Ambattur Industrial EstateChennai 600 058 v. The Debts Recovery Appellate Tribunal Ethiraj Salai

O R D E R D.MURUGESAN, J.This Court is called upon to decide the question as to whetherthe Debts Recovery Tribunal or the Debts Recovery Appellate Tribunalwould have power to direct the borrower or the guarantor to surrenderthe passport to the Tribunal and to further restrain the borrower orthe guarantor from leaving the country without the written permissionof the Debts Recovery Tribunal/the Debt Recovery Appellate Tribunal,as the case may be.2. The above issue arises under the following circumstances.The petitioner is M/s ICICI Bank Limited, Chennai (hereinafterreferred to as 'the bank'). M/s Subhiksha Trading Services Limitedavailed credit facilities in the form of term loan for their retailtrading business in the sale of grocery, fruits and vegetables,pharma, mobiles and fast moving consumer goods and also for expansionof their business in the States of Karnataka, Andhra Pradesh andGujarat. The said facilities were availed in the year 2005. The thirdrespondent by name R.Subramanian (hereinafter referred to as 'therespondent'), who is the Managing Director of the said company, hadalso executed Personal Guarantee in favour of the bank guaranteeingthe due repayment of the facilities except the credit card facility.As the company failed and committed default in repayment of the loanand the interest, the bank had recalled the facilities and calledupon the company to pay the dues. As the company failed to pay thedues demanded in the notice, the bank invoked the guarantee of therespondent. Despite receipt of the said notice, the respondent alsofailed and neglected to make payments. In the circumstances, thebank filed O.A.No.96 of 2010 before the Debts Recovery Tribunal-III,Chennai for recovery of a sum of Rs.221,97,76,635.78p as on 31stDecember, 2009, which application stood transferred to the file ofDebts Recovery Tribunal-II and renumbered as O.A.No.190 of 2010.Along with the said O.A., among other interlocutory applications, thebank also filed I.A.No.250 of 2010 under Section 19(25) of theRecovery of Debts Due to Banks and Financial Institutions Act, 1993seeking for a direction to the said R.Subramanian, the respondent, tosurrender his passport and not to leave the country without thepermission of the Tribunal. By order dated 30.9.2010, the DebtsRecovery Tribunal-II, Chennai allowed the said I.A., and directed therespondent to deposit his passport with the Registrar of the Tribunalwithin fifteen days from the date of the said order and furtherdirected that the respondent should not leave the country withoutobtaining the permission of the Tribunal. 3. This order was challenged by the respondent before the DebtsRecovery Appellate Tribunal, Chennai by filing M.A.No.606 of 2010.By the impugned order dated 12.8.2011, the Debts Recovery AppellateTribunal set aside the order of the Debts Recovery Tribunal on theground that the Tribunal has no authority under law to impound thepassport, as the passport authority empowered under the PassportsAct, 1967 would alone have such power. This order is questioned inthis writ petition. https://hcservices.ecourts.gov.in/hcservices/

4. For consideration of the issue, the following provisionsunder the Recovery of Debts Due to Banks and Financial InstitutionsAct, 1993 (hereinafter referred to as 'the RDDBFI Act') and the DebtsRecovery Tribunal (Procedure) Rules, 1993 (hereinafter referred to as'the DRT Rules') as well as the rules of the Second Schedule to theIncome Tax Act. 1961 are referable. They read as follows:“S.17. Jurisdiction, powers and authority ofTribunals.--(1) A Tribunal shall exercise, on andfrom the appointed day, the jurisdiction, powersand authority to entertain and decideapplications from the banks and financialinstitutions for recovery of debts due to suchbanks and financial institutions.(2) An Appellate Tribunal shall exercise, on andfrom the appointed day, the jurisdiction, powersand authority to entertain appeals against anyorder made, or deemed to have been made, by aTribunal under this Act.S.19. Application to the Tribunal.-- (12) The Tribunal may make an interimorder (whether by way of injunction or stay orattachment) against the defendant to debar himfrom transferring, alienating or otherwisedealing with, or disposing of, any property andassets belonging to him without the priorpermission of the Tribunal. (13(A) Where, at any stage of theproceedings, the Tribunal is satisfied, byaffidavit or otherwise, that the defendant, withintent to obstruct or delay or frustrate theexecution of any order for the recovery of debtthat may be passed against him,--(i)is about to dispose of the whole or anypart of his property; or(ii)is about to remove the whole or any partof the property from the local limits of thejurisdiction of the Tribunal; or(iii)is likely to cause any damage or mischiefto the property or affect its value bymisuse or creating third party interest,the Tribunal may direct the defendant, within atime to be fixed by it, either to furnishsecurity, in such sum as may be specified in theorder, to produce and place at the disposal ofthe Tribunal, when required, the said property orthe value of the same, or such portion thereof asmay be sufficient to satisfy the certificate for https://hcservices.ecourts.gov.in/hcservices/ the recovery of debt, or to appear and show causewhy he should not furnish security. (B) Where the defendant fails to show causewhy he should not furnish security, or fails tofurnish the security required, within the timefixed by the Tribunal, the Tribunal may order theattachment of the whole or such portion of theproperties claimed by the applicant as theproperties secured in his favour or otherwiseowned by the defendant as appears sufficient tosatisfy any certificate for the recovery of debt. (18) Where it appears to the Tribunal to bejust and convenient, the Tribunal may, byorder,-- (a) appoint a receiver of any property,whether before or after grant of certificate forrecovery of debt;(b) remove any person from the possession orcustody of the property; (c) commit the same to the possession,custody or management of the property; (d) confer upon the receiver all suchpowers, as to bringing and defending suits in theCourts or filing and defending applicationsbefore the Tribunal and for the realization,management, protection, preservation andimprovement of the property, the collection ofthe rents and profits thereof, the applicationand disposal of such rents and profits, and theexecution of documents as the owner himself has,or such of those powers as the Tribunal thinksfit; and (e) appoint a Commissioner for preparationof an inventory of the properties of thedefendant or for the sale thereof. (25) The Tribunal may make such orders andgive such directions as may be necessary orexpedient to give effect to its orders or toprevent abuse of its process or to secure theends of justice.S.22. Procedure and powers of the Tribunal andthe Appellate Tribunal.--(1) The Tribunal and theAppellate Tribunal shall not be bound by theprocedure laid down by the Code of CivilProcedure, 1908 (5 of 1908), but shall be guidedby the principles of natural justice and, subjectto the other provisions of this Act and of any https://hcservices.ecourts.gov.in/hcservices/ rules, the Tribunal and the Appellate Tribunalshall have powers to regulate their own procedureincluding the places at which they shall havetheir sittings.(2) The Tribunal and the Appellate Tribunal shallhave, for the purposes of discharging theirfunctions under this Act, the same powers as arevested in a Civil Court under the Code of CivilProcedure, 1908 (5 of 1908), while trying a suit,in respect of the following matters, namely:-- (a) summoning and enforcing the attendanceof any person and examining him on oath; (b) requiring the discovery and productionof documents; (c) receiving evidence on affidavits; (d) issuing commissions for theexamination of witnesses or documents; (e) reviewing its decisions; (f) dismissing an application for default ordeciding it ex parte; (g) setting aside any order of dismissalof any application for default or any orderpassed by it ex parte; (h) any other matter which may beprescribed.(3) Any proceeding before the Tribunal or theAppellate Tribunal shall be deemed to be ajudicial proceeding within the meaning ofsections 193 and 228, and for the purposes ofsection 196, of the Indian Penal Code (45 of1860) and the Tribunal or the Appellate Tribunalshall be deemed to be a civil Court for all thepurposes of section 195 and Chapter XXVI of theCode of Criminal Procedure, 1973 (2 of 1974).S.25. Modes of recovery of debts.--The RecoveryOfficer shall, on receipt of the copy of thecertificate under sub-section (7) of section 19,proceed to recover the amount of debt specifiedin the certificate by one or more of thefollowing modes, namely:--(a) attachment and sale of the movable orimmovable property of the defendant;(b) arrest of the defendant and his detentionin prison;(c) appointing a receiver for the managementof the movable or immovable properties of thedefendant.R.18. Orders and directions in certain cases.--The Tribunal may make such orders to give suchdirections as may be necessary or expedient to https://hcservices.ecourts.gov.in/hcservices/ give effect to its orders or to prevent abuse ofits process or to secure the ends of justice.The Second Schedule to Income Tax Act, 1961R.75. Custody pending hearing. Pending theconclusion of the inquiry, the Tax RecoveryOfficer may, in his discretion, order thedefaulter to be detained in the custody of suchofficer as the Tax Recovery Officer may think fitor release him on his furnishing security to thesatisfaction of the Tax Recovery Officer for hisappearance when required.”5. The object and purpose for which the Debt Recovery Tribunalswere constituted have relevance for deciding the issue. Before weadvert to the object and purpose and importance of the RDDBFI Act, wemay refer the banking structure in India. Even while India was tosecure independence, the Reserve Bank of India Act, 1935 was enactedto regulate the functions of the banks. Indian independence markedthe end of a regime of laissez-faire for the Indian banking. TheGovernment of India initiated measures to play an active role in theeconomic life of the nation, which resulted in the greaterinvolvement of the State in diffierent segments of the economyincluding banking and finance. One of the major steps taken was toregulate the banking including the Reserve Bank of India duringJanuary, 1949, as the Reserve Bank of India is the Indian CentralBanking Authority. Thereafter, the Banking Regulation Act, 1949 wasenacted empowering the Reserve Bank of India to regulate, control andinspect the banks in India. Having noticed that the Indian bankingindustry had become an important tool to facilitate the developmentof Indian economy, nationalisation of the banking industry wasmooted, which ultimately led to the enactment of Banking Companies(Acquisition of Transfer of Undertaking) Act, 1969. The above stepswere taken having regard to the banks playing an active and importantrole in the growth of Indian economy.6. When the banks and financial institutions experiencedconsiderable difficulties in recovering loans and enforcement ofsecurities charged with them from the borrowers, posing threat toIndian economy as a whole, especially when some of the borrowers whoavailed loans for development of their units, became sick and weakresulting in accumulated non-performing assets, the RDDBFI Act wasenacted by virtue of the powers conferred on the Union of India underEntry 45 of List-I of Seventh Schedule. The Tribunals wereestablished in terms of Section 3 of the RDDBFI Act to exercisejurisdiction, powers and authority conferred by the Act. Section 17deals with the jurisdiction, powers and authority of the Tribunals.Sub-section (1) of Section 17 relates to the jurisdiction, powers andauthority to entertain and decide applications from the banks andfinancial institutions for recovery of debts due to such banks andfinancial institutions. Similar jurisdiction, powers and authoritywere also conferred on the Appellate Tribunal by virtue of sub-section (2) of Section 17. Those powers are exclusively conferredonthe Tribunal and the Appellate Tribunal except the Supreme Courtand the High Court in terms of Section 18 of the Act. The provision https://hcservices.ecourts.gov.in/hcservices/ is intended to confer wider power to the Tribunal/ Appellate Tribunalto deal with the matters relating to various modes of recovery ofunpaid loan or bad debts.7. While dealing with the applications filed by a bank or afinancial institution to recover any debt from any person, in termsof sub-section 12 of Section 19, the Tribunal may make an interimorder (whether by way of injunction or stay or attachment) againstthe respondent in the application to debar him from transferring,alienating or otherwise dealing with, or disposing of, any propertyand assets belonging to him without the prior permission of theTribunal. By virtue of sub-section (13) of Section 19, the Tribunalmay appoint a Receiver to take custody and management of theproperty. By virtue of sub-section 13A of Section 19, the Tribunal,in the event, is satisfied that the respondent with the intent toobstruct or delay or frustrate the execution of any order for therecovery of debt that may be passed against him, is about to disposeof the whole or any part of his property; or is about to remove thewhole or any part of the property from the local limits of thejurisdiction of the Tribunal; or is likely to cause any damage ormischief to the property or affect its value by misuse or creatingthird party interest, may direct such person to furnish security fora sum that may be specified in the order or to produce and place atthe disposal of the Tribunal the said property or the value of thesame or such portion thereof as may be sufficient to satisfy thecertificate for the recovery of debt. To manage the property soattached, the Tribunal has the power to appoint a receiver eitherbefore or grant of certificate for recovery of debt under sub-section(18) of Section 19. In terms of sub-section (17) of Section 19, theTribunal has the power to order the properties of the person guiltyof disobedience of the orders made under sub-sections (12), (13) and(18) of Section 19, to be attached and may also order such person tobe detain in the civil prison for a term not extending three months. 8. By virtue of sub-section (25) of Section 19 and Rule 18 of theRules, the Tribunal may make such orders and give such directions asmay be necessary or expedient to give effect to its orders or toprevent abuse of its process or to secure the ends of justice. Interms of Section 22 of the Act, the Tribunal and the AppellateTribunal shall not be bound by the procedure laid down by the Code ofCivil Procedure, but shall be guided by the principles of naturaljustice and subject to the other provisions of the Act and the rulesmade thereunder. By that provision, the Tribunal and the AppellateTribunal shall have the powers to regulate their own proceduresincluding the places at which they shall have their sittings.9. The Apex Court, in Industrial Credit and InvestmentCorporation of India Ltd. v. Grapco Industries Ltd., (1994) 4 SCC710, while considering the provisions of the Act and the powers ofthe Tribunal, has observed that the powers of the Tribunal, except asstated in sub-section (2) of Section 19, are wider than the powers ofa Civil Court and the only limitation was that it should observeprinciples of natural justice. The Apex Court has observed asfollows:- https://hcservices.ecourts.gov.in/hcservices/ “ We, however, do not agree with thereasoning adopted by the High Court. When Section22 of the Act says that the Tribunal shall not bebound by the procedure laid down by the Code ofCivil Procedure, it does not mean that it will nothave jurisdiction to exercise powers of a Court ascontained in the Code of Civil Procedure. Rather,the Tribunal can travel beyond the Code of CivilProcedure and the only fetter that is put on itspowers is to observe the principles of naturaljustice.”The Apex Court has further observed:-“It will, thus, be seen that while there areno limitations on the powers of the Tribunal underthe Act, the Legislature has thought fit torestrict the powers of the authorities undervarious enactments while exercising certain powersunder those enactments. ... Further, when power isgiven to the Tribunal to make an interim order byway of injunction or a stay, it inheres in it thepower to grant that order even ex parte, if it isso in the interest of justice. ..”Subsequently, while concurring with the view expressed in the abovecase, the Apex Court in Allahabad Bank v. Radha Krishna Maity,A.I.R. 1999 SC 3426, has observed in paragraphs 9 and 10 as follows:-“9.The scope and extent of the powers of theTribunal are mainly referred to in sub-clause (1)of Section 22 of the Act which says that theTribunal shall not be bound by the procedure laiddown by the Code of Civil Procedure but shall beguided by principles of natural justice. Asstated in Grapco by this Court, the Tribunal canexercise powers contained in the Code of CivilProcedure and can even go beyond the Code as longas it passes orders in conformity with principlesof natural justice. We may add that Section 19(6)does not in any manner limit the generality ofthe powers of the Tribunal under Section 22(1).It merely states that certain types of injunctionor stay orders may be passed by the Tribunal. Itis to be noticed that sub-clause (6) of Section19 starts with the words - “The Tribunal may makean interim order....” The provision is anenabling provision and merely states that certaintypes of injunction or stay orders mentionedtherein can be passed by the Tribunal but such anenumeration cannot, in our opinion, be deemed tobe exhaustive nor restricting the Tribunal'spowers only to those types of injunction or stayorders. The width and amplitude of the powersare to be gathered from Section 22(1) as statedin Grapco. In addition, Rule 18 enables the https://hcservices.ecourts.gov.in/hcservices/ Tribunal to pass orders to secure the ends ofjustice.10.Thus, we are of the view that the Tribunalcertainly has powers to pass other types ofinjunction orders or stay orders apart from whatis stated in Section 19(6). ...”(emphasis supplied)10. The above judgment was rendered with reference to the powersof the Tribunals to pass interim orders of stay or injunction interms of the provisions of sub-section 19(6) prior to amendment Act 1of 2000, whereby the same power was retained to the Tribunal underSection 19(12) of the Act. In the light of the above law laid down bythe Apex Court, the question to be considered is as to “whether theTribunal, in exercise of the power conferred under sub-section (25)of Section 19 could pass an order directing the borrower or theguarantor, as the case may be, to surrender his passport and in suchevent, the direction to surrender the passport would amount toimpounding of the passport and further, whether the Tribunal coulddirect the borrower or the guarantor not to leave the country withoutpermission of the Tribunal or the Appellate Tribunal”.11. Before answering the above issue, as it is argued by thelearned senior counsel for the respondent that the passport or atravel document could be impounded or revoked only by the passportauthority and not by any other authority/forum/Court, we will nowdeal with certain provisions of the Passport Act. 12. A passport is considered to be essentially a politicaldocument for the benefit of its holder. A passport recognises theholder as the citizen of the country granting it and is in the natureof a request to the other country for his free passage there. Inthat sense, it is a document of importance for travel abroad and isof considerable value to its holder. The issuance of passport isgoverned by the provisions of the Passports Act, 1967. There is anembargo under Section 3 of the Passports Act that no person shalldepart from or attempt to depart from India, unless he holds in thisbehalf a valid passport or travel document. In order to obtain thepassport or a travel document, one has to make an application to thepassport authority who is empowered to issue such passport or traveldocument. The application is to be made under Section 5 of the Actand the passport authority is defined under Section 2(c) of the Act.The passport authority has the power to refuse passport or traveldocuments on the grounds enumerated under Section 6. The power tovary, impound or revoke passports and travel documents is conferredon the passport authority under Section 10. The reasons for suchvariation, impounding and revocation of passports and traveldocuments are enumerated under Section 10(3) of the Act, which readsas under:-“S.10(3) The passport authority may impound orcause to be impounded or revoke a passport ortravel document,--(a) if the passport authority is satisfied thatthe holder of the passport or travel document isin wrongful possession thereof, https://hcservices.ecourts.gov.in/hcservices/ (b) if the passport or travel document wasobtained by the suppression of materialinformation or on the basis of wrong informationprovided by the holder of the passport or traveldocument or any other person on his behalf:Provided that if the holder of such passportobtains another passport, the passport authorityshall also impound or cause to be impounded orrevoke such other passport.(c) if the passport authority deems it necessaryso to do in the interests of the sovereignty andintegrity of India, the security of India,friendly relations in India with any foreigncountry, or in the interests of the generalpublic;(d) if the holder of the passport or traveldocument has, at any time after the issue of thepassport or travel document, been convicted by aCourt in India for any offence involving moralturpitude and sentenced in respect thereof toimprisonment for not less than two years;(e) if proceedings in respect of an offencealleged to have been committed by the holder ofthe passport or travel document are pendingbefore a Criminal Court in India;(f) if any of the conditions of the passport ortravel document has been contravened;(g) if the holder of the passport or traveldocument has failed to comply with a notice undersub-section (1) requiring him to deliver up thesame;(h) if it is brought to the notice of thepassport authority that a warrant or summons forthe appearance, or a warrant for the arrest, ofthe holder of the passport or travel document hasbeen issued by a Court under any law for the timebeing in force or if an order prohibiting thedeparture from India of the holder of the passport or other traveldocument has been made by any such Court and the passportauthority is satisfied that a warrant or summonshas been so issued or an order has been so made.”13. Apart from the power to vary, impound or revoke a passportor travel document, the Central Government or any designated officercould by order suspend any passport by virtue of the provisions ofSection 10-A. Any person aggrieved by any order passed under theprovisions of the Act could prefer an appeal to the appellateauthority under Section 11. The contravention of the provisions ofthe Act is considered to be an offence, for which penalties are alsoenumerated under Section 12. The above provisions of the PassportsAct would show that the Passports Act is a special enactmentgoverning not only for issuance of passport but also for interimsuspension, variation, revocation and impounding of the passport in https://hcservices.ecourts.gov.in/hcservices/ exercise of powers under Section 10 of the Act which powers areexhaustive. Hence, the Passport Act occupies the field covered underthe provisions enumerated therein. 14. The Apex Court in Satwant Singh Sawhney v. D.Ramarathnam,Asst. Passport Officer, 1967 (3) SCR 525, while considering the rightof a passport holder to travel abroad, has observed that such a rightis guaranteed under Article 21 of the Constitution of India and noperson can be deprived of his right to travel except according toprocedure established by law. Subsequently, the Apex Court in MenakaGandhi v. Union of India, 1978 (1) SCC 248, has held as follows:“...Now, it has been held by this Court inSatwant Singh's case (supra) that 'personalliberty' within the meaning of Article 21includes within its ambit the right to go abroadand consequently no person can be deprived ofthis right except according to procedureestablished by law. Prior to the enactment of thePassports Act, 1967, there was no law regulatingthe right of a person to go abroad and that wasthe reason why the order of the Passport Officerrefusing to issue passport to the petitioner inSatwant Singh's case (supra) was struck down asinvalid. It will be seen at once from thelanguage of Article 21 that the protection itsecures is a limited one. It safeguards the rightto go abroad against executive interference whichis not supported by law; and law here means'enacted law' or 'State law' (vide A.K.Gopalan'scase). Thus, no person can be deprived of hisright to go abroad unless there is a law made bythe State prescribing the procedure for sodepriving him and the deprivation is effectedstrictly in accordance with such procedure....”15. Quoting the above judgments with approval, the Apex Courtsubsequently in Suresh Nanda v. Central Bureau of Investigation, 2008(3) SCC 674, while dealing with the powers of the passport authorityto impound under Section 10(3)(e) of the Passports Act, has observedas follows:“7. Sub- section (3)(e) of Section 10 of the Actprovides for impounding of a passport ifproceedings in respect of an offence alleged tohave been committed by the holder of the passportor travel document are pending before a criminalcourt in India. Thus, the P a s sport Authorityhas the power to impound the passport under theAct. Section 1 0 2 of Cr.P .C. gives powers tothe police officer to seize any property whichmay be alleged or suspected to have been stolenor which may be found under circumstances whichcreate suspicion of the commission of anyoffence. Sub- section (5) of Section 165 ofCr.P.C. provides that the copies of record made https://hcservices.ecourts.gov.in/hcservices/ under sub- section (1) or sub-section (3) shallforthwith be sent to the nearest Magistrateempowered to take cognizance to the offencewhereas Section 104 of Cr. P.C. authorizes thecourt to impound any document or thing producedbefore it under the Code. Section 165 of Cr.P .C. does not speak about the passport which hasbeen searched and seized as in the present case.It does not speak about the documents found insearch, but copies of the records prepared undersub- section (1) and sub- section (3). "Impound"means to keep in custody of the law. There mustbe some distinct action which will show thatdocuments or things have been impounded.According to the Oxford Dictionary "impound"means to take legal or formal possession. In thepresent case, the passport of the appellant is inpossession of CBI right from the date it hasbeen seized by the CBI. When we read Section 104of Cr. P.C. and Section 10 of the Act together,under Cr.P .C., the Court is empowered to impoundany document or thing produced before it whereasthe Act speaks specifically of impounding of thepassport. 8. Thus, the Act is a special Act relatingto a matter of passport, whereas section 104 ofthe Cr.P .C. authorizes the Court to impounddocument or thing produced before it. Where thereis a special Act dealing with specific subject,resort should be had to that Act instead ofgeneral Act providing for the matter connectedwith the specific Act. As the Passports Act is aspecial act, the rule that "general provisionshould yield to the specific provision" is to beapplied. See : Damji Valaji Shah & another Vs.L.I.C. of India & others [AIR 1966 SC 135];Gobind Sugar Mills Ltd. Vs. State of Bihar &others [1999 (7) SCC 76]; and Belsund Sugar Co.Ltd. Vs. State of Bihar and others [AIR 1999 SC3125] . 9. The Act being a specific Act whereasSection 104 of Cr. P.C. is a general provisionfor impounding any document or thing, it shallprevail over that Section in the Cr.P .C. asregards the passport. Thus, by necessaryimplication, the power of Court to impound anydocument or thing produced before it wouldexclude passport.”(emphasis supplied)In fact, the Apex Court, while considering the difference between theseizure and impounding of passport, has observed as follows inparagraph-12: https://hcservices.ecourts.gov.in/hcservices/ “12. It may be mentioned that there is adifference between seizing of a document andimpounding a document. A seizure is made at aparticular moment when a person or authoritytakes into his possession some property which wasearlier not in his possession. Thus, seizure isdone at a particular moment of time. However, ifafter seizing of a property or document the saidproperty or document is retained for some periodof time, then such retention amounts toimpounding of the property/or document. In theLaw Lexicon by P.Ramanatha Aiyar (2nd Edition),the word "impound" has been defined to mean "totake possession of a document or thing for beingheld in custody in accordance with law ". Thus,the word "impounding" really means retention ofpossession of a good or a document which has beenseized.”16. In the above backdrops of law on two enactments, we mayrefer to some of the judgments on the issue relied upon on eitherside. Mr.T.V.Ramanujam, learned senior counsel for the respondent,would rely upon the judgment of the Division Bench of the Delhi HighCourt in Sanjeev R.Apte v. I.F.C.I. Ltd., and others, 2008 (154) DLT77. In that case, the Division Bench has held that the DebtsRecovery Tribunal/Debts Recovery Appellate Tribunal has no power togrant interim injunction beyond the provisions of Section 19(6)(presently Section 19(12)) of the RDDBFI Act. In that case, theDivision Bench had no occasion to consider the provisions of Section19(25) of the RDDBFI Act and Rule 18 of the DRT Rules, which empowerthe Tribunal to make such orders and give such directions as may benecessary or expedient to give effect to its orders or to preventabuse of its process or to secure the ends of justice. The power “toprevent abuse of its process” includes the power to direct theborrower/guarantor, as the case may be, to surrender the passport andnot to leave the country without the permission of the Court. Suchpower can also be traced to the orders passed “to secure the ends ofjustice”. The only requirement for the Tribunal before passing ordersis to find out as to whether the borrower/guarantor, if allowed toleave the country, may defeat or frustrate the proceedings pending torecover the dues. The learned senior counsel would further rely uponthe judgment of a single Judge of the Delhi High Court in A.S.Mittalv. Presiding Officer, Debt Recovery Tribunal and others, 2004 DRTC188. The said judgment was also quoted with approval by the DivisionBench of the Delhi High Court in Sanjeev R.Apte case, referred supra.Even in the said judgment, the Court had no occasion to consider theprovisions of Section 19(25) of the RDDBFI act. Yet another judgmentof a learned single Judge of Karnataka High Court in ICICI Ltd.,Bangalore v. Passport Officer, Bangalore and others, AIR 2002Karnataka 118, was relied upon by the learned senior counsel. Hereagain, the Court had no occasion to consider the scope and power ofthe Tribunal to pass orders to prevent the abuse of its process or tosecure the ends of justice. https://hcservices.ecourts.gov.in/hcservices/

17. On the other hand, Mr.A.L.Somayaji, the learned seniorcounsel appearing for the bank would rely upon the judgment of theDivision Bench of Kerala High Court in Smt.Annai Jayabharathi v.The Debt Recovery Tribunal & Anr., CDJ 2005 Ker HC 171. The DivisionBench, having referred to the Passport Act as well as the rightconferred on the passport holder under Article 21 of the Constitutionof India, observed that there is no infraction of Article 21 of theConstitution of India in the event the Tribunal directs theborrower/guarantor to surrender passport. The Division Bench hasalso held that the power of the Tribunal with reference to theprovisions of Section 22 of the RDDBFI Act is wider than a civilCourt. For the reasons stated in our order, we are entirely inagreement with the decision of the Division Bench of the Kerala HighCourt and with great respect, we are not in agreement with the viewtaken by either the Karnataka High Court or the Delhi High Court.18. We are inclined to add further in support of our above view.The RDDBFI Act was enacted to provide for establishment of Tribunals,for expeditious adjudication and recovery of debts due to banks andfinancial institutions with the powers to regulate their ownprocedure and therefore, it is regulatory in nature. Likewise, ThePassport Act, 1967 was also enacted to issue passports and traveldocuments to regulate the departure from India of citizens of Indiaand other persons. Both are special enactments made by theparliament by virtue of the powers conferred under List I of SeventhSchedule.19. At the time when the Passport Act was enacted, the RDDBFIAct was not enacted and for that reason, there was no occasion forthe Parliament to make a provision conferring on the passportauthority to order impounding the passport in case the borrower orthe guarantor fails to repay the loan and the bank anticipated orapprehended that such borrower/guarantor may leave the countrythereby successfully evading payment. The Act underwent subsequentamendments during 1995, 2000 and 2004 as well. Even then, nospecific power was conferred upon the passport authority to orderimpounding or revoke the passport or the travel document of thedefaulted borrower or guarantor, who is facing recovery proceedingsbefore the Debts Recovery Tribunal. Both the Acts being enactedunder List I of Seventh Schedule, when the Passport Act deals withthe issue of passport and travel document in order to regulatedeparture from India of citizens of India and other persons, theRDDBFI Act is intended to recover the dues from the borrower or theguarantor with wide range of powers to pass interim orders in orderto secure the interest of justice in realising the dues. Both theActs are operating on different fields and the provisions of the Actsare to be considered keeping in mind the respective objects for whichthey were enacted. In this context, we may further refer to thefollowing facts.20. Impounding of a passport results in civil consequencebesides curtailment of the fundamental rights guaranteed underArticle 21 of the Constitution of India. In Suresh Nanda v. CentralBureau of Investigation, (2008) 3 SCC 674, the question before theHon'ble Supreme Court was as to whether the Central Bureau ofInvestigation has got power to retain the passport after seizing the https://hcservices.ecourts.gov.in/hcservices/ same in connection with a crime under investigation. The argumentadvanced before the Hon'ble Supreme Court was that though there is nospecific power conferred upon the investigating agency to impound apassport under Section 102 of the Code of Criminal Procedure, suchpower has been vested on the investigating agency by implication.But, the Hon'ble Supreme Court did not accept the said contention.The Hon'ble Supreme Court held that under the Code of CriminalProcedure, the investigating agency has been empowered to seize anyproperty or document including a passport. It has been held thatthough under Section 102 the investigating agency has the power toseize the property which includes a passport or a travel document, ithas no power to impound the same and for that reason, if theinvestigating agency retains the passport for a longer period, itwould amount to impounding of passport or travel document. Thisfinding was rendered taking note of sub-section (2) of Section 102 ofthe Code of Criminal Procedure, which mandates the investigatingagency to produce the seized document to jurisdictional magistratewho would deal with the document in terms of Section 104 of the Codeof Criminal Procedure. The Hon'ble Supreme Court after referring todictionary meaning of the term “impound” held that under Section 104of the Code of Criminal Procedure, the court before which thedocument is produced is empowered to impound the same. However, thePassport Act, 1967, being a special enactment which regulates theissuance and impounding of passport, should have overriding effectover the Code of Criminal Procedure, since under the Passport Act,power to impound has been conferred upon the authorities underSections 10(3)(e) and 10(3)(h) of the Act. Therefore, the generalpower of the court conferred under Section 104 of the Code ofCriminal Procedure by necessary implication stands excluded inrespect of a passport. In nutshell, the Hon'ble Supreme Court hasheld that though in general the criminal court has got power toimpound any document, i.e., produced either by the investigatingagency or any person in connection with the case before it, the saidpower does not extend to impound a passport because impounding ofpassport is the subject covered by a special enactment in the form ofthe Passport Act. Since the Passport Act does not empower thecriminal court to impound the passport, the Hon'ble Supreme Court hasheld that the criminal court has got no power to pass any order toretain the passport.21. A close reading of the said judgment would make itmanifestly clear that since impounding of passport infringes theright to life guaranteed under Article 21 of the Constitution, suchimpounding can be made only by following the due procedureestablished by law. It is needless to point out that the procedureestablished by law would mean the law made by the Parliament or bythe State Legislatures and not otherwise. In the judgment citedsupra, the Hon'ble Supreme Court has held that the Passport Act beinga special enactment to regulate the issuance of passport andimpounding the same, and the Code of Criminal Procedure is a generalenactment containing provisions which are procedural in nature, thespecial enactment shall override the general enactment. With thatfinding, the Apex Court has held that the criminal Court cannotimpound a passport in exercise of the powers conferred under Sections102 or 104 of the Code of Criminal Procedure. https://hcservices.ecourts.gov.in/hcservices/

22. In Allahabad Bank v. Radhakrishnan, AIR 1999 SC 3426, theHon'ble Supreme Court had an occasion to thoroughly andscientifically examine the provisions of the RDDBFI Act. The argumentbefore the Hon'ble Supreme Court was that the Tribunal has onlylimited powers to pass interim orders of certain types, but theinjunction granted was not of the type enumerated in Section 19(6)[presently, Section 19(12)] of the Act. The order passed by theTribunal was an interim order against the respondents restrainingthem from recovering any money from the company till disposal of theinterim matter. 23. The scope of such inherent power on a forum speciallyconstituted under the statute came up for consideration before theFull Bench of this Court very recently in Ramalinga v. Radha, 2011(4) CTC 481. That was a case where there were conflicting viewsexpressed by two Division Benches in respect of the powers of anInsolvency Court to grant an interim order of protection duringpendency of insolvency petition under the provisions of ProvisionalInsolvency Act. A Division Bench in Sinnaswami Chettiar v. AligiGoundan and others, AIR 1924 Madras 893 held that the court does nothave inherent power whereas another Division Bench in NallagattiGoundan v. Ramana Gounda and others, AIR 1925 Madras 170 took theview that though there is no express provision in the provisions ofthe Insolvency Act empowering the Insolvency Court to grant suchinterim order of protection, the Court has got inherent power. Inorder to resolve the conflicting views in these two judgments, thematter was referred to the Full Bench of this Court. In Ramalingav. Radha, 2011 (4) CTC 481, the Full Bench held that though there isno specific provision in the Act empowering the Insolvency Court togrant such a relief, the Court has got inherent power to pass suchinterim order. Thus, the judgment of the Division Bench in SinnaswamiChettiar v. Aligi Goundan and others, AIR 1924 Madras 893 wasoverruled and the law laid down in Nallagatti Goundan v. RamanaGoundan and others, AIR 1925 Madras 170 was upheld by the Full Bench.Drawing an analogy from the same, there can be no doubt to hold thatthe Tribunal/Appellate Tribunal enjoy wider inherent power than anordinary civil Court which could be exercised to pass interim orderto meet the ends of justice including an order to impound a passport.The only limitation would be that such orders should relate only toensure the implementation of the provisions of the RDDBFI Act,particularly to protect the interest of the banks/financialinstitutions to recover the dues.24. Incidentally, we will have to consider the next question asto whether the RDDBFI Act will override the Passport Act. ThePassport Act falls within entry 19 of List-I of the Seventh Scheduleand the RDDBFI Act falls within entry 45 of List-I of SeventhSchedule of the Constitution of India. Both are special laws whichdeal with respective entry. If, there is any inconsistency betweenthese two laws, an occasion may arise for this Court to examine as towhich will prevail upon the other. In the event, this Court finds noinconsistency between the two laws made by the Parliament, thequestion of one Act overriding the other does not arise. Insofar asthe Passport Act is concerned, of course, it provides for impoundingof passport by following a set of procedure by the authority. As heldby the Hon'ble Supreme Court it will have overriding effect over the https://hcservices.ecourts.gov.in/hcservices/ general law, namely, the Code of Criminal Procedure or Code of CivilProcedure so as to exclude the power of impounding by exercise ofsuch inherent power. If we have to consider whether the inherentpower of the Court under the Code of Civil Procedure will prevailupon the Passport Act, the answer will be an emphatic no, because thePassport Act is a special enactment which will naturally override thegeneral law. But, insofar as RDDBFI Act is concerned, the inherentpower of the Tribunal does not flow from the general law namely, Codeof Civil Procedure, as it flows from another statute namely, RDDBFIAct, which is also a special enactment. The Hon'ble Supreme Courthas made it very clear that such inherent power flowing from RDDBFIAct is wider than the inherent power which would normally flow on acivil Court. Therefore, the provisions of the Passport Act shall notexclude the inherent power of the Debts Recovery Tribunal to pass anyinterim order to meet the ends of justice for which power flows fromthe special enactment namely, RDDBFI Act. 25. In Income Tax Officer v. M.K.Mohammad Kunhi, AIR 1969 SC430, the Full Bench of the Hon'ble Supreme Court had to examine animportant question as to whether the Appellate Income Tax Tribunalhas power under the relevant provisions of the Income Tax Act, 1961to stay the proceedings of recovery of realization of the penaltyimposed by the departmental authorities on an assessee duringpendency of an appeal before it. In paragraph 6 of the said judgment,the Hon'ble Supreme Court has held thus:“It is well known that an Income-taxAppellate Tribunal is not a court but itexercises judicial powers. The Tribunal's powersin dealing with appeals are of the widestamplitude and have in some cases held similar toand identical with the powers of an appellateCourt under the Civil Procedure Code.”Having taken such a view based on the earlier judgments on thissubject and after referring to Halsbury's Laws of England inparagraph 8 of the judgment, the Hon'ble Supreme Court made thefollowing observation:-“In our opinion the Appellate Tribunal mustbe held to have the power to grant stay asincidental or ancillary to its appellatejurisdiction.”In paragraph 9 of the said judgment, the Hon'ble Supreme Court, witha caution note, has ultimately held as follows:- “9. .... It is needless to point out thatthe power of stay by the Tribunal is not likely tobe exercised in a routine way or as a matter ofcourse in view of the special nature of taxationand revenue. laws. It wilt only be when a strongprima facie case is made out that the Tribunalwill consider whether to stay the recoveryproceedings and on what conditions and the staywill be granted in most deserving and appropriatecases where the Tribunal is satisfied that theentire purpose of the appeal will be frustrated https://hcservices.ecourts.gov.in/hcservices/ or rendered nugatory by allowing the recoveryproceedings to continue during the pendency of theappeal.”26. In the instant case, though Debts Recovery Tribunalconstituted under the RDDBFI Act is not a court stricto sensu, still,undoubtedly, it exercises judicial powers and such judicial powersflow from the RDDBFI Act. As we have already held, the said Act notonly empowers the Tribunal to pass interim orders in order to recoverthe dues, but also enables to regulate its own procedures. Thoughthere is no specific provision in the Act for impounding a passport,such power is inherent in the Tribunal conferred under Section 19(25)of the RDDBFI Act. The power of the Tribunal to make such order canbe traced as well to Section 22 of the RDDBFI Act and Rule 18 of theRules. Clause 75 of the Second Schedule to Income-tax Act, is alsomade applicable to the Tribunals by virtue of provisions of Section29 of the RDDBFI Act. Thus, we hold that the power of the Tribunalor Appellate Tribunal to impound a passport has not been eitherexpressly or impliedly excluded by the provisions of the PassportAct. Even while we hold so, having regard to the law laid down bythe Apex Court in Menaka Gandhi's case, supra, holding that a rightto hold passport cannot be deprived as it may amount to infringementof Article 21 of the Constitution of India, the power under Section19(25) cannot be exercised as a matter of routine and has to beexercised in deserving cases and that too sparingly. While issuingsuch order, the Tribunal should satisfy itself as to whether suchdirections are absolutely necessary in the given set of facts and tomeet the ends of justice since the satisfaction of the Tribunal issubject to judicial review.27. Coming to the facts of this case, at the time when the O.A.was filed by the petitioner-bank, a sum of Rs.221,97,76,635.78p as on31.12.2009 was due from the respondent. On the ground that therespondent availed the credit facilities during the year 2005 anddefaulted in repayment of the loan and the interest as well, the bankcalled upon the respondent to pay the dues except invoice fundingfacility. In spite of the same, the respondent failed to pay themoney, which necessitated the bank to invoke the various bankguarantees. The bank came to know that the borrower had shut thebusiness for several months and had deliberately not finalised itsbooks of accounts since March, 2007 and the accounts have not beenaudited till 2008. The borrower had also admittedly borrowed a sumin excess of Rs.800 crores from various lenders and they are claimingthat there are no assets worth available with the borrower. Theborrower had also not submitted stock statements for several months.The borrower also owed a large sum of money to other lenders apartfrom the bank and had also transferred various assets to defeat theclaim of the bank and other lenders. Under the above circumstances,the bank filed an application under Section 19(25) of the RDDBFI Actbefore the Debts Recovery Tribunal for a direction to the respondentherein, who is the Managing Director of the principal borrower tosurrender his passport and not to leave the country withoutpermission of the Tribunal. The Tribunal, having considered theabove grievance, ultimately ordered the application. The said orderwas set aside by the Debts Recovery Appellate Tribunal solely on theground that the Tribunal had no jurisdiction to pass such an order. https://hcservices.ecourts.gov.in/hcservices/

28. As we have held that both the enactments operate ondifferent field and the powers conferred on the Tribunal to passinterim orders particularly under Section 19(25) of the Act is wideenough to cover the power to pass an order directing the surrender ofpassport, we hold that the order of the Debts Recovery AppellateTribunal is unsustainable and is liable to be set aside. 29. The provisions of the RDDBFI Act must be interpreted bythe Courts to give effect to the object for which such enactment wasmade. In order to ensure recovery of the dues to the bank, and forthat matter such recovery is in the interest of sustained growth ofeconomy of the country, measures like directing surrender of passportand ordering the borrower/guarantor not to leave the country withoutthe permission of the Tribunal would be well within the powersconferred on the Tribunal under Section 19(25) of the RDDBFI Act.Such an order, in our opinion, is sustainable especially in thepresent case in view of the fact that the application filed by thebank was in respect of recovery of Rs.221,,97,76,635.78p which wasdue as on 31.12.2009 from the respondent and the respondent also owedmore than a sum of Rs.800 crores to various lenders and that thereare no assets worth the value available with the borrower. The DebtsRecovery Appellate Tribunal has miserably failed to take note of theabove aspects while setting aside the order of the Debts RecoveryTribunal.30. Hence, for all the above reasons, we set aside the order ofthe Debts Recovery Appellate Tribunal, Chennai, dated 12.08.2011passed in M.A.No.606 of 2010 and restore the order of the DebtsRecovery Tribunal-II, Chennai, dated 30.09.2010 passed in I.A.No.250of 2010 in O.A.No.190 of 2010. The writ petition is allowed. Nocosts.Sd/-Deputy Registrar/true copy/Sub Asst. Registrar.ss/sraTo1. The Registrar Debts Recovery Appellate Tribunal Ethiraj Salai, Egmore Chennai 600 0082. The Registrar,Debts Recovery Tribunal-2 Deva Towers, 6th Floor No.770-A, Anna Salai Chennai 600 0022 ccs To Mr.Prakash Goklaney, Advocate Sr 622951 cc To Mr.Shivakumar, Advocate Sr 62286W.P.Nos.19707 of 2011ng[co]eu/18.10