Whether Section 5 of Limitation Act applicable to Appeal against order of Recovery Officer under RDB Act?

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Supreme Court has recently held that Section 5 of Limitation Act shall not be applicable to appeal against order of Recovery Officer under Section 30 of the Recovery of Debts due to Banks and Financial Institutions Act, 1993.

In the present case, The Debts Recovery Tribunal condoned the delay by applying Section 5 of the Limitation Act, 1963. The DRAT set aside the order passed by the Debts Recovery Tribunal condoning the delay applying Section 5 of the Limitation Act observing that Section 5 of the Limitation Act shall not be applicable to the appeal under Section 30 of the Act, 1993 against the order passed by the Recovery Officer. By the impugned judgment and order, the High Court has set aside the order passed by the DRAT relying upon the decision of this Court in the case of A.R. Venugopal Alias R. Venugopal v. Jotheeswaran and Ors., (2016) 16 SCC 588.

Feeling aggrieved and dissatisfied with the impugned judgment and order passed by the High Court restoring the order passed by the Debts Recovery Tribunal condoning the delay applying Section 5 of the Limitation Act to the appeal under Section 30 of the Act, 1993, the original respondent – Bank has preferred the present appeal.

Supreme Court noted that the issue involved in the present appeal is now not res integra in view of the direct decision of this Court in the case of International Asset Reconstruction Company of India Limited v. Official Liquidator of Aldrich Pharmaceuticals Limited and Ors., (2017) 16 SCC 137. Dealing with the appeal under Section 30 of the Act, 1993 after 2000 amendment, it is held that Section 5 of the limitation Act is specifically excluded so far as appeal under Section 30 of the Act, 1993 is concerned. While holding so, in paragraph 13, it is observed and held as under:-

“The RDB Act is a special law. The proceedings are before a statutory Tribunal. The scheme of the Act manifestly provides that the legislature has provided for application of the Limitation Act to original proceedings before the Tribunal under Section 19 only. The Appellate Tribunal has been conferred the power to condone delay beyond 45 days under Section 20(3) of the Act. The proceedings before the Recovery Officer are not before a Tribunal. Section 24 is limited in its application to proceedings before the Tribunal originating under Section 19 only. The exclusion of any provision for extension of time by the Tribunal in preferring an appeal under Section 30 of the Act makes it manifest that the legislative intent for exclusion was express. The application of Section 5 of the Limitation Act by resort to Section 29(2) of the Limitation Act, 1963 therefore does not arise. The prescribed period of 30 days under Section 30(1) of the RDB Act for preferring an appeal against the order of the Recovery Officer therefore cannot be condoned by application of Section 5 of the Limitation Act.”

It was held that, as per the law laid down by this Court in the aforesaid case and even otherwise considering Section 30 of the Act, 1993, we are also of the view that Section 5 of the Limitation Act shall not be applicable to the appeal against the order of Recovery Officer as provided under Section 30 of the Act, 1993. Therefore, the High Court has committed a grave error in quashing and setting aside the order passed by the DRAT and in restoring the order passed by the Debts Recovery Tribunal condoning the delay in preferring the appeal under Section 30 by applying Section 5 of the Limitation Act.

Read Order here