Decided on March 27,2003

GLENNY Appellant


Jawahar Lal Gupta, C.J. - (1.) Do the provisions of Recovery of Debts Due to Banks and Financial Institutions Act, 1993, debar the Civil Court from setting aside an ex parte decree passed by it? This is the short question that arises in this appeal. In view of the conflict in judicial opinion, the Division Bench has referred this case to a Full Bench. A few facts as relevant for the decision of this case may be briefly noticed.
(2.) On 11/05/1994 the appellant took a loan of an amount for Rs. 3,34,000 from the respondent bank. He failed to repay. On 27/10/1998 the bank filed a suit for the recovery of Rs. 8,61,530 with interest. The suit was filed in the Court of the Sub Judge at Thrissur. On 16/06/2000 the Court passed an ex parte decree. The bank s claim was allowed with interest at the rate of 18 per cent per annum from 27/10/1988 till realization. The bank was also held entitled to its costs. The decree was for an amount of more than Rs.11 lakhs, On 28/08/2000 the bank filed a petition, viz. O.A. No.258 of 2000 before the Debts Recovery Tribunal, Ernakulam, for the recovery of the amount. After more than six months, on 23/03/2001, the appellant filed an Interlocutory Application No. 1391 of 2001, before the sub Court, Thrissur under Order 9, Rule 13, C.P.C. He prayed that the ex parte decree be set aside. On 22/10/2001 the trial Court dismissed the application. It held that in view of the provisions of Sections 18, 22(g) and 31 of the Act, it had no jurisdiction to entertain the application. On February 7, 2002 the appellant filed the present appeal. The matter was posted before a Division Bench. On August 13, 2002 the case was referred to a Full Bench. Thus, the matter has been placed before this Bench.
(3.) Ms.Seemanthini, Learned Counsel for the appellant contended that the Debts Recovery Tribunal was established for the State of Kerala on 4/11/1996. The suit was filed almost two years later. The claim in the suit was for an amount of less than Rs.10 lakhs. Consequently the suit did not fall within the jurisdiction of the Tribunal. Thus, the Civil Court had entertained it. On 10/02/1999 the trial Court had passed an order for ex parte proceedings. Ultimately the ex parte decree was passed on 16/06/2000. Since the suit had been rightly instituted before the Civil Court and the ex parte decree had been passed after the appointed day, only the Court, which has tried the suit could have set aside the ex parte decree. On the other hand, Mr. Varghese Kuriakose, learned Counsel for the respondent bank contended that the Decree passed by the Civil Court was for one more than Rs. 11 lakhs. A claim for such an amount was beyond the jurisdiction of the civil Court. In view of the provisions of Sections 18, 22(g) and 31 of the Act, the petitions for execution or for the setting aside of the decree, could be filed before the Tribunal only. On this basis, the Counsel contended that the order passed by the learned trial Court is absolutely legal and valid. Learned Counsel for both sides placed reliance on various decisions. These shall be noticed at the appropriate stage.;

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