W.P.(C)/1954/2020 of M/S SASHA TELECOM PVT. LTD. AND ORS. Vs M/S PHOENIX ARC PVT. LTD.

*IN THE HIGH COURT OF DELHI AT NEW DELHI

+W.P.(C) 1954/2020 & CM APPL. 6850/2020

M/S SASHA TELECOM PVT. LTD. AND ORS. .....PetitionersThrough:Mr. Tarun Rana, Mr. S. Pandey, Mr.Waseem Akram, Mr. Anish Singh andMr. Shivam Veena, Advocates

versus

M/S PHOENIX ARC PVT. LTD......RespondentThrough:Mr. Samrendra Kumar, Advocate

CORAM:HON'BLE THE ACTING CHIEF JUSTICEHON'BLE MR. JUSTICE TUSHAR RAO GEDELA

%28.08.2024

1.The only issue raised in the present petition is with regard tointerpretation of the proviso under Section 19(5) of the Recovery of Debtand Bankruptcy Act, 1993.

2.This Court vide order dated 10[th]March, 2022 has held that the issue inthe present petition is squarely covered by the Division Bench judgment inAnita Garg Vs. SBI, 2021 SCC Online Del 431, wherein this Court hastaken the view that the time for filing the written statement under Section19(5) is mandatory.

3.Today, learned counsel for the petitioner refers to and relies upon thejudgment of the Supreme Court in Dr. Suresh Kumar & Ors. Vs. AmitAgarwal, (2021) 7 SCC 466, to submit that the judgment in the case of NewIndia Assurance Co. Ltd. Vs. Hilli Multipurpose Cold Storage (P) Ltd.,

(2020) 5 SCC 757, with regard to para materia provisions, has been held toapply prospectively.

4.The learned predecessor Division Bench of this Court vide orderdated 8[th]April, 2022 has rejected the said argument. The relevant portion ofthe order dated 8[th]April, 2024 is reproduced hereunder:-

2. The petitioners’ grievance against the order of the DRT was that the writtenstatement was not taken on record.

2.1. The impugned order of the DRAT records that the summons in the O.A.preferred by the respondent was served on 22.05.2017.

2.2. As per the provisions of Section 19(5) of the Recovery of Debts andBankruptcy Act, 1993 [in short, ‘1993 Act’], the petitioners i.e., the originaldefendants were required to file written statement, including the claim for set-off or counter-claim along with the original documents or true copies of the same,within 30 days of the service of summons.

2.3 It appears that the DRT vide order dated 25.07.2017 granted one week to thepetitioners/defendantsforfilingawrittenstatement.Concededly,thepetitioners/defendants did not file the written statement, within the timeframeallocated by the DRT.

2.4. The petitioners/defendants, evidently, filed the written statement before theRegistrar, DRT on 15.09.2017.

3. The impediment before the petitioners/defendants is the provisions of Section19(5)(i) of the 1993 Act.

3.1. As noted above, the written statement was required to be filed by thepetitioners/defendants, within 30 days of the summons being served upon them.

3.2 However, in exceptional cases or special circumstances, which the presidingofficer is required to record as per the proviso to the aforementioned section, afurtherperiodcouldbegrantedtothelitigant[inthiscase,thepetitioners/defendants], which cannot exceed 15 days.

3.3.Inthiscase,asnotedabove,oneweekwasgrantedtothepetitioners/defendantsbytheDRTviaorderdated25.07.2017.Thepetitioners/defendants, in fact, have crossed even the 15 days’ timeframe providedin the proviso to Section 19(5) (i) of the 1993 Act.

4. The record shows that the coordinate bench on 10.03.2022 had brought to thenotice of the counsel for the petitioners/defendants, the view taken by thecoordinate bench of this court in Anita Garg & Ors. v. State Bank of India, 2021SCC OnLine Del 4311. The Division Bench in the said judgment has concluded

that the DRT cannot extend the time for filing the written statement, as providedin Section 19(5)(i) of the 1993 Act, read with the proviso appended thereto.

5. Mr Tarun Rana, who appears on behalf of the petitioners, has not been able toplace any judgment before us which adverts to the aforementioned provisionfound in the 1993 Act, and takes position different to the view held in AnitaGarg case.

5.1. Although, Mr Rana has referred to the judgment rendered by the SupremeCourt in Dr. Suresh Kumar & Ors. v. Amit Agarwal, (2021) 7 SCC 466, which,inter alia, highlights the fact that the Supreme Court in New India Assurance Co.Ltd. v. Hilli Multipurpose Cold Storage (P) Ltd., (2020) 5 SCC 757 has held thatits decision would apply prospectively; in our view, that will not help the cause ofthe petitioners as only the Supreme Court can say that their judgments will applyprospectively.

5.2 The reason Mr Rana has cited the aforementioned judgment is on account ofthe fact that the provisions the Consumer Protection Act, 1986 with regard to thetimeframe for filing the defense in an action filed under the said Act is andsomewhat similar to Section 19(5)(i) of the 1993 Act.

5.3 To be noted, in New India Assurance Co. Ltd., even according to Mr Rana,the Supreme Court has stated that the consumer forum cannot exceed the timelinefor filing the defense beyond 30 days plus 15 days.

5.4. The fact that the dicta in New India Assurance Co. Ltd. will applyprospectively was reiterated by the Supreme Court in Dr. Suresh Kumar. Asnoted above, it is not open to this court to state that judgment would applyprospectively except in exceptional circumstances, say, when an act is declaredas an offence for the first time.....”

5.Consequently, the argument advanced by learned counsel for thepetitioner cannot be accepted by this Court. Accordingly, the present writpetition along with application is without merit and dismissed.

ACTING CHIEF JUSTICE

AUGUST 28, 2024/ms

TUSHAR RAO GEDELA, J