Delhi High Court
Icici Bank Ltd vs Jkak Tradelinks Pvt Ltd & Anr on 26 September, 2016
$~A-33
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of Decision: 26.09.2016
+ CM(M) 961/2016
ICICI BANK LTD ..... Petitioner
Through Mr.Punit K.Bhalla, Adv.
versus
JKAK TRADELINKS PVT LTD & ANR ..... Respondent
Through
CORAM:
HON'BLE MR. JUSTICE JAYANT NATH
JAYANT NATH, J. (Oral)
1. In the present petition the petitioner's grievance is that alongwith the
suit the petitioner had filed an application under Order 40 Rule 1 CPC for
an ex parte ad interim order appointing a Receiver which relief has not been
even looked into by the impugned order.
2. The case of the petitioner is that the petitioner advanced a vehicle loan
to the respondents. As there have been repeated defaults in payment of the
monthly instalment, the petitioner recalled the vehicle loan and has filed the
present suit for recovery. Learned counsel appearing for the petitioner relies
upon a judgment of this Court in FAO 7/2016 titled ICICI Bank Limited
vs. Updesh Nagar dated 05.01.2016 to contend that in identical facts this
Court had held that appointment of an ex parte Receiver would be in order.
In the said judgment titled as ICICI Bank Limited vs. Updesh Nagar this
court held as under:-
"6.1 In my opinion, issuance of a mere notice can, in certain
set of circumstances, cause prejudice to the applicant; the
present matter is one such case.
6.2 On the aspect as to how a court is to proceed where a
request, for appointment of a receiver, is made by a bank or a
financial institution - the following observations of the Full
Bench of the Bombay High Court, in the case of State Bank of
India vs Trade Aid Paper and Allied Products (India) Pvt.
Ltd. & Ors. AIR 1995 Bom 268, being instructive are required
to be noticed.
6.3 Briefly, the court in its judgment exhorts adoption of a
practical approach while exercising power of appointment of a
receiver in the case of banks and financial institutions having
regard to the fact that they deal in public funds :-
"...Indeed, it is the duty and function of the Court
entertaining the suits instituted by Banks and financial
institutions to ensure that efforts are made to dispose
of the suits as early as possible and even during the
pendency of the suits, ensure that not only the
properties are protected but the defendant is made to
repay the amount, if desirous of enjoying the benefits
secured by obtaining the loan. The powers of the
Court under Order 40, Rule 1 of the Code of Civil
Procedure are to be exercised to advance cause of
justice and what is „just and convenient‟ depends
upon the nature of the claim and the surrounding
circumstances. The Court should not close eyes to the
realities and blindly follow the principles laid down
50 years before when the suits by Banks and financial
institutions were a novelty. The economic
liberalization and the policy of the Government to
grant loans for various activities have increased the
number of suits by Banks and financial institutions
and in this Court every year more than 2,000 suits are
instituted. It would not be difficult to imagine how
much public money is involved in these suits and how
long the Nationalised Banks and financial institutions
are deprived of their dues. The Court should be
conscious of these facts and should be more pragmatic
in exercising powers under Order 40, Rule 1 of the
Code of Civil Procedure." (Emphasis is mine)
6.4 To be noted, the abovementioned Full Bench judgement of
the Bombay High Court in State Bank of India vs Trade Aid
Paper and Allied Products (India) Pvt. Ltd. & Ors. case was
taken up in appeal to the Supreme Court only on one issue
which was qua the embargo put in place by the court on the
aspect of sale of the property by the receiver prior to a decree
being passed in the suit. The Supreme Court over-ruled the Full
Bench judgement on this aspect and stated, in no uncertain
terms, in its judgement in the case of ICICI Ltd. & Ors. vs
Karnataka Ball Bearings Corpn. Ltd. & Ors. (1999) 7 SCC
488, that no such fetter is contemplated on the powers of the
receiver appointed under the provisions of Order 40 Rule 1 of
the CPC. In other words, the Supreme Court went as far as to
observe that a receiver, pursuant to the directions issued by the
court in that behalf, is empowered to sell the property even
before a decree is passed in the suit. This, according to the
Supreme Court, is discernable on a plain reading of provisions
of Order 40 Rule 1 of the CPC. (See : ICICI Bank Ltd. v.
Collage Estates Pvt. Ltd. & Ors., 2015 SCC Online Del 12143)
7. Having regard to the above, to the extent, the impugned
order declines the prayer made for an exparte appointment of a
receiver; that part of the order, is set aside."
3. Keeping in view the above judgment of this Court, it is clear that in
the facts of this case a receiver should have been appointed by the trial court.
Hence, Mr.Ashish Mathur representative of the petitioner/bank is authorised
to take possession of the vehicle, namely, Honda City/VXMT bearing
Registration No.HR-51BB-7171 from the possession of the respondents
from agents or from anyone else. The Receiver will abide by the following
terms and conditions:-
"(i) The receiver, while taking possession of the subject
vehicle will ensure that the due courtesies are extended to
the respondents/ defendants.
(ii) The receiver will also keep in mind the time and the
place where the subject vehicle is taken possession of. If, at
the time of taking possession, the respondents/ defendants
were to pay the sums, which are due and payable then as
stated below in para 4, the receiver, will issue a receipt in
that behalf to the respondents/ defendants and release the
vehicle on superdari to him.
(iii) In case the police assistance is required, the receiver
will approach the Station House Officer manning the
nearest police station, who, in such an eventuality, shall
render due assistance to enable compliance in the matter.
(iv The receiver will file his report with the trial court
within ten days of taking possession of the subject vehicle.
(v) In case the receiver is successful in obtaining
possession of the subject vehicle before the next date of
hearing, the trial court will pass appropriate orders on the
next date of hearing.
(vi) However, in case the subject vehicle is not traced till
the next date of hearing, the trial court will, accordingly,
extend the period for locating the vehicle and, in that
behalf, pass appropriate orders in the pending application."
4. In the eventuality the respondents tender the full amount of
instalments in default to the petitioner/Receiver minus the penalty and other
surcharges and also files an undertaking to continue to pay the monthly
instalment as agreed upon in future, the receiver shall release the vehicle to
the respondents on superdari forthwith. With the above observations, the
present petition stands disposed of.
5. A copy of this order be given dasti under signatures of the Court
Master to counsel for the petitioner.
JAYANT NATH, J
SEPTEMBER 26, 2016
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