INDUSTRIAL DEVELOPMENT BANK OF INDIA Vs. EXPORT IMPORT BANK OF INDIA

JUDGEMENT

(1.) ORDER Pratibha Upasani, 1. This misc. Appeal is filed by the appellants/original defendant No. 3 Industrial Development Bank of India (for a sake of brevity hereinafter to be referred to as IDBI) being aggrieved by the order dated 15.1.2004 passed by the learned Presiding Officer of Debts Recovery Tribunal-I, Mumbai in Appeal No. 11 of 2003 in Recovery Proceedings of 29 of 2001 in Original Application No. 2268 of 2000. By the impugned order, the learned Presiding Officer dismissed the appeal filed by the appellants. The said appeal had been filed by the appellants being aggrieved by the order passed by the Recovery Officer of the said Tribunal below Exhibit No. 92 in Recovery Proceedings No. 29 of 2001 rejecting appellant's contention that the plant and machinery in question were movables and, therefore, the appellants had pari passu charge on the said plant and machinery and they were entitled to share the net sale proceeds thereof.

(2.) Few facts, which are required to be stated and for which there is no dispute, are as follows: The appellants IDBI has filed Original Application No. 2632 of 2000 before the Debts Recovery Tribunal-II, Mumbai against the respondent No. 2 Eastern Overseas Limited (for the sake of brevity hereinafter to be referred to as the Company) wherein the respondent No. 1 Export Import Bank of India (for the sake of brevity hereinafter to be referred to as Exim Bank) were defendant No. 4. The Exim Bank had also filed Original Application No. 2268 of 2000 against the very same respondent No. 2 i.e. the Company before the said Tribunal and both these original applications namely one filed by the IDBI as well as one filed by Exim Bank against the said respondent No. 2, the company came to be decreed. Immovable properties of the respondent No. 2, the company, were mortgaged with the respondent No. 1 Exim Bank exclusively, whereas the IDBI and Exim Bank had pari passu charge on the movables of the respondent No. 2, the company. After the recovery certificate was issued in favour of the Exim Bank, recovery proceedings bearing R.P. No. 29 of 2001 came to be initiated, in which the immovable properties along with plant and machinery were put to sale as a one lot and movables were sold as a different lot. When the process of sale was going on, IDBI had filed an application before the Recovery Officer to sell the plant and machinery as different lot contending inter alia that it was movable property, over which they had pari passu charge and therefore they were entitled to share the sale proceeds of the same. Somehow or the other the said application was not prosecuted by the IDBI. In the meanwhile, after making four different efforts, the sale was concluded in which the plant and machinery were sold as one lot and rest of the movables were sold as different lot. It was thereafter that the IDBI moved application before the Recovery Officer that they were entitled to share sale proceeds of the plant and machinery. The said application was opposed by the Exim Bank on the ground that the application given by the IDBI to treat the plant and machinery as a different lot was never prosecuted by them, that the said plant and machinery was sold along with the land building treating it as immovable property, that all this was done within the knowledge of the IDBI and that the IDBI did not press for selling the plant and machinery as different lot, despite giving such application because even the IDBI was aware that it was part and parcel of the immovable property and could not have been sold separately. It was also denied that the plant and machinery was movable property and could have been sold separately. It was reiterated that it was very much an immovable property which was mortgaged with them and that IDBI has no share in the same.

(3.) I have heard Mr. Rishabh Shah along with Mr. Sunil Shukla appearing for the appellants so also Mr. Kevic Setalwad appearing for the respondent No. 1 Exim Bank. I have also gone through the entire proceedings including the order passed by the Recovery Officer, one passed by the learned Presiding Officer, which is impugned in this appeal and the relevant case law cited by both the parties at the bar and in my view, the impugned order has been correctly passed.