Decided on October 14,2005

T. Padmavathy Appellant
Western Exports India Pvt. Ltd. And Anr. Respondents


K.Gnanaprakasam, J. (Chairperson) - (1.) THIS is an Appeal filed by the Auction Purchaser. That in respect of the amount due by the 1st respondent to the 2nd respondent, the 2nd respondent Bank namely Indian Overseas Bank, instituted a suit in the High Court of Madras, and the suit was subsequently transferred to the DRT, Chennai and the same was taken on file as TA -51/1997, and the said application was decreed in favour of the Bank on 10.11.1997. As the 1st respondent did not pay the decretal amount, Recovery Certificate was issued and the property of the guarantor was brought to sale in 2000. At that time, the 1st respondent filed writ petition before the Madras High Court to set aside the order of the respondent Bank rejecting their request for settlement based upon the guidelines issued by the Reserve Bank of India (RBI) and for a direction to the Bank to implement the guidelines issued by the RBI. During the pendency of the writ petition, the High Court granted stay on condition that the 1st respondent should deposit 25% of the decree amount and the same was not. complied with. That, thereafter, the property was brought to sale in the Public auction held on 22.1.2002 and the appellant became the successful bidder and she had deposited a sum of Rs. 20 lakh as per the auction conditions. The 1st respondent filed writ petition before the High Court for stay of the confirmation of sale and the High Court by its order dated 30.1.2002, granted stay on condition that, the writ petitioner should deposit a sum of Rs. 27 lakh within a period of one week and the same was complied. The auction purchaser impleaded herself in the writ proceedings and filed an application to vacate the interim stay and the High Court dismissed to vacate stay petition on the ground no case made out and that the 1st respondent have also complied with interim order. The auction purchaser was given liberty to take back the amount deposited by her. However, during the pendency of the writ proceedings, the 1st respondent settled the matter with the 2nd respondent Bank and wanted to withdraw the writ petition and the same was opposed by the auction purchaser. Ultimately, the High Court by its order dated 14.2.2003 had disposed of the writ petitions and writ Miscellaneous Petitions by observing that, "It is for the forum constituted under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, to decide all other controversies or other disputes in respect of the proceedings before it as well as subsequent auction sale and purchase and it is open to the parties to work out whatever remedies available to them in law in respect of the auction sale." Based upon the said order, the 1st respondent filed IA -130/2003 to stay all further proceedings in DRT No. 123/2001 with the Recovery Officer -I, and IA -131/2003 to withdraw the Recovery Certificate issued in DRC -123/2001 and to dismiss the TA -144/2001 as settled. The Bank also filed a Memo dated 9,5.2003 for recording full satisfaction of the amount received, namely Rs. 38 lakh, The learned Presiding Officer had taken that Memo on record and also recorded full satisfaction. DRC -123/2001 was also directed to be terminated. The Recovery Officer was also directed to terminate all further proceedings in DRC -123/2001. Aggrieved by the same, the auction purchaser has preferred this appeal. Heard the learned Advocate for the appellant and respondents.
(2.) THE points for consideration that arise in this appeal are: (1) Whether the Presiding Officer of the DRT has power to recall the Recovery Certificate after having issued, on the ground that the matter was settled between the Creditor Bank and the Borrower. (2) Are not the Bank and the borrower/guarantor entitled to settle the matter after the issuance of the Recovery Certificate Points 1&2 The learned Advocate for the appellant had straightaway taken me to Section 26 of the RDDB & FI Act, 1993, which deals with validity of certificate and amendment thereof, which runs as under: (1) It shall not be open to the defendant to dispute before the Recovery Officer the correctness of the amount specified in the certificate and no objection to the certificate on any other ground shall also be entertained by the Recovery Officer. (2) Notwithstanding the issue of a certificate to a Recovery Officer the Presiding Officer shall have power to withdraw the certificate or correct any clerical on arithmetical mistake in the certificate by sending an intimation to the Recovery Officer. (3) The Presiding Officer shall intimate to the Recovery Officer any order withdrawing or cancelling a certificate or any correction made by him under Sub -section (2). Sub -clause (2) of Section 26 of the 'Act' empowers the Presiding Officer to withdraw the certificate or correct any clerical or arithmetical mistake in a certificate by sending an intimation to the Recovery Officer, and this could be done even after the issuance of the certificate. As such, the power and authority of the Presiding Officer to withdraw the recovery certificate cannot at all be disputed. But the contention of the appellant, that it could be withdrawn only to carry out the correction of any clerical or arithmetical mistakes in the certificate and not for any other purpose. That in order to support his submission, the appellant relied upon purpose. That in order to support his submission, the appellant relied upon the case of Dwaraka Das v. State of M.P. and Anr. II . That judgment deals with the powers of the Civil Court under Sections 152 and 151 CPC : 6. Section 152, CPC provides for correction of clerical or arithmetical mistakes in judgments, decrees or orders of errors arising therein from any accidental slip or omission, the exercise of this power contemplates the correction of mistakes by the Court of its ministerial actions and does not contemplate of passing effective judicial orders after the judgment, decree or order. The settled position of law is that after the passing of the judgment, decree or order, the Court or the Tribunal becomes functus officio and thus being not entitled to vary the terms of the judgments, decrees and orders earlier passed.
(3.) IT is the contention of the appellant that the learned Presiding Officer having passed an order by issuing a recovery certificate to the Recovery Officer, has no right to recall or withdraw the said certificate as he has become functus officio. The appellant also relied upon the case of Premier Automobiles Ltd., Bombay v. Kabirunissa and Ors. 1991 Supp. (2) SCC 282. That case deals with the powers of the Civil Court under Order 47 Rule 27 only. In that case, "During the pendency of the appeal before the appellant Court, an application for admitting additional evidence under Order 41 Rule 27, of the Code of Civil Procedure was filed by the appellants, which remained undisposed of. Even while pronouncing its judgment disposing of the appeal finally, the appellant Court did not advert to it. It was only after the case was disposed of that the application for additional evidence was rejected by a short order, observing that the appellants had sufficient opportunity to produce the documents in the Trial Court, and it had failed to do so." In those circumstances, it was held that after the appeal had been finally disposed of, the appellate Court had become functus officio. Appellant also relied upon the case of Hari Singh Mann v. Harbhajan Singh Bajwa and Ors. (2001) 1 SCC 169. That case arose under criminal proceedings and the same has no relevance to the facts of our case. Appellant also relied upon the case of State of Punjab v. Darshan Singh , which deals with the power of the Court under Section 152 of the CPC, The appellant also relied upon the case of Subhadra Ranipal Choudhary v. Sheirly Wergal Nain and Ors. , which is of no help to decide the issue involved in this matter. Appellant also relied on the case of Babu Khan and Ors. v. Nazim Khan (Dead), by LRs and Ors. . The facts in the said case deal with regard to the dispossession of a tenant and it has no application to the case on hand. The appellant also relied upon the case of Union of India and Anr. v. Paras Laminates (P) Ltd. , which deals with the powers of the Administrative Tribunal Act, 1985, and also the precedents. It was observed, "There is, doubt that the Tribunal functions as a Court within the limits of its jurisdiction. It has all the powers conferred expressly by the statute. Furthermore, being a judicial body, it has all those incidental and ancillary powers which are necessary to made fully effective the express grant of statutory powers. Certain powers are recognised as incidental and ancillary, not because they are inherent in the Tribunal, nor because its jurisdiction is plenary, but because it is the legislative intent that the power which is expressly granted in the assigned field of jurisdiction is efficaciously and meaningfully exercised. The powers of the Tribunal are no doubt limited. Its area of jurisdiction is clearly defined, but within the bounds of its jurisdiction, it has all the powers expressly and impliedly granted. The implied grant is, of course, limited by the express grant and, therefore, it can only be such powers as are truly incidental and ancillary for doing all such acts or employing all such means as are reasonably necessary to make the grant effective." This decision supports the case of the 1st respondent.;

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