INDIAN OVERSEAS BANK Vs. U T I BANK LTD
LAWS(DR)-2006-11-4
DEBTS RECOVERY APPELLATE TRIBUNAL
Decided on November 27,2006

Appellant
VERSUS
Respondents

JUDGEMENT

K.Gnanaprakasam, - (1.) THIS miscellaneous appeal is directed as against the order dated 24th March, 2006, passed in I.A. No. 92 of 2006 in Original Application No. 137/2004, by the D.R.T.-I at Chennai. I have heard the learned Advocate for the appellant and the respondent No. 1.
(2.) The learned Advocate for the appellant submitted that they have filed the Original Application No. 610/1998 before the D.R.T.-I, Chennai, for the recovery of the amount due by the borrowers and the said Original Application was decreed on 25th September, 2000. Subsequently, due to the formation of D.R.T.-II, Chennai, it was transferred to D.R.T.-II and re-numbered as Original Application No. 2021/2001 for further proceedings. The appellant brought the property for sale and the sale was scheduled to be held on 27th February, 2006. It is stated that respondent No. 1 has filed Original Application 137/2004 before the D.R.T.-I, and the same is pending. The respondent No. 1 had approached the High Court, Madras, challenging the auction sale notice in Original Application No. 2021/2001 on the file of D.R.T.-II at Chennai, and the High Court by its order dated 1st March, 2006, has observed, "According to the petitioner, respondent Nos. 4 and 5 borrowed certain loans from the petitioner by mortgaging the assets which have now been brought for sale through the respondent No. 6 (Recovery Officer, D.R.T.-II) at the instance of the respondent No. 1 (Indian Overseas Bank). The petitioner also stated to have preferred a suit in Original Application No. 137 of 2004, which is stated to be pending on the file of D.R.T.-I, Chennai. Therefore, even if the sale effected by the respondent No. 6 fructifies, the petitioner can always seek for appropriate remedy either in the Original Application preferred by it or in the D.R.T. proceedings pending on the file of the respondent No. 6 who can validly decide, as to which of the claims namely either of the petitioner or of the respondent No. 1 to take precedence in the matter of disbursement of sale proceeds". The respondent No. 1 moved the D.R.T.-I, for stay of the sale and the D.R.T.-I by its Order dated 24th March, 2006 granted stay of sale of the property by Recovery Officer, D.R.T.-II, until further orders and the same is challenged in this appeal. It is the contention of the learned Advocate for the appellant that they have filed the Original Application in the year 1998, and got a decree in 2000, and the same was not challenged further and, therefore, the order passed in the Original Application has reached finality. Pursuant to the same, proceedings were taken to bring the property for sale. But whereas, the respondent No. 1 filed the Original Application only in the year 2004, and moved the High Court for stay of the sale and the High Court directed the respondent No. 1 to seek its remedy either in its Original Application or in the D.R.T. proceedings pending on the file of D.R.T.-II. No doubt, an option has been given to the respondent No. 1 to work out its remedy either in its Original Application or in the proceedings pending on the file of D.R.T.-II at Chennai. But the respondent No. 1 knows its remedy, which is available either under Section 19(2) of the RDDBFI Act, 1993, or it could very well make its claim before the Recovery Officer as provided under Rule 11 of the Schedule II (Procedure for Recovery of Tax) of the Income-tax Act, 1961. The respondent No. 1 has not chosen to do so.
(3.) ON the contrary, the learned Advocate for the respondent No. 1 would submit that the borrowers of the appellant have mortgaged the very same property to them and they are in possession of the necessary documents also. They moved the High Court only when they came to know that the appellant was bringing the property for sale and the High Court by its order dated 1st March, 2006, has given the option to work out its remedy either in its Original Application or in the D.R.T. proceedings pending on the file of D.R.T.-II at Chennai. It is also stated that they have sent a letter to the Recovery Officer, D.R.T.-II, on 1st February, 2006, protesting the sale to be held and also requested that their claim may be registered in its record.;


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