Duncans Industries Ltd. vs Narayan Kumar Khaitan

Prasenjit Mandal, J.—This application is at the instance of a judgment debtor and is directed against the order dated August 31, 2010 passed by the learned State Consumer Disputes Redressal Commission in revision case No. RC/72/2010 arising out of the execution case No. 126 of 2008.

The short fact of the case is that the opposite party/complainant got an award of Rs. 3,00,000/-only with interest and litigation costs against the Petitioner passed by the learned State Consumer Disputes Redressal Commission (henceforth shall be called ''State Commission'') in an appeal arising out of the case filed by the complainant before the District Forum. Against that order of the appellate forum, no revision before the National Commission or before the High Court was initiated. Thereafter, the opposite party put the said award into execution against the Petitioner, as no payment was made as per direction of the appellate forum. The Petitioner prayed for stay of the execution case and that prayer was rejected by the executing court by an order dated April 28, 2010. Being aggrieved, the Petitioner preferred a revisional application before the State Commission and that revisional application was also dismissed affirming the order of the executing court. Being aggrieved by such orders, this application has been preferred.

Mr. Mitra, learned senior Advocate appearing on behalf of the Petitioner, submits that the Petitioner company is a sick one and it went on to BIFR. So, according to the provisions of Section 22 of the SICA [Sick Industrial Companies (Special Provisions)] Act, 1985, such a proceeding should be stayed. The question of payment of money does not arise at present until a final decision is made under the provisions of the SICA Act. But the State Commission has failed to take a notice of such fact and so the impugned order should be set aside.

On the other hand, Mr. Nayak, learned Advocate appearing on behalf of the opposite party, submits that the provisions of Section 22 of the SICA Act, 1985 will not be applicable in the instant situation. It is a case of repayment of money on the deposits made by the decree holder. Moreover, it is not a single instance that the payment is being made by the judgment debtor. In fact, the claim was to the extent of Rs. 6,70,000/- out of which an amount of Rs. 3,70,000/- has already been paid. Similarly, the Petitioner-company has also paid its dues to other companies. So, the Petitioner cannot make any discrimination to make payment as per award passed by the State Commission. In support of his contention Mr. Nayak has referred to the decision of 2009 (2) Comp LJ 685 paragraph 25, 2010 CTJ 601 paragraph 13, 14 & 16 and 1995 (1) Comp LJ 124 paragraph 13 and thus he submits that the State Commission has rightly rejected the prayer for stay.

Therefore, the point that arises for decision is whether the State Commission was justified in dismissing the revision petition filed by the Petitioner, by the impugned order.

Upon hearing the learned Counsel for the parties and on going through the materials on record, I find that the opposite party filed an application before the State Commission to get back the balance deposited money of Rs. 3,00,000/- matured in 2001 and 2002. That amount was not paid. For that reason, he filed a claim petition before the consumer forum. That application was rejected by the forum on technical ground of limitation. But the appellate forum, i.e., the State Commission allowed the appeal and the State Commission directed the Petitioner to pay a sum of Rs. 3,00,000/-to the complainant along with interest accrued thereon at the rate of 14% per annum from the date of deposit till such payment is made to the Appellant-complainant/opposite party herein. A sum of Rs. 4,000/- was also awarded as litigation costs in favour of the opposite party. The Petitioner was directed to make payment to the aforesaid amount to the complainant within 45 days from the date of communication of the judgment passed by the appellate forum, failing which the amount would carry interest at the rate of 12% per annum till full payment. The Petitioner did not move the National Commission against such order dated October 16, 2008. So, the order passed by the State Commission has become final and it is binding upon the Petitioner. Thereafter, the opposite party filed an application for execution of the award and in that case the Petitioner took the plea that the BIFR is dealing with the matter and as such, according the provisions of Section 22 of the SICA Act, 1985, the realisation of money against a sick company should be stopped.

It may be mentioned here that the financial position of the Petitioner went on to the BIFR in the year 2006. The claim petition before the forum was filed by the complainant in the year 2007. The BIFR took certain measures and passed orders accordingly, as appearing in page No. 38 of the application. The Petitioner was aggrieved by such orders and it moved the Appellate Authority for Industrial and Financial Reconstruction and this Appellate Authority by an order dated December 14, 2007 set aside certain provisions as laid down in paragraph 15(I) and 15(5) and the guideline numbers 8, 14 and 17 of the order of the BIFR. The other orders passed by the BIFR were not altered or changed. The BIFR was directed to formulate guidelines to prepare a rehabilitation scheme. Though the Petitioner was declared as a sick company, the stoppage of payment was directed to be made with regard to the dues to the other persons in support of security, loan, etc. and not with regard to the deposits made by the person like the opposite party, in the company. Thus, I find that the State Commission passed the final order while the Petitioner-company was on the BIFR. Therefore, the opposite party has no restriction to realise the deposits made with the Petitioner-company. In fact, the Petitioner filed a stay before the executing court, i.e., the District forum which rejected the prayer of stay and the District forum has considered the aspects of BIFR and the provisions of Section 22 of the SICA Act, 1985 and thereafter passed the order dated April 28, 2010, appearing at page No. 133. It has been clearly observed by the executing court that the Petitioner-company is paying its dues to other persons, in compliance with orders passed in many cases, and in fact, this Petitioner - company has paid a sum of Rs. 3,70,000/- to the opposite party. So, the Petitioner cannot take a different attitude in dealing with different persons. The prayer for stay filed by the Petitioner-company has been rejected accordingly. Against such order, the Petitioner-company preferred a revisional application u/s 17(i)(b) of the Consumer Protection Act before the State Commission and that revisional application has been rejected by the impugned order. So, I find that the State Commission has once exercised the supervisory jurisdiction and I do not find any error or want of jurisdiction in exercising supervisory capacity.

This being the position, the present application under Article 227 of the Constitution of India for exercising the supervisory power, I hold, cannot be invoked because there was no want of jurisdiction on the part of the State Commission in dealing with the matter in its supervisory capacity. The Petitioner did not move the National Commission against such order u/s 21(b) of the Consumer Protection Act, 1985.

I have considered the decision of the Manager, Burdwan Co-operative Agriculture & Rural Development Bank Ltd. v. Anath Bandhu Dhara reported in 2009 (2) Comp LJ 685 will be applicable very much in the instant situation.

This being the position, I am of the view that the State Commission has acted and disposed of the matter within the limits of its jurisdiction. Therefore, I am of the view that this Court has no authority to entertain the application under Article 227 of the Constitution in view of the provisions of the Consumer Protection Act, 1986. Accordingly, this application is dismissed.

Considering the circumstances, there will be no order as to costs.

Urgent xerox certified copy of this order, if applied for, be supplied to the learned Advocates for the parties on their usual undertaking.