Bombay High Court
Reliable Extraction Industries ... vs Canara Bank And 19 Ors on 25 July, 2017
Bench: B.R. Gavai
NMWL537-2016.doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
NOTICE OF MOTION (L) NO. 537 of 2016
IN
WRIT PETITION NO.514 OF 2010
ALONGWITH
NOTICE OF MOTION (L) NO.190 OF 2017
IN
WRIT PETITION NO.514 OF 2010
M/s. Reliable Extractions Industries Pvt. ...Applicant /
Ltd. Petitioner
Versus
Canara Bank & Ors. ...Respondents
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Mr. Prajyot Jaggi for the Petitioner.
Mr. Nirman Sharma for the Respondent No.2.
Mr. Bharat Vaishnawa i/b M/s. Bharat Vaishnawa and Co., for
the Respondent No.3.
Mr. Satya Prakash Sharma, Applicant In NMWL/190/2017.
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CORAM : B.R. GAVAI AND
RIYAZ I. CHAGLA, JJ.
DATE : 25 July 2017
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NMWL537-2016.doc
JUDGMENT : (Per Riyaz I. Chagla, J.)
1. The Petitioner by the present Petition is challenging the
order dated 23rd February 2010 passed by the Debts Recovery
Appellate Tribunal, Mumbai upholding the common order dated
4th September 2009 passed by Recovery Officer, Debts Recovery
Tribunal-II, Mumbai and the common order dated 6th
November 2009 passed by the learned Presiding Officer, Debts
Recovery Tribunal- II, Mumbai. The Petitioner has sought
directions from this Court directing the Court Receiver to hand
over physical possession of the subject properties to the
Petitioner Company.
2. The Petitioner Company is a borrower from the
Respondent No.1-Bank. Upon the non-payment of dues by the
Petitioner, the Respondent No.1-Bank filed two Suits of 1984
against Petitioner Company and Original Respondent No.3 as
well as Respondent Nos.4 to 19 as the guarantors. The two
Suits came to be transferred to the Debts Recovery Tribunal-II,
Mumbai and registered as Original Application Nos.323 and 485
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NMWL537-2016.doc
both of 2001. A Court Receiver had been appointed by this
Court in the suits over the subject property and by an order
dated 21st April 2004, the Respondent No.1 was appointed as
Tribunal Receiver in place of Court Receiver. The Tribunal
Receiver was discharged while allowing the Original
Applications by the Debts Recovery Tribunal-II, Mumbai vide
order dated 12th May 2006. The Original Respondent No.3 had
filed Review Petitions, one of which was allowed and the other
dismissed by order dated 30st August 2006. Subsequently, two
Recovery Proceedings Nos.173 and 174 of 2006 were initiated
by Respondent No.1. The Petitioner represented by group of
persons (hereinafter referred "group of persons") filed an
application seeking to restrain the Respondent No.1 from
dealing with and entering into correspondence with the Original
Respondent No.3 for and on behalf of the Petitioner Company.
There was a dispute between the groups of persons claiming to
be Directors of the Petitioner-Company and Original Respondent
No.3 who claimed to represent the Petitioner-Company. The
group of persons were pursuing the proceedings in Debts
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NMWL537-2016.doc
Recovery Tribunal-II / Debts Recovery Appellate Tribunal. The
group of persons filed an application before the Recovery Officer
of the Debts Recovery Tribunal - II, Mumbai seeking declaration
that the Respondent No.1 Bank had illegally accepted money
from the Original Respondent No.3 and executed registered
deed of assignment dated 7th April 2008 in favour of the
Original Respondent No.3. The group of persons also filed a
Suit before this Court challenging the assignment. The
Respondent No.1 Bank had refused to accept the money from
the group of persons and upon accepting the money from the
Original Respondent No.3 handed over the subject property to
the Original Respondent No.3 of which the group of persons
were aggrieved. It was their case that the Original Respondent
No.3 had been removed as Director way back in 1994 and since
then he was not concerned with the affairs of the Petitioner-
Company, although, in the year 2007, he got himself and his son
fraudulently appointed as Directors. The Recovery Officer has
rejected the application filed by the group of persons. The
impugned order upheld by the Debts Recovery Tribunal was
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challenged in the Debts Recovery Appellate Tribunal. The
Respondent Nos.1 and the Original Respondent No.3 supported
the order of the Recovery Officer as mentioned in the impugned
order of the Debts Recovery Appellate Tribunal. It was the
contention of the Respondent No.1-Bank that the issue raised by
the group of persons was beyond the scope of the Recovery
Proceedings and Recovery Officer had rightly not entertained
them. Shri. Agarwal, Advocate representing the group of
persons/Petitioner before the Debts Recovery Appellate Tribunal
had first stated that there was no dispute between the Directors
representing the Petitioner-Company and that the Recovery
Officer and Presiding Officer had erred in holding that they have
no jurisdiction over the matter. Advocate Shri. Agarwal, despite
making the statement has filed this proceeding, challenging the
status of the Original Respondent No.3 and his right to
represent the Petitioner-Company as a Director. The allegations
raised by the group of persons have been held by the Debts
Recovery Appellate Tribunal to clearly demonstrate that there
was a dispute between the Original Respondent No.3 and the
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group of persons as Directors representing the Petitioner-
Company. The Debts Recovery Appellate Tribunal has held that
unless a competent forum decides this dispute, the Debts
Recovery Appellate Tribunal cannot consider the claim of the
group of persons to represent the Petitioner-Company. The
Debts Recovery Appellate Tribunal by the impugned order has
rejected the Appeals preferred by the group of persons
challenging the impugned orders of the Recovery Officer and
the Debts Recovery Tribunal.
3. Shri. Nirman Sharma, learned counsel for the Respondent
No.2 has contended that there were two Advocates representing
the Petitioner-Company, one Advocate appearing for the
Applicant in Notice of Motion seeking restoration of the Petition
which had been dismissed by this Court and another Advocate
representing the Petitioner in the Writ Petition. We are not
inclined to go into which Advocate has rightly represented the
Petitioner-Company, as we are of the considered view that the
Petitioner has approbated and reprobated their stand before the
Debts Recovery Appellate Tribunal as to there being a dispute
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NMWL537-2016.doc
between the Directors representing the Petitioner-Company. It
is settled law that a party cannot be allowed to approbate and
reprobate their stand at the same time.
4. We are of the considered view that there is no merit in the
present Petition as the Debts Recovery Appellate Tribunal has
rightly held in the impugned order that the issue of which group
represents the Petitioner Company is left open for an
appropriate forum to determine.
5. We are of the considered view that this Court exercising
jurisdiction under Article 226 of Constitution of India cannot go
into these disputes, particularly since, they involve disputed
questions of facts and we leave the determination of which to an
appropriate forum.
6. We allow the Notice of Motion seeking restoration of this
Petition and dismiss the Petition. There shall be no order as to
costs.
[RIYAZ I. CHAGLA J.] [B.R. GAVAI, J.]
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