Appollo Gleneagles Hospitals Ltd.:Civil Suits – Equities – the respondent took land on lease not from a rightful owner – constructed Hospitals therein

Civil Suits – Equities – the respondent took land on lease not from a rightful owner – constructed Hospitals therein – suitable compensation – Apex court held that the Appellants are entitled and the first Respondent Apollo Hospitals is liable to pay the following amounts: 

Compensation towards value of land Rs.24,04,188 per cottah for 11.66(11.659) cottah which comes to Rs.2,80,32,832 (Rupees Two Crores Eighty Lakhs Thirty Two Thousand Eight Hundred and Thirty Two only).

 Interest at the rate of 2% per annum for 23 years which works out to Rs.1,28,95,102 (Rupees One Crore Twenty Eight Lakhs Ninety Five Thousand One Hundred and Two only).

 Utilization charges at the rate of Rs.21,500 per annum equal to Rs.4,94,500 (Rupees Four Lakhs Ninety Four Thousand Five Hundred only). 

Costs Rs.5 lacs (Rupees Five Lakhs only). The first Respondent shall deposit the sum of Rs.4,20,00,000 with the Secretary General of this Court within four weeks from today.

 The Appellants shall make all arrangements to produce the original title deeds and specify the schedule of the land and the sketch from the competent authority of the revenue department and furnish the same within eight weeks from this date.

 On submission of such records, by the Appellants to this court, the first Respondent shall inspect those records and express its confirmation.

On such confirmation being submitted by the first Respondent within two weeks of the submission of the records by the Appellants, within two weeks thereafter the Appellants will execute a deed of conveyance of the land admeasuring about 11.66 (11.659) cottah of land in favour of first Respondent. 

All stamp duty and registration charges and other incidental expenses for the conveyance shall be borne by the first Respondent Appollo Hospitals. On such registration of the conveyance deed, the Appellants will be at liberty to seek for release of Rs.4,20,00,000 with whatever interest accrued thereon.

 The State of West Bengal shall direct its authorities to ensure that the lands involved in this appeal, namely, 11.66 (11.659) cottah is issued necessary certificate of such demarcation. The above said directions are without prejudice to the rights of the first Respondent hospital in relation to the rest of the lands which is governed by the registered lease deed dated 21.06.1991 as between the first Respondent hospital and the State of West Bengal which is stated to be for a period of 30 years with provision for option for further renewal for additional two terms of 30 years each.

 It is needless to state that the said rights of the first Respondent hospital under the registered lease deed dated 21.06.1991 would be governed by the terms and conditions contained therein in respect of the lands, namely, 34,147 – 743.21 square metre = 33,403.79 square metres.

 On deposit of the sum of Rs.4,20,00,000 with the Secretary General of this Court as per paragraph “a” of these directions, the Secretary General shall invest the same in UCO Bank initially for a period of six months. It shall be renewed periodically pending further orders to be passed by this Court. With the above directions, these appeals will stand disposed of. 

However, in order to ensure compliance of the directions by all the parties concerned, call these appeals for passing final orders in the first week of December, 2014.

 However, in the meantime, if all formalities are complied with, it is open to the parties to mention for posting the above appeals for passing final orders. = CIVIL APPEAL NOS…83-6684 OF 2014 (@ SLP (C) Nos. 8854-8855 of 2010) Somnath Chakraborty and Anr. … Appellants VERSUS Appollo Gleneagles Hospitals Ltd. & Ors. … Respondents = 2014 July. Part – http://judis.nic.in/supremecourt/filename=41788

 ADVMMOHAN ⋅ AUGUST 2, 2014 ⋅

Civil Suits – Equities – the respondent took land on lease not from a rightful owner – constructed Hospitals therein – suitable compensation – Apex court held that  the  Appellants  are

entitled and the first Respondent Apollo Hospitals is  liable  to  pay  the

following amounts:

• Compensation towards  value  of  land  Rs.24,04,188  per  cottah  for  11.66(11.659) cottah which comes to  Rs.2,80,32,832  (Rupees  Two  Crores  Eighty Lakhs Thirty Two Thousand Eight Hundred and Thirty Two only).

• Interest at the rate of 2% per  annum  for  23  years  which  works  out  to Rs.1,28,95,102 (Rupees One Crore Twenty Eight  Lakhs  Ninety  Five  Thousand One Hundred and Two only). Utilization charges at the rate of Rs.21,500 per annum equal to  Rs.4,94,500 (Rupees Four Lakhs Ninety Four Thousand Five Hundred only).

• Costs Rs.5 lacs (Rupees Five Lakhs only).
• 
  
• The first Respondent shall  deposit  the  sum  of  Rs.4,20,00,000  with  the Secretary General of this Court within four weeks from today. 
• The Appellants shall make all arrangements to  produce  the  original  title deeds and specify  the  schedule  of  the  land  and  the  sketch  from  the competent authority of the revenue department and furnish  the  same  within eight weeks from this date.

• On submission of such records, by the Appellants to this  court,  the  first Respondent shall inspect those records and express its confirmation.
• On such confirmation being submitted by  the  first  Respondent  within  two weeks of the submission of the records by the Appellants, within  two  weeks thereafter the Appellants will execute a deed  of  conveyance  of  the  land admeasuring  about  11.66  (11.659)  cottah  of  land  in  favour  of  first Respondent.

• All stamp duty and registration charges and other  incidental  expenses  for the conveyance shall be borne by the first Respondent Appollo Hospitals.

• On such registration of the conveyance  deed,  the  Appellants  will  be  at liberty to  seek  for  release  of  Rs.4,20,00,000  with  whatever  interest accrued thereon.

• The State of West Bengal shall direct its authorities  to  ensure  that  the lands involved in this appeal,  namely,  11.66  (11.659)  cottah  is  issued necessary certificate of such demarcation.

• The above said directions are without prejudice to the rights of  the  first Respondent hospital in relation to the rest of the lands which  is  governed by  the  registered  lease  deed  dated  21.06.1991  as  between  the  first Respondent hospital and the State of West Bengal which is stated to  be  for a period of 30 years with provision  for  option  for  further  renewal  for additional two terms of 30 years each.  It is needless  to  state  that  the said rights of the first Respondent  hospital  under  the  registered  lease deed dated  21.06.1991  would  be  governed  by  the  terms  and  conditions contained therein in respect of the lands, namely, 34,147  –  743.21  square metre = 33,403.79 square metres.

• On deposit of the sum of Rs.4,20,00,000 with the Secretary General  of  this Court as per paragraph “a” of these directions, the Secretary General  shall invest the same in UCO Bank initially for a period of six months.  It  shall be renewed periodically pending further orders to be passed by this Court.

• With the above directions, these appeals will stand  disposed  of.  However, in order  to  ensure  compliance  of  the  directions  by  all  the  parties concerned, call these appeals for passing final orders in the first week  of December, 2014. However, in the meantime, if all  formalities  are  complied with, it is open to the parties to mention for  posting  the  above  appeals for passing final orders. =

the appeals pertain to a piece of  land  which

is as on date in the possession of the first Respondent  Appollo  Gleneagles

Hospitals  Ltd.  (hereinafter  called  “Appollo   Hospitals”),   which   was

originally owned by one Narayan Chandra Dutta.

He stated to  have  sold  the

said lands to  one  Tilak  Sundari  Debi.

Her  title  was  confirmed  after

prolonged litigation in the judgment of the High  Court  of  Calcutta  dated

25.07.1986 in Second Appeal No. 384 of 1967.

When the said  litigation  was

pending, the heirs of late Tilak Sunderi Debi sold the  said  lands  to  the

present Appellants who became the joint owners of the land consisting of  11

Katha 10 chitaks and 25 square feets, in all 11.659 cottah of land. =

DIVISION BENCH

The Division Bench by the judgment  impugned  in

these appeals held as under in paragraph 12.1:

“12.1 The second appellate decree might be binding only upon the parties  to

the said proceedings.  However, it is otherwise a judgment in rem, at  least

against any person claiming title derived from the judgment debtor.   Hence,

State deriving title by way of vesting from Orient was not entitled to  deny

the right, title and interest of the respondents in question.”  (underlining

is ours)

Again in paragraph 12.2 the Division Bench observed as under:

“12.2…….The title was in dispute. Hence the doctrine of lis  pendence  would

apply. During the pendency of the second  appeal,  the  present  respondents

purchased the interest of the then owner of the said land in question  which

was yet to be adjudicated  upon.  They  stepped  into  the  shoes  of  their

predecessor in interest.  The declaration was made in their  favour  by  the

Division Bench of this Court.  Hence,  the  State  was  obliged  to  proceed

against them under the provisions of the said  Act  of  1976.   The  learned

Single Judge rightly observed as such and we are in full agreement with  His

Lordship on that score.” (underlining is ours)

Again in paragraph 12.3 the Division Bench made further observations to  the

following effect:

“12.3 It is true that the hospital was constructed by  Appollo  by  spending

huge sum. They did it at their own risk and peril as it was a lease  for  30

years which is going to expire in 2021. The  Hospital  authority  took  that

risk before proceeding further.  Hence, the contention made by Mr. Mitra  on

that score cannot be accepted.”

Further observation was made by Division Bench in paragraph 12.4 as under:

“12.4 We however, feel that although it is a private hospital it is  serving

people of the State giving medical services and it would not  be  proper  to

stop such activity at this stage. We are prompted to say so as we also  find

the respondents guilty of laches.  They did  not  approach  the  appropriate

authority  at  the  right  moment.   They  should  have   raised   objection

contemporaneously.  However, such laches cannot take  away  their  right  to

claim appropriate relief without  disturbing  the  hospital,  if  possible.”

(underlining is ours)

Ultimately the Division Bench issued the following direction  in  paragraphs

13.1 and 13.2. The same are extracted as under:

“13.1 The order of the learned Single Judge is thus modified to  the  extent

that the hospital authority need not hand over  actual  physical  possession

to the State before a final declaration, if any, is made  under  Section  10

(3) considering the return to be submitted by the respondents  in  terms  of

the liberty granted by His Lordship to them.

13.2 The hospital authority would be obliged to compensate  the  respondents

to the extent of the land, if any allowed to be retained  by  them,  by  the

competent authority under the said Act of 1976 and for the balance  part  of

the land the State would be obliged to pay compensation in  accordance  with

law.”

The above said judgment of the  Division  Bench  is  the  subject  matter  of

challenge in these appeals.  =

Apex court held that

Accordingly,  we  hold  that  the  Appellants  are

entitled and the first Respondent Appollo Hospitals is  liable  to  pay  the

following amounts:

Compensation towards  value  of  land  Rs.24,04,188  per  cottah  for  11.66

(11.659) cottah which comes to  Rs.2,80,32,832  (Rupees  Two  Crores  Eighty

Lakhs Thirty Two Thousand Eight Hundred and Thirty Two only).

Interest at the rate of 2% per  annum  for  23  years  which  works  out  to

Rs.1,28,95,102 (Rupees One Crore Twenty Eight  Lakhs  Ninety  Five  Thousand

One Hundred and Two only).

Utilization charges at the rate of Rs.21,500 per annum equal to  Rs.4,94,500

(Rupees Four Lakhs Ninety Four Thousand Five Hundred only).

Costs Rs.5 lacs (Rupees Five Lakhs only).

The first Respondent shall  deposit  the  sum  of  Rs.4,20,00,000  with  the

Secretary General of this Court within four weeks from today.

The Appellants shall make all arrangements to  produce  the  original  title

deeds and specify  the  schedule  of  the  land  and  the  sketch  from  the

competent authority of the revenue department and furnish  the  same  within

eight weeks from this date.

On submission of such records, by the Appellants to this  court,  the  first

Respondent shall inspect those records and express its confirmation.

On such confirmation being submitted by  the  first  Respondent  within  two

weeks of the submission of the records by the Appellants, within  two  weeks

thereafter the Appellants will execute a deed  of  conveyance  of  the  land

admeasuring  about  11.66  (11.659)  cottah  of  land  in  favour  of  first

Respondent.

All stamp duty and registration charges and other  incidental  expenses  for

the conveyance shall be borne by the first Respondent Appollo Hospitals.

On such registration of the conveyance  deed,  the  Appellants  will  be  at

liberty to  seek  for  release  of  Rs.4,20,00,000  with  whatever  interest

accrued thereon.

The State of West Bengal shall direct its authorities  to  ensure  that  the

lands involved in this appeal,  namely,  11.66  (11.659)  cottah  is  issued

necessary certificate of such demarcation.

The above said directions are without prejudice to the rights of  the  first

Respondent hospital in relation to the rest of the lands which  is  governed

by  the  registered  lease  deed  dated  21.06.1991  as  between  the  first

Respondent hospital and the State of West Bengal which is stated to  be  for

a period of 30 years with provision  for  option  for  further  renewal  for

additional two terms of 30 years each.  It is needless  to  state  that  the

said rights of the first Respondent  hospital  under  the  registered  lease

deed dated  21.06.1991  would  be  governed  by  the  terms  and  conditions

contained therein in respect of the lands, namely, 34,147  –  743.21  square

metre = 33,403.79 square metres.

On deposit of the sum of Rs.4,20,00,000 with the Secretary General  of  this

Court as per paragraph “a” of these directions, the Secretary General  shall

invest the same in UCO Bank initially for a period of six months.  It  shall

be renewed periodically pending further orders to be passed by this Court.

With the above directions, these appeals will stand  disposed  of.  However,

in order  to  ensure  compliance  of  the  directions  by  all  the  parties

concerned, call these appeals for passing final orders in the first week  of

December, 2014. However, in the meantime, if all  formalities  are  complied

with, it is open to the parties to mention for  posting  the  above  appeals

for passing final orders.

Syndicate Bank chief held on allegations of bribery

BS 3 Aug 2014

The Central Bureau of Investigation has arrested S K Jain, chairman and managing director of Syndicate Bank, for allegedly accepting bribes from private companies to extend credit facilities.

On Saturday, the agency conducted raids at 20 locations across Bangalore, Bhopal, Mumbai and Delhi, after registering a case in the matter. It confiscated Rs 50 lakh, allegedly received by Jain as bribe. “So far, searches have led to recoveries of several asset papers and incriminating documents,” said a CBI spokesperson.

During the raids, the CBI also unearthed about Rs 21 lakh in cash, gold worth Rs 1.68 crore and fixed deposit receipts of Rs 63 lakh.

The CBI alleged Jain had enhanced the credit limit to certain private companies, in violation of rules and regulations. The companies concerned are believed to be embroiled in the coal block allocation scam, according to the investigative agency.

Jain’s brother-in-law, as well as a chartered accountant, have also been taken into police custody. Vipul Agarwal of Prakash Industries Delhi has also been arrested in the case. Sources said a few others, including Neeraj Singhal, vice-chairman of Bhushan Steel, were also likely to be arrested.

Efforts to contact Singhal and the Bhushan Steel chief financial officer proved futile till the time of going to press.

For the quarter ended June, Syndicate Bank reported a 7.3 per cent rise in net profit at Rs 485 crore, compared with Rs 452 crore in the corresponding period last year. The bank’s total income rose 16.8 per cent to Rs 5,523 crore from Rs 4,726 crore in the year-ago period. During the same period, provisioning fell from Rs 489 crore to Rs 468 crore. While the bank’s net interest income rose one per cent to Rs 1,351 crore, against Rs 1,338 crore in the corresponding quarter last year, net interest margin declined to 2.47 per cent from 2.83 per cent. Deposits rose 17.72 per cent to Rs 2,14,863 crore from Rs 1,82,513 crore in the first quarter of 2013-14.

WELL VERSED IN VARIOUS FACETS OF BANKING

Sudhir Kumar Jain, whom Syndicate Bank employees describe as “soft-spoken”, took charge as chairman and managing director of the bank on July 8, 2013. A commerce graduate and chartered accountant, he started his career as credit manager at Dena Bank in 1987, steadily rising through the ranks to become general manager, heading the bank’s accounts, treasury, retail banking, investor relations and international segments. He also served as executive director of Bank of Baroda for two years. Jain, who hails from Rajasthan, has 27 years of experience in various facets of banking and has worked across capacities and locations, including Kolkata, Ahmedabad and New Delhi.

Doctrine of estoppel. – Sec.43 of T.P.Act

Doctrine of feeding the estoppel. – Sec.43 of T.P.Act – mother is the owner – but son sold the property to the appellant – pending case first son died and his legal heirs brought on record- next the mother /plaintiff died leaving grand children as her legal heirs – The Appellant now took the shelter of Sec.43 of T.P. Act 

– Apex court held that We have, therefore, no doubt in our mind that in a case where a transferor never acquired by succession, inheritance or otherwise any interest in the property during his life time then the provision of Section 43 will not come into operation as against the heirs who succeeded the stridhan property of their grandmother.we do not find any merit in this appeal, which is accordingly dismissed. = CIVIL APPEAL NO.3198 OF 2007 Agricultural Produce Marketing Committee ………Appellant Versus Bannama (D) by LRs. ……..Respondents = 2014 July. Part – http://judis.nic.in/supremecourt/filename=41792

ADVMMOHAN ⋅ AUGUST 3, 2014 ⋅ 

Doctrine  of feeding the estoppel.  – Sec.43 of T.P.Act – mother is the owner – but son sold the property to the appellant – pending case first son died and his legal heirs brought on record- next the mother /plaintiff died leaving grand children as her legal heirs – The Appellant now took the shelter of Sec.43 of T.P. Act – Apex court held that We  have, therefore, no doubt in our mind that in a  case  where  a  transferor  never acquired by  succession,  inheritance  or  otherwise  any  interest  in  the property during his life time then the provision  of  Section  43  will  not come into  operation  as  against  the  heirs  who  succeeded  the  stridhan property of their grandmother.we do not find any merit in this appeal,  which is accordingly dismissed. =

“43.  Transfer by unauthorised person who subsequently acquires interest  in

property transferred.—

Where a person fraudulently or erroneously  represents

that he is authorised to transfer certain immoveable property and  professes

to transfer such property for consideration, such  transfer  shall,  at  the

option of the transferee, operate on any interest which the  transferor  may

acquire in such property at any time during which the contract  of  transfer

subsists.

Nothing in this section shall impair the right of transferees  in  good

faith for  consideration  without  notice  of  the  existence  of  the  said

option.”

14.   The doctrine is based on the principle of law of estoppel.

It  simply

provides that when  a  person  by  fraudulent  or  erroneous  representation

transfers certain immovable property, claiming himself to be  the  owner  of

such property, then such transfer will subsequently operate on any  interest

which the transferor may acquire in such property during which the  contract

of transfer subsists.

This doctrine known in English law has form  part  of

Roman Dutch law, according to which where a granter has purported  to  grant

an interest in  the  land  which  he  did  not  at  the  time  possess,  but

subsequently acquires,  the  benefit  of  his  subsequent  acquisition  goes

automatically to the earlier grantee.  In other words, where a vendor  sells

without title in the property, but subsequently acquires title then a  right

accrues to the purchaser to claim interest  in  the  said  property  and  it

automatically goes in favour of the transferor.=

the appellant would not be entitled to take the benefit of the  doctrine  of

feeding the estoppel.

The finding of  facts  recorded  by  the  two  courts

based on the records that the original plaintiff was  the  owner  and  title

holder  of  the  said  property  

but  by   making   false   and   fraudulent

representation by her son that the property  belonged  to  him,  transferred

the same in favour of the appellant.   

During  the  pendency  of  the  first

appeal  before  the  district  court,  the  vendor  (son  of  the   original

plaintiff) died.

Although on the death, his children  did  not  inherit  or

succeeded any interest in the property, through their deceased  father,  but

they were impleaded as legal representatives in the appeal.

However,  during

the pendency of this appeal, the original plaintiff, namely, Bannamma  died.

After her death, the respondents being the  grand  children  inherited  and

acquired interest in the suit property.

Admittedly,  the  deceased  son  of

the original plaintiff, namely Nagi Reddy never  acquired  any  interest  in

the suit property owned  by  his  mother  during  his  life  time.

In  the

aforesaid premises, the doctrine of feeding  the  estoppel  would  not  come

into operation as against the grand  children  of  the  original  plaintiff.

Section 43 in our considered opinion applies when the transferor  having  no

interest in the  property  transfers  the  same  but  subsequently  acquires

interest in the said property, the purchaser may claim the benefit  of  such

subsequent acquisition of the property by the  transferor.

Had  it  been  a

case where the son Nagi Reddy during his life time  succeeded  or  inherited

the property but- died subsequently, then to some extent it could have  been

argued that the heirs of Nagi Reddy who inherited the property on the  death

of their father would be bound by  the  principle  of  estoppel.

We  have,

therefore, no doubt in our mind that in a  case  where  a  transferor  never

acquired by  succession,  inheritance  or  otherwise  any  interest  in  the

property during his life time then the provision  of  Section  43  will  not

come into  operation  as  against  the  heirs  who  succeeded  the  stridhan

property of their grandmother.

16.   For all these reasons, we do not find any merit in this appeal,  which

is accordingly dismissed.

CBI registers case against Syndicate Bank CMD

Syndicate Bank CMD Sudhir Kumar Jain

BL :NEW DELHI, AUGUST 2: 2014

The Central Bureau of Investigation has registered a case of alleged bribery against the Chairman & Managing Director of Syndicate Bank, Sudhir Kumar Jain and 11 others including CMD & Directors of two private firms based at Delhi. Case has been registered under Prevention of Corruption Act, 1988 and criminal conspiracy.

The allegation pertains to Jain asking for bribe to extend credit facilities to certain companies. The agency also raided 20 places at 4 cities of Bangalore, Bhopal, Mumbai and Delhi. It has recovered bribe amount of Rs 50 lakhs. A senior CBI official said that cash amounting approximately Rs 21 lakh, gold worth Rs 1.68 crore and Fixed Deposit Receipts worth Rs 63 lakh found from Jain.

He also disclosed names of suspected/accused in this case which include Neeraj Singhal (Vice Chairman of Delhi based Bhushan Steel), Ved Prakash Agarwal (Chairman & Managing Director of Delhi based Prakash Industries), Vipul Agarwal (Prakash Industries), Pawan Bansal, Vineet Godha, Punit Godha, Vijay Pahuja, Pursotam Lal Totlani and Pankaj Bansal.

According to an official statement, it is alleged that the said public servant has been indulging into negotiations for illegal gratification directly as well as through middlemen for extending undue favour to private companies by granting sanction to various financial proposals. The private persons on behalf of companies and others allegedly enter into criminal conspiracy and obtain illegal gratification meant for the public servant and further deliver it to the middlemen on behalf of the public servant.

It is further alleged, that in one case, the public servant was directly negotiating with a private company for an illegal gratification of Rs. 50 lakh in lieu of granting credit extension to the said company as it had defaulted on the payment of loan installments amounting to crores of rupees to the bank. The officials of the said company allegedly agreed to pay the said illegal gratification and the money was transferred to the middlemen who are also relative of the public servant. CBI laid a trap and recovered the illegal gratification of Rs. 50 lakh on the spot after the said delivery was made.

Jain assumed charge as CMD of the bank on July 8 last year. He has been in banking industry for 26 years.

(This article was published on August 2, 2014)

Union of India & Ors. Vs. Debts Recovery Tribunal Bar Association & ANR.

  THANKS Ashpreet Sethi

Union of India & Ors. Vs. Debts Recovery Tribunal Bar Association & ANR.

[Civil Appeal Nos.617-618 of 2013 arising out of SLP (C) Nos. 22808-22809 of 2010]

O R D E R

1. Leave granted.

2. These appeals arise out of judgment dated 18th September 2008 in CWP No. 11742 of 2007, and order dated 21st August 2009 in Review Application 161 of 2009, rendered by the High Court of Punjab & Haryana, whereby certain directions relating to provision for adequate space for the smooth functioning of the Debts Recovery Tribunals (for short "the DRTs") at Chandigarh, have been issued. The circumstances that have led to the filing of these appeals are succinctly stated below.

3. A Bench of the DRT was established at Chandigarh by the Union of India (for short "the UOI"), vide notification dated 24th March 2000, in a rented building. Subsequently, a second Bench of the DRT was established, which was supposed to function from another premises. However, both the Benches continued to function from the same premises where the earlier Bench was functioning. By a communication dated 20th July, 2007, the UOI directed that the second Bench would function from the premises acquired for it. Thereupon, the respondent Bar Association made a representation to the Presiding Officers of both the Benches, requesting them to inter alia, continue to function from the premises from where the first DRT was functioning. However, in light of the aforesaid communication issued by the UOI, the request of the Bar Association was not acceded to.

4. Aggrieved, the Bar Association filed a Civil Writ Petition in the High Court of Punjab & Haryana, seeking directions to the UOI, to inter alia provide adequate accommodation for the functioning of both the DRTs; and to frame Rules for recruitment/appointment of the Presiding Officer & the Recovery Officers. In light of the assurance on behalf of the UOI that adequate space would be taken on lease for the smooth functioning of both the Benches at the same place, and that further, land was also being acquired for housing the DRTs, the writ petition was disposed of with a direction that the construction of the building shall be completed within three years from the date of its order. However, the High Court did not examine the other issues referred to above on the ground that they were unrelated to the inadequacy of office space needed by the DRTs.

5. Having failed to get the said order reviewed, the UOI is before us in these appeals. In order to appreciate the issue involved in the matter before us, it would be useful to have a bird's eye view of the constitution of DRTs and their functioning.

6. Prior to the promulgation of the Recovery of Debts Due to Banking and Financial Institutions Act, 1993 (for short "the RDDBFI Act"), all banks and financial institutions were required to file their recovery cases in the form of suits before the civil courts, on the basis of their territorial and pecuniary jurisdictions. Due to delays in the disposal of such suits by civil courts on account of heavy dockets, the recovery of loans and enforcement of securities suffered. Thus, an urgent need was felt to work out a suitable mechanism through which, the dues of the banks and financial institutions could be realized expeditiously. This led to the establishment of DRTs and the Debts Recovery Appellate Tribunals (for short "DRATs") under the RDDBFI Act for expeditious adjudication and recovery of debts due to banks and financial institutions.

7. As per the information available, there are all in all 33 DRTs established in the entire country out of which Delhi, Mumbai, Chennai, Kolkata, Chandigarh and Ahmedabad have two or more DRTs each. However, there are only five DRATs, established in Allahabad, Chennai, Delhi, Kolkata and Mumbai, each covering multiple DRTs of a particular geographical zone. As a result, DRATs are overburdened and are also facing an acute shortage of infrastructure and staff.

8. Given the poor state of affairs as highlighted by the Bar Association, we were constrained to take cognizance and hence, vide order dated 15th November 2010, directed the learned Addl. Solicitor General to file an affidavit suggesting measures for improving the working of the said Tribunals. Subsequently, on 7th April 2011, this Court appointed Mr. Rajeeve Mehra, Senior Advocate, as amicus curiae to assist the Court. Consequently, having considered the views of all DRTs, DRATs as well as the Bar Associations, the learned Addl. Solicitor General and the learned amicus curiae have filed their responses, highlighting the core issues and respective suggestions to address the same. In light of the above, the UOI was directed to place on record their response on the issues so raised, in particular, on the criteria being adopted for appointment of the members, Recovery Officers etc. In pursuance thereof, the UOI has filed status reports, indicating the measures agreed upon by the Government to address the aforementioned issues. Before we proceed to list the same, it would be helpful to discuss the core issues in respect of which the suggestions have been made.

9. At present, DRTs and DRATs suffer from severe infrastructural constraints. Most of the DRTs are being run from rented premises and face acute shortage of space, exorbitant rents, limitations on non- renewal/extension of leases etc. It has been brought to our notice that where the DRTs have been allotted space of about 5000 sq. ft., the actual requirement is not less than 7,500 sq. ft. Similarly, the learned amicus curiae brought to the fore several other issues plaguing the smooth functioning of the Tribunals, the most significant being: that there is a need to increase the number of DRATs in the country to reduce the workload of the existing DRATs; that many serving Recovery Officers lack a judicial background or are appointed on deputation from those very banks or financial institutions which are filing recovery cases in DRTs, thereby raising serious questions about their independence, impartiality and fairness; that the time taken in filling up vacancies for the posts of senior officials of DRTs and DRATs is extremely long; and that the presence of modern and technological systems of administration continues to be elusive in the administration of justice in as much as many DRTs and DRATs do not even have websites or computerized systems. Suggestions made by the learned Addl. Solicitor General and learned amicus curiae S. Issue Suggestions of the Suggestions of the No learned Addl. learned amicus Solicitor General curiae

1. Premises & All DRTs and DRATs Concurring Physical should be housed in Infrastructure suitable buildings. Pending construction of these buildings, the Tribunals should be housed in rented premises having an area of at least 8000 sq.ft. where suitable space for records, etc. and amenities for the officers of the court, staff, litigants and lawyers should be provided.

2. Increase in A DRAT must be Number of established in each DRTs/DRATs state where there --- is a DRT or multiple DRTs. DRATs may be established in the city where the concerned High Court of a State is located.

3. Appointment of Qualifications for Appointment of Recovery Officers Recovery Officers Recovery Officers should include at by way of the very least, a deputation from basic degree in law. Government If possible, Departments/Ministr judicial officers or ies, Banks and advocates with five Financial years standing at Institutions should the Bar may be be discontinued. Appointed as Instead, the person Recovery Officers. appointed must be a person of a judicial background, preferably a judicial officer of the rank below the designation of Addl. District and Sessions Judge on deputation, and should be given the same facilities and perks he/she enjoys in the parent cadre.

4. Vacancies and A select list of

a. For posts other Status of Senior candidates should be than Presiding Officers of maintained to fill Officers and DRTs/DRATs the vacancies. The Recovery Officers, selections should be on-going process of made within a fixed sourcing time frame. Staff/officers on deputation should be discontinued, and permanent cadres should be established.

b. The post of Presiding Officers, Registrars and Recovery Officers should be filled up from the state cadre of Judicial Officers through deputations and rotations so that these posts do not remain vacant.

c. Judicial officers must be provided the same facilities and perks as they enjoy in their parent cadres. Further, residential accommodation must be necessarily earmarked for Presiding Officers.

5. Information DRTs and DRATs must Concurring Technology and have a website. Computerisation Possibility of publication of notices and auctions on the website should be explored, keeping necessary safeguards in mind. The National Informatics Centre should be called upon to prepare appropriate software for computerization of processes in the DRTs, from filing to disposal, so that the time taken for disposal is reduced.

10. We are pleased to note the positive and forthcoming response of the UOI to the suggestions of the learned Addl. Solicitor General and the learned amicus curiae. Having taken note of the urgent need to address the abject conditions prevailing in the Tribunals, the UOI, has agreed to: i. Provide adequate infrastructure to DRTs/DRATs on the following basis:

a. If sufficient space as per requirement is available in the Government building, then space from the concerned department will be allotted on a permanent basis.

b. If space is not available in the Government building but sufficient space is available in public sector undertakings' buildings, then the DRTs/DRATs may move to the same on a permanent lease/rental basis.

c. If (a) and (b) are not possible, then suitable land may be purchased for construction of a building, or a suitably constructed building may be purchased from public authorities. This may be completed in a phased manner. In the mean time, DRTs and DRATs may continue at their present locations or hire alternative suitable space as per norms.

d. Further, on the basis of a spot study conducted by the Department of Financial Services on 11th December 2011, the existing space authorization of 5000 sq. ft. for DRTs and 3600 sq. ft. for DRATs was examined. In light of the study and requirements of additional facilities, the same has been increased to 7200 sq. ft. and 4500 sq. ft. respectively.

In case more than one DRT is accommodated in one building, space would be saved for common facilities such as bar room, consultation chamber, reception, canteen, washrooms, etc. In such a case, the space requirements for the second and third DRT (if located in the same building) may be around 6000 sq. ft. and 5500 sq. ft. respectively.

e. Preference is to be given to buildings where parking facility is provided either within the building premises or in the vicinity.

ii. Consider the feasibility of establishing more DRTs/DRATs and redefining the jurisdiction of some DRTs on the basis of data showing pendency of cases and existing workload of all the DRTs and DRATs.

iii. Fill all anticipated vacancies for the posts of senior officers, as and when they arise, with candidates who have already been selected according to the stipulated rules.

iv. Extend the facility of General Pool of Accommodation of the type entitled to Group A officers upto April 2013 to the Presiding Officers. In the meantime, the Ministry of Finance and Ministry of Urban Development will examine all issues to finalise modalities for either buying or construction of flats/houses for use of the members of the Tribunals. Further, in case this proposal does not materialize, then the possibility of hiring accommodation shall be considered at the appropriate stage. v. Implement the "e-DRT Project" to automate and improve DRT services by building IT systems as expeditiously as possible. vi. Carry out the recruitment of Recovery Officers by promotion, failing which, by deputation, in accordance with the eligibility criteria as defined in the recruitment rules of each DRT. Keeping in mind the profile of the post of a Recovery Officer, it may not be possible to appoint judicial officers of a rank below that of an Additional District and Sessions Judge, as suggested by the learned amicus curiae.

However, the UOI shall give preference to only those candidates who either have legal experience or hold a degree in law. Further, with respect to improving the selection procedure of Recovery Officers, the Departmental Promotion Committee (DPC), provided for in the recruitment rules, shall be expanded to include the Presiding Officer of any DRT as a member of the DPC to take part in the selection of the Recovery Officers. At the same time, the level of representation of the Reserve Bank of India in the DPC will also be raised from the rank of Deputy Legal Advisor to Joint Legal Advisor, RBI. vii. Hold regular training programmes for Recovery Officers/Assistant Registrars/Registrars to give them minimum working knowledge of the procedures followed in DRTs, the provisions of the RDDBFI Act, the SARFAESI Act, the Rules made there under, and the provisions of Schedules II and III of the Income Tax Act, 1961.

11. We are confident that the aforementioned measures proposed by the UOI, shall go a long way in improving the administration of justice in these Tribunals. We are in agreement with these proposals and hope that they will be implemented efficiently and expeditiously by the concerned authorities. Having said that, it is necessary that the exercise undertaken by this Court must reach its logical end sans any delays and glitches or any other hindrances in the implementation of these suggestions. To this effect, we issue the following directions:

i. All the aforementioned proposals and measures agreed upon by the UOI in response to the suggestions made by the learned amicus curiae and the Addl. Solicitor General shall be implemented expeditiously within a suitable time frame. In the event that the UOI or the concerned authority fails to comply with the aforesaid assurances, it will be open to the learned amicus curiae to bring the same to this Court's notice for appropriate directions.

ii. Further, we believe that the High Courts are empowered to exercise their jurisdiction of superintendence under Article 227 of the Constitution of India in order to oversee the functioning of the DRTs and DRATs. Section 18 of the RDDBFI Act leaves no scope for doubt in this behalf. It reads thus:

18. Bar of Jurisdiction.-On and from the appointed day, no court or other authority shall have, or be entitled to exercise, any jurisdiction, powers or authority (except the Supreme Court, and a High Court exercising jurisdiction under articles 226 and 227 of the Constitution) in relation to the matters specified in section 17. Article 227 of the Constitution stipulates that every High Court shall have superintendence over all courts and tribunals throughout the territories interrelation to which it exercises jurisdiction.

This power of superintendence also extends to the administrative functioning of these courts and tribunals [Shalini Shyam Shetty & Anr. Vs. Rajendra Shankar Patil[1]]. Hence, in light of the above, we expect that all the High Courts shall keep a close watch on the functioning of DRTs and DRAT, which fall within their respective jurisdictions. The High Courts shall ensure a smooth, efficient and transparent working of the said Tribunals. We are confident that through the timely and appropriate superintendence of the High Courts, the Tribunals shall adhere to the rigour of appropriate standards indispensable to the fair and efficient administration of justice.

12. Before parting, we place on record our deep appreciation for the able assistance rendered to us by Mr. Sidharth Luthra, the learned Addl. Solicitor General, Mr. Rajeeve Mehra, the learned amicus curiae and Mr. Arjun Kapoor, Law Clerk-cum-Research Assistant.

13. These appeals stand disposed of in the above terms.

.................................J. (D.K. JAIN)

.................................J. (H.L. DATTU)