- (1.) This writ petition has been filed by Kirti Kapoor and four others, challenging the validity of notification dated 06.09.2018 issued by the Central Government, Ministry of Finance (Department of Financial Services), New Delhi. Prayer has been made to quash and set aside the aforesaid notification and pass any other order as may be deemed fit and proper in the facts of the case. The Central Government has issued the aforesaid notification invoking its power under sub-section (4) of Section 1 of the Recovery of Debts due to Banks and Financial Institutions Act, 1993 (for short, 'the Act of 1993'), thereby raising the threshold pecuniary limit of ten lakh rupees to twenty lakh rupees for filing application for recovery of debts in the Debts Recovery Tribunal by banks and financial institutions. The notification has provided that the provisions of the Act of 1993 shall not be attracted where the amount of debt due to any bank is less than twenty lakh rupees.
(2.) Ms. Anita Aggarwal, learned counsel for petitioners, submitted that as per the provisions of Section 1(4) of the Act of 1993, the provisions of the said Act are not applicable where the amount of debt due to any bank or financial institution etc. is less than ten lakh rupees or such other amount, being not less than one lakh rupees, as the Central Government may, by notification, specify. A plain reading of this provision reveals that while the provisions of the Act of 1993 shall be applicable to debts of ten lakh rupees and above but the Central Government with a view to bring more cases in the domain of the Debts Recovery Tribunal, can reduce the amount of ten lakh rupees to one lakh rupees but it has no authority to increase the amount of ten lakh rupees to any higher amount. Relying on the judgment of the Supreme Court in Union of India and Another Vs. Delhi High Court Bar Association and Others - (2002) 4 SCC 275, learned counsel argued that the Supreme Court therein held that for the disputes between the banks and the other parties, the jurisdiction of the Tribunal in a debt claim of more than ten lakh rupees may be attracted but if it is less than ten lakh rupees, the ordinary civil court would have the jurisdiction. But the Central Government by the impugned notification has now created a situation where the claims of more than ten lakh rupees, upto twenty lakh rupees, would be excluded from the purview of the Debts Recovery Tribunal and sent to the Civil Courts. Relying on the judgment of Division Bench of the Allahabad High Court in Mudit Entertainment Industries Vs. Banaras State Bank Ltd. and Others - 2000 (2) AWC 1008 : (2000) 1 UPLBEC 25, learned counsel argued that the High Court on interpretation of Section 1(4) of the Act of 1993 held that having regard to the contingency, debts less than ten lakh but more than one lakh can be included within the purview of the Tribunal. It is thus evident that the authority has been conferred on the Central Government to only reduce the amount of claim from ten lakh rupees downwards but with a rider that such reduction in the amount shall not be less than one lakh rupees. Ms. Anita Aggarwal, learned counsel for the petitioners, submitted that imperativeness of enactment of the Act of 1993 also finds adequately reflected in the judgment of the Supreme Court in United Bank of India Vs. Debts Recovery Tribunal - (1999) 4 SCC 69. It is submitted that the prime object of the enactment appears to be to provide for the establishment of tribunals for expeditious adjudication and recovery of debts due to banks and financial institutions and for matters connected therewith or incidental thereto. A purposive construction and interpretation of the Statute has to be therefore made so as to advance the purpose of the enactment and intention of the legislature. Reliance in this connection is placed on the judgments of the Supreme Court in RMD Chamarbaugwala Vs. Union of India - AIR 1957 SC 628 and Competition Commission of India Vs. Steel Authority of India Ltd. - (2010) 10 SCC 744. It is argued that a plain reading of the provisions of Section 1(4) of the Act of 1993 does not admit of an interpretation, by which the amount of ten lakh rupees can be raised to twenty lakh rupees, without amending the Act, merely by notification of the Central Government. Doing so would be acting contrary to the intention of the Parliament in providing speedy trial, disposal of such claim cases and would result in throwing away the cases falling from the range of ten lakh rupees to twenty lakh rupees, in the arena of civil courts/commercial courts having applicability of principles of Civil Procedure Code which is a long and tardy procedure. It would be the anti-thesis, retrograde move defeating the very object of the Act of 1993. Even if there are two views possible on interpretation of Section 1(4) of the Act of 1993, the Court has to choose such interpretation which fulfills the object of the Act. The argument advanced on behalf of the Central Government that the limit of ten lakh rupees has been increased to twenty lakh rupees on account of fall in intrinsic value of rupee due to inflationary pressure on the economy cannot find any countenance and justification for raising this limit. This would tantamount to legislation which is quite impermissible. In case the Central Government intends to do so, the same cannot be done only by amending the provisions of Section 1(4) of the Act of 1993. Reliance in this behalf is placed on the judgment of the Government of Andhra Pradesh and Others Vs. P. Laxmi Devi - (2008) 4 SCC 720.
(3.) Ms. Anita Aggarwal, learned counsel for the petitioners, argued that mere use of punctuation marks in between the words "less ten lakh rupees or such other amount" and "being not less than one lakh rupees" would not give jurisdiction to the Central Government to increase the limit of ten lakh rupees to twenty lakh rupees. Learned counsel relied on the judgment of the Allahabad High Court in L. Mansa Vs. Mt. Ancho - AIR 1933 All. 521, wherein it was held that punctuation marks cannot control the meaning of a section. Intention of the legislature in the present case has to be gathered from the plain reading of the provision. Reliance is also placed on the judgment of the Supreme Court in Central Bank of India Vs. State of Kerala & Others - (2009) 4 SCC 94, wherein it has been held that the sole criteria of enactment of the Act of 1993 and the establishment of the Debts Recovery Tribunals has been to ensure expeditious recovery of the bank debts. It is argued that the Supreme Court in State of West Bengal and Others Vs. Swapan Kumar Guha and Others - (1982) 1 SCC 561 held that it would be safer and more satisfactory to discover the true meaning of the clause by having regard to substance of the matter as it emerges from the object and purpose of the Act, the context in which the expression is used. The DRT was established with a view that industrialization was growing in India and with growing economy the problem of defaults in repayment of bank loans was also increasing and legislature wanted to provide a speedier mechanism for recovery of bank dues, since the Civil Courts were already flooded with other civil disputes. It is argued that the Supreme Court in the State of Rajasthan Vs. Basant Nahata - (2005) 12 SCC 77 held that the delegation of power to the legislature cannot be wide, uncanalised or unguided. If the interpretation of the words "or such other amount" is taken that any amount more than ten lakh rupees can be taken as the threshold limit, it would amount to giving uncanalised, unguided power to the delegate and would also amount to delegating the essential legislative functions. Reliance is placed on the judgment of the Supreme Court in State of Bombay Vs. Narottam Das Jethabhai and Another - AIR 1951 SC 69, wherein the Bombay High Court, while interpreting Sections 3 and 4 of the Bombay City Civil Court Act, 1948 held that the legislation entrusted on the provincial government particular powers or a limited discretion and the discretion can be exercised within defined limits of it. It was further observed that the policy of the legislature in regard to the pecuniary jurisdiction of the court that was being set up was settled by Sections 3 and 4 of the Act and it was to the effect that initially its pecuniary limit is ten thousand and in future if the circumstances make it desirable and this was left to the determination of the provincial government, it could be given jurisdiction upto the value of twenty five thousand rupees. In the present matter, the legislature itself has decided the maximum pecuniary jurisdiction by providing that no cases less than ten lakh debt shall be entertained by the Tribunal or such other amount, being not less than one lakh rupees, as the central government may, by notification, specify. It is argued that although Section 1(4) of the Act of 1993 does not suffer from vice of excessive delegation since the legislature has clearly provided the limits in which the discretion can be exercised by the Central Government, the interpretation given to it by the Central Government brings Section 1(4) within the ambit of excessive delegation, thus making it bad and amenable to challenge on such ground.;