Bank, Calcutta Vs. Radha Krishna Maity & Ors
 INSC 329 (10
M.J.Rao M. JAGANNADHA RAO,J.
Bank, Calcutta has filed this appeal against the
order of the Calcutta High Court dated 19.6.98 in C.O. 1238/98. By that order
passed under Article 227 of the Constitution of India, the High Court set aside
the order dated 30.4.98 passed by the Presiding Officer, Debts Recovery
Tribunal, Calcutta (under the Recovery of Debts due to Banks and Financial
Institutions Act, (Act No.51 of 1993) (hereinafter called the 'Act'). .pa The
facts of the case are that the Bank filed a suit under Section 19(1) of the Act
before the Tribunal on 27.3.97 for recovery of monies in a sum of Rs.46.54 lakhs
and odd from respondents 1 to 3 and for other reliefs. Pending the case, the
Bank applied on 29.3.97 seeking temporary injunction restraining the
respondents from taking any monies or sums from M/s.
and Co. When the advance copy of the IA was sought to be served on the learned
counsel for respondents, the same was refused. The Tribunal then passed an
interim order of injunction on 30.4.98 as follows:
the meantime, the respondents 1, 2 and 3 are restrained from recovering any
money from M/s Braitewaite and Co. Ltd., till disposal of the interim
respondents moved the High Court, in an application under Article 227 of the
Constitution of India.
High Court in its order dated 19.6.98 held that under Section 19(6) the
Tribunal had only limited powers to pass interim orders of certain types but
that the injunction granted was not of the type enumerated in Section 19(6).
High Court, therefore, set aside the Tribunal's order.
Bank has filed this appeal. We have heard learned counsel on both sides. We
shall first refer to the relevant statutory provisions.
provisions of Sub-clause (6) of Section 19 of the Act read as follows:
19(6): The Tribunal may make an interim order ( whether by way of injunction or
stay) against the defendant to debar him from transferring, alienating or
otherwise dealing with, or disposing of, any property and assets belonging to
him without any prior permission of the Tribunal".
will be noticed that the above provision in Section 19(6) refers to certain
types of injunction or stay orders and the injunction order passed in this case
is no doubt not one of the types mentioned in Section 19(6). It is next
necessary to refer to the important provisions in Sub-clause (1) and (2) of
Section 22 of the Act and Rule 18 of the Debt Recovery Tribunal ( Procedure)
Rules, 1993. Section 22 reads as follows:
22: Procedure and Powers of the Tribunal and the Appellate Tribunal- (1) The
Tribunal and the Appellate Tribunal shall not be bound by the procedure laid down
by the Code of Civil Procedure, 1908 ( 5 of 1908), but shall be guided by the
principles of natural justice and, subject to the other provisions of this Act
and of any rules, the Tribunal and the Appellate Tribunal shall have powers to
regulate their own procedure including the places at which they shall have
The Tribunal and the Appellate Tribunal shall have, for the purposes of
discharging their functions under this Act, the same powers as are vested in a
civil court under the Code of Civil Procedure, 1908 ( 5 of 1908), while trying
a suit, in respect of the following matters, namely:-
and enforcing the attendance of any person and examining him on oath;
the discovery and production of documents;
evidence on affidavits;
commissions for the examination of witnesses or documents;
an application for default or deciding it ex parte;
aside any order of dismissal of any application for default or any order passed
by it ex parte;
other matter which may be prescribed.
18 of the Rules states as follows:
18: Orders and directions in certain cases- The Tribunal may make such orders
to give such directions 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.
will be noticed that Section 22(1) deals with the powers of the Tribunal and
Section 22(2) deals with certain specified powers. Rule 18 also deals with the
power of the Tribunal to pass orders.
recent decision of this Court under this Act in Industrial Credit and
Investment Corporation of India Ltd.
Court considered the provisions of the Act and the powers of the Tribunal. The question
that arose in that case was whether the Tribunal could pass an order granting
ex- parte injunction. In that context, reference was made to Section 22 of the
Act. This Court observed that the Tribunal's powers were ( except as stated in
sub-clause (2)), wider than the powers of a Civil Court and the only limitation was that it should observe
principles of natural justice. Wadhwa,J. stated as follows: (P.716, para 11)-
"We, however, do not agree with the reasoning adopted by the High Court.
When Section 22 of the Act says that the Tribunal shall not be bound by the
procedure laid down by the Code of Civil Procedure, it does not mean that it
will not have jurisdiction to exercise powers of a Court as contained in the
Code of Civil Procedure. Rather, the Tribunal can travel beyond the Code of
Civil Procedure and the only fetter that is put on its powers is to observe the
principles of natural justice." After contrasting the provisions of the
Act with the restrictions imposed upon certain other Tribunals under other
statutes, this Court observed: (P.717)- "It will, thus, be seen that while
there are no limitations on the powers of the Tribunal under the Act, the
Legislature has thought fit to restrict the powers of the authorities under
various enactments while exercising certain powers under those enactments...
Further, when power is given to the Tribunal to make an interim order by way of
injunction or a stay, it inheres in it the power to grant that order even ex parte,
if it is so in the interest of justice...." It is true that in the above
case this Court was not concerned with the power of the Tribunal to pass an
order of injunction or stay (or an ex-parte interim order or stay) other than
the type of injunction or stay enumerated in Sub-clause (6) of Section 19 of
the Act. But that in our opinion makes no difference, for the following
scope and the extent of the powers of the Tribunal are mainly referred to in
Sub-clause (1) of Section 22 of the Act which says that the Tribunal shall not
be bound by the procedure laid down by the Code of Civil Procedure but shall be
guided by principles of natural justice. As stated in Grapco by this Court, the
Tribunal can exercise powers contained in the Code of Civil Procedure and can
even go beyond the Code as long as it passes orders in conformity with
principles of natural justice. We may add that Section 19(6) does not in any
manner limit the generality of the powers of the Tribunal under Section 22(1).
It merely states that certain types of injunction or stay orders may be passed
by the Tribunal. It is to be noticed that Sub-clause (6) of Section 19 starts
with the words - "The Tribunal may make an interim order..." The
provision is an enabling provision and merely states that certain types of
injunction or stay orders mentioned therein can be passed by the Tribunal but
such an enumeration cannot, in our opinion, be deemed to be exhaustive nor
restricting the Tribunal's powers only to those types of injunction or stay
width and amplitude of the powers are to be gathered from Section 22(1) as
stated in Grapco. In addition, Rule 18 enables the Tribunal to pass orders to
secure the ends of justice. Thus, we are of the view that the Tribunal
certainly has powers to pass other types of injunction orders or stay orders
apart from what is stated in Section 19(6). It may issue notice and after
hearing the opposite side, pass orders. Or, it may pass ad interim orders
without hearing the opposite side and then give a subsequent hearing to the
opposite party and pass final orders. We may also point out that Section 22(2)
too does not limit the general powers referred to in Section 22(1). All that
Section 22(2) states is that in respect of the type of applications falling
under (a) to (h), the Tribunal has only powers as are vested in a Civil Court. On the facts of the case before
us, we have already stated that the counsel for the respondents refused to
accept notice and that therefore the Tribunal proceeded to pass the impugned
order. Thus, the Tribunal had conformed to principles of natural justice.
Tribunal was, therefore, very much within its powers in passing the order in
question. The High Court, therefore, erred in holding that the Tribunal had
exceeded its jurisdiction and its order is, therefore, liable to be set aside.
A point was raised before us that a notice was given to the Bank about the
death of one of the debtors and no steps were taken by the Bank in that behalf.
This point does not arise in this appeal. It will be for the parties to raise
it before the Tribunal and for the Tribunal to deal with the same, in
accordance with law. In the result, the appeal is allowed and the order of the
High Court is set aside and the order of the Tribunal is restored. We should
not be understood as having stated anything on the merits of the interlocutory
application or in regard to the main case.
will be no order as to costs.