Gujarat High Court
Vinayak Infosys vs Bank Of Baroda on 20 June, 2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 4767 of 2024
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VINAYAK INFOSYS & ORS.
Versus
BANK OF BARODA & ANR.
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Appearance:
ADITYA A GUPTA(7875) for the Petitioner(s) No. 1,2,3
MS NALINI S LODHA(2128) for the Respondent(s) No. 1
REFUSED SERVED (N)(10) for the Respondent(s) No. 2
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CORAM:HONOURABLE MR. JUSTICE NIRAL R. MEHTA
Date : 20/06/2025
ORAL ORDER
1. By way of this petition under Article 226 of the
Constitution of India, the petitioners have approached this
Court challenging, inter alia, the order dated 2.2.2024 passed
in Case bearing Diary No.1000 of 2022 by the learned Debt
Recovery Tribunal-I, Ahmedabad (for short 'the Tribunal'), by
which the application preferred by the petitioners for
condonation of delay of 15 days came to be rejected mainly on
the ground that in view of the provisions of Section 17 of the
Securitisation and Reconstruction of Financial Assets and
Enforcement of Security Interest Act, 2002 (for short 'the
SARFAESI Act'), the power to condone the delay is not
available with the Tribunal.
2. Short facts of the case can be stated as under :
2.1 The respondent No.1 bank has undertaken the
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proceedings under the SARFAESI Act by way of notice under
Section 13(2) dated 12.1.2017. In the said notice, a sum of
Rs.39,02,805/- was asked to be paid by the petitioners.
2.2 On 17.4.2017, initially, the respondent No.1 bank has
taken over the symbolic possession of the property by affixing
the notice, which, thereafter, culminated into the actual
physical possession with the aid of the order by the District
Magistrate under Section 14 of the SARFAESI Act.
2.3 The petitioners had filed SA No.133 of 2018 before the
Tribunal, which came to be disposed of on 7.8.2019,
recording, inter alia, the settlement between the parties.
Pertinently, the petitioners admitted the claim of
Rs.44,53,138/-.
2.4 It appears that some amount to the extent of Rs.5 lakhs
and Rs.10 lakhs deposited by the petitioners with the
respondent No.1 bank on 8.8.2018 and 4.12.2018
respectively.
2.5 It further appears that thereafter, the petitioners did not
pay any agreed amount and thereby, the respondent No.1
bank was constrained to move further with the auction of the
property and the auction was held on 28.1.2020. The said
auction was disputed by the petitioners by way of SA No.50 of
2020 before the Tribunal. The Tribunal, vide its order dated
23.3.2021, set aside the auction held by the authorized
officers of the respondent No.1 bank and further directed the
respondent No.1 bank to have a fresh valuation and then, to
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auction the property, again.
2.6 On various dates, as it appears, the auctions were
conducted; however, could not yield into any result. Once
again on 24.8.2022, the auction was advertised and the date
so fixed was on 14.9.2022. On the said date, the auction could
go through and the property of the petitioners was sold of at
Rs.56,52,000/-.
2.6 According to the petitioners, the said auction was not
conducted properly and the purchaser of the property appears
to be the close one of the employee of the respondent No.1
bank. Thus, the petitioners intend to challenge the said
proceedings. However, since there was a delay of 15 days, the
petitioners submitted an application before the Tribunal for
condonation of delay which was registered as Diary No.1000
of 2022, filed on 25.10.2022. The Tribunal, having considered
the documents available on record, vide its order dated
2.2.2024, rejected the application of the petitioners mainly
relying upon the provisions of Section 17 of the SARFAESI
Act, holding, inter alia, further that there is no power
available with the Tribunal to condone the same, as the
provisions of the Limitation Act are not applicable.
3. Being aggrieved and dissatisfied by the aforesaid, the
petitioners have approached this Court by way of this petition
for the reliefs prayed therein.
4. I have heard Mr.Aditya Gupta learned advocate for the
petitioners and Ms.Nalini Lodha learned advocate for the
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respondents.
5. Mr.Aditya Gupta learned advocate for the petitioners,
while assailing the impugned order, has made mainly the
following submissions :
(1) Mr.Aditya Gupta learned advocate submitted that the
impugned order passed by the Tribunal is not legally tenable
in the eye of law. He further submitted that the order
impugned is mainly passed relying upon the decision of the
Madras High Court in the case of M/s.Velar Engineering
Works Pvt. Ltd. v. The Authorized Officer / Chief
Manager, Indian Bank & Ors., rendered in Writ Petition
No.31251 of 2018, decided on 5.9.2019. Mr.Aditya Gupta
learned advocate submitted that as such, the Division Bench
of this Court in the case of Aditya Birla Finance Ltd. v.
Manglesh Champaklal Gandhi & Ors., rendered in Letters
Patent Appeal No.224 of 2020, decided on 28.6.2024, has
categorically held that Section 5 of the Limitation Act applies
to the proceedings under Section 17 of the SARFAESI Act.
(2) Mr.Aditya Gupta learned advocate further submitted
that in view of settled proposition of law laid down by the
Division Bench of this Court, the Tribunal ought not to have
rejected the application of the petitioners in such a casual
manner. Learned advocate submitted that assuming that there
is a delay, in that event also, there is a meager delay of 15
days and thus, the Tribunal ought to have adopted the
pragmatic view instead of such hyper-technical approach.
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5.1 By making above submissions, Mr.Aditya Gupta learned
advocate, urged this Court to allow the present petition.
6. Per contra, Ms.Nalini Lodha learned advocate for the
respondents, while supporting the impugned order, has made
mainly the following submissions :
(1) Ms.Nalini Lodha learned advocate fervently submitted
that the impugned order passed by the Tribunal is perfectly
justified and is within the four corners of law and thereby, this
Court exercising jurisdiction under Article 226 of the
Constitution of India, may not show any interference. Learned
advocate further submitted that the petitioners are
continuously trying to halt and/or hamper the auction
proceedings by way of filing repeated application before the
Tribunal. She further submitted that initially, the petitioners
have approached the Tribunal by way of SA No.133 of 2018;
however, said SA was disposed of pursuant to the settlement
arrived at between the parties. Ms.Nalini Lodha learned
advocate submitted that though the said settlement though
agreed upon by the petitioners, was never fulfilled in its letter
and spirit.
(2) Ms.Nalini Lodha learned advocate submitted that
because of non-fulfillment of the terms and conditions of the
settlement, the respondent No.1 bank was left with no option
but, to continue with the auction of the property and that
action was also challenged by the petitioners by way of SA
No.50 of 2020 before the Tribunal. The Tribunal, thereafter,
quashed the auction proceedings and direct the respondent
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No.1 bank to auction the property after having fresh valuation
of the property. Learned advocate further pointed out that
pursuant to the said direction of the Tribunal, after obtaining
fresh valuation, the property was put to auction and
accordingly, after numbers of unsuccessful attempts, finally,
the respondent No.1 could auction the property and fetch the
sum of Rs.56,52,000/-. However, that also, now sought to be
challenged by way of present petition and the same is not
permissible. Ms.Nalini Lodha learned advocate pointing out
the aforesaid facts and events, submitted that the approach of
the petitioners is not bona fide and repeatedly approaching
the Tribunal for the purpose of derailing the auction
proceedings and/or disturbing the auction. Thus, the Tribunal
was otherwise justified in not condoning the delay as there is
no merits in the matter.
(3) Ms.Nalini Lodha learned advocate, without prejudice to
the aforesaid, submitted that in view of Section 17 of the
SARFAESI Act, the Tribunal has got no authority and/or
power to condone the delay beyond 45 days and thereby, the
impugned order passed by the Tribunal rejecting the
application for condonation of delay beyond the period of 45
days, is perfectly justified and thus, this Court may not
interfere the petition.
6.1 By making above submissions, Ms.Nalini Lodha learned
advocate, urged this Court to dismiss the petition.
7. Heard learned advocates appearing for the respective
parties and have gone through the material produced on
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record. No other and further submissions have been
canvassed by learned advocates appearing for the respective
parties.
8. Having considered the submissions made by learned
advocates appearing for the respective parties and the
material produced on record, a short question that falls for
consideration of this Court is whether the Tribunal has got
power to condone the delay beyond 45 days as envisaged
under Section 17 of the SARFAESI Act?
9. The aforesaid question is no more res-integra. The
Division Bench in the case of Aditya Birla Finance Ltd.
(supra) has already decided and held that Section 5 of the
Limitation Act applies to the proceedings under Section 17 of
the SARFAESI Act. In other words, the Division Bench has, in
no uncertain terms, held that Section 5 of the Limitation Act is
applicable and that the Tribunal under that has got ample
power to condone the delay. The relevant observations of the
aforesaid decisions, read thus :
"38. Having exhaustively gone through the provisions of the
SARFAESI Act, 2002 and the RDB Act, 1993 and the
Limitation Act, 1963 and the decisions of the Apex Court in
International Asset Reconstruction Co. Of India Ltd. (supra)
and Baleshwar Dayal Jaishwal (supra), heavily relied by
learned senior counsel for the appellant, as also the decision
of the Kerala High Court based on the aforesaid judgments of
the Apex Court and the Division Bench judgment of this
Court in Corporation Bank (supra), we may note, at the
outset that, we are convinced with the reasoning given by the
learned Single Judge in holding that Section 5 of the
Limitation Act, 1963 applies to the proceedings under
Section 17 (1) of the SARFAESI Act, 2002, relying upon
exhaustive reasoning given by the Division Bench of this
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Court in Corporation Bank (supra). We find ourselves in full
agreement with the decision of the Division Bench of this
court on the first question of applicability of Section 5 of the
Limitation Act, 1963 for the reasons given hereinafter.
39. We may note, at the outset, that we are conscious of
the fact that the SARFARESI Act, 2002 has been enacted in
order to provide legal provision for facilitating securitisation
of financial assets of banks and financial institutions, that
too, without the intervention of the Court or Tribunal.
Section 13 contained in Chapter III of SARFAESI Act, 2002
prescribes an extensive procedure as to how the banks or
financial institutions would enforce security interest created
in their favour as secured creditor, in the case of default of
borrower. As noted hereinbefore, Section 13(2) provides that
the demand notice would be served upon the borrower
requiring him to discharge in full his liabilities to the secured
creditor within 60 days from the date of notice. Sub-section
(3A) of Section 13 gives right to the borrower to raise
objection to such notice. Section 13(4), however, provides
that, in case, the borrower fails to discharge his liability in
full within the period specified in the notice under Section
13(2), the secured creditor will be free to take recourse to
any of the measures to recover his secured debt. Remedy of
challenging the action taken by the secured creditor or any
of the measures referred to in Sub-section (4) of Section 13
taken by the secured creditor or his authorised officer has
been provided to the borrower under Section 17(1). Section
17(1) provides a timeline within which the borrower can file
an application before the DRT to challenge any of the
measures taken by the secured creditor as referred to in Sub-
section (4) of Section 13. We may further note that there is
no outer time limit provided in Sub-section (1) of Section 17
or the provision attached to it, restricting the DRT not to
entertain any application made under Section 17(1) beyond
the period of 45 days. Section 18 of the SARFAESI Act, 2002
further provides a remedy of appeal against the order passed
by the DRT under Section 17, within a period of 30 days from
the date of the receipt of the order, as per Sub-section (1)
thereof. It is further relevant to note that there is no outer
time limit prescribed in Section 18(1) or the proviso attached
thereto, to restrain the Appellate Tribunal from entertaining
an appeal beyond the period of 30 days provided in Sub-
section (1) of Section 18.
40. As noted by the Division Bench in Corporation Bank
(supra), Section 35 though gives overriding effect to the
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provisions of the Securitisation Act, 2002 against any other
law, which is inconsistent with its provision, Section 36
which prescribes limitation restrains the secured creditor not
to take all or any of the measures under Sub-section (4) of
Section 13, unless his claim in respect of the financial asset
is made within the period of limitation prescribed in the
Limitation Act. Section 37 further states that the provisions
of the SARFAESI Act, 2002 are in addition to other
regulations such as Companies Act, etc. which include RDB
Act, 1993.
41. It is noted by the Apex Court in Baleshwar Dayal
Jaishwal (supra) that in M/s Transcore vs Union Of India
[2008 (1) SCC 125], the Apex Court has observed that the
RDB Act and the SARFAESI Act are complementary to each
other. The question before the Apex Court in Baleshwar
Dayal Jaishwal (supra) was with regard to the power of the
Appellate Tribunal to condone the delay after the expiry of
the period of 30 days prescribed in filing appeal under
Section 20 of the RDB Act. The Apex Court has held that the
Appellate Tribunal under Section 18(1) of the SARFAESI Act
has power to condone the delay in view of Section 20(3) of
the RDB Act read with Section 18(2) of the SARFAESI Act,
2002.
42. We may note that the language of Sub-section (2) of
Section 18 and Sub-section (7) of Section 17 are the same, as
they read as under :
"17. Application against measures to recover secured
debts.-
(1) xxx
(2) xxx
(3) xxx
(4) xxx
(5) xxx
(6) xxx
(7) Save as otherwise provided in this Act, the Debts
Recovery Tribunal shall, as far as may be, dispose of
the application in accordance with the provisions of the
Recovery of Debts Due to Banks and Financial
Institutions Act, 1993 (51 of 1993) and the rules made
thereunder."
"18. Appeal to Appellate Tribunal.-
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(1) xxx
(2) Save as otherwise provided in this Act, the
Appellate Tribunal shall, as far as may be, dispose of
the appeal in accordance with the provisions of the
Recovery of Debts Due to Banks and Financial
Institutions Act, 1993 (51 of 1993) and rules made
thereunder."
43. It is further pertinent to note that the RDB Act, 1993
and SARFAESI Act, 2002 though provide different
procedures of recovery of the debts due to banks and
financial institutions, however, the fundamental object and
aim of both the statutory provisions is to ensure speedy and
expeditious recovery of debts due to banks and financial
institutions. The RDB Act enacted in the year 1993 provides
for establishment of Tribunal named as "Debts Recovery
Tribunal" and Appellate Tribunal named as "Debts Recovery
Appellate Tribunal" to provide a forum to bank and financial
institutions to recover any debt from any person by making
an application to the DRT under Section 19, which in
essence is a suit or original proceeding for recovery of debts
filed by the bank or financial institution. Section 24 of the
RDB Act makes the provisions of the Limitation Act apply to
the proceedings before the Tribunal under Section 19, as it
says that the provisions of the Limitation Act shall apply to
an application made to the Tribunal, which means an
"application made under Section 19".
44. As noted hereinbefore, Section 20(3) of the RDB Act
confers power on the Appellate Tribunal to condone the
delay in the limitation provided for filing an appeal under
Subsection (1) of Section 20, if there was a sufficient cause
for doing so.
45. From a careful reading of the aforesaid provisions, it
can be discerned that there is no bar or restraint with the
Tribunal not to entertain any application under Section 17(1)
beyond the period of 45 days. Insofar as the power of DRAT
to condone the delay in filing appeal under Section 18(1) of
the SARFAESI Act, 2002, the controversy has been set at
rest by the Apex Court in Baleshwar Dayal Jaishwal (supra),
as noted hereinbefore. The only issue remains is that of
applicability of the Limitation Act to the proceedings under
Section 17(1) of the SARFAESI Act, 2002.
46. The Division Bench of this Court in Corporation Bank
(supra), after taking note of the above referred provisions of
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SARFAESI Act, 2002 and RDB Act, 1993, has observed that
it cannot be disputed that filing of application and the
procedure so provided for disposal of the application is by
the Act (SARFAESI Act, 2002), which is a Special law. It was
noted that it is also true that there is no express provision
made by the Parliament in the Act for applicability of Section
5 of the Limitation Act to the proceedings under Section 17
of the Act.
47. Therefore, the Division Bench further proceeded to
consider the provisions of the Limitation Act, to answer the
question of applicability of Section 5 of the Limitation Act to
the Special law, i.e. SARFAESI Act, 2002, whether the
Limitation Act may also include the proceedings under
Section 17 of the Act. By reading the provisions of Section
29(2) of the Limitation Act, which is a saving clause,
pertaining to the applicability of the Limitation Act to any
Special law, it was observed in paragraph '12' as under :-
"12. The aforesaid provisions show that applicability of
the Limitation Act if provided under the special law for
the different period than that provided under the
schedule of the Limitation Act, the provisions of the
Limitation Act would apply as if section 3 of the
Limitation Act provides for the prescribed period of
limitation for such purpose, but it further provides for
the purpose of determining any period of limitation
prescribed for any suit, appeal or application under any
special or local law, the provisions contained in sections
4 to 24 of the Limitation Act shall apply unless they are
expressly not excluded by any such special or local law.
The pertinent aspect is that section 29(2) of the
Limitation Act for applicability of sections 4 to 24 of the
Limitation Act to the period prescribed under any
special law, no distinction is made to the proceedings of
any suit or appeal or application. It considers all the
proceedings of any suit or appeal or application alike if
provided by any special or local law for the purpose of
applicability of sections 4 to 24 of the Limitation Act. To
say in other words, sections 4 to 24 of the Limitation
Act are made applicable to all the matters specified in
special or local law for any suit or appeal or application
unless they are expressly excluded by such special or
local law."
48. Noticing a previous decision in Union Bank of India
(supra), passed by the learned Single Judge of this Court, the
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Division Bench has observed that on a plain reading of
Section 29 of the Limitation Act, it appears that if there is an
express provision in Special law or in local law, prescribing
the limitation for any suit or appeal or application, such shall
apply for prescription of such period. However, the
provisions contained in Sections 4 to 24 would apply to the
extent unless they are expressly excluded by such Special
law. That means that if the Limitation Act provided for a
particular period during which the application has to be
made to any Tribunal or any authority, such period would
not apply in view of express provision under Section 17(1) of
the SARFAESI Act providing for preferring an application
within a period of 45 days. However, so far as further
application of the Limitation Act is concerned and more
particularly from Sections 4 to 24, which includes Section 5
for condonation of delay, such would apply, inasmuch, as
there is no express exclusion of the said provisions by the
Special law, i.e. SARFAESI Act, 2002. It was further noted
that Section 17(1) is silent on the aspect of providing outer
period of limitation for filing of the application or for
exercise of the discretion for entertainment of the
application after expiry of period of 45 days. The result is
that the Legislature has not expressed its intention to curtail
further exercise of power by the Tribunal for entertaining of
the application after expiry of the period of 45 days. Under
such circumstances, the provisions of Section 5 would apply
to the discretion to be exercised by the Tribunal for
entertainment of the application after the period of 45 days,
but such discretion has to be exercised taking into
consideration the facts and circumstances on the aspect of
sufficient cause to condone the delay or not.
49. On the applicability of Section 29(2) to the period of
limitation provided by any special or local laws in any
proceedings such as suit, appeal or application, different
from the period prescribed by the Schedule under the
Limitation Act, it has further been noticed therein that
Section 29(2) does not make any distinction between the
proceedings before a Court or Tribunal for the applicability
of Section 29(2) of the Limitation Act. What is required to be
found out is whether any special or local law prescribes
different period of limitation for any suit, appeal or
application. Once the Special law provides a different period
of limitation, the consequences laid down by Section 29(2)
must follow.
50. The Division Bench has further relied upon the decision
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of this Court in Mahesh Harilal Khamar vs. B.N. Narasimhan
[1982 GLH 700], wherein the question of applicability of
Section 29(2) of the Limitation Act was discussed with
reference to the limitation provided in a Special law, viz.
Gujarat Agricultural Produce Market Act, 1963. It was held
therein that where Special law provides for period of
limitation different from that provided by the Limitation Act
and once Section 3 of the Limitation Act gets attracted by
virtue of Section 29(2) to the proceedings before the
concerned authority acting under the Special law which has
to enforce the period of limitation, said authority will have to
apply the provisions of Section 3 of the Limitation Act to the
proceedings presented before it under the provisions of the
concerned Special law or the local law, as the case may be.
The result is that if the proceeding is initiated beyond the
period of limitation provided in the Special law, the
concerned authority has to apply Section 3 of the Limitation
Act to dismiss the concerned application or appeal, if it is
found to be barred by time prescribed in the statute. It was
thus held in Mahesh Harilal Khamar (supra), that if the
injunction prescribed by Section 3(1) has to operate by
virtue of Section 29(2), the said injunction must necessarily
bring in its wake all the rest of the provisions of the said
Sub-section (1) of Section 3. A further reading of Section
3(1) of the Limitation Act shows that the operation of
Section 3 is subject to the provisions contained in Sections 4
to 24 (inclusive).
51. Consequently, if the provisions of Sections 4 to 24 are
made applicable, they would necessarily override and
superimpose themselves upon the operation of Section 3(1)
of the Limitation Act. It was, thus, held in Mahesh Harilal
Khamar (supra) that :-
"It is trite to say that if section 3 applies to the first
respondent acting under Section 27 (5) of the Act then
it must follow as a necessary corollary that Section 5 of
the Limitation Act would equally apply by virtue of
Section 29(2) read with Section 3(1) of the Limitation
Act. It cannot be urged for a moment that Section 3(1)
of the Limitation Act would apply but Section 5 thereof
would not apply to the first respondent's proceedings
because he is not a court. While Section 29(2) is
attracted the entire machinery of Sections 3 to 24 of
the Limitation Act gets imported and would
automatically apply to the proceedings before the
concerned authority under the given special or local
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law has to enforce the period of limitation for any
appeal or application before such authority, implicit in
the power would be the power to condone the delay
which would get imported as part and parcel of the
entire machinery of Sections 3 to 24 of the Limitation
Act that would apply by virtue of Section 29(2) of the
Limitation Act to such proceedings before the
concerned authorities acting under the special or local
law. This is the logical effect of the applicability of
Section 29(2) of the Limitation Act and hence the
question whether the concerned authority is a court
within the strict meaning of the term as envisaged by
the Limitation itself, would necessarily pale into
insignificance."
52. With the above discussion, the contention made by the
petitioner (therein) in the Corporation Bank (supra), that
Section 5 of the Limitation Act would apply only to the Court
and not to the Tribunal or any proceedings before the
authority other than the Tribunal, has been turned down by
the Division Bench. It was held that Section 5 of the
Limitation Act would also apply to the statutory authority
under the Special law when it is not expressly barred or
prohibited.
53. We do not find any justification to form contradictory
opinion to the said reasoning of the Division Bench with
regard to the applicability of Section 5 of the Limitation Act
by reading of Section 29(2), which applies to the
proceedings before any Tribunal or any authority under
Special law or in local law.
54. Further discussion of the Division Bench in Corporation
Bank (supra), are on the aspects of the provisions of
Securitisation Act read with the provisions of Non
Performing Assets Act and the Limitation Act. While holding
that Section 5 of the Limitation Act would apply to the
proceedings before the DRT under Section 17 of the
SARFAESI Act, though original in nature, the Division Bench
has referred to the decision of the Bombay High Court in
UCO Bank Vs. M/s. Kanji Manji Kothari [2008 SCC Online
(Bom) 170]. The observations therein in paragraph '37' are
relevant to be extracted hereinunder :-
"37. Section 17 (1) of the SARFAESI Act, prescribes a
period of limitation of just 45 days for filing an
application, challenging any of the measures taken by
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the secured creditor under Section 13 (4) of the Act.
The remedy under Section 17 (1) is virtually a remedy
in respect of a right of redemption. Therefore, to hold
that Section 5 of the Limitation Act, will not apply to an
application under Section 17 (1) would virtually defeat
the valuable right of redemption available to a
mortgagor. This right of redemption normally gets
extinguished after the sale of the property. Therefore
the apprehension expressed by the learned counsel for
the Bank that the parties may come up with
applications after a huge delay and defeat the object of
the Act for speedy recovery of dues, may not be well
founded for the simple reason that after losing
possession of the property under Section 13 (4), a
debtor cannot afford to wait for long. If he waits for
long, the property may get sold and his rights may get
extinguished. Hence the application of Section 5 of the
Limitation Act, to proceedings under Section 17 (1) of
the SARFAESI Act, would neither defeat the rights of
the secured creditor nor cause irreparable hardship to
the secured creditor."
55. It has further noted the observations of the Apex Court
in Karnataka State Financial Corporation vs. N.
Narasimahaiah [(2008) 5 SCC 176] in paragraph '39', as
under: -
"39. Viewed in the context of the ratio laid down by the
Supreme Court extracted above, it could be seen that
the right conferred upon the secured creditor under
Section 13 (4) of the SARFAESI Act, is a right of
recovery. The right conferred upon the debtor or the
surety under Section 17 is a right to save one's own
property. To hold that the fate of a debtor or surety will
be sealed in a period of 45 days from the date of
initiation of the measures under Section 13 (4) and that
he would be left remediless after the said period on
account of non-availability of Section 5 of the Limitation
Act, would defeat the right to property. Therefore the
Court has to choose an interpretation which would lean
in favour of the right to property. If so done, the
conclusion is irresistible that Section 5 of the Limitation
Act, would apply to applications filed under Section 17
of the SARFAESI Act."
56. The observations in paragraph '14' are further relevant
to be extracted herein under :-
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"14. As observed earlier, even if the contention of the
learned counsel is considered and accepted that it is a
Tribunal and not the Court as per the view taken by the
Apex Court in the case of Nahar Industrial Enterprises
Ltd. (supra), then also in view of the observations made
hereinabove, it cannot be accepted that Section 5 of the
Limitation Act would not apply to the proceedings
under Section 17 of the Securitisation Act before the
Debt Recovery Tribunal. The reliance upon the decision
of the Apex Court in the case of Consolidated
Engineering Enterprises (supra) is ill-founded inasmuch
the observations of the Apex Court are to be considered
and applied to the facts of that case. If such observation
are considered, what is being held by the Apex Court
that if there is express period prescribed in the special
law, such would apply and not the prescription as
provided under the Limitation Act, but the same cannot
be read in absolute so as to excluded the applicability
of other provisions of the Limitation Act which may
apply, more particularly in view of the no express bar
provided under the special law. Therefore, such a
decision is of no help to the learned counsel for the
petitioner."
"14. As observed earlier, section 29 of the Limitation
Act makes no distinction for any suit or appeal or
application provided by the special or local law. It is
true that as observed by the Apex Court in the case of
Mardia Chemicals Limited and another Vs. Union of
India and others, reported at (2004) 4 SCC 311 = AIR
2004 SC 2371 read with the judgment of the Apex
Court in the case of M/s Transcore Vs. Union of India
and another reported at AIR 2007 SC 712, the
proceedings under section 17 of the Act are not the
appellate proceedings and may be termed as the
original proceedings, but then also when the special
law uses the language of the word "appeal", it cannot
be said that the proceedings under section 17 of the Act
can be termed as "suit" for the purpose of applicability
of the Limitation Act if one goes by the plain and literal
meaning of the language used by the Parliament in the
Act. Even, if it is considered that literal meaning cannot
be accepted and in view of the above referred decisions
of the Apex Court in the case of Mardia Chemicals
Limited (supra)and M/s Transcore (supra), the
proceedings under section 17 of the Act may be termed
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as analogous to the proceedings of any suit, then also in
our view, as per the language of section 29(2) read with
the language used under the special law i.e. the Act in
the present case, the distinction as considered by the
Calcutta High Court in the case of Akshat Commercial
Private Limited (supra) cannot be emphasized. At this
stage, we may refer to the decision of the Apex Court in
the case of The Kerala State Electricity Board,
Trivandrum Vs. T.P. Kunhaliumma reported at AIR
1977 SC 282 wherein the Apex Court had an occasion
to consider applicability of the provisions of the
Limitation Act in light of the provisions of section 16(3)
of the Indian Telegraph Act enabling the owner or
occupier of the property to demand compensation by
preferring the petition to the District Judge. The Apex
Court, in the said decision did observe, inter alia, at
paragraph 18 as under.
"....But it has to be an application to a court for
the reason that Sections 4 and 5 of the 1963
Limitation Act speak of expiry of prescribed period
when Court is closed and extension of prescribed
period if applicant or the appellant satisfies the
court that he had sufficient cause for not preferring
the appeal or making the application during such
period."
15. Therefore, even in case where the proceedings
were provided by the special law for a petition which
may be termed as original in nature rather at par with
the suit, the Apex Court did observe for application of
sections 4 and 5 of the Limitation Act in respect of the
special law i.e. Indian Telegraph Act read with the
Indian Electricity Act. Hence, in our view, applicability
of the Limitation Act by virtue of section 29(2) of the
Limitation Act would not be different merely because if
under any special law, the proceedings by way of an
appeal or application has been provided which are in
the nature of original proceedings."
57. It is further noted that under the RDB Act, whenever
any application is made to the Tribunal by the bank or
financial institution for recovery of the amount under
Section 19, it is to be termed as original proceedings and
Section 24 of the RDB Act expressly provides for
application of the provisions of the Limitation Act. It was
held that by virtue of the provisions of Section 17(7) of the
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SARFAESI Act, 2002, Section 24 of the RDB Act is imported
under the SARFAESI Act. The Parliament while applying
the provisions of the Limitation Act to the RDB Act, or to
the SARFAESI Act, 2002 for the purposes of original
proceedings, may be at par with the suit proceedings, made
no distinction for applicability of any of the provisions of the
Limitation Act. Rather, it has consciously applied the
provisions of the Limitation Act by express provisions of
Section 24 of the RDB Act, which as per the Division Bench
are to apply to the proceedings under Section 17 of the
SARFAESI Act, by virtue of the provisions of Section 17(7)
of the said Act. It was, thus, finally concluded on
consideration of the above aspects of the matter that
Section 5 of the Limitation Act, as are applicable, confers
power on the DRT to condone the delay in the proceedings
under Section 17(1) of the SARFAESI Act. In other words,
Section 5 of the Limitation Act would be applicable to the
proceedings under Section 17(1) of the Act for the purpose
of condonation of delay in making the application by a
borrower.
58. We do not find any good ground in the submissions
made by the learned senior counsel for the appellant to
assail the reasoning given by the learned Single Judge
based on the above discussed decision of the Division Bench
with regard to the application of Section 5 of the Limitation
Act to the proceedings under Section 17(1) of the
SARFAESI Act, 2002. However, it goes without saying that
while dealing with the application for condonation of delay,
the DRT has to be conscious of the scheme of the
SARFAESI Act, 2002. It must bear in mind the object and
purpose of the SARFAESI Act, 2002, enacted to expedite
the recovery of secured debt by the banks and financial
institutions and should not allow any person to
procrastinate the proceedings by making frivolous
application for condonation of delay.
59. Coming to the contention of the learned senior counsel
for the appellant on the decision of the Apex Court in
International Asset Reconstruction Co. Of India Ltd.
(supra), and the observations in the case of Baleshwar
Dayal Jaishwal (supra), we may note that in Baleshwar
Dayal Jaishwal (supra), the specific question was about the
power of the Appellate Tribunal to condone the delay in
filing appeal under Section 18(1) of the Act. The Apex Court
while answering the said question in affirmative has
compared the provisions of the RDB Act and SARFAESI Act,
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2002 and by reading Section 18(2) of the SARFAESI Act,
2002, it was held that by virtue of Section 18(2), the
provisions of RDB Act stand incorporated into the
SARFAESI Act. It was observed that the RDB Act and
SARFAESI are complementary to each other and the
proviso to Section 20 (3) of the RDB Act is applicable to the
proceedings before the appellate tribunal under Section 18
by virtue of Section 18(2) of the SARFAESI Act, 2002. While
saying so, though there is an observation that even if the
power of condonation of delay by virtue of Section 29(2) of
the Limitation Act were held to be inapplicable, unless the
scheme of the statute expressly excludes the power of
condonation, there is no reason to deny such power to an
appellate tribunal when the statutory scheme so warrants.
This observation of the Apex Court in Baleshwar Dayal
Jaishwal (supra) cannot be read to hold that the Apex Court
has decided the question of applicability of Section 29(2) of
the Limitation Act in the proceedings under the SARFAESI
Act, 2002. The further observations made by the Apex Court
on the applicability of Section 29(2) of the Limitation Act
are not to be taken as a binding precedent for the
observations made in paragraph '13', as under:-
"13........ We are of the view that for purposes of
decision of these appeals, it is not necessary to decide
the question whether the Tribunal under the Banking
statutes in question was court for purposes of Section
29(2) of the Limitation Act."
61. The observations in paragraph '14' therein [Baleshwar
Dayal Jaishwal (supra)] that "the provisions of the
Limitation Act having been expressly incorporated under
the special statutes in question, Section 29(2) stands
impliedly excluded" is with reference to the power of
condonation of delay with the Appellate Tribunal under
Section 18(2) of the SARFAESI Act, which was decided in a
different context by reading of the proviso to Section 20(3)
of the RDB Act.
62. In view of the above detailed discussion with regard to
the applicability of the provisions of Section 29(2) of the
Limitation Act, in the proceedings before the statutory
authority under a Special law or local law, we are of the
considered opinion that the observations made by the Apex
Court in Baleshwar Dayal Jaishwal (supra) with regard to
the applicability of Section 29(2) of the Limitation Act do
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not hold any contrary view on the specific question about
the applicability of Section 5 of the Limitation Act by virtue
of Section 29(2) thereof, in the proceedings under Section
17 of the SARFAESI Act, 2002.
63. We, therefore, do not find any substance in the
submission of Mr. Shalin Mehta, learned senior counsel
appearing for the appellant with regard to the applicability
of Section 5 of the Limitation Act based on the aforesaid
observations."
10. In view of the aforesaid, this Court is of the firm opinion
that the order impugned passed by the Tribunal is not tenable
in eye of law being contrary to the decision of the Division
Bench of this Court in the case of Aditya Birla Finance Ltd.
(supra).
11. Accordingly, the petition deserves to be allowed and is
hereby allowed. The impugned order dated 2.2.2024 is hereby
quashed and set aside. The Tribunal is hereby directed to
decide the condonation of delay application afresh, keeping in
mind the provisions of law and the decision of the Division
Bench of this Court in the case of in view of decision of the
Division Bench in the case of Aditya Birla Finance Ltd.
(supra).
(NIRAL R. MEHTA,J)
V.J. SATWARA
