S KUMAR Vs. INDIAN BANK

JUDGEMENT

(1.) THE respondent Bank filed suit before the High Court and then transferred to City Civil Court, Chennai, in OS No. 10289/96 against the appellants/defendants for recovery of a sum of Rs. 6.90,837.32 p together with interest and costs and the defendants were set ex pane and the suit was decreed with costs as prayed for, on 8.10. 1 996 by the City Civil Court. Chennai. THE petitioners did not file any petition for setting aside the ex pane decree. After the Recovery of Debts Due to Banks and Financial Institutions (RDDB&FI) Act (the Act) came into force, as the amount due from the defendants was more than Rs. 10 lakhs, the Bank filed OA before DRT, Chennai, for issue of Recovery Certificate. THE Tribunal issued Recovery Certificate for a sum of Rs. 16,33,433/- together with future interest by order dated 7.12.2000 stating that no notice is required to be issued to the defendants under Section 31 (A). THE defendants filed the IA to re-open the OA staling that the summons were received to appear before the Tribunal on 22.12.2000 but the defendants' Counsel was informed that the OA was already disposed of on 7.12.2000 and the defendants are having valid grounds to defend their case and hence the petition must be allowed to reopen the OA.

(2.) The respondent Bank filed counter contending that no notice is required to be issued to the defendants under Section 31 (A) and since the amount exceeded Rs. 10 lakhs it is not necessary to file any final decree application before the Court which passed the preliminary decree and the petition is not maintainable and it is liable to be dismissed. The PO, DRT-II heard that petition and dismissed that petition. That order is challenged in this appeal.

(3.) IN the above said decisions the High Court has held that application for passing final decree after expiry of thee years cannot be maintained. The matter was pending in the City Civil Court. The Bank filed OA for issue of Recovery Certificate after the RDDB&FI Act came into force. The Act came into force on 24.6.1993. Decree was passed by the City Civil Court on 8.10.1996. After the passing of the RDDB&FI Act, all matters pending before the Civil Courts for the value of Rs. 10 lakhs and above are to be transferred to the DRTs as per Section 31 of the Act. The ex pane decree was passed by the City Civil Court on 8.10.1996 and the appellants did not take any steps to set aside the exparte decree in the Civil Court and that decree was transferred to the DRT under the provisions of the Act. Section 31A empowers the Tribunal to issue certificate of recovery in case of decree or order. Where a decree or order is passed by any Court before the commencement of the RDDB&FI (Amendment) Act, 2000 and has not yet been executed, then the decree holder may apply to the Tribunal to pass an Order for recovery of the amount and on receipt of that application under Section 31 A(1), the Tribunal may issue a certificate for recovery to a Recovery Officer. On receipt of a certificate under Section 31A(2), the Recovery Officer shall proceed to recover the amount as if it was a certificate in respect of a debt recoverable under this Act. By virtue of the power conferred on the Tribunal under Section 31 A, the Tribunal issued a Recovery Certificate on 7.12.2000. The Tribunal has also ordered issue of notice to the appellants directing the appellants to appear before the Tribunal on 22.12.2000 but passed the Order on 7.12.2000 itself issuing Recovery Certificate.