court after keeping in view relevant principles exercises its discretion granting relief unless it is shown to be manifestly unjust or perverse, the Supreme Court would be loathe to interfere with it.''

12. In the instant case, the discretion exercised by the Court below cannot be said to be reasonable. Simply because the first respondent is a Bank, the discretion need not be exercised in its favour. The Court must satisfy that the delay has been satisfactorily explained. Therefore, I have to necessarily set aside the order of the Court below in condoning the delay in filing the application to set aside the dismissal order. Accordingly, the order passed by the Court below is set aside.

13. That is not the end of the matter. This Court sees any amount of negligence on the part of the officers of the Bank. Their negligence has caused the Bank an enormous loss, which has to be replenished by the persons who are found to beresponsible for their indolent and reclacitrant attitude. The officers who are looking after the case must be held to be responsible for this eventuality. Therefore, it is necessary that the 1st respondent-Bank shall initiate enquiry under the provisions of the Conduct Regulations and fix the responsibility on the officers concerned. It is open for the 1st respondent Bank to recover the loss sustained on account of this situation from the officers who are responsible for this situation. A copy of this order shall be transmitted to the Head Office and Local Head Office of 1st respondent-Bank for taking necessary action.

14. The CRF is accordingly allowed. No costs.