Bombay High Court
Lt. Col. Anil Bhat Of vs Citibank on 9 February, 2009
Bench: F.I. Rebello, R.S. Mohite
MGN
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
WRIT PETITION NO.1631 OF 2008
1.Lt. Col. Anil Bhat of )
Delhi, Indian Inhabitant, )
residing at 315, "Qutab View" )
Mehrauli, New Delhi-110 030 )
2.Sucheta Bhat of
Delhi, Indian Inhabitant, )
residing at 315, "Qutab View" )
Mehrauli, New Delhi-110 030 )
3.Nadiya Bhat of )
Delhi, Indian Inhabitant, )
residing at 315, "Qutab View" )
Mehrauli, New Delhi-110 030 )..PETITIONERS
Versus
Citibank, N.A. )
a National Banking Association )
duly constituted, registered and)
in existence in accordance with )
the law of the United States of )
America now in force and having )
its head office at 399, Park )
Avenue, Borough of Manhattan, )
City of New York and having )
an office in India among other )
places at Cititowers, 61, )
Dr.S.S.Rao Road, Parel, )
Mumbai-400 012. )..RESPONDENTS
Mr.Atul Rajadhyaksha, Senior Counsel with Mr.
Mayur Bhajwani i/b. Manilal Kher Ambalal & Co.,
for the Petitioenrs.
Mr. C.S. Balsara i/b.Ramesh Makhija & Co., for
the Respondent.
CORAM: F.I. REBELLO &
R.S.MOHITE, JJ.
DATED: 9th February, 2009
JUDGMENT (PER F.I. REBELLO, J.):
. Rule. Heard forthwith.
2. The petitioners have approached this Court
against the order of the Debt Recovery Appellate
Tribunal which after accepting the contention of the
petitioners herein that the proceedings filed before
it by the respondent were without jurisdictions
directed the return of the plaint (Application) for
(-2-)
presentation to the proper Court. The petitioners
are aggrieved by this part of the order. It is the
submission on behalf of the petitioners that the
Tribunal under the Act being a creature of Statute,
consequently would have no jurisdiction to direct
return of the Original Application to the Respondent
for presentation to the proper Court. The
application filed under Section 19 of the Act is
neither a plaint nor a suit as contemplated under
the Code of Civil Procedure and as the Recovery of
Debts Due to Bank & Financial Institution Act, 1993,
hereinafter referred to as RDB Act, does not have a
provision for return of plaint, it was not open to
the Tribunal to direct return of the plaint.
3. On the other hand on behalf of the
Respondent it is submitted that considering the
language of Section 22 of the RDB Act the Tribunal
is not bound by the procedure laid down by the Code
of Civil Procedure. The relevant portion of Section
22 of the RDB Act reads as under:-
"22. Procedure and powers of the Tribunal
and the Appellate Tribunal.- (1) The
Tribunal and the Appellate Tribunal shall
not be bound by the procedure laid down by
the Code of Civil Procedure, 1908 (5 of
1908), but shall be guided by the principles
(-3-)
of natural justice and, subject to the other
provisions of this Act and of any rules, the
Tribunal and the Appellate Tribunal shall
have their sittings.
(2) The Tribunal and the Appellate Tribunal
shall have, for the purposes of discharging
their functions under this Act, the same
powers as are vested in a civil Court under
the Code of Civil Procedure, 1908 (5 of
1908),
while trying a suit, in respect of
the following matters, namely:-
(a) summoning and enforcing the attendance
of any person and examining him on oath.
(b) requiring the discovery and production
of documents;
(c) receiving evidence on affidavits.
(d) issuing commissions for the examination
of witnesses or documents;
(e) reviewing its decisions.
(f) dismissing an application for default or
deciding it ex parte;
(-4-)
(g) setting aside any order of dismissal of
any application for default or any order
passed by it ex parte.
(h) any other matter which may be
prescribed."
It is further submitted that merely because some
specific powers under the C.P.C. have been
conferred
under sub-section (2), the Tribunal will
not cease to have jurisdiction to exercise those
powers based on equity. The only fetter in exercise
of the procedural powers is to observe the
principles of natural justice.
4. The question, therefore, for consideration
of this Court is whether after the Tribunal came to
the conclusion that it had no jurisdiction over the
subject matter, could it then have passed the
consequential order of directing return of the
plaint (Application).
5. A few facts may be set out:- The petitioners
owned a flat which was let out to respondent for a
period of 3 years. The respondent by way of
security kept deposit of Rs.21.00 lakhs with the
petitioners. According to the petitioners
(-5-)
respondent terminated the license before the expiry
of the period. The petitioners in preparation of
handing over gave a cheque dated 3rd October, 2000
for the return of the security deposit amount.
According to the petitioners they paid Rs.21.00
lakhs in cash because the petitioners wanted early
possession of the flat as there was another multi
national bank who was willing to take the same on
license. The respondent on 3rd October, 2000
presented the cheque which was returned on the next
day. It is
not necessary to refer to the other
averments except to state that the respondent
thereafter filed a suit for recovery of the amount
as set out in the cheque under the RDB Act. The
petitioners herein raised a defence that the
Tribunal had original jurisdiction to decide only
amounts claimed as a debt and in the instant case as
it was not a debt, the Tribunal would have no
jurisdiction. This application was dismissed by the
Tribunal, but in Appeal the Appellate Tribunal
accepted the contention of the petitioners by its
order dated 26th November, 2007. Pursuant to the
order directing return of the plaint the respondent
have presented the plaint before the Competent Court
where the proceedings are pending.
6. Let us consider the submission. An added
submission is that even if the Civil Court holds
(-6-)
that it has no jurisdiction over the subject matter
then its jurisdiction to direct return the plaint is
limited to those cases relating to want of
territorial or pecuniary jurisdiction. The argument
proceeds on the footing that if the Court has no
jurisdiction over the subject matter, once it holds
that it has no jurisdiction it can pass no further
order. In a case of territorial or pecuniary
jurisdiction the Court would have jurisdiction over
the subject matter, but cannot entertain the
proceedings
because it does not have territorial
jurisdiction or the claim is not within its
pecuniary limits.
. Such an issue had come up for consideration
before the Supreme Court in Raizada Topandas & Anr
vs. M/s.Gorakhram Gokalchand, AIR 1964 SC 1348.
The issue before the Supreme Court was whether on a
proper interpretation of Section 28 of the Bombay
Rents, Hotel and Lodging House Rates Control Act,
1947 the Court of Small Causes, Bombay, had
exclusive jurisdiction to deal with the same.
Relief sought in a Suit filed before the City Civil
Court was that the plaintiff be declared to be a in
lawful possession and the Defendants had no right to
enter into or remain in possession of the shop,
injunction and other consequential reliefs. The
defence raised was that the question involved in the
(-7-)
suit related to possession of the premises as
between landlord and tenant and the Court of Small
Causes alone will have jurisdiction to entertain and
try the suit. On these pleadings a preliminary
issue was framed. The City Civil Court held in
favour of the defendants and accordingly made an
order that the plaint be returned to the plaintiff
for presentation to the proper Court. In Appeal
before the High Court the Court took a view that the
City Civil Court had jurisdiction. Against that
order Special
Leave to Appeal was preferred from
which the Appeal arose. Before the Court the issue
was, if the defendant raised the claim or question
as to existence of relationship of landlord and
tenant as to between the defendant and the Plaintiff
the jurisdiction of City Civil Court is ousted even
though the plaintiff pleads that there is no such
relationship and the only Court which has exclusive
jurisdiction to try the suit is the Court of Small
Causes. In answering the question the Court relied
on the principle as explained in a Full Bench
decision of the Allahabad High Court in Ananti v.
Channu, AIR 1930 All. 193.
193 We may gainfully
reproduce the said paragraph:-
"The plaintiff chooses his forum and files
his suit. If he establishes the correctness
of his facts he will get his relief from the
(-8-)
forum chosen. If .............. he frames
his suit in a manner not warranted by the
facts and goes for his relief to a court
which cannot grant him relief on the true
facts, he will have his suit dismissed.
Then there will be no question of returning
the plaint for presentation to the proper
court,for the plaint as framed, would not
justify the other kind of court to grant him
the relief........If it is found on a trial
on the
merits so far as this issue of
jurisdiction goes, that the facts alleged by
the plaintiff are not true and the facts
alleged by the defendants are true, and that
the case is not cognisable by the court,
there will be two kinds of orders to be
passed. If the jurisdiction is only one
relating to territorial limits or pecuniary
limits, the plaint will be ordered to be
returned for presentation to the proper
Court. If, on the other hand, it is found
that, having regard to the nature of the
suit, it is not cognizable by the class of
court to which the court belongs, the
plaintiff's suit will have to be dismissed
in its entirety."
Relying on this principle the Court held, that the
(-9-)
view taken by the High Court was correct. The
proposition which follows is that the power of the
Civil Court to direct return of the plaint is
limited to those cases where it has no territorial
or pecuniary jurisdiction. In case if it has no
jurisdiction in respect of the subject matter then
it cannot direct return of the plaint. If this
principle is accepted on the facts of the case then
the Tribunal would have no jurisdiction to direct
return of the plaint as it came to the conclusion
that it had no jurisdiction over the subject matter.
7. The next question that we are called upon to
is to answer the issue is whether the D.R.T., can
exercise all the powers of a Civil Court under the
Code of Civil Procedure. Return of the plaint is
governed by the provisions of Order 7 Rule 10. We
have earlier reproduced the relevant provisions of
Section 22(2) of the C.P.C. The power to return the
plaint is not one such power which the Tribunal and
the Appellate Tribunal has been conferred
specifically. In the absence of conferring such
power, can the Tribunal under the powers conferred
on it under Section 22(1) direct return of the
plaint. A similar issue had come up for
consideration and stands concluded in the case of
Industrial Credit and Investment Corporation of
India Ltd. vs. Garapco Industries Ltd. & Ors.,
(-10-)
AIR 1999 S.C.1975.
S.C.1975 The question for consideration
before the Court was whether the Tribunal under the
RDB Act had jurisdiction to grant ad-interim exparte
order of injunction or stay against the defendant on
an application filed by the bank or financial
institution for recovery of debt. After considering
the provisions the High Court had taken a view that
the Tribunal had no jurisdiction to grant exparte
order. The Supreme Court reversed the order of the
High Court and observed as under:-
"We, however, do not agree with the
reasoning adopted by the High Court. When
Section 22 of the Act says that the Tribunal
shall not be bound by the procedure laid by
the Code of Civil Procedure, it does not
mean that it will not have jurisdiction to
exercise powers of a Court of Civil
Procedure. Rather, the Tribunal can travel
beyond the Code of Civil Procedure and the
only fetter that is part on its powers is to
observe the principles of natural justice."
Considering the language of Section 22 the Court
observed as under:-
"We have to give meaning to Section 22 of
the Act as here the Tribunal is exercising
(-11-)
powers of a Civil Court while trying a money
suit. Further, when power is given to the
Tribunal to make interim order by way of
injunction or stay, it inherits in it the
power to grant that order even ex parte, if
it is so in the interest of justice and as
per the requirements as spelt out in the
judgment of this Court in Morgan's case
which has been quoted above."
We
need not refer to in detail the judgment in the
case of Morgan Stanley Mutual Fund v. Kartick Das,
(1994) 4 SCC 225.
225 There the Court was considering
Section 14 of the Consumer Protection Act, 1986,
which section did not provide for grant of any
interim relief or even ad-interim relief and
provided only for final relief. The Supreme Court
there laid down the principles to be taken into
consideration by Court or Tribunal in granting
ex-parte injunction. Apart from the other general
principles the Supreme Court took the view that the
exparte order should be granted only under
exceptional circumstances and that grant of exparte
order is not a rule but an exception." Considering
the judgment in Grapco Industries Ltd. (supra) the
proposition follows that even though there is no
specific power conferred on a Tribunal under the RDB
Act, considering Section 22(1) the Tribunal though
(-12-)
not bound by the procedure laid down in the Code of
Civil Procedure is not extinguished of jurisdiction
to exercise powers of a Court under the C.P.C.,
rather the Tribunal can travel beyond the scope of
C.P.C., but in doing so, the only fetter is to
observe the principles of natural justice. The
Tribunal therefore, would have jurisdiction to
direct return of the plaint but in cases limited to
pecuniary or territorial jurisdiction.
8. Having said
ig so the question still remains
whether after having come to the conclusion that it
had no jurisdiction over the subject matter
considering the principles laid down in Raizada
Topandas & Anr (supra) the Tribunal could have
directed the return of the plaint. The principle
which the Supreme Court accepted in Raizada Topandas
& Anr (supra) was that if a plaint as drafted does
not confer jurisdiction on the Court in respect of
the subject matter, then it will have no
jurisdiction to direct return of the plaint. In
such a case it will have jurisdiction limited to the
extent of a case of pecuniary and territorial
jurisdiction. If this proposition is accepted then
the learned Tribunal on determination of the issue
as to whether it has jurisdiction over the subject
matter could not have directed the return of the
plaint.
(-13-)
9. Having so answered, the question is whether
this Court should interfere in the exercise of its
extra ordinary jurisdiction as in the meantime the
plaint has already been lodged with the Civil Court
which is seized of the matter. The effect of return
of the plaint would sound in limitation as to
whether it is a continuation of the proceedings or
not. Whether the return of the application and
presenting the same in the Civil Court is a
continuation
of the proceedings, this Court really
need not answer as the plea can be raised by the
petitioner herein, before the Civil Court. Suffice
it to say that we may only refer to some of the
judgments. In Harshad Chiman Lal Modi vs. D.L.F.
Universal Ltd., & Anr., AIR 2006 S.C. 646.
646 A suit
had been filed on the Original Side of the High
Court of Delhi for various reliefs. In the written
statement filed no plea was raised as to
jurisdiction. The suit then was transferred to the
District Court. Issues were framed which did not
include as to jurisdiction. Subsequently amendment
was sought to raise an objection as to jurisdiction.
It was allowed and additional issue was framed and
the Court held that it had no jurisdiction and
accordingly directed return of the plaint for
presentation to proper Court. The order was
confirmed by the High Court as well as by the
(-14-)
Supreme Court. An interlocutory application was
filed in the disposed of Appeal by the Applicant.
In the application it was pointed out that when the
applicant had approached the Supreme Court against
the judgment of the Delhi High Court. Status quo
had been directed. The Additional District Judge
was allowed to proceed with the suit, but directed
not to deliver the judgment until further orders.
The trial Court proceeded with the suit. Evidence
was recorded, but did not proceed to pronounce the
judgment. The
plea before the Supreme Court was
that the Gurgaon Court which was the Court of
competent jurisdiction should be directed to proceed
with the suit from the stage at which it stood
transferred and to decide it expeditiously. This
was resisted by the respondent contending that once
the Court took the view that Delhi Court had no
jurisdiction and the direction was given for return
of the plaint for presentation to proper Court and
when presented to the Gurgaon Court it cannot be
treated as continuation of the proceedings as the
earlier proceedings were in a Court which had no
jurisdiction. The suit would commence on the day
when the plaint would be presented to the proper
Court. In answering this issue the Supreme Court
held that the suit could not have been instituted in
the Delhi Court keeping in view the subject matter.
The plea that the Gurgaon Court should proceed with
(-15-)
the matter from the stage where the proceedings
continued in Delhi could not be accepted as it could
not be said that they were continuation of
proceedings considering that the Delhi Court had no
jurisdiction over the subject matter. The Court
then also noted that distinction between pecuniary
jurisdiction and jurisdiction in respect of the
subject matter.
10. In Ramdutt Ramkissen Dass vs. E.D. Sassoon
&
Co., AIR 1929 Privy Council 103 the Privy Council
considering Section 4 of the Limitation Act,
observed that where a suit has been instituted in a
Court which is found to have no jurisdiction and it
is found necessary to raise a second suit in a Court
of proper jurisdiction, the second suit cannot be
regarded as a continuation of the first, even though
the subject matter and the parties to the suits were
identical.
11. In our opinion, considering that the plaint
has already been presented and for that matter the
respondents herein could have always filed a Second
Suit on the first Court holding that it has no
jurisdiction and as the issue whether the suit as
filed is within limitation or whether the time taken
before the D.R.T. and D.R.A.T. can be excluded are
the issues which will be available to the petitioner
(-16-)
to be raised the suit now pending. Thus it is not
necessary for this Court in such circumstances to
interfere in the exercise of our extra ordinary
jurisdiction with the order passed even though we
have held that the Tribunal would have no
jurisdiction to direct return of the plaint after it
came to the conclusion that it had no jurisdiction
over the subject matter.
(R.S.MOHITE, J.) (F.I.REBELLO, J.)
