M/S Palghat Automotives (P) Ltd. and George Kurian and Sheela George v State Bank of India

Case Details & Bench

Court: High Court of Kerala
Hon'ble Judges: C. S. Dias
Judgment Date: 2023-07-04
Court Decision / Holding: Exts. P12 and P13 are set aside. Exts. P10 and P11 are allowed. OA No. 353 of 2012 is revived. The parties are directed to appear before the Tribunal on 01.08.2023, and the petitioners may file their written statement within 30 days from appearance. The Tribunal is to consider and dispose of OA 353/2012, in accordance with law and as expeditiously as possible, by 30.09.2023.
Final Disposition: Original Petition allowed

Parties to the Case

Appellants / Petitioners

M/S Palghat Automotives (P) Ltd.
George Kurian
Sheela George

Respondents

State Bank of India, Palakkad Branch Retail Assets Small and Medium Enterprises City Credit Centre (RASMECCC), SBI Buildings, English Church Road, Palakkad – 678 014

Legal Representation & Advocates

Counsels for Petitioners

• M. Gopikrishnan Nambiar
• K. John Mathai
• Joson Manavalan
• Kuryan Thomas
• Pauloose C. Abraham
• Raja Kannan
• Asher Revi Job

Counsels for Respondents

• Shri. Jithesh Menon, SC, SBI
• C. Ajith Kumar

Case Synopsis & Summary

This Original Petition (OP) challenges Exts. P12 and P13 orders of the Debts Recovery Tribunal, Ernakulam, which dismissed Exts. P10 and P11 that sought condonation of delay and setting aside an ex parte order in OA No. 353 of 2012. The petitioners had availed a cash credit facility from the respondent bank and defaulted on instalments. The bank initiated proceedings under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI). Pursuant to the proceedings, S.A. No. 553 of 2011 was disposed of on 22.11.2012 with Ext. P2, permitting payment of the amount in instalments as per Ext. P1 award. Subsequently, OA No. 353 of 2012 was filed by the bank (Ext. P3), leading to Ext. P4 ex parte order dated 10.08.2015. The petitioners sought to set aside the ex parte order (Ext. P11) and condone a delay (Ext. P10). The Tribunal dismissed these applications via Exts. P12 and P13, which prompted the petition under Article 227 of the Constitution. The High Court found the Tribunal’s reasoning pedantic, held that the delay of 19 days had cogent reasons in Ext. P10, and invoked supervisory jurisdiction to set aside Exts. P12 and P13. The court allowed the Original Petition, set aside the Tribunal orders, revived OA 353/2012, and directed expedited proceedings with a date for appearance. Overall, the court emphasized merits over procedural default and stressed expeditious resolution of the long-pending matter.

Provisions of Law Cited

Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002Constitution of India, Article 227

Legal Doctrines & Maxims

Disposal of cases on their merit rather than on default; Courts/Tribunals should endeavour to decide cases on merits
Judicial intervention under Article 227 to correct manifest illegality or errors in orders that are pedantic or hyper-technical

Submissions & Arguments

Contentions of Appellants / Petitioners

The petitioners contended that Exts. P12 and P13 were patently erroneous and that Exts. P10 and P11 presented cogent reasons for condonation of delay and for setting aside the ex parte order. They urged that the Tribunal’s reasoning was pedantic and sought relief under Article 227 to correct the illegality and to revive OA No. 353 of 2012, ensuring timely adjudication of the long-pending matter.

Contentions of Respondents

The respondent-bank argued that the petition lacked merit and sought dismissal of the writ petition, emphasizing that the Tribunal’s orders were not illegal and that supervisory interference under Article 227 was unwarranted.

Extracted Judgment Text

Exact text extracted from official judgment records.

## IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE C.S.DIAS TUESDAY, THE 4[TH] DAY OF JULY 2023 / 13TH ASHADHA, 1945 OP (DRT) NO. 235 OF 2023 ## PETITIONER/S: 1 M/S PALGHAT AUTOMOTIVES (P) LTD., 5/428, MARUTHA ROAD, KOOTUPATHA, CHANDRA NAGAR, PALAKKAD – 678 007, REPRESENTED BY ITS MANAGING DIRECTOR GEORGE KURIAN. 2 GEORGE KURIAN, AGED 64 YEARS S/O KURIEN GEORGE, MANAGING DIRECTOR, M/S PALGHAT AUTOMOTIVES (P) LTD,5/428, MARUTHA ROAD, KOOTUPATHA, CHANDRA NAGAR, PALAKKAD – 678 007, RESIDING AT HOUSE NO. 47,VELLATHOTTAM, KOOTTUPATHA CHANDRA NAGAR, PALAKKAD - 678 007. 3 SHEELA GEORGE, AGED 60 YEARS W/O GEORGE KURIEN, DIRECTOR ,M/S PALGHAT AUTOMOTIVES (P) LTD 5/428, MARUTHA ROAD, KOOTUPATHA, CHANDRA NAGAR, PALAKKAD – 678 007. RESIDING AT HOUSE NO. 47, VELLATHOTTAM, KOOTTUPATHA CHANDRA NAGAR, PALAKKAD - 678 007. BY ADVS. M.GOPIKRISHNAN NAMBIAR K.JOHN MATHAI JOSON MANAVALAN KURYAN THOMAS PAULOSE C. ABRAHAM RAJA KANNAN ASHER REVI JOB ## RESPONDENT: STATE BANK OF INDIA, PALAKKAD BRANCH RETAIL ASSETS SMALL AND MEDIUM ENTERPRISES CITY CREDIT CENTRE (RASMECCC), SBI BUILDINGS, ENGLISH CHURCH ROAD, PALAKKAD, REPRESENTED BY ITS MANAGER, PIN – 678 014. BY ADVS. SHRI.JITHESH MENON, SC, SBI C.AJITH KUMAR THIS OP (DEBT RECOVERY TRIBUNAL) HAVING BEEN FINALLY HEARD ON 04.07.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: O.P.(DRT) NO. 235/2023 :: 2 :: ## C.S.DIAS,J. - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - O.P. (DRT) No. 235 of 2023 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Dated this the 4[th] day of July, 2023 ## JUDGMENT This Original Petition is filed challenging Exts.P12 and P13 orders passed by the Debts Recovery TribunalI, Ernakulam. 2. Short relevant facts leading to Exts.P12 and P13 orders are as follows: 2.1. The petitioners had availed a cash credit facility from the respondent Bank. They failed to pay the instalments on time. The Bank proceeded against the secured asset under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (‘Act’, in short). Subsequently, the petitioners filed S.A. No. 553 of 2011 before the Debts Recovery Tribunal, Ernakulam (‘Tribunal’) and Ext.P2 order dated 22.11.2012 was passed, permitting the O.P.(DRT) NO. 235/2023 :: 3 :: petitioners to pay the amount as per Ext.P1 award in instalments. 2.2 Again, the petitioners could not re-pay the amount on time. The Bank filed O.A. No. 353 of 2012 before the Tribunal to realise the amount covered by Ext.P2 order. Subsequently, the petitioners were set ex parte and Ext.P4 order was passed by the Tribunal on 10.08.2015. 2.3. In order to set aside the ex parte order, the petitioner filed Ext.P11 application along with Ext.P10 application to condone the delay. 2.4. The Tribunal, by the impugned Exts.P12 and P13 orders, dismissed Exts.P11 and P10, respectively. 2.5. Exts.P12 and P13 are manifestly wrong and erroneous. Hence, the Original Petition. 3. The respondent has filed a counter affidavit inter alia denying the assertions in the Original Petition. The respondent has contended that the petitioners have not made out any valid ground to invoke the supervisory O.P.(DRT) NO. 235/2023 :: 4 :: jurisdiction of this Court under Article 227 of the Constitution of India. The writ petition is meritless and may be dismissed. 4. Heard Sri. M. Gopikrishnan Nambiar, the learned counsel for the petitioner and Sri. C. Ajith Kumar, the learned counsel for the respondent. 5. The short point that arises for consideration is, whether there is any illegality in Exts.P12 and P13 orders. 6. Indisputably, the petitioners were set ex parte and Ext.P4 order was passed. The petitioners filed Exts.P10 and P11 applications, respectively to condone the delay and set aside the ex parte order. 7. The petitioners have averred reasons in Ext.P10 application to condone the delay of 19 days in filing Ext.P11 application. 8. The Tribunal, by the impugned Ext.P13 order, has concluded that the petitioners have not satisfactorily explained the delay of 19 days to file Ext.P11 application. O.P.(DRT) NO. 235/2023 :: 5 :: Consequently, the Tribunal has dismissed Exts.P10 and P11 applications. 9. I find that the reasoning of the Tribunal to be pedantic and hyper-technical. 10. It is trite; the Courts/Tribunal shall make every endeavour to dispose of the cases on its merit, rather than on default. 11. A reading of the elaborate assertions in Ext.P10 application, I find that the petitioners have stated reasons to condone the delay of 19 days in filing Ext.P11 application, to be quite cogent and sufficient. Consequently, I am of the view that Exts.P12 and P13 orders are erroneous and wrong and, therefore, liable to be interfered with by this Court by exercising the supervisory powers under Article 227 of the Constitution of India. Resultantly, I allow the Original Petition as follows: - i. Exts.P12 and P13 orders are set aside. ii. Exts.P10 and P11 applications are allowed. O.P.(DRT) NO. 235/2023 :: 6 :: iii. O.A. No. 353 of 2012 is revived back to file. - iv. The parties are directed to appear before the Tribunal on 01.08.2023. - v. The petitioners may file their written statement, if so - adivised, within 30 days from the date of appearance. - vi. As the Original Application is of the year 2012, the Tribunal is directed to consider and dispose of the same, in accordance with law and as expeditiously as possible, at any rate, on or before 30.09.2023. sd/C.S.DIAS, JUDGE. Rv O.P.(DRT) NO. 235/2023 :: 7 :: ## **A PPENDIX OF OP (DRT) 235/2023** ## PETITIONERS’ EXHIBITS: - Exhibit P1 TRUE COPY OF THE AWARD DATED 10.12.2011 IN S.A 553 OF 2011 BEFORE THE DEBT RECOVERY TRIBUNAL, ERNAKULAM - Exhibit P2 TRUE COPY OF THE ORDER DATED 22.11.2012 PASSED BY THE DEBT RECOVERY TRIBUNAL, ERNAKULAM IN S.A NO. 535 OF 2012 - Exhibit P3 TRUE COPY OF THE O.A NO. 353 OF 2012 DATED 16.08.2012 FILED BY THE RESPONDENT BANK - Exhibit P4 TRUE COPY OF THE ORDER DATED 10.08.2015 PASSED BY THE DEBT RECOVERY TRIBUNAL, ERNAKULAM IN O.A NO. 353 OF 2012 - Exhibit P5 TRUE COPY OF THE AFFIDAVIT DATED 17.02.2018 FILED BY THE RESPONDENT BEFORE THE DEBT RECOVERY TRIBUNAL, ERNAKULAM IN O.A NO. 353 OF 2012 - Exhibit P6 TRUE COPY OF THE STATEMENT OF ACCOUNTS DATED 24.07.2013 ISSUED BY THE RESPONDENT BANK PERTAINING TO THE LOAN ACCOUNT BEARING NO. 30875959229 - Exhibit P7 TRUE COPY OF THE STATEMENT OF ACCOUNTS DATED 24.07.2013 ISSUED BY THE RESPONDENT BANK PERTAINING TO THE LOAN ACCOUNT BEARING NO. 30875925347 - Exhibit P8 TRUE COPY OF THE STATEMENT OF ACCOUNTS DATED 19.10.2015 ISSUED BY THE RESPONDENT BANK PERTAINING TO THE LOAN ACCOUNT BEARING NO. 30875959229 - Exhibit P9 TRUE COPY OF THE STATEMENT OF ACCOUNTS DATED 19.10.2015 ISSUED BY THE RESPONDENT BANK PERTAINING TO THE LOAN ACCOUNT BEARING NO. 30875925347 - Exhibit P10 TRUE COPY OF THE APPLICATION BEARING NO. M.A NO. 4 OF 2015 DATED 17.11.2015, FILED BY THE PETITIONERS IN EXHIBIT P3 PROCEEDINGS - Exhibit P11 TRUE COPY OF THE APPLICATION BEARING NO. M.A NO. 3 OF 2015 DATED 17.11.2015, FILED BY THE PETITIONERS IN EXHIBIT P3 PROCEEDINGS - Exhibit P12 TRUE COPY OF THE ORDER DATED 8.05.2023 O.P.(DRT) NO. 235/2023 :: 8 :: PASSED BY THE DEBT RECOVERY TRIBUNAL, ERNAKULAM IN M.A NO. 3 OF 2015 IN O.A NO. 353 OF 2012 Exhibit P13 TRUE COPY OF THE ORDER DATED 8.05.2023 PASSED BY THE DEBT RECOVERY TRIBUNAL, ERNAKULAM IN M.A NO. 4 OF 2015 IN O.A NO. 353 OF 2012 ## RESPONDENTS’ EXHIBITS: NIL _True Copy_ rv P.S To Judge.