DRT Solutions Weekly Mail – 229th Issue
dated 28th September
‘12
All Weekly mails right from 1st Issue to latest, click
at top of the page
(1) 15 Years after SC Order, Babus hold on to Tribunals
Following is the extract from our web page vide link
http://www.drtsolutions.com/drt_DRT.htm
Dr. Suresh, Founder of ‘Borrowers’ Rights Forum’ and one of our clients
has sent following important news item:-
15 years after SC order, babus hold on to tribunals
Posted about 11 hours ago | 0
comment
New Delhi, September 26, 2012(TNN): Over 15 years ago, the Supreme Court
had said that tribunals should be free from direct administrative
control of various ministries but the highest court’s advice has
remained on paper as key ministries are reluctant to lose their
tribunals to the supervision of an autonomous umbrella body.
“The department of justice prepared a proposal for creation of a Central
Tribunal Division and sought comments of the 24 ministries/departments
having administrative control of 62 tribunals/authorities. Of the 24
ministries/departments, 10 opposed it, four supported it and eight
conveyed conditional concurrence,” the
law ministry said in an affidavit.
Faced with persistent queries from a bench of Justices G S Singhvi and S
J Mukhopadhaya on efforts made to make the tribunals functional in
letter and spirit, the Centre said to overcome divergent views, it has
set up an inter-ministerial group (IMG) “to discuss the feasibility of
having central level agency for exercising administrative control over
the quasi-judicial bodies (read tribunals)”.
The first meeting of the IMG was held on September 13 in which
department of revenue did not favour setting up of Common Tribunal
Division (CTD). Likewise, ministries of corporate affairs, power,
petroleum & natural gas and commerce too said the tribunals under them
functioned for a specific purpose and selection of the chairperson and
members was a specialized task having no parallel to other tribunals.
The law ministry, in its affidavit, said, “It was impressed upon the
participants in the September 13 meeting that there is urgency in the
matter and the need for finding a common ground for way forward. The IMG
members have been requested to consider four proposals – to devise
uniformity for those tribunals performing quasi-judicial functions,
possible uniformity in appointment of chairman/members of the tribunals,
need for uniform terms and conditions of service and mechanism for
monitoring the performance of the tribunals as well as to look into
complaints of corruption and misconduct.”
The SC’s 1997 judgment in L Chandra Kumar case had unambiguously
said, “We are of the view that, until a wholly independent agency
for administration of all such tribunals can be set up, it is desirable
that all such tribunals should be, as far as possible, under a single
nodal ministry which will be in a position to oversee the working of
these tribunals. For a number of reasons, that ministry should
appropriately be the ministry of law.”
The law ministry said the court’s 15-year-old suggestion was
considered by the government but “the concerned ministries where the
tribunals are functional have been resisting the creation of a
centralized agency in the law ministry on the ground that each tribunal
is set up for certain specific objective pertaining to a subject matter
dealt with by that ministry”.
It said the chairman and members of these tribunals — like Income
Tax Appellate Tribunal, , Employees Provident Fund Appellate Tribunal,
Telecom Disputes Settlement and Appellate Tribunal, Film Certification
Appellate Tribunal, Appellate Tribunal for Foreign Exchange, Appellate
Tribunal For Prevention of Money Laundering Act, Securities Appellate
Tribunal, Railways Claims Tribunal and Railways Rates Tribunal – were
drawn from various sources with the specific background, knowledge and
experience required for that tribunal.
“These tribunals do not have identical arrangements and have
officers of different backgrounds with subject knowledge. Thus, there is
no uniformity in manning of the tribunals at the chairman/member level,” it
said.
However, the government’s effort had been to formulate a uniform
policy for appointment of chairpersons and members of various tribunals
covering age, tenure and other conditions of appointment, it said but
lamented that there had been no consensus on it among the ministries.
Our Comments
(a) As
per the above news item, the Govt does not appear to be keen to transfer
the tribunals from the controls of the parent ministries.
(b) In
the cases of DRTs, the attitude of the Ministry of Finance is no
different.
(c) On
one hand, the Govt desires quick decisions from the DRTs even within 6
months but is unable to take any decision even after 15 years of the
judgment of the Supreme Court.
(d) In
view of above, the only course left is to incorporate all these aspects
in the pleadings. All the arbitrary dealings of the Govt should be
described such as establishment and control of the DRTs, appointment of
the POs, arbitrary decisions of the Pos, partiality shown to the banks
etc with the conclusion that justice can not be obtained with the
present state of affairs. On one hand huge court fees of being charged
(e.g. Rs. 1.5 lac for OA and Rs. 1.5 lac for the counter-claim), the
appeal in the matter of SAs are nearly impossible due to prescribed
deposit of minimum 25%, exhaustive trial is a must. In our previous
mails we have given lot of tools to ensure exhaustive trials, the same
should be used. The litigant borrowers and guarantors have to take
special pains to help their advocates.
(e) As
emphasized the borrowers need to question the constitutional validity of
the said 25% provision of the deposit. This can only be achieved by an
united fight.
(f) Since
there are more than 60 tribunals in the country, our above suggestions
need to be spread among the litigants of other tribunals by forwarding
our this mail to them.
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DRT Solutions Weekly Mail – 228th Issue
dated 21stSeptember ‘12
All Weekly mails right from 1st Issue to latest, click
at top of the page
(1) DM, CMM, Collectors and DRT Judges are reading our Weekly Mails
Following is the extract from our web page vide link
http://www.drtsolutions.com/securitisation_securitization_SARFAESI_SA_Act.htm
Few of our clients have informed that DM, CMM, Collectors and DRT Judges
are reading our weekly Mails. Our comments are as under:-
(a) Our
Judicial system does not have any established mass communication system
for updating the knowledge of the Judicial officials. They have to
depend on either self study or the submissions made by the advocates
during the arguments.
(b) The
legal reports for the self study contains mostly the judgments delivered
by different courts in the country. Most of such judgments are outdated
for the needs of the latest and current problems.
(c) Since
the judges are highly overloaded and overworked, most of them don’t have
time for self study and hence they have no options but to go by the
submissions made by the advocates during the arguments.
(d) On
account of present huge pendency as well as ever increasing rate of
growing of the said pendency, the judges do not allow time for
exhaustive arguments and hence are deprived of proper understanding of
modern complex problems. The emphasis is on disposal rather than
justice. Thus the original judgment suffers giving rise to review and
appeal. The higher courts are no way different. All these factors give
rise to further additions to huge pendency, poor quality and great
dissatisfaction. Most of the litigants heavily suffer due to long drawn
process of years and decades.
(e) Advocates
are having their own problems. They are mostly governed by the plight of
the judges.
(f) Thus
on account of above, there is no scope for solutions to current or
latest problems.
(g) We
have recognized the above ground reality and accordingly designed our
website, conferences and the weekly mails. As a policy we provide
immediate response to anyone on our mobile phone. Hence we are quite
uptodate with day to day problems. This is one of the our core
strengths.
(h) We
had several instances when the DRT Judges, High Court Judge, Retired
judges etc called on us and had serious brain storming sessions.
(i) We
welcome the Judicial authorities to communicate and interact with us to
apprise them with most appropriate solutions to current and latest
problems.
(2) Sec 14 of Securitisation Act – Remedial Measures for Borrowers &
Guarantors
Following is the extract from our web page vide link
http://www.drtsolutions.com/securitisation_securitization_SARFAESI_SA_Act.htm
The following measures are suggested:-
(a) As
soon as legal notice is received u/s 13(2), the borrowers and guarantors
whose properties are involved as the alleged secured assets, should find
out the office of the DM, CMM or Collector who is handling the
applications from the bank for taking physical possession.
(b) One
should have continuous contact with the said office so that as soon as
the bank approaches, it should be immediately known. The copy of the
application submitted by the bank should be obtained, studied and reply
submitted to the said office.
(c) The
concerned judicial authority is bound to provide opportunity to hear
oral arguments and take into account the written submissions.
(d) Side
by side, one should file application with the DRT under sec 17 along
with a stay application.
(e) In
our several previous weekly mails, we have given lot of details on above
as well as other points.
DRT Solutions Weekly Mail – 227th Issue
dated 14thSeptember ‘12
All Weekly mails right from 1st Issue to latest, click
at top of the page
(1) Supreme Court fires Bank for Unnecessary & Mindless Litigation -
Bank ordered to pay Huge Costs compared with the Claim
Following is the extract from our web page vide link
http://www.drtsolutions.com/drt_DRT.htm
Despite numerous instructions and court judgments, the bank officials
are indulging in unnecessary and mindless litigations. Supreme Court
fired the bank for fighting a bank claim case of paltry sum of Rs
15,000=00 in District Consumer Forum, State Consumer Forum, National
Consumer Forum and then Supreme Court. The bank lost in all the courts.
District Forum imposed costs of Rs. 3000=00 on 26.07.07 and Supreme
Court imposed costs of Rs. 10,000=00 on 09.07.12. The bank must have
spent huge money on advocates in all the courts. Further the bank
officials must have spent lot of time in office, advocates office and
courts apart from expenditure on travel.
The entire judgment is reproduced at the end of this mail.
Our Comments
On account of above mindset of the bank officials, we always tell our
clients that even if the bank loses in DRT, the bank officials will
fight up to Supreme Court. Hence we emphasize that the pleadings must be
prepared by persons having mastery of facts and mastery of law. One must
pay adequate attention on all dates without leaving the matter to the
advocates only.
(2) NPAs in 2013 may increase tremendously to 10%
Following is the extract from our web page vide link
http://www.drtsolutions.com/drt_DRT.htm
Following extract from a news item predicts tremendous increase in bank
NPAs in 2013:-
“Global rating agency, Fitch, post examining the Indian economic
condition and global downturn forecasted the non performing assets (NPAs)
of the banks to reach 3.75% (FY12 2.9%). However, given the macro
pressures and addition of NPAs particularly, by government banks in the
last financial year the agency expects stressed assets in the system,
including unseasoned restructured loans, to reach around 10% by FY13
from 6.7% in FY10.”
DRT Solutions Weekly Mail – 226th Issue
dated 7thSeptember ‘12
All Weekly mails right from 1st Issue to latest, click
at top of the page
(1) Bank Official committed Serious Irregularities: Court
Following is the extract from our web page vide link
http://www.drtsolutions.com/securitisation_securitization_SARFAESI_SA_Act.htm
One of our clients have sent the following useful news item which is
self explanatory:-
Bank official committed serious irregularities: court
CHENNAI, August
19, 2012
Directs bank’s CMD to conduct probe and take action
Stating that the Authorised Officer of a nationalised bank had committed
serious irregularities in the sale of a property at Besant Nagar here,
the Madras High Court has directed the bank’s Chairman-cum-Managing
Director to conduct an inquiry in the matter and take appropriate action
against all concerned.
The enquiry should be conducted by an officer not below the rank of a
General Manager.
A Division Bench comprising Justices D. Murugesan and K.K. Sasidharan
passed the order while allowing a writ petition by one Hemalatha
Ranganathan who
sought the quashing of an order of the Chief Metropolitan Magistrate of
February 22 this year and consequently direct the bank to hand over
possession of a portion of the property to her.
By the February order, the CMM had permitted the bank to take possession
of the property from one Rajalakshmi who died in December last year. The
petitioner had succeeded to the estate.
The writ petition’s substance related to the collusive sale made by the
Authorised Officer (AO), Indian Bank, Circle Office, here, in favour of
a person who was not even a bidder. The
auction proceedings had been conducted in spite of a High Court stay
that restrained the bank from proceeding further with the sale.
Subsequently, the officer had taken action to take possession of the
property by approaching the CMM, Egmore, under Section 14 of the
Securitisation and Reconstruction of Financial Assets and Enforcement of
Security Interest (SARFAESI) Act without divulging the background facts.
This was followed by the issue of a sale certificate in favour of a
stranger.
Mr. Justice Sasidharan said a perusal of the file revealed that the AO
had committed serious irregularities in the sale. It had been made in
utter violation of the mandatory provisions of the SARFAESI Act besides
the terms and conditions of the bank’s auction notification. The AO
confirmed the sale in the name of a third party, accepted 75 per cent of
the sale consideration after 17 months and ultimately sold the property
to yet another person. “The
present case is a classic example as to how Authorised Officers of the
banks are dealing with the secured assets by misusing the enormous power
at their command,” Mr.
Justice Sasidharan said. The Bench said Magistrates should not pass
orders under Section 14 of the Act in a routine manner. They should
satisfy themselves that the court’s intervention was necessary to take
possession of the property concerned.
There were instances where Advocate-Commissioner (AC) with police
assistance locked the premises without even allowing the inmates to take
the cooked food or uniform and books of school-going children. In the
normal circumstances, it was not necessary to order police protection
and permission to break open the lock. It was always open to magistrates
to issue suitable directions to execute the order under Section 14 of
the Act depending upon the AC’s report after the initial inspection.
Setting aside the CMM’s order, the Bench directed the CMM to put the
petitioner in vacant possession of the property by deputing the very
same AC or another AC within two weeks.
(2) Frauds committed by Bank Officials
Following is the extract from our web page vide link
http://www.drtsolutions.com/drt_DRT.htm
Many of our clients are reporting frauds committed by the bank officials
while sanctioning the loans, disbursement of loans, declaring the NPAs,
declaring willful defaulters etc. Our comments are as under:-
(a) All
discussions with the bank officials should be audio recorded and
transcripted.
(b) All
dealings should be covered in writing.
(c) If
the said fraudulent actions are resulting into loss and damages, the
same should be mentioned in correspondence.
(d) If
any document is got signed by the bank officials, photocopy should be
obtained and kept in record.
(e) Copies
of all correspondence be endorsed to the Chairman of the bank.
(f) Whenever
any legal action is initiated by the bank, the above documents and
material will be quite useful.
(g) At
the initiation of the said legal action, one should study the provisions
of law as well as the RBI Guidelines.
(h) If
any bank officials is personally involved or is troubling personally,
the Indian Penal Code be gone through and relevant sections be noted.
This will be useful for initiation criminal action against the said
official
(i) Since
the bank officials are not afraid of usual correspondence and if they
initiate any legal action, communication with them should be made
through legal mode only with copies to the Chairman of the Bank.
(j) Whenever
any claim is raised by the bank in money value, the defence should also
be in money value i.e. loss and damages or counter-claim in money value.
(k) In
case of frauds, the matter be reported to the RBI and CVC (Central
Vigilance Commission)
(l) All
above will be useful whenever any criminal action is initiated against
the bank officials.
DRT Solutions Weekly Mail – 225th Issue dated 31st August
’12
All Weekly mails right from 1st Issue to latest, click
at top of the page
(1) Counter-claim Limitation – Continuing Cause of Action
Following is the extract from our web page vide link
http://www.drtsolutions.com/drt_DRT.htm
Many advocates of our clients have been raising objections against the
counter-claim particularly on the issue of limitation. Our comments are
as under:-
(a) The
banks are initiating actions for recovery of their dues by invoking
either DRT Act or Securitisation Act. The alleged claim of the bank is
in money value. The ultimate defence for the borrowers should also be
money value. Such defence in respect of DRT Act will be by way of
counter-claim (in form of damages) or in respect of Securitisation Act
by way of loss and damages in the application u/s 17.
(b) The
nature of above mentioned damages and losses is that the same go on
increasing every day i.e. they are continuing tort. Accordingly the said
counter-claim or the loss and damages are to be treated under Section 22
of the Limitation Act 1963, which relates to ‘Continuing breaches and
torts’
(c) In
view of above, there is no bar of limitation for the above mentioned
counter-claim or loss and damages and accordingly the pleadings should
be framed.
(d) This
is just for information that we have filed a counter-claim in respect of
one of our clients after 21 years as an Indigent Person.
(2) Dealing with a Powerful Recovery Agent
Following is the extract from our web page vide link
http://www.drtsolutions.com/drt_DRT.htm
Recently one our clients informed that the bank has deputed a powerful
Recovery Agent who will take necessary actions for taking physical
possession of the secured assets. We guided the said client as under:-
(a) Legal
notice be sent to the bank with copy to their Chairman laying down the
various provisions of law for taking possession of the secured assets.
It was also informed in the said legal notice that the visit of the said
Recovery Agent will be video recorded.p
(b) The
bank informed the day and time of the visit of the said Recovery Agent.
We asked our client to have foolproof arrangements for video recordings,
one by handycam and another by mobile. A mock trial be conducted for the
video recording so that there is no failure even at odd hours.
(c) The
said Recovery Agent did not come at the appointed time. Another legal
notice was sent to the bank with copy to the Chairman informing the
non-visit of the said Agent asking them to inform at least 3 days in
advance about the next visit.
(d) Normally
these agents employ some goonda elements and they come at odd hours on
late evenings of holidays. Some time they come with fake police
personnels and take forcible possession of the secured assets. We
apprised our client about all these tricks and machinations employed by
the Recovery Agents.
(e) On
account of above, the said Recovery Agent declined to come to the
premises and hence the bank employed another Recovery Agent who came on
the spot without prior information. His visit was video recorded and
anther legal notice was sent to the bank with copy to the Chairman.
(f) With
above empowerment of the client, no physical possession could be taken.
Bank or their Recovery Agent have no choice but to take symbolic
possession only.
(g) In
democratic frame work, there is only rule of law and not rule by
persons. The law is in favour of public, in favour of borrower. The
public servants (i.e. the Bank Officials including the Chairman) are
servants and not masters. They have to render service to their masters
i.e. the borrowers. But this will happen only when the master (i.e. the
borrowers, i.e. the public) knows the law otherwise the servants (i.e.
the bankers i.e. the politicians) will rule the masters (i..e the
borrower i.e. public)
(h) In
British days, when the Collector used to write a letter to the public,
he will end the letter with ‘Yours most obedient servant’, this line has
been dropped in Free India but needs to be introduced again. When a
politician comes for votes, he requests the public with folded hands to
vote him. After elections, the folded hands disappear and public can not
meet him.
(i) In
UK and other developed countries, there are no red lights on the cars of
the politicians, beauracrats etc. Red lights are there only on the
ambulance and fire vehicles.
(j) In
Japan, the beauracts sit on simple chair and table, whereas the visiting
public is seated on sofas at higher level.
(k) In
Netherland, their Prime Minister is often seen moving on a bycycle.
(l) In
all the above countries, there are no security personnels surrounding
them.
(m) On
account of above, the borrowers (i.e. public) need to understand and use
the Constitution of India i.e. the Mother Law as well as other
subordinate laws while dealing with the bank officials as well as other
government officials.
DRT Solutions Weekly Mail – 224th Issue dated 24thAugust ’12
All Weekly mails right from 1st Issue to latest, click
at top of the page
(1) Alertness and Vigilance on part of Borrowers in Litigation
Following is the extract from our web page vide link:-
http://www.drtsolutions.com/drt_DRT.htm
Recently few of our clients experienced problems during litigation. We
advised them to make audio records of various discussions with the
bankers and the advocates as well as the court arguments. Based on such
audio records and other feedback from the said clients, our views are as
under:-
(a) Prior
preparations must be made before such discussions take place. All
relevant documents must be gone through and understood thoroughly well.
(b) All
discussions must be audio recorded so that the same is reviewed and
revised with a view to have corrections in future.
(c) Important
discussions with the bank officials must be covered in writing.
(d) Have
a sitting with the advocate at least one week in advance. Provide and
explain him all the relevant documents and case laws so that he can
prepare for all the pros and cons. Have another sitting at lease two
days in advance to ascertain as to how he has prepared the matter. One
should never go the court without such preparations.
(e) Always
attend the court along with the advocate and make audio record of the
complete court proceedings. During the course of arguments, if there is
any important information, the same should be immediately provided to
the advocate then and there only.
(f) Always
keep in view that your stake is the highest. Every moment should be
accomplished thoroughly. Always keep in view that if there is any lapse,
future corrections will be extremely difficult rather impossible.
(g) Be
frank with your advocate and if he can not fulfil your above
requirements, it will be better to appoint another advocate. While we
appreciate the advocates, but they have their own limitations and no one
will agree that on account of their limitations, one should lose his
case.
(h) It
is needless to mention that the environment is totally against the
borrowers. Hence all possible efforts are to be made right from the
inception at every point of time. Any lapse or neglect, will result in
adverse outcomes which may be impossible to correct in future.
(i) With
above approach, some of our clients have been quite successful in their
bank litigations.
(2) Important Mail from Mr. Ajay Khemka, Bangalore
Following is the extract from our web page vide link
http://www.drtsolutions.com/drt_DRT.htm
An important mail from Mr. Ajay Khemka, one of our clients from
Bangalore is reproduced below. It is self explanatory:-
Recently, I read a short book by Leila Seth (the first woman of Delhi
high court and the first woman chief justice of a high court in India). We,
The Children of India – The Preamble to our Constitution by Seth
explains the ideals of our Constitution in a simple and lucid manner,
namely, dignity, equality, opportunity, freedom, liberty, rights,
justice, fraternity, democracy, socialism and secularism.
At the same time, I came to read a report by the Centre for Social
Justice regarding lack of awareness in our lower judiciary about
socio-economic rights guaranteed by our Constitution.
There is nothing surprising or shocking in the report. A few years back,
the while attending the classes of Judicial Academy, lower court judges
raised a question, “How are we concerned with the human rights of our
Constitution?”
I was asked by the chairman to prepare a short note to show how
Fundamental Rights and Directive Principles are also important in the
work of the lower judiciary. In almost every case, one or the other
right is directly or indirectly involved, as in the case of tortured
wife, child labour, right to education, custodial violence, bail and
remands, family disputes, dispossession of land, termination of worker’s
services, landless labourer’s claim for minimum wages, granting
injunctions, water disputes, money lending etc..
This ignorance or indifference or insensitivity has not only been
prevalent in the lower judiciary, but has also spread to the higher
judiciary. When we talk about human rights in a lower court, we are
ridiculed and told “not here, but in the high court”. When we do the
same thing in the high court, we are told in many cases the same thing,
“not here, go to the Supreme Court”.
Our Constitutional ideals have largely become a dead letter for a large
number of our judges and black letter lawyers for whom law is a logical
exercise or linguistic gymnasium. Every legal concept has not only a
core meaning, but also a penumbral area where your sense of justice and
ideals of Constitution have same role to play.
But for these judges, deciding the cases is the job, not doing justice.
For many lawyers and judges, law is a game of chess – you move and I
counter-move. But every case is a human drama where human beings are the
actors.
A workman retrenched or dismissed, a woman burnt, exploited child
labourer, a displaced tribal, tortured dalit are not simple law cases
but living, suffering human beings seeking justice from the courts.
For doing justice, legal scholarship or disposal efficiency is not
important but Soloman’s wisdom is required. There can be no better
guideline than our Preamble for doing justice.
In this unfortunate state of affairs, I think Leila Seth’s short book
should be made available to all judges as the basic textbook to guide
them towards administering justice.
Strangely, Swift’s Gulliver’s Travels, which was meant for the
adults came to be used as a children’s book. Here, Leila Seth’s book,
written for children, should be studied and digested by our Hon’ble
judges. Every day, the court work must begin and end with the recitation
of our Preamble so as to remind the judges and the lawyers that truth
and justice are the two pillars of administration of justice.
(2) Amount of Counter-claim
Following is the extract from our web page vide link
http://www.drtsolutions.com/drt_DRT.htm
In several cases, we have prepared counter-claims running in thousands
of crores. Repeatedly, our clients have been asking us to reduce the
said huge amount of counter-claim to lower figures. Our replies to them
have been as under:-
(a) Law
of Damages is highly developed in advanced countries but in India, it is
still in its infancy. The advocates who have adequate knowledge of law
of damages will never raise such question.
(b) There
is no upper limit or any restriction on the amount of counter-claim
filed in the court of law including DRTs.
(c) The
maximum amount of court fee in most of the States and also in DRTs is Rs.
1 5 lac.
(d) In
view of above, one should claim, as much is possible under the law of
damages.
DRT Solutions Weekly Mail – 222nd Issue dated 10thAugust ’12
All Weekly mails right from 1st Issue to latest, click links
below:-
Weekly Mails - 1-10 11-20 21-30 31-40 41-50 51-60 61-70 71-80 81-90 91-100 101-110 111-120 121-130 131-140 141-150 151-160 161-170 171-180 181-190 191-200 201-Latest
(1) Complaints against DRT Judges at Coimbatore, Hyderabad & Jabalpur
Following is the extract from our web page vide link
http://www.drtsolutions.com/drt_DRT.htm
Dr Suresh, one of our clients and founder of ‘Borrowers Rights Forum’
has sent the following useful news item:-
