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Development Credit Bank Ltd. Versus Appellate Tribunal For Forfeited Property New Delhi And Others

Condonation of delay in filing of appeal - Power of tribunal under SAFEMA to condone the delay - Forfeiture of property - Detention order - Respondent No.3 and his wife failed to produce sufficient evidence to prove that the suit property was acquired from legal sources - Held that:- Appeal admittedly was filed on 6th June, 2012. Therefore clearly the appeal was filed after a period of 106 days from the date on which the order was served upon the Petitioners.

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ibunal may entertain an appeal after the said period of 45 days but not after 60 days from the date aforesaid, if it is satisfied that the Appellant was prevented by sufficient cause from filing the appeal in time. The words "but not after 60 days" are of great significance. These words indicate that there is a clear mandate that beyond the period of 60 days from the date on which the order is served upon the aggrieved person, the Appellate Tribunal has no power to condone the delay.

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the purpose of determining any period of limitation prescribed by any such special or local law, the provisions contained in sections 4 to 24 of the Limitation Act shall apply only insofar as and to the extent to which, they are not expressly excluded by such special or local legislation. - under the provisions of section 12(4) read with the proviso thereto, the Appellate Tribunal had no power to condone the delay beyond the period of 60 days from the date on which the order impugned in the app .....

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done the delay beyond the period of 60 days from the date on which the order was served upon the Petitioners. As stated earlier, it is admitted that the appeal of the Petitioners was not filed within the aforesaid period, and therefore, clearly time barred. In this view of the matter, no fault can be found with the impugned order requiring interference in our extraordinary, equitable and discretionary jurisdiction under Article 226 of the Constitution of India. - Decided against the appellant. - .....

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, the Petitioners seek to challenge the order dated 12th March 2013 passed by the Appellate Tribunal for Forfeited Property, New Delhi, Respondent No.1 herein. Challenge is also laid to the order dated 23rd September, 2011 passed by the passed by Respondent No.2 under section 7 of the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976 (for short "SAFEMA"). Respondent No.2 is the Competent Authority under SAFEMA. 3. The brief facts to decide the present contr .....

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t No.3 under section 3(1) of the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974 (for short, "COFEPOSA"). In view of the said detention, the provisions of SAFEMA were made applicable to Respondent No.3 as he was a notified person under the provisions of section 2(2)(b) of SAFEMA. Ms. Pravina L. Patel, 3rd Respondent's wife was also covered under the definition of "relative" as defined under section 2(2)(c) of SAFEMA. Thereafter, an enquir .....

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ling upon them to explain the sources of income through which they were acquired. 5. The above show cause notice was thereafter adjudicated and Respondent No.2, by an order of forfeiture dated 23rd September, 2011, passed under section 7 of SAFEMA held that the suit property was an illegally acquired property and stood forfeited to the Central Government free from all encumbrances. The aforesaid finding was rendered by Respondent No.2 on the basis that Respondent No.3 and his wife failed to prod .....

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,00,000/-. The Petitioners contend that the repayment of the aforesaid cash credit facility was inter alia secured by creation of an equitable mortgage of the suit property. It is stated that this mortgage was created on 29th January, 2010. In view of defaults being committed by Respondent No.3 in repayment, his account was classified as a non-performing asset with effect from 15th December, 2010 and the Petitioners initiated action under the provisions of the Securitisation and Reconstruction o .....

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equisitions contained in the aforesaid notice, the Petitioners filed an application under section 14 of the SARFAESI Act before the Chief Metropolitan Magistrate seeking his assistance for taking physical possession of the suit property and handing over the same to the Petitioners. By an order dated 4th November 2011, the said Application was granted and pursuant thereto, it is the claim of the Petitioners that they have, on or about 23rd January 2013, taken physical possession of the suit prope .....

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eps in respect of the suit property, as according to him, under section 14 of SAFEMA, there was an express bar in proceeding with the sale of the suit property once it had been declared as a forfeited property under section 7 of the said Act. A copy of the order passed under section 7 of SAFEMA and dated 23rd September, 2011 was also enclosed with the said letter. 11. In reply to the said letter, the Petitioners through their Advocates' letter dated 22nd March, 2012 called upon Respondent No .....

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e Petitioners on 29th May, 2012. The Petitioners have then filed an appeal under section 12(4) of SAFEMA on 6th June 2012 challenging the order dated 23rd September, 2011. Along with their appeal the Petitioners also filed an application for condonation of delay, if any, in filing the appeal. 13. This appeal along with the application for condonation of delay was heard by Respondent No.1 and on 12th March 2013, Respondent No.1 passed the impugned order dismissing the appeal of the Petitioners on .....

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e first contention canvassed was that the provisions of the SARFESI Act would override the provisions of SAFEMA insofar as the provisions contained therein are inconsistent with the provisions of the SARFAESI Act. In other words, it was the submission of Mr. Kamat that the provisions of SARFAESI Act would have primacy over the provisions of SAFEMA. The second contention canvassed before us was that in any event Respondent No.2 was in grave error in not condoning the delay, if any, in filing the .....

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e Petitioners on the ground that it was barred by limitation or whether Respondent No.1 ought to have condoned the delay, if any, and heard the Petitioners appeal on merits. 16. On this aspect, Mr. Kamat submitted that Respondent No.1 was in grave error in dismissing the Petitioners appeal on the ground that it was not filed within the time period prescribed under section 12(4) of SAFEMA. Mr. Kamat submitted that looking to the facts and circumstances of the present case, there was no delay in f .....

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rescribed under section 12(4) of SAFEMA and there was no delay in filing the appeal. In this regard, Mr. Kamat relied upon the provisions of section 12(4) and contended that the said section stipulates that when any person is aggrieved by the order of the Competent Authority made under section 7, sub-section (1) of section 9 or section 10, shall file an appeal to the Appellate Tribunal within 45 days from the date on which the order is served on him. He submitted that in view of the fact that th .....

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that the Petitioners being a third party could not effectively challenge the order in appeal without having in their possession or custody the papers and proceedings which led to the passing of the order being challenged. It would therefore be necessary for the Petitioners to also be served with the papers and proceedings to effectively challenge the order in appeal. In these circumstances, Mr. Kamat submitted that there was no delay in filing the appeal and Respondent No.1 was in grave error i .....

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that even on this ground, the impugned order was contrary to law that required our interference under Article 226 of the Constitution of India. 18. With the help of the learned counsel, we have gone through the papers and proceedings in the above Writ Petition along with the Annexures thereto. We have also carefully perused the orders impugned in this Writ Petition. To understand the controversy, it would be apposite to refer to the provisions of section 12 of SAFEMA which read as under:- " .....

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ubsection (1) of Section 9 or Section 10. (2) The Chairman of the Appellate Tribunal shall be a person who is or has been or is qualified to be a Judge of the Supreme Court or of a High Court. (3) The terms and conditions of service of the Chairman and other members shall be such as may be prescribed. (4) Any person aggrieved by an order of the competent authority made under Section 7, sub-section (1) of Section 9 or Section 10, may, within forty-five days from the date on which the order is ser .....

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nquiry as it deems fit, confirm, modify or set aside the order appealed against. (6) The powers and functions of the Appellate Tribunal may be exercised and discharged by Benches consisting of three members and constituted by the Chairman of the Appellate Tribunal. (6-A) Notwithstanding anything contained in sub-section (6), where the Chairman considers it necessary so to do for the expeditious disposal of appeals under this section, he may constitute a Bench of two members and a Bench so consti .....

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the Appellate Tribunal and on payment of the prescribed fee, the Tribunal may allow a party to any appeal or any person authorised in this behalf by such party to inspect at any time during office hours, any relevant records and registers of the Tribunal and obtain a certified copy of any part thereof." (emphasis supplied) 19. As section 12(1) itself suggests, the Appellate Tribunal is constituted by the Central Government for hearing appeals against the orders made under section 7, sub-sec .....

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it is satisfied that the Appellant was prevented by sufficient cause from filing the appeal in time. In other words, the period for filing the appeal under section 12(4) is a period of 45 days and if the appeal is not filed within the aforesaid time period, it has the discretion to condone the delay for an additional period of 15 days. The words "but not after 60 days" appearing in the proviso to section 12(4) are of great significance as it clearly mandates that the Appellate Tribunal .....

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person who is aggrieved by the said order. As the section itself suggests any person aggrieved by the order of the Competent Authority, made under section 7, sub-section (1) of section 9 or section 10, may within 45 days from the date on which the order is served on him, prefer an appeal to the Appellate Tribunal. In the facts of the present case, admittedly, the order dated 23rd September, 2011 (and which was impugned in the Petitioners' appeal) was served upon the Petitioners on 20th Febru .....

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l interpretation we cannot supply words therein, which are otherwise clear and unambiguous, and alter the mandate of the legislature. It is pertinent to note that there was no bar or fetter on the Petitioners from filing their appeal once they received a copy of the order on 20th February, 2012. Instead of filing their appeal, the Petitioners engaged in correspondence with the authorities. We do not think that entering into such correspondence would stall the time to run against the Petitioners .....

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l admittedly was filed on 6th June, 2012. Therefore clearly the appeal was filed after a period of 106 days from the date on which the order was served upon the Petitioners. 22. On an ex-facie reading of section 12(4), it is clear that the appeal is to be filed within a period of 45 days from the date on which the order is served on the aggrieved person. If the appeal is not filed within the aforesaid period, under the proviso to section 12(4), the Appellate Tribunal is given the power to condon .....

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indicate that there is a clear mandate that beyond the period of 60 days from the date on which the order is served upon the aggrieved person, the Appellate Tribunal has no power to condone the delay. 23. It cannot be seriously disputed that SAFEMA is a special law and that section 12(4) provides for a period of limitation different from that prescribed under the Limitation Act, 1963. Section 29(2) of the Limitation Act, inter alia stipulates that where any special or local law prescribes for a .....

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uch special or local legislation. Section 29 of the Limitation Act, 1963 reads thus:- 29. Savings.-(1) Nothing in this Act shall affect Section 25 of the Indian Contract Act, 1872. (2) Where any special or local law prescribes for any suit, appeal or application a period of limitation different from the period prescribed by the Schedule, the provisions of Section 3 shall apply as if such period were the period prescribed by the Schedule and for the purpose of determining any period of limitation .....

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ment" in Section 2 shall not apply to cases arising in the territories to which the Indian Easements Act, 1882, may for the time being extend. (emphasis supplied) 24. On perusing section 29(2) of the Limitation Act, it is exfacie clear that the provisions of sections 4 to 24 would apply when (i) there is a special or local law which prescribes a different period of limitation for any suit, appeal or application; and (ii) the special or local law does not expressly exclude those sections. In .....

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60 days" appearing in the proviso thereto, we are clearly of the view there was an express exclusion within the meaning of section 29(2) of the Limitation Act to the applicability of section 5 thereof. To our mind, Parliament did not need to go any further. To hold that the Appellate Tribunal could entertain the appeal under section 12(4) even beyond the extended period as stipulated in the proviso thereof, would render the phrase "but not after 60 days", wholly otiose. No princip .....

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pon them. We, therefore, find no infirmity in the impugned order dated 12th March, 2013 passed by Respondent No.1. 26. In taking this view, we are supported by a decision of the Supreme Court in the case ofUnion of India v/s Popular Construction Company. (2001) 8 SCC 470 The issue involved before the Supreme Court in the aforesaid decision was whether the Court entertaining a challenge to an Arbitral Award under section 34 of the Arbitration and Conciliation Act, 1996 had the power to condone th .....

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the Limitation Act applicable to special laws like the 1996 Act since the 1996 Act itself did not expressly exclude its applicability and that there was sufficient cause for the delay in filing the application under Section 34. Counsel for the respondent, on the other hand, has submitted that the language of Section 34 plainly read, expressly excluded the operation of Section 5 of the Limitation Act and that there was as such no scope for assessing the sufficiency of the cause for the delay beyo .....

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dule and for the purpose of determining any period of limitation prescribed for any suit, appeal or application by any special or local law, the provisions contained in Sections 4 to 24 (inclusive) shall apply only insofar as, and to the extent to which, they are not expressly excluded by such special or local law." 6. On an analysis of the section, it is clear that the provisions of Sections 4 to 24 will apply when: (i) there is a special or local law which prescribes a different period of .....

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(3) An application for setting aside may not be made after three months have elapsed from the date on which the party making that application had received the arbitral award or, if a request had been made under Section 33, from the date on which that request had been disposed of by the Arbitral Tribunal: Provided that if the court is satisfied that the applicant was prevented by sufficient cause from making the application within the said period of three months it may entertain the application .....

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397, para 7 : 1976 SCC (Cri) 10]. ********* 11. Thus, where the legislature prescribed a special limitation for the purpose of the appeal and the period of limitation of 60 days was to be computed after taking the aid of Sections 4, 5 and 12 of the Limitation Act, the specific inclusion of these sections meant that to that extent only the provisions of the Limitation Act stood extended and the applicability of the other provisions, by necessary implication stood excluded [Patel Naranbhai Margha .....

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et aside the award beyond the extended period under the proviso, would render the phrase "but not thereafter" wholly otiose. No principle of interpretation would justify such a result." 27. The principle of law laid down in the aforesaid decision of the Supreme Court clearly supports the view that we have takenin this judgment. 28. We may also refer to a decision of a Division Bench of this Court to which one of us was a party (S. C. Dharmadhikari, J.), in the case of Flemingo (Du .....

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Court. The Hon'ble Supreme Court proceeds to hold that when applicability of section 5 of the Limitation Act is not absolute, but circumscribed or restricted, then, the statutory provision restricting or circumscribing it must be given effect to in the light of clear language of sub-section (2) of section 29 of the Limitation Act, 1963. In other words, sections 4 to 24 (inclusive) shall apply only insofar as and to the extent to which they are not excluded by the special or local law. In ou .....

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