G. Gopalakrishnan v. The Debts Recovery Tribunal-II & Ors

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED: 18.8.2009CORAM:THE HONOURABLE MR.JUSTICE ELIPE DHARMA RAOANDTHE HONOURABLE MR.JUSTICE M.VENUGOPALWrit Petition No.12761 of 2009andM.P.No.2 of 2009G.Gopalakrishnan... PetitionerVs.1.The Debts Recovery Tribunal-II, 4th Floor, Spencer's Towers, 770A, Anna Salai, Chennai-600002.2.M/s.Indian Bank, rep.by its Authorized Officer, Kotturpuram Branch, No.3,Vellaiyan Road, Kotturpuram, Chennai.... Respondents * * *Writ Petition filed under Article 226 of the Constitution ofIndia, praying to issue a Writ of Certiorari, calling for therecords on the file of the 1st respondent, relating to the impugnedorder dated 8.6.2009 in S.A.No.136 of 2007 and quash the same. * * *For petitioner: Mr.S.Parthasarathy, Senior Counsel for Mr.N.NandakumarFor R.2: Mr.V.Raghavachari* * * https://hcservices.ecourts.gov.in/hcservices/ O R D E R(Order of the Court was delivered by ELIPE DHARMA RAO, J.)The petitioner availed secured over draft facility of Rs.25lakhs from the second respondent Bank in the year 1995 for thepurpose of movie making, agreeing to repay the dues together withcontractual rate of interest within six months from the date ofsanction and thereafter, he also seems to have availed another overdraft facility of Rs.5 lakhs on 21.8.1995. Alleging non-payment,thesecond respondent Bank has proceeded against the petitioner underthe provisions of the Securitisation and Reconstruction of FinancialAssets and Enforcement of Security Interest Act, 2002 (SARFAESI Actin short) and issued demand notice under Section 13(2) and the salenotice under Section 13(4). Aggrieved, the petitioner filedS.A.No.136 of 2007 before the first respondent Tribunal and sincethe same was dismissed by the Tribunal, by the order dated 8.6.2009,the petitioner has come forward to file this writ petition. Alongwith the writ petition, the petitioner has also filed M.P.No.2 of2009, praying to stay all proceedings of the second respondent underthe SARFAESI Act against the petitioner account, pending disposal ofthe writ petition.2. When the above writ petition along with the stay petition inM.P.No.2 of 2009, came up for admission on 10.7.2009, a contemporaryDivision Bench of this Court has passed the following order:"Mr.V.Raghavachari, learned counsel accepts notice forthe second respondent and he is allowed a week's timeto file counter affidavit.The case may be disposed of at the stage ofadmission. Post the case "For Admission" on 20.7.2009.In the meantime, if the petitioner deposits a sumof Rs.20 lakhs (Rupees twenty lakhs only) by 12.7.2009and another sum of Rs.30 lakhs by 3.8.2009, therespondents may proceed with the auction-sale, but willnot confirm the sale, without prior permission of theCourt. On failure of payment, the Court may dismissthe Writ Petition." (emphasis supplied)3. Thus, a conditional order has been passed by this Court on10.7.2009, further making it clear that on failure of payment, theCourt may dismiss the writ petition.4. Today, when this matter has been taken up for consideration, https://hcservices.ecourts.gov.in/hcservices/ it has been fairly accepted on the part of the learned seniorcounsel appearing for the petitioner that the conditional orderpassed by this Court on 10.7.2009 has not been complied with by thepetitioner.5. On a perusal of the entire materials placed on record, weare able to see that as on 10.3.2003,the outstanding balance in theover draft account of the petitioner was Rs.54,50,984/=. The maincontention urged on the part of the petitioner before the Tribunalis that the sale notice did not give 30 clean days time before thedate of proposed sale and this contention has been pooh-poohed bythe second respondent Bank by producing the documents to show thatthe sale notice is dated 30.12.2006 and the date of the sale wasfixed as 31.1.2007 and thus, 30 clean days time had been given bythe second respondent Bank in the sale notice and even in the secondsale notice dated 1.1.2007, the auction was fixed on 31.1.2007,giving 30 clean days. Even the other ground raised by thepetitioner that the possession notice was not served on him was alsorejected by the Tribunal, having regard to the strong documentaryevidence available on record showing that the Bank had enclosed acopy of possession notice served on the petitioner and publicationof the same in two newspapers. On a thorough analysis of all thesefactual aspects, will not, in any manner, hinder us from arriving atan irresistible conclusion that the Tribunal is right in rejectingthe application filed by the petitioner.6. As has already been observed by us supra, as on 10.3.2003,the outstanding balance in the over draft account of the petitionerwas Rs.54,50,984/= and the conditional order passed by this Court on10.7.2009 has not been complied with by the petitioner. Therefore,automatically, the second part of the conditional order, making itclear that on failure of payment, the Court may dismiss the writpetition, would come into operation, making this writ petitionliable to be dismissed.7. The relief under the extraordinary jurisdiction of thisCourt under Article 226 of the Constitution is not available as amatter of course and in exercising the said extraordinary power, thewrit court will bear in mind the conduct of the party, who isinvoking such jurisdiction. The petitioner is in huge arrears ofpublic money to the second respondent Bank, and even though thisCourt has passed a conditional order, the same has not been compliedwith by the petitioner. Such a person, who has invoked theextraordinary jurisdiction of this Court under Article 226 of theConstitution and who has not complied with the interim order passedby this Court is not entitled to any relief before this Court. https://hcservices.ecourts.gov.in/hcservices/

8. At this juncture, we feel it apt to quote a judgment of theHonourable Apex Court in PRESTIGE LIGHTS LTD. vs. STATE BANK OFINDIA [(2007) 8 SCC 449]. In the said case also, the appellantcompany therein has availed loan from the respondent Bank, bymortgaging certain immovable properties and thereafter failed torepay the same, amounting to a sum of Rs.87,64,549.42. The borrowerhas unsuccessfully challenged the sale proceedings initiated by theBank before the Tribunal and the High Court and thereafterapproached the Honourable Supreme Court wherein a conditional stayorder has been passed by the Honourable Apex Court on 6.5.2005,including a default clause that on non-payment, the stay would standvacated. Admittedly, the said conditional order has not beencomplied with by the petitioner therein. In such circumstances, theHonourable Apex Court has held in the following terms:"An order passed by a competent court – interim or final– has to be obeyed without any reservation. If suchorder is disobeyed or not complied with, the court mayrefuse the party violating such order to hear him onmerits. Refusal to hear a party to the proceeding onmerits is a "drastic step" and such a serious penaltyshould not be imposed on him except in grave andextraordinary situations, but sometimes such an actionis needed in the larger interest of justice when a partyobtaining interim relief intentionally and deliberatelyflouts such order by not abiding by the terms andconditions on which a relief is granted by the court inhis favour. This, however, does not mean that in eachand every case in which a party has violated an interimorder it has no right to be heard at all. Nor will thecourt refuse to hear him in all circumstances. Thenormal rule is that an application by a party will notbe entertained until he has purged himself of thecontempt. There are, however, certain exceptions tothis rule. One of such exceptions is that the party mayappeal with a view to setting aside the order on whichhis alleged contempt is founded. A person against whomcontempt is alleged must be heard in support of thesubmission that having regard to the meaning andintendment of the order which he is said to havedisobeyed, his actions did not constitute a breach ofit.""A prerogative remedy is not available as a matter ofcourse. In exercising extraordinary power, therefore, awrit court will indeed bear in mind the conduct of the https://hcservices.ecourts.gov.in/hcservices/ party who is invoking such jurisdiction. If theapplicant does not disclose full facts or suppressesrelevant materials or is otherwise guilty of misleadingthe court, the court may dismiss the action withoutadjudicating the matter. The rule has been evolved inlarger public interest to deter unscrupulous litigantsfrom abusing the process of court by deceiving it. Thevery basis of the writ jurisdiction rest in disclosureof true, complete and correct facts. If the materialfacts are not candidly stated or are suppressed or aredistorted, the very functioning of the writ courts wouldbecome impossible."9. The above judgment of the Honourable Apex Court wouldsquarely apply to the facts of the case on hand, being alike.Further more, in view of the above factual discussion of the casealso, no better purpose would be served by keeping this matterpending. In other words, pendency of matters of this type, whereinhuge sums of public money is due from the defaulters of the Banks,will have serious repercussions directly on the lending capacity ofthe Banks and on the economy of the nation as a whole and therefore,in the larger interest of the nation and the justice, this petitionfiled by a defaulter, who has also failed to comply with the interimorder passed by this Court, must fail. For all the above discussions, this writ petition is liable tobe dismissed and the same is dismissed. No costs. Consequently,M.P.No.2 of 2009 is also dismissed.Sd/Asst.Registrar/true copy/Sub Asst.Registrargri/Rao https://hcservices.ecourts.gov.in/hcservices/ To1.The Debts Recovery Tribunal-II,4th Floor, Spencer's Towers,770A, Anna Salai,Chennai-600002.2. The Authorized Officer, Indian Bank, Kotturpuram Branch, No.3,Vellaiyan Road, Kotturpuram, Chennai.+1cc to Mr.V.Raghavachari, Advocate Sr 39538CK(CO)km/3.9. W.P.No.12761 of 2009