Madras High Court
Vimala Radhakrishnan vs The Joint Secretary (Ps) & Cpo on 5 February, 2025
Author: D.Bharatha Chakravarthy
Bench: D.Bharatha Chakravarthy
2025:MHC:635
W.P.No.550 of 2024
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 05.02.2025
CORAM:
THE HONOURABLE MR. JUSTICE D.BHARATHA CHAKRAVARTHY
W.P.No.550 of 2024
Vimala Radhakrishnan ... Petitioner
Vs.
1.The Joint Secretary (PS) & CPO
Ministry of External Affairs
Patiala House, Tilak Marg
New Delhi 110 001.
2.The Passport Officer
First Floor, Commercial Complex Passage
Opp. Thandu Mariamman Temple
442, Avinashi Road
Coimbatore 641 018.
3.The Punjab National Bank
Assets Recovery Management Branch
No.448-A, Dr.Nanjappa Road
Coimbatore 641 018. ....Respondents
1/50
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W.P.No.550 of 2024
Prayer : Writ Petition filed under Article 226 of the Constitution of India, to
issue a Writ of Certiorarified Mandamus, calling for the records of the second
respondent issued in the nature of writ calling for the records of the second
respondent issued in file No.CB1074551404922 dated 07.12.2023, quash the
same and consequently direct the second respondent to renew the petitioner's
Passport bearing No.J8583919 immediately and handover the same to the
petitioner within the time to be stipulated by this Court.
For Petitioner : Mr.R.Bharath Kumar
For Respondents : Mr.K.Gangadharan for R1 & R2
(CGSC)
Ms.S.R.Sumathy for R3
Amicus Curiae : Mr.Prasad Vijayakumar
ORDER
This Writ Petition challenges the order dated 07.12.2023 made by
the second respondent. In this order, the petitioner's application for passport
renewal was declined. The operative portion of the order contested in the Writ
Petition is extracted as follows:
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“NOW THEREFORE, I Shri.Sathish K S,
Passport Issuing Authority after considering the facts and
hearing the parties involved pass the following order;
1.The issuance of passport facilities to
Smt.Vimala Radhakrishnan is refused under
Section 6 of the Passport Act, 1967 based on the
DRT order dated 04.05.2016.
2.The impounding of the passport of
Smt.Vimala Radhakrishnan does not arise as the
Passport No J8583919 was already expired on
13.09.2022.
3. The Passport renewal application of
Smt.Vimala Radhakrishnan vide file
no.CB1074551404922 dated 02.09.2022 will be
closed.
However, the applicant can file an appeal to the Joint
Secretary (PSP) & CPO, Ministry of External Affairs,
Patiala House, Tilak Marg, New Delhi 110 001 against
this order.”
2. The brief factual background of the Writ Petition is that it is
alleged that dues exceeding Rs.68 crores are payable by the petitioner and
others, including the corporate debtor. OA No. 308 of 2016 was filed by the
third respondent Bank before the Debts Recovery Tribunal in Chennai under
the Recovery of Debts and Bankruptcy Act, 1993 (hereinafter referred to as
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the RDB Act). While the Original Application was pending, the third
respondent submitted an Interlocutory Application, I.A. No. 1239 of 2016,
before the Debt Recovery Tribunal, Coimbatore, requesting a directive for
respondents 2 and 3 to surrender their respective passports to the Registrar of
the Debt Recovery Tribunal. In the event of non-compliance, the request was
to impound their passports and instruct the Regional Passport Officer,
Coimbatore, to make the necessary entries in the register accordingly. In this
application, the Debt Recovery Tribunal issued the following order, and it is
essential to extract the entire order dated 04.05.2017, which reads as follows:
“I.A.No.1239/16: (Direction Petition to impound
the Passport) This petition has been filed by the
Petitioner/Applicant Bank to direct the Respondents 2 and
3 to handover their respect passports to the Registrar, DRT,
failing which to impound their passports and direct the
Regional Passport Officer. Coimbatore, to make necessary
entries in the Register to that effect.
The Ld. Counsel for the Petitioner/Applicant Bank
submitted that the total outstanding amount due to the
Applicant bank is Rs.48,82,48,583.65, together with
interest and while so, the Applicant Bank apprehends that
the Respondents / Defendants with an intention to delay
and frustrate the recovery of debts are trying to dispose of
the entire shares belonging to them to the third parties and
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are making attempts to move away to foreign countries.
The Ld. Counsel further submitted that the respondents are
willful defaulters, who are making strenuous efforts to
leave the territorial jurisdiction of this Tribunal and are
frequently flying abroad and they are leaving the country, it
would be impossible for the Applicant Bank to recover
their dues and it would frustrate the recovery proceedings
initiated by the Applicant Bank. The Ld. Counsel for the
Applicant Bank further submitted that this Tribunal has
power to pass order under S.19(7) of the Act and have
incidental power to prevent a person from going abroad and
also ordering arrest of the judgment debtor and his
detention in prison under S.25(b) of the Act. The
Representing Officer further submitted that under S.29 the
Ilnd and IIIrd schedule of the Income Tax Act and the
Income Tax (Certificate Proceedings) Rules, 1962, the
Respondents be considered as a "judgment debtor" and the
amount payable to be construed as "Tax due" under the Act
and Clause 75 of the Schedule II empowers this Tribunal to
detain the defaulter in jail for recovery of the amount under
the Income Tax Act and therefore, the surrendering or
impounding of Passport would restrain the Respondents to
leave this country to avoid the legal proceedings. The
Representing Officer sought an order to impound the
Passports, which are more fully mentioned in the schedule
in this Petition.
The Ld. Counsel for the Respondents strongly
objected to the plea of the Petitioner/Applicant Bank.
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The Hon'ble High Court in Writ Petition No. 19707
of 2011 in ICICI Bank Ltd. vs. DRAT and Ors in CDJ 2011
MHC 5452, has observed that there is no specific provision
in the Act for impounding a Passport, but such power is
inherent in the Tribunal conferred under S.19(25) of the
RDDBFI Act and the power of the Tribunal to make such
an order can be traced as well in S.22 of the RDDBFI Act
and R.18 of the said Rules. The Hon'ble High Court hold
that the power of the Tribunal or the Appellate Tribunal to
impound the Pass port has not been either expressly or
impliedly excluded by the provisions of the Passport Act.
The Hon'ble High Court in support of its observations has
relied upon the ruling rendered by the Hon'ble Supreme
Court in Menaka Gandhi's case. The Hon'ble High Court
further observed that. S. 19(25) cannot be exercised as a
matter of routine and has to exercised in deserving cases
and that too, sparingly and while issuing such order the
Tribunal should satisfy itself that such actions are
absolutely necessary in the given set of facts and to meet
the end of justice. The Hon'ble High Court further observed
that though the Passport Act and RDDBF1 Act are separate
and special enactments, both had no overriding effect on
each other and the provisions contained in both enactments
are not inconsistent with each other.
Therefore, having taken into consideration of the
liabilities, this Tribunal is of the view that the
apprehensions expressed by the Applicant Bank have to be
countenanced and it shall be dispelled. Hence, this Tribunal
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is of the view that if a limited conditional order is passed
against the Respondents, it would meet the interest of
justice and natural justice. Accordingly, the Petitioner /
Applicant Bank is directed to approach the Regional
Passport Officer of Chennai/Coimbatore, or any other
office / officer, who are the competent authority to impound
the passport of the Respondents as the case may be, and
submit all the materials pertaining to the Respondents
before such authority and explain the implications in detail
and make a request to the Regional Passport Officer
Chennai/Coimbatore or any other office / officer under S.
10(3)(h) of the Pass Port Act, 1967, and the Regional
Passport officer in turn is required to peruse the materials
placed before the authority, and to pass appropriate orders
to impound the passports of the Respondents, which are
more fully described in the schedule of this Petition, at their
discretion on production of the copy of this Order so as to
bring the Respondents to face the legal proceedings
initiated against them for their liability / default, after
taking into consideration of involvement of the public
money in this proceedings. The Petitioner/Applicant Bank
and the Regional Passport Authority / Passport officer/
Chennai/Coimbatore or any other Office/Officer, who are
the competent authority to impound the passport, as the
case may be, are directed to act accordingly and I.A.
No.1239/2016 is ordered accordingly. No costs. The
Registry is directed to furnish the copy of the order to the
Petitioner/Applicant Bank free of cost for the purpose of
complying with the directions issued by this Tribunal supra.
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For filing Proof Affidavit by 08.06.2016. Petition to
set aside ex-parte order against D-1 pending. The Registry
is directed to check the petition and take it on file, if it is
otherwise in order. Notice of hearing and counter by
08.6.2017. Written arguments also by then. Call on
08.06.2016.”
(emphasis supplied)
3. Subsequently, the petitioner filed an application for the
renewal of a passport on 02.09.2022. When the matter was reviewed by the
respondent, no orders were issued. Therefore, the petitioner approached this
Court via W.P.No.13313 of 2023, and this Court ordered that the petitioner’s
application be considered and orders be issued on merits and in accordance
with law within two weeks from the receipt of the copy of the order.
Following this, the impugned order was issued, which led the petitioner to file
the present Writ Petition.
4. Heard Mr.R.Bharath Kumar, learned counsel appearing on
behalf of the petitioner, Mr.K.Gangadharan, learned Central Government
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Standing Counsel appearing on behalf of the respondents 1 & 2,
Ms.S.R.Sumathy, learned counsel appearing on behalf of the third respondent
and Mr.Prasad Vijayakumar, learned Amicus Curiae appearing in this case.
5. Earlier, this Court addressed certain questions while
considering the matter and, by an order dated 15.04.2024, appointed the
amicus curiae to assist the Court. Accordingly, the learned amicus curiae has
submitted a detailed report with an extensive survey of all relevant decisions.
6. Mr.R.Bharath Kumar, the learned counsel appearing on behalf
of the petitioner, submits that the DRT directed the Passport Authority to
consider the issue. The Passport Authority can only consider the issue per the
provisions of the Passport Act of 1967. A reading of Section 10 of the
Passport Act shows that no grounds for denying renewal exist in this case. The
mere pendency of the Original Application before the Tribunal does not
amount to a case pending before the Criminal Court. It is not a criminal case.
The petitioner has a fundamental right to travel abroad, as authoritatively held
by the Honourable Supreme Court of India in Maneka Gandhi vs Union of
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India1. Therefore, for reasonable medical necessity and to visit his daughter-
in-law, this petitioner wants to travel abroad. When the petitioner already
holds a passport and submitted an application for renewal, the Authority has
no jurisdiction or grounds to refuse the renewal or to impound the passport.
He would further submit that even from the compilation of judgments placed
on record by the learned Amicus Curiae, and by taking this Court through the
judgment of the Bombay High Court in Anurag vs Bank of India, Nagpur2,
he points out that the Bombay High Court has categorically held that there is
no express provision in the RDB Act or any Rules framed thereunder
expressly conferring the power on the Debt Recovery Tribunal to order the
impounding of passports or to refuse renewal, etc. The Bombay High Court
has ruled that in the absence of an express provision, especially when the right
to travel abroad is a fundamental right of citizens, the Tribunal cannot
exercise such power by passing orders that restrain defendants from travelling
abroad or issuing orders regarding the impounding of passports.
7. The learned counsel submits that this view is also followed by
1 1978 1 SCC 248
2 2022 SSC Online, Bombay, 1160
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the Kerala High Court. Thereafter, taking this Court through the position held
by the Division Bench in ICICI Bank Limited Vs. the Debt Recovery
Tribunal3, the learned counsel contends that our High Court recognizes that
even though there is no express power, such power can be exercised sparingly
and only in the rarest of occasions. Therefore, the DRT did not consider the
mandate of this Court and failed to address whether the current case warrants
such a limited exercise of power. The DRT's order is neither a positive
direction nor within its jurisdiction, and the impugned order should be
quashed. The learned counsel further notes that certain properties have already
been auctioned, resulting in a sum of Rs.30 crores being realized. The
petitioner, an ex-Director and currently a housewife, suffers from various
ailments in her old age, requiring treatment. Additionally, she needs to visit
family members abroad, but only for short durations. She has no intention of
fleeing the jurisdiction permanently.
8. The learned counsel submits that she has also filed an affidavit
of undertaking, and even if any specific undertaking is needed, the petitioner
will file it. Therefore, for all the aforementioned reasons, the petitioner
3 2011 6 CTC 70
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requests that the Writ Petition be allowed.
9. The learned counsel representing the Passport Authority would
submit that when an application for renewal is made, it should also be treated
as a fresh application for a passport. The DRT, being a tribunal that issues
directions, has passed an order in the aforementioned interlocutory
application. The Passport Authority is required to comply with this order, and
in light of the DRT's direction, the impugned order was issued, as clarified in
the order itself.
10. The learned counsel representing Punjab National Bank
submits that there are still huge dues exceeding Rs. 68 crores that are liable to
be recovered. It is not uncommon in our country for individuals to obtain
large loans and then flee the jurisdiction, often never returning. Many
borrowers have left for abroad without returning, thereby making a mockery
of judicial and recovery proceedings in our country. Given the changing times
and the amount due in this case, an order of restraint is necessary. The
defendant's presence is critical for the plaintiff to recover its dues.
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Accordingly, when the plaintiff submitted an application to the Debt Recovery
Tribunal, that tribunal is empowered to issue orders in the interest of justice to
protect the bank's interests. The Bank manages funds belonging to the public
of this country. The petitioner has not challenged the DRT's order by filing an
appeal before the DRAT. The Passport Authority's order is solely based on the
DRT's ruling. Moreover, the petitioner has an appellate remedy against the
Passport Authority's order, thus he cannot maintain the current Writ Petition.
11. The learned Amicus Curiae, Mr. Prasad Vijaykumar, assisting
this Court, submits that regarding whether the DRT has the power to restrain
the defendants in the original applications under the RDB Act from visiting
abroad or impounding their passports, two views have emerged. The Hon’ble
Division Bench of this Court holds that in extraordinary circumstances, such
orders can be issued by the DRT. Conversely, the Bombay and Kerala High
Courts opine that in the absence of an explicit provision, the DRT should
refrain from passing such orders, particularly since the right to travel abroad is
a fundamental right. He further argues that additional questions arise,
specifically whether the authorities can impound passports and whether the
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DRT qualifies as a Criminal Court under the Act. He contends, based on the
decisions presented before this Court, that the DRT cannot be deemed a
Criminal Court. Therefore, it must be considered whether the Tribunal's status
while a matter is pending before it serves as grounds for impounding a
passport. The following judgments were submitted by him for the record:
S. No. Case Law Relevant Paras
Right to Travel as
a Fundamental
Right
Satwant Singh Sawhney v. D. • (para 31) For the reasons
Ramarathnam, 1967 SCC mentioned above we would accept
OnLine SC 21 [SC – 5J] the view of Kerala, Bombay and
Mysore High Courts in
preference to that expressed by
the Delhi High Court. It follows
that under Article 21 of the
Constitution no person can be
deprived of his right to travel
except according to procedure
established by law. It is not
disputed that no law was made by
the State regulating or depriving
persons of such a right.
Maneka Gandhi v. Union of • (para 5) It will be seen at once
India, (1978) 1 SCC 248 [SC from the language of Article 21 that
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– 7J] the protection it secures is a limited
one. It safeguards the right to go
abroad against executive
interference which is not
supported by law; and law here
means “enacted law” or “state
law” (vide A.K. Gopalan case).
Thus, no person can be deprived
of his right to go abroad unless
there is a law made by the State
prescribing the procedure for so
depriving him and the
deprivation is effected strictly in
accordance with such procedure.
It was for this reason, in order to
comply with the requirement of
Article 21, that Parliament
enacted the Passports Act, 1967
for regulating the right to go
abroad.
Power of DRT to
Restrain Right to
Travel Abroad
Karti P Chidambaram v • (para 75) My conclusion is thus,
Regional Passport Officer, that, Section 5 applies to both new
Chennai WP. No. 1190 of as well as renewal of passport, and
2024 the grounds for refusal set out under
Section 6(2) would apply equally to
both situations, issuance of new as
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well as renewal passports. There is
thus no merit in the submission of
the petitioner that the grounds for
refusal set out under Section 6(2)
are unavailable in the case of
passport renewals. This issue is
answered in favour of the
respondent.
ICICI Bank Limited v. Debts • (para 6) When the Banks and
Recovery Appellate Tribunal, financial institutions experienced
2011 SCC OnLine Mad 1739 considerable difficulties in
[Madras HC – 2J] recovering loans and enforcement
of securities charged with them
from the borrowers, posing threat to
Indian economy as a whole,
especially when some of the
borrowers who availed loans for
development of their units, became
sick and weak resulting in
accumulated non-performing assets,
the RDDBFI Act was enacted by
virtue of the powers conferred on
the Union of India under Entry 45
of List-I of Seventh Schedule. The
Tribunals were established in terms
of Section 3 of the RDDBFI Act to
exercise jurisdiction, powers and
authority conferred by the
Act. Section 17 deals with the
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jurisdiction, powers and authority
of the Tribunals. Sub-section (1) of
Section 17 relates to the
jurisdiction, powers and authority to
entertain and decide Applications
from the Banks and financial
institutions for recovery of debts
due to such Banks and financial
institutions. Similar jurisdiction,
powers and authority were also
conferred on the Appellate Tribunal
by virtue of sub-section (2) of
Section 17. Those powers are
exclusively conferred on the
Tribunal and the Appellate Tribunal
except the Supreme Court and the
High Court in terms of Section 18
of the Act. The provision is
intended to confer wider power to
the Tribunal/Appellate Tribunal
to deal with the matters relating
to various modes of recovery of
unpaid loan or bad debts.
• (para 17) On the other hand, Mr.
A.L. Somayaji, the learned Senior
Counsel appearing for the Bank
would rely upon the judgment of
the Division Bench of Kerala High
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Court in Annai Jayabharathi v. The
Debt Recovery Tribunal, The
Division Bench, having referred to
the Passport Act as well as the right
conferred on the Passport holder
under Article 21 of the Constitution
of India, observed that there is no
infraction of Article 21 of the
Constitution of India in the event
the Tribunal directs the
borrower/guarantor to surrender
Passport. The Division Bench has
also held that the power of the
Tribunal with reference to the
provisions of Section 22 of the
RDDBFI Act is wider than a Civil
Court. For the reasons stated in our
order, we are entirely in
agreement with the decision of
the Division Bench of the Kerala
High Court and with great
respect, we are not in agreement
with the view taken by either the
Karnataka High Court or the
Delhi High Court.
• (para 18) We are inclined to add
further in support of our above
view. The RDDBFI Act was
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enacted to provide for
establishment of Tribunals, for
expeditious adjudication and
recovery of debts due to Banks and
financial institutions with the
powers to regulate their own
procedure and therefore, it is
regulatory in nature. Likewise, The
Passport Act, 1967 was also enacted
to issue Passports and travel
documents to regulate the departure
from India of citizens of India and
other persons. Both are special
enactments made by the parliament
by virtue of the powers conferred
under List I of Seventh Schedule.
• (para 19) At the time when the
Passport Act was enacted, the
RDDBFI Act was not enacted and
for that reason, there was no
occasion for the Parliament to make
a provision conferring on the
Passport Authority to order
impounding the Passport in case the
borrower or the guarantor fails to
repay the loan and the Bank
anticipated or apprehended that
such borrower/guarantor may leave
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the country thereby successfully
evading payment. The Act
underwent subsequent amendments
during 1995, 2000 and 2004 as
well. Even then, no specific power
was conferred upon the Passport
Authority to order impounding or
revoke the Passport or the travel
document of the defaulted borrower
or guarantor, who is facing
Recovery proceedings before the
Debts Recovery Tribunal. Both the
Acts being enacted under List I of
Seventh Schedule, when the
Passport Act deals with the issue of
Passport and travel document in
order to regulate departure from
India of citizens of India and other
persons, the RDDBFI Act is
intended to recover the dues from
the borrower or the guarantor with
wide range of powers to pass
interim orders in order to secure the
interest of justice in realising the
dues. Both the Acts are operating
on different fields and the
provisions of the Acts are to be
considered keeping in mind the
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respective objects for which they
were enacted.
• (para 23) there can be no doubt
to hold that the
Tribunal/Appellate Tribunal
enjoy wider inherent power than
an ordinary Civil Court which
could be exercised to pass interim
order to meet the ends of justice
including an order to impound a
Passport. The only limitation
would be that such orders should
relate only to ensure the
implementation of the provisions
of the RDDBFI Act, particularly
to protect the interest of the
Banks/financial institutions to
recover the dues.
• (para 24) we will have to
consider the next question as to
whether the RDDBFI Act will
override the Passport Act. The
Passport Act falls within Entry 19
of List-I of the Seventh Schedule
and the RDDBFI Act falls within
Entry 45 of List-I of Seventh
Schedule of the Constitution of
India. Both are special laws which
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deal with respective entry. If, there
is any inconsistency between these
two laws, an occasion may arise for
this Court to examine as to which
will prevail upon the other. In the
event, this Court finds no
inconsistency between the two laws
made by the Parliament, the
question of one Act overriding the
other does not arise. Insofar as the
Passport Act is concerned, of
course, it provides for impounding
of Passport by following a set of
procedure by the authority. As held
by the Hon'ble Supreme Court, it
will have overriding effect over the
general law, namely, the Code of
Criminal Procedure or Code of
Civil Procedure so as to exclude the
power of impounding by exercise of
such inherent power. If we have to
consider whether the inherent
power of the Court under the Code
of Civil Procedure will prevail upon
the Passport Act, the answer will be
an emphatic no, because the
Passport Act is a special enactment
which will naturally override the
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general law. But, insofar as
RDDBFI Act is concerned, the
inherent power of the Tribunal does
not flow from the general law
namely, Code of Civil Procedure, as
it flows from another statute
namely, RDDBFI Act, which is also
a special enactment. The Hon'ble
Supreme Court has made it very
clear that such inherent power
flowing from RDDBFI Act is
wider than the inherent power
which would normally flow on a
Civil Court. Therefore, the
provisions of the Passport Act
shall not exclude the inherent
power of the Debts Recovery
Tribunal to pass any interim
order to meet the ends of justice
for which power flows from the
special enactment namely,
RDDBFI Act.
• (para 26) Thus, we hold that the
power of the Tribunal or
Appellate Tribunal to impound a
Passport has not been either
expressly or impliedly excluded
by the provisions of the Passport
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Act. Even while we hold so, having
regard to the law laid down by the
Apex Court in Menaka Gandhi's
case, supra, holding that a right to
hold Passport cannot be deprived as
it may amount to infringement of
Article 21 of the Constitution of
India, the power under Section
19(25) cannot be exercised as a
matter of routine and has to be
exercised in deserving cases and
that too sparingly. While issuing
such order, the Tribunal should
satisfy itself as to whether such
directions are absolutely
necessary in the given set of facts
and to meet the ends of justice
since the satisfaction of the
Tribunal is subject to judicial
review.
• (para 29) The provisions of the
RDDBFI Act must be interpreted by
the Courts to give effect to the
object for which such enactment
was made. In order to ensure
recovery of the dues to the Bank,
and for that matter such recovery is
in the interest of sustained growth
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of economy of the country,
measures like directing surrender
of Passport and ordering the
borrower/guarantor not to leave
the country without the
permission of the Tribunal would
be well within the powers
conferred on the Tribunal under
Section 19(25) of the RDDBFI
Act.
Ajay Kumar Bishnoi v. Debts • It is true in a subsequent
Recovery Tribunal-I, 2017 decision in RADHIKA VIJAY
SCC OnLine Mad 6535 KUMAR v. DEBTS RECOVERY
[Madras HC – 2J] TRIBUNAL-II [W.P. No. 2621 of
2014 dated 11.02.2014], a contrary
view would appear to have been
expressed. The earlier binding
decision of the Division Bench
in ICICI BANK LIMITED v. THE
DEBTS RECOVERY APPELLATE
TRIBUNAL [2011 (6) CTC 70] was
not brought to the notice of the
Court in the later case. We are in
agreement with the view taken by
the Division Bench in ICICI BANK
LIMITED v. THE DEBTS
RECOVERY APPELLATE
TRIBUNAL [2011 (6) CTC 70]. The
above ruling of the Division Bench
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will apply on all fours to the present
case.
Annai Jayabharathi v. Debt • (para 10) The Recovery of Debts
Recovery Tribunal (Kerala Due to Banks and Financial
and Lakshadweep), Institutions Act, 1993 was brought
Ernakulam, 2005 SCC into force from 27-8-1993 with an
OnLine Ker 80 [Kerala HC] avowed object of expeditious
disposal of debts due to Banks and
financial institutions so to enable
the fast Recovery of debts due to
them, and for matters connected
therewith or incidental thereto. The
act is applicable if the debt is more
that Rs. 10.00 lakhs. Up to the said
limit, the common law Courts still
continue to exercise jurisdiction,
subject to such pecuniary limits of
the Civil Courts, as may be fixed by
the respective States. For debts
which can be recovered by filing
suits in the civil Courts up to the
above pecuniary limit, the Code of
Civil Procedure is applicable and,
as a necessary corollary, all
provisions therein including the
attachment before judgment, Order
XXXVIII and Rules made therein
apply. Apart from that, Section 151
confers inherent power. A question
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arises as to whether for higher
pecuniary jurisdiction, which is
now taken off from the civil Courts
and invested in the Tribunals,
Tribunals are made less powerful
than the common law Court, when
the very purpose of setting up of.
Tribunals under the Act is not only
for fast adjudication, but, for
effective and early recovery of
debts, which was got vital role in
economic stability of the country. In
fact, a presumption can be raised
very safely that the special
Tribunals are vested with such
powers so as to adopt such
procedure, by which all effective
measures can be taken not only for
fast disposal of the cases, but, for
fast recovery of the dues, as may be
found to be payable after
adjudication. It is specifically
provided that after adjudication, a
decree is passed, and, in execution
thereof, under Section 25 of the
Act, decree passed by the DRT can
be enforced by (i) attachment and
sale of movable or immovable
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property of the judgment debtor; (ii)
arrest of the judgment-debtor and
his detention in prison; and (iii)
appointing Receiver for the
management of the movable or
immovable properties of the
judgment-debtor. But, what happens
if the judgment-debtor escapes from
the country in order to evade and
defeat the decree? Is the DRT so
powerless to do anything is the
question. If a power is given to
arrest the judgment-debtor and to
detain him in prison for enforcing
the realization of a debt-ordered to
be paid in decree by issuance of a
Certificate under Section 19(7) of
the Act, it carries with it an
incidental power to prevent a
person from going abroad, as an
interim measure, so as to give effect
to the power of ordering arrest of
the judgment-debtor and his
detention in prison conferred by
Section 25(b) of the Act. Otherwise,
the said provision becomes
redundant and otiose. The
arguments of the learned counsel
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for the appellant that Section 22 of
the Act bars the application of CPC,
excepting those which are
enumerated in sub-section (2)
thereof, and that power to impound
the passport is not the one of such
powers enumerated, and, therefore,
the DRT has got no power to
impound a passport cannot be
acceded to, as Section 22(1) has to
be read in a different perspective
than understood by the learned
counsel for the appellant. Section
22(1) of the Act relieves the DRT
from the bondage of rigour of
procedure laid down by the Code of
Civil Procedure, leaving it to be
guided by the Principles of Natural
Justice, subject to other provisions
of the Act and the Rules, and, vests
the DRT with such wide powers
to regulate its own procedure
including the place at which it
can have sittings. As such, the
powers of DRT have not to be
read to have been truncated by
Section 22(1), and, in fact, it has
to be read and understood to
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have been widened giving a free
hand to the Tribunal to pass any
such orders, which have got the
effect of not only speedy trial,
but, effective enforcement of the
decree in the event of the same
being passed. It cannot be denied
that presence of the appellant in
the country enables the smooth
and speedy disposal of the case
before the DRT, and, in the event
of the decree being passed and a
Certificate is issued under Section
19(7) of the Act, the same can be
effectively executed. If there are
no grounds to pass
the impugned order, certainly, it
is arbitrary as it violates not only
the fundamental right under
Article 21, but also Articles 14
and 19 too. But, the DRT is of the
considered view that the security
offered is far too meagre as
compared to the debt to be
realized, and, in that context, it
cannot be said that the order of
the tribunal is arbitrary. Under
Section 22(2) of the Act, the DRT is
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vested with sqme powers as are
vested in a civil Court under CPC
while trying a suit, and, while such
powers are enumerated in clauses
(a) to (g), but clause (h) is residuary
in nature, which empowers to adopt
a procedure on any other matter,
which may be prescribed. Further,
under Section 29 of the Act,
provisions of the II and III
Schedules to the Income-tax Act,
1961 and the Income-tax
(Certificate Proceedings) Rules,
1962, are also made applicable by
referential legislation to1 read the
assessee as a ‘judgment-debtor’ and
‘tax due’ as ‘the debt payable under
the Act’. Under Clause 75 of
Schedule II of the Income-tax Act,
interim detention can be ordered
pending enquiry relating to final
detention in jail for recovery of the
amount determined under the
Income-tax Act. Section 34 gives
overriding effect to the Act over
other enactments. Section 36
confers rule-making power by
virtue of which the Debts Recovery
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Tribunal (Procedure) Rules, 1993
were framed. Rule 18 of the Rules
empowers the DRT to make such
orders and to give such directions1
as may be necessary or expedient to
give effect to its orders or to
prevent abuse of its process or to
secure the ends of justice and,
certainly, the impugned order falls
within this Rule read with Section
25(2) of the Act. The Karnataka
High Court in ICICI's case (AIR
2002 Karnataka 118) (supra) did
not deal with these aspects and, in
our considered view, the order of
the DRT sustains, as it is valid
under law.
ICICI Bank Ltd. v. Kapil • (para 23) From the reading of
Puri, 2017 SCC OnLine Del the aforesaid judgments, it is clear
7377 [Delhi HC – 2J] that the Supreme Court referring to
Sections 19(6) (as existed)
[presently Section 19(12)] and
22(1) has held that the Tribunal is
not bound by the procedure laid by
the Code of Civil Procedure. The
Tribunal can travel beyond the
Code of Civil Procedure and the
only pre-condition is that it has to
observe the principles of natural
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justice. The power of the Tribunal
under subsection 6 of Section 19
to pass injunction or stay orders
is not exhaustive but the width
and amplitude of the powers can
be gathered from Section 22(1).
The Supreme Court also observed
Rule 18 of the Tribunal enables the
Tribunal to pass orders to secure
ends of justice.
• (para 28) No doubt, the Madras
High Court has read the power of
the Tribunal under Section 19 of the
Act to include the power to
impound a passport
• (para 33) The Debts Recovery
Tribunal being a creature of
statute would have power as
conferred on these Tribunals by
the statute. If the intention was to
confer such power allowing the
Tribunal to restrain a person
from travelling abroad, it ought
to have been so conferred on the
Tribunal. Here notice can be taken
of the provisions of Section 19(17)
of the RDDDBFI Act which
empowers the Recovery Tribunal to
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order detention of a person in civil
prison for a period not exceeding
three months if such person is
found guilty of disobedience or
breach of any order made by the
Tribunal. Apparent reason for not
bestowing power to the Tribunal to
restrain the borrower from
travelling abroad may be because
borrower is not needed to remain
present in person before the
Tribunal when the recovery
proceedings are in progress. It is
his property only which is the
security for recovery of the debt
and his presence may be need at
much later stage during the
recovery proceedings as and
when ordered if full amount is
not recovered from the secured
assets. To justify passing of such
order by invoking the provisions of
Section 19(25) of the RDDBFI Act
or Rule 18 of the Rules to urge that
these would be available to ensure
recovery may lead to creating or
recognizing a right or liability or
obligation which is not provided for
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in the Statute.
Anurag v. Bank of India, 2022 • (para 20) Under section 19(25),
SCC OnLine Bom 1160 the Tribunal is empowered to make
[Bombay HC – 2J] such orders and give such directions
as may be necessary or expedient to
give effect to its orders or prevent
abuse of its process or secure the
ends of its justice. Sub-section (12)
of section 19 conferred the powers
on Tribunal to pass interim orders
during the pendency of proceedings
by way of injunction or stay or
attachment against the defendant
restraining him from transferring,
alienating or otherwise dealing with
or disposing of any property and
assets belonging to him without
prior permission of the Tribunal.
The Tribunal is also empowered
under sub-section (13)(A) of
section 19 to direct the defendant to
furnish security or pass such order
as specified therein on being
satisfied that the defendant with an
intent to obstruct or delay or
frustrate the execution of any order
or the recovery of debt passed
against him, or is about to dispose
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of the whole or any part of the
property, or is about to remove to
whole or any of the part of the
property, or is likely to cause any
damage or mischief to the property
or affect its value by misuse or
creating third party interest. On
careful consideration of the
language of sub-section (12),
(13)(A), (17) and (18) of section
19, we are of the considered view
that the Tribunal is not conferred
with specific power to restrain a
person from leaving the country.
• (para 23) In the case of ICICI
Bank Ltd., the High Court of Delhi
has considered both judgments and,
by detailed judgment, has dissented
from the views taken by Kerala and
Madras High Court. A similar
matter fell for consideration before
a Division Bench of the Gujarat
High Court in State Bank of
India (supra), which held that the
Debt Recovery Tribunal has no
power to restrain a person from
travelling abroad in the absence of
specific powers to that effect.
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Special Leave to Appeal (Civil) No.
16714/2011 against the judgment of
the High Court of Gujarat has been
dismissed by the Hon'ble Supreme
Court on 15-7-2011. We fully
agree with the views expressed by
the Delhi High Court in the case
of ICICI Bank Ltd. (supra) and
Gujarat High Court in State
Bank of India (supra) that the
Debt Recovery Tribunal has no
power to restrain a person from
travelling abroad.
Nitin Shambhukumar • (para 11) The Passport Act is a
Kasliwal v Debt Recovery special enactment and is trite that
Tribunal WP No. 26333 of it being a special enactment
2023 [Karnataka HC – 1J] which would prevail over any
power of even the civil court or
criminal Court to retain or
impound a passport. The issue in
the case at hand is, such an act
being done by the Tribunal which
undoubtedly has only the power of
following the procedure of a civil
Court in securing ends of justice.
The civil Court or the criminal
Court itself do not have the power
to impound the passport. Section
102 or 104 of the Cr.P.C. empowers
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the Police to seize and the Court to
impound any document.
Impounding of any document
produced before the Court cannot
stretch to an extent that those
Courts can impound the passport
also. The Court – either the
criminal Court or the civil Court,
issuing directions to deposit of a
passport before it, till conclusion
of trial are those orders which are
without authority of law. The
Tribunal – Debts Recovery
Tribunal can hardly have such
power. The very act of the
Tribunal in directing surrender of
the passport of a citizen or its
detention before it, would amount
to impounding of passport. Such
power is unavailable to the
Tribunal.
Suresh Nanda v. CBI, (2008) • (para 10) Thus, the Act is a
3 SCC 674 [SC – 2J] special Act relating to a matter of
passport, whereas Section 104
CrPC authorises the court to
impound document or thing
produced before it. Where there is a
special Act dealing with specific
subject, resort should be had to that
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Act instead of general Act
providing for the matter connected
with the specific Act. As the
Passports Act is a special Act, the
rule that “general provision
should yield to the specific
provision” is to be applied.
• (para 11) The Act being a
specific Act whereas Section 104
CrPC is a general provision for
impounding any document or
thing, it shall prevail over that
section in CrPC as regards the
passport. Thus, by necessary
implication, the power of court to
impound any document or thing
produced before it would exclude
passport.
Difference
between “civil”
and “criminal”
proceedings
S.A.L. Narayan Row v. • (para 8) The expression “civil
Ishwarlal Bhagwandas, proceeding” is not defined in the
(1965) SCC OnLine SC 18 Constitution, nor in the General
[SC – 5J] Clauses Act. The expression in our
judgment covers all proceedings in
which a party asserts the existence
of a civil right conferred by the civil
law or by statute, and claims relief
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for breach thereof. A criminal
proceeding on the other hand is
ordinarily one in which if carried to
its conclusion it may result in the
imposition of sentences such as
death, imprisonment, fine or
forfeiture of property. It also
includes proceedings in which in
the larger interest of the State,
orders to prevent apprehended
breach of the peace, orders to bind
down persons who are a danger to
the maintenance of peace and order,
or orders aimed at preventing
vagrancy are contemplated to be
passed. But the whole area of
proceedings, which reach the High
Courts is not exhausted by
classifying the proceedings as civil
and criminal. There are certain
proceedings which may be regarded
as neither civil nor criminal. For
instance, proceeding for contempt
of court, and for exercise of
disciplinary jurisdiction against
lawyers or other professionals, such
as Chartered Accountants may not
fall within the classification of
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proceedings, civil or criminal. But
there is no warrant for the view that
from the category of civil
proceedings, it was intended to
exclude proceedings relating to or
which seek relief against
enforcement of taxation laws of the
State. The primary object of a
taxation statute is to collect revenue
for the governance of the State or
for providing specific services and
such laws directly affect the civil
rights of the tax-payer. If a person is
called upon to pay tax which the
State is not competent to levy, or
which is not imposed in accordance
with the law which permits
imposition of the tax, or in the levy,
assessment and collection of which
rights of the tax-payer are infringed
in a manner not warranted by the
statute, a proceeding to obtain relief
whether it is from the tribunal set
up by the taxing statute, or from the
civil court would be regarded as a
civil proceeding. The character of
the proceeding, in our judgment,
depends not upon the nature of the
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tribunal which is invested with
authority to grant relief, but upon
the nature of the right violated and
the appropriate relief which may be
claimed. A civil proceeding is,
therefore, one in which a person
seeks to enforce by appropriate
relief the alleged infringement of
his civil rights against another
person or the State, and which if the
claim is proved would result in the
declaration express or implied of
the right claimed and relief such as
payment of debt, damages,
compensation, delivery of specific
property, enforcement of personal
rights, determination of status etc.
Ram Kishan Fauji v. State of • (para 30) It further held that a
Haryana, (2017) 5 SCC 533 civil proceeding is, therefore, one in
[SC – 3J] which a person seeks to enforce by
appropriate relief the alleged
infringement of his civil rights
against another person or the State,
and which, if the claim is proved,
would result in the declaration,
express or implied, of the right
claimed and relief such as payment
of debt, damages, compensation,
delivery of specific property,
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enforcement of personal rights,
determination of status, etc.
• (para 31) The aforesaid
authority makes a clear distinction
between a civil proceeding and a
criminal proceeding. As far as
criminal proceeding is concerned, it
clearly stipulates that a criminal
proceeding is ordinarily one which,
if carried to its conclusion, may
result in imposition of (i) sentence,
and (ii) it can take within its ambit
the larger interest of the State,
orders to prevent apprehended
breach of peace and orders to bind
down persons who are a danger to
the maintenance of peace and order.
The Court has ruled that the
character of the proceeding does not
depend upon the nature of the
tribunal which is invested with the
authority to grant relief but upon
the nature of the right violated and
the appropriate relief which may be
claimed.
12. I have considered the rival submissions made on both sides
and reviewed the relevant material records of this case. At the outset,
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I appreciate the efforts of the learned Amicus, Mr. Prasad Vijayakumar, in
providing all the pertinent decisions and a note addressing the questions
raised, and in assisting this Court.
13. Firstly, this impugned order is not a typical statutory exercise
of power. The Passport Authority has not relied on the grounds enumerated
under Section 10 or on the grounds available to it to reject the renewal of the
passport. The operative portion, which is extracted (supra), makes it clear that
it is based on the direction given by the Debts Recovery Tribunal. Therefore,
the question of considering the grounds available under the Act for refusal,
whether the action of impounding is proper as per the provisions of the Act,
and whether the DRT is a Criminal Court under the Act would not arise. The
refusal is made based on the orders of the Debts Recovery Tribunal.
Whenever an interim or final order is issued by any court of law/tribunal, the
appropriate authority to which the particular order is addressed is obligated to
comply with that order. This position is also clarified by the Passport Act
itself, by virtue of Section 10 (h), which stipulates that if any court order is
brought to the attention of the Passport Authority, the authority must act upon
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it, prohibiting the departure of the individual. Furthermore, every authority or
person who is subject to jurisdiction would be bound by the orders issued by
the Courts or Tribunals.
14. The next question to consider is whether the DRT issued such
a direction or merely instructed the authorities to consider the case. The entire
order of the DRT is reproduced above. In the first paragraph of the order, the
prayer made before the DRT is noted. Subsequently, the DRT assessed
whether it has the power to restrain individuals from travelling abroad and to
issue directions to the Passport Authority. The DRT examined the relevant
provisions under the Act and the Income Tax Act, along with the rules enacted
thereunder. Following this, the DRT relied upon the Division Bench judgment
in ICICI Bank Limited (cited above) and concluded that it has the authority to
act. The DRT explicitly acknowledged the bank's expressed apprehension. It
then directed that the relevant papers be submitted to the authority, which has
the power to impound passports, instructing them to review the materials
presented and to act accordingly. Therefore, this is not a case where the
authority is merely tasked with considering the representation or the
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application without expressing any view on its merits.
15. A reading of the DRT's order as a whole leads to the
conclusion that it is a positive directive granted to the authority, and it cannot
be said that the matter is left entirely to the passport authority. It cannot be
interpreted in such a way because, admittedly, no other grounds exist
according to the provisions of the Passport Act. Therefore, the order of a
Court of law or Tribunal cannot be read in a manner that renders it without
any substance. In light of this, I answer this question by stating that the
Passport Authority has acted solely in accordance with the directions of the
Debt Recovery Tribunal.
16. Since the Passport Authority acted only according to the
directions of the Debt Recovery Tribunal, the only remedy available to the
petitioner is to challenge the debt order of the DRT. The learned counsel for
the petitioner submitted certain grounds on merit with reference to the DRT
and argued that it need not even be challenged as it is without jurisdiction. It
is true that the Bombay High Court in Anurag v. Bank of India (cited supra)
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has held that once the right to travel abroad is considered a fundamental right,
the DRT cannot pass interim orders in restraint thereof unless there is an
express provision. The Kerala High Court has also held similarly. However,
this Court is bound by the dictum of the Division Bench in Annai
Jayabharathi v. Debt Recovery Tribunal (Kerala and Lakshadweep),
Ernakulam (cited supra). The Division Bench has held that there is no
inherent lack of power and the DRT can pass orders. Furthermore, Section
19(25) of the Act expressly vests the Tribunal with powers to make such
orders and give such directions as may be necessary or expedient to give
effect to its orders, prevent abuse of its process, or secure the ends of justice.
The questions are whether the creditor bank should proceed solely against
properties or, in the current scenario, where powerful and wealthy borrowers
evade justice and manage their affairs from overseas, making it impossible for
the creditors to take action, should they seek such restraining relief(s)?
Whether the instant case falls within the necessity of such action. I am unable
to accept the submission that the DRT is wholly without jurisdiction.
Therefore, to agitate on the merits of the decision, the petitioner must
challenge the Order of the DRT in the manner known to law. An effective
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appellate remedy is provided under the Act to approach the Appellate
Tribunal.
17. Consequently, allowing the petitioner to challenge the DRT
order in a manner known to law, this Writ Petition is disposed of. The period
from 09.01.2024 until the receipt of the order copy will be duly considered for
exclusion in computing the limitation when the petitioner opts to file an
appeal before the appropriate forum against the DRT order. No costs.
05.02.2025
Neutral Citation : Yes
dna
To
1.The Joint Secretary (PS) & CPO
Ministry of External Affairs
Patiala House, Tilak Marg
New Delhi 110 001.
2.The Passport Officer
First Floor, Commercial Complex Passage
Opp. Thandu Mariamman Temple
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442, Avinashi Road
Coimbatore 641 018.
3.The Punjab National Bank
Assets Recovery Management Branch
No.448-A, Dr.Nanjappa Road
Coimbatore 641 018.
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D.BHARATHA CHAKRAVARTHY, J.
dna
05.02.2025
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