TMI Blog2018 (11) TMI 985X X X X Extracts X X X X X X X X Extracts X X X X ..... xtent of 75%, has been reduced to that of 50% and correlated with that, the power of the Appellate Tribunal to waive the condition of pre-deposit has been restricted to 25%. The amendment in question, for its nature and for the reasons indicated above, in our view, is required to be taken as retrospective in operation and applicable to all appeals to be filed before the DRAT. The Writ Petitions being devoid of merits, are dismissed. - WRIT PETITION NOS. 13681,34948 of 2017 AND 356 of 2017 (GM-DRT) - - - Dated:- 5-10-2018 - MR DINESH MAHESHWARI, CJ. AND KRISHNA S. DIXIT, J. For The Petitioner : G. Krishnamurthy, Sr. Adv. and Chandrakanth Patil K., Advocates For The Respondent : . Radesh Prabhu, Adv., Smt. Lakshmi Iyengar, Adv., Manjunatha B.L., Adv., G.N. Sathyamurthy, Adv.and K.V. Lokesh, Advocate ORDER This set of two petitions involving the same parties and inter-related issues, having been considered together are taken up for disposal by this common order. 2. The petitioners herein proposed to maintain an appeal against the order dated 31.05.2016 passed by the Debt Recovery Tribunal at Bengaluru ('DRT') in O.A.No.267/2013, before the Debt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es, within one month from that date. The Appellants preferred IA 44/2017 for extension of time saying that the matter is challenged before Hon'ble High Court in Writ jurisdiction. On account of personal financial crunches and hardship, the extension of time is sought. According to the provisions of Section 21 of the RDDB FI Act, the DRAT can entertain the Appeal only after compliance of Order of pre deposit. No good ground is made out by the Appellants for extension of time. Appellants have not complied with the Order dated 30.11.2016. IA 44/2017 is dismissed. Accordingly, the Application for Waiver stands dismissed and consequently, the Appeal is rejected. The aforesaid order dated 06.01.2017 is questioned in W.P.Nos.13681/2017 and 34948/2017. 5. The relevant background aspects of the matter could be taken in contentions as follows: (a) The second Respondent-Deccan Cargo and Express Logistics Pvt. Ltd (hereafter Deccan Cargo ) way back in February 2010, had availed from the first Respondent-Syndicate Bank, an initial loan facility of ₹ 50 Crore which later came to be enhanced to ₹ 150 Crore. The petitioners were the sureties/guarantors for the re-p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the impugned order suffers from an error apparent on the face of the record inasmuch as the DRAT has laboured under a misconception of law that the 2016 Amendment to Section 21 of the Act of 1993 was retrospective in operation and governed the application seeking waiver of pre-deposit. He would submit that the right of appeal falling in the realm of substantive law accrues to a litigant when the original proceedings are instituted although the same becomes exercisable after suffering an adverse order and, therefore, O.A.No.267/2013 having been filed long before the 2016 Amendment, the DRAT ought to have invoked the proviso to Section 21 of the Act as it stood before its Amendment. In support of his submission, the learned counsel has relied upon the decision of Apex Court in the case of Hoosein Kasam Dada (India) Ltd. v. State of M.P. AIR 1953 SC 221. 8. Learned Senior Counsel has also contended that because of the mistake of the Lending Bank, the business of the second Respondent-Deccan Cargo was badly affected and that the same resulted into the Company being ordered to be wound up; the petitioners to show that they do not have any financial strength to comply with the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1993 in the year 2016, deals with substantive right of appeal and hence, is only prospective in operation. The submissions have several shortfalls and shortcomings. 14. For the questions involved, appropriate it would be to take note of the provisions of Section 21 of the Act of 1993 as existing before the amendment in the year 2016 and as existing after the amendment, as follows: Before amendment After amendment 21. Deposit of amount of debt due, on filing appeal.-Where an appeal is preferred by any person from whom the amount of debt is due to a bank or a financial institution or a consortium of banks or financial institutions, such appeal shall not be entertained by the Appellate Tribunal unless such person has deposited with the Appellate Tribunal seventy-five per cent. of the amount of debt so due from him as determined by the Tribunal under section 19: Provided that the Appellate Tribunal may, for reasons to be recorded in writing, waive or reduce the amount to be deposited under this section. 21. Deposit of amount of debt due, on filing appeal.-Where an appeal is preferred by any person fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xercisable; ordinarily such conditions fall within the domain of procedure especially when the alteration of said conditions is not substantial, inasmuch as even after amendment, discretion is left with the DRAT to reduce the amount of pre-deposit, although not below 25% of the decreetal amount. Therefore, the law by which such conditions are varied cannot be construed to be substantive law but shall remain within the realm of procedural law. The Supreme Court in the case of Shiv Shakti Coop. Housing Society v. Swaraj Developers [2003] 6 SCC 659 has observed (in paragraph 32): .No person has a vested right in a course of procedure. He has only the right of proceeding in the manner prescribed. If by a statutory change the mode of procedure is altered, the parties are to proceed according to the altered mode, without exception, unless there is a different stipulation. Therefore, the contention of the petitioner that the amendment is prospective in effect, is not acceptable. 19. Alternatively, for the sake of argument even if the Amendment Act 2016 that takes away the discretion of the DRAT to waive the condition of pre-deposit is assumed to be that of substantive law, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of a amending operation of law during the period in which it was in force. Similarly, in KOTESWAR VITTAL KAMATH v. K.RANGAPPA BALIGA, the three Judge Bench of the Supreme Court emphasized the distinction between supersession of rule and substitution of a rule and held that the process of substitution consists of two steps: first, the old rule is made to cease to exist and, next, the new rule is brought into existence in its place. Thus, what emerges from the aforesaid judgments of the Supreme Court is that an amendment which has the effect of substitution of a provision has the effect of replacing the old provision by the substituted provision and in the absence of repugnancy, inconsistency and absurdity, must be construed as if it has been incorporated in the Act right from abinitio. In other words, an amendment by way of substitution has retrospective operation. Therefore, the contention that the amendment in question is prospective in operation, is liable to be rejected. 21. Another aspect of the matter also needs consideration. It is not that prior to the 2016 amendment, the Act of 1993 had given to the appellant before the DRAT an absolute and unconditional right of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the DRAT. 24. The contention advanced on behalf of the first Respondent-Syndicate Bank that the amount due under the DRT Order is approximately ₹ 250 Crore and the direction to deposit ₹ 50 Crore falls short of 25 % of the amount due appears to be prima facie correct in the view of the material on record. Therefore, even the premise apparently operated by the DRAT that there is a statutory ceiling limit of 25% under the 2016 Amendment does not come to the aid of the petitioners. 25. Yet another reason for not granting indulgence in these writ petitions is that, the first petitioner in support of his application in I.A.No.1 for waiving the condition of pre-deposit has filed a supporting affidavit dated 25.07.2016, and paragraph 8 thereof reads as under: I submit that I have certain agricultural properties. There is severe restriction on the purchase of agricultural property in Karnataka by the provisions of the Karnataka Land Reforms Act. They are not easily transferable even if I intend to sell them. Even on the said agriculture property State Bank of India has obtained an injunction in a separate proceedings before the DRT, Bangalore . 26. This had appa ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
