The Lucknow Bench of the Allahabad High Court has ordered a Central Bureau of Investigation (CBI) probe against the then Presiding Officer of the Debt Recovery Tribunal (DRT) Lucknow.
A Single Bench of Justice Pankaj Bhatia passed this order while hearing a petition filed by Bank Of Baroda, A Body Corporate, Barabanki Through its Authorized Officer, Vinay Agrawal.
The controversy involved in the petition under Article 227 of the Constitution of India is the conduct of the Presiding Officer of the DRT, Lucknow has conducted the proceedings with material irregularities just prior to his retirement. A shadow is cast upon the orders dated 18.09.2024 and 22.04.2024 passed by the Tribunal.
The submission of the counsel for the petitioner that the Presiding Officer of the DRT did not sit on 18.09.2024, the date on which order was passed on 18.09.2024, which is on record and subsequently to hide the irregularities a corrigendum order dated 27.09.2024 was passed by the Presiding Officer indicating that the order dated 18.09.2024 be read as order dated 24.09.2024.
It is further argued by the petitioner that the order dated 27.09.2024 was never on record and was subsequently introduced, which is established as per them based upon the certified copy of the entire records obtained by the petitioner and was made available to them on 23.10.2024, which does not contain the order dated 27.09.2024.
It is further pleaded that in the cause list on 24.09.2024, the case was never listed for pronouncement of orders. In the light of these discrepancies, it is proposed to be argued that the order dated 18.09.2024 was not passed in a bona fide manner and mala fides have been alleged against the Presiding Officer of the DRT Lucknow.
Counsel on behalf of the respondent on the other hand insists that the order dated 18.09.2024, which is the bone of contention, on its merits, does not require any interference and is in consonance with the mandate of provisions of SARFAESI Act.
It is further argued that merely if there were some irregularities in pronouncement of the order, the said order would not ipso facto be treated as an illegality, which can be checked by the Court in exercise of power under Article 227 of the Constitution of India.
The Court noted that,
In the light of the conflicting submissions made with regard to the manner of passing of the order dated 18.09.2024, the Court by order dated 18.11.2024 had directed to summon the original record in a sealed cover to be submitted by the Registrar, DRT Lucknow and a report of the Registrar was also called with regard to the fact that whether the order dated 18.09.2024 was dictated to the Private Secretary/Stenographer by the Presiding Officer.
A report has been submitted on November 21 indicating that the order dated 18.09.2024 passed by the Presiding Officer/Tribunal was to be read as 24.09.2024 in terms of the corrigendum order dated 27.09.2024 passed by the then Presiding Officer, as per the record.
It further records that as per the information given by the NIC team of the Tribunal the order dated 18.09.2024 was uploaded on 27.09.2024 on the e-portal. It was also mentioned in the said report that on account of inadvertence the order dated 27.09.2024 could not be uploaded on the e-DRT portal, and the said order remains part of the record of the file. The order dated 27.09.2024, on perusal of the record is found on record in the order sheets.
The second part of the report submitted by the Registrar, DRT Lucknow is that on enquiry form the Stenographer diary, regarding dictation of the order dated 18.09.2024, comments were sought from the Private Secretary and from the comments received from him, it is informed that no dictation was taken by the Private Secretary/Stenographer in respect of final order dated 18.09.2024 from the then Presiding Officer.
It further records that the corrigendum order dated 27.09.2024 was taken under dictation by the Stenographer working on the outsource basis. It further records that the Presiding Officer superannuated on 27.09.2024 on completion of his tenure.
The Court said that,
The DRT Act was enacted in the year 1993 for setting up a special mechanism for recovery of the financial dues and in terms of the difficulties faced by the Banks and Financial Institutions, the Tribunals were set up with an aim to enhance and fulfill the need for expeditious recovery of the banking dues. A huge burden was cast by the Tribunals by virtue of the said Act. In furtherance of the Act, for which the Act was enacted, the Tribunal set up by virtue of the Act were vested with substantial powers.
The procedure prescribed under the Act was to ensure a balance in between the object of expeditious recovery of the Banking dues, on one hand and the safeguard of the rights, particularly enshrined under Article 300-A in respect of the borrowers and the guarantors.
It is expected that the Tribunals are to act in fair and reasonable manner while exercising the vast powers conferred upon them under the Act read with SARFAESI Act. Any dent/ shadow cast upon the manner of working of the Tribunal has the effect of subverting the object with which the Act was enacted and thus it is expected, that the Presiding Officer of the Tribunal would act fairly and reasonably while discharging their functions.
“In the case clearly prior to the date of superannuation, the Presiding Officer acted in a manner so as to create a cloud on the working of the entire Tribunal as has also been observed by the court in respect of the specific instances in the detailed order dated 08.07.2024.
In terms of the mandate of Sections 32 and 33 of the DRT Act, the Presiding Officers are deemed to be government servants within the meaning of Section 21 of IPC and protection is also accorded to them for actions taken for good faith, however, the series of the incidents as highlighted and indicated above, prima facie, demonstrates that the actions were not in good faith.
Considering the serious allegations (verified in the Registrar’s report) with regard to the passing of the order dated 18.09.2024 and the corrigendum order dated 27.09.2024 levelled against the Presiding Officer and series of such complaints, as highlighted in the two orders passed by the Court on the earlier occasions, extracted above, I deem it appropriate to direct the CBI Inquiry into the matter”, the Court observed.
“The Investigating Officer of the CBI will be duly authorized to verify the record of the DRT Lucknow specifically the records as are mentioned in the Division Bench Order, whereby an inquiry was ordered and if anything wrong is found, the CBI shall take steps for filing charge sheet against the persons concerned for prosecution in accordance with law.
The CBI shall submit a report to the Court within 15 days with regard to the action taken in pursuance to the order. The interim order passed by the Court shall continue till the next date of listing,” the Court ordered.
The Court has fixed the next hearing of the petition on 10.12.2024.
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A Single Bench of Justice Pankaj Bhatia passed this order while hearing a petition filed by Bank Of Baroda, A Body Corporate, Barabanki Through its Authorized Officer, Vinay Agrawal.
The controversy involved in the petition under Article 227 of the Constitution of India is the conduct of the Presiding Officer of the DRT, Lucknow has conducted the proceedings with material irregularities just prior to his retirement. A shadow is cast upon the orders dated 18.09.2024 and 22.04.2024 passed by the Tribunal.
The submission of the counsel for the petitioner that the Presiding Officer of the DRT did not sit on 18.09.2024, the date on which order was passed on 18.09.2024, which is on record and subsequently to hide the irregularities a corrigendum order dated 27.09.2024 was passed by the Presiding Officer indicating that the order dated 18.09.2024 be read as order dated 24.09.2024.
It is further argued by the petitioner that the order dated 27.09.2024 was never on record and was subsequently introduced, which is established as per them based upon the certified copy of the entire records obtained by the petitioner and was made available to them on 23.10.2024, which does not contain the order dated 27.09.2024.
It is further pleaded that in the cause list on 24.09.2024, the case was never listed for pronouncement of orders. In the light of these discrepancies, it is proposed to be argued that the order dated 18.09.2024 was not passed in a bona fide manner and mala fides have been alleged against the Presiding Officer of the DRT Lucknow.
Counsel on behalf of the respondent on the other hand insists that the order dated 18.09.2024, which is the bone of contention, on its merits, does not require any interference and is in consonance with the mandate of provisions of SARFAESI Act.
It is further argued that merely if there were some irregularities in pronouncement of the order, the said order would not ipso facto be treated as an illegality, which can be checked by the Court in exercise of power under Article 227 of the Constitution of India.
The Court noted that,
In the light of the conflicting submissions made with regard to the manner of passing of the order dated 18.09.2024, the Court by order dated 18.11.2024 had directed to summon the original record in a sealed cover to be submitted by the Registrar, DRT Lucknow and a report of the Registrar was also called with regard to the fact that whether the order dated 18.09.2024 was dictated to the Private Secretary/Stenographer by the Presiding Officer.
A report has been submitted on November 21 indicating that the order dated 18.09.2024 passed by the Presiding Officer/Tribunal was to be read as 24.09.2024 in terms of the corrigendum order dated 27.09.2024 passed by the then Presiding Officer, as per the record.
It further records that as per the information given by the NIC team of the Tribunal the order dated 18.09.2024 was uploaded on 27.09.2024 on the e-portal. It was also mentioned in the said report that on account of inadvertence the order dated 27.09.2024 could not be uploaded on the e-DRT portal, and the said order remains part of the record of the file. The order dated 27.09.2024, on perusal of the record is found on record in the order sheets.
The second part of the report submitted by the Registrar, DRT Lucknow is that on enquiry form the Stenographer diary, regarding dictation of the order dated 18.09.2024, comments were sought from the Private Secretary and from the comments received from him, it is informed that no dictation was taken by the Private Secretary/Stenographer in respect of final order dated 18.09.2024 from the then Presiding Officer.
It further records that the corrigendum order dated 27.09.2024 was taken under dictation by the Stenographer working on the outsource basis. It further records that the Presiding Officer superannuated on 27.09.2024 on completion of his tenure.
The Court said that,
The DRT Act was enacted in the year 1993 for setting up a special mechanism for recovery of the financial dues and in terms of the difficulties faced by the Banks and Financial Institutions, the Tribunals were set up with an aim to enhance and fulfill the need for expeditious recovery of the banking dues. A huge burden was cast by the Tribunals by virtue of the said Act. In furtherance of the Act, for which the Act was enacted, the Tribunal set up by virtue of the Act were vested with substantial powers.
The procedure prescribed under the Act was to ensure a balance in between the object of expeditious recovery of the Banking dues, on one hand and the safeguard of the rights, particularly enshrined under Article 300-A in respect of the borrowers and the guarantors.
It is expected that the Tribunals are to act in fair and reasonable manner while exercising the vast powers conferred upon them under the Act read with SARFAESI Act. Any dent/ shadow cast upon the manner of working of the Tribunal has the effect of subverting the object with which the Act was enacted and thus it is expected, that the Presiding Officer of the Tribunal would act fairly and reasonably while discharging their functions.
“In the case clearly prior to the date of superannuation, the Presiding Officer acted in a manner so as to create a cloud on the working of the entire Tribunal as has also been observed by the court in respect of the specific instances in the detailed order dated 08.07.2024.
In terms of the mandate of Sections 32 and 33 of the DRT Act, the Presiding Officers are deemed to be government servants within the meaning of Section 21 of IPC and protection is also accorded to them for actions taken for good faith, however, the series of the incidents as highlighted and indicated above, prima facie, demonstrates that the actions were not in good faith.
Considering the serious allegations (verified in the Registrar’s report) with regard to the passing of the order dated 18.09.2024 and the corrigendum order dated 27.09.2024 levelled against the Presiding Officer and series of such complaints, as highlighted in the two orders passed by the Court on the earlier occasions, extracted above, I deem it appropriate to direct the CBI Inquiry into the matter”, the Court observed.
“The Investigating Officer of the CBI will be duly authorized to verify the record of the DRT Lucknow specifically the records as are mentioned in the Division Bench Order, whereby an inquiry was ordered and if anything wrong is found, the CBI shall take steps for filing charge sheet against the persons concerned for prosecution in accordance with law.
The CBI shall submit a report to the Court within 15 days with regard to the action taken in pursuance to the order. The interim order passed by the Court shall continue till the next date of listing,” the Court ordered.
The Court has fixed the next hearing of the petition on 10.12.2024.
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