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PETITIONER:

UNITED BANK OF INDIA, CALCUTTA

Vs.

RESPONDENT:

ABHIJIT TEA CO.PVT.LTD. AND ORS.

DATE OF JUDGMENT: 05/09/2000

BENCH:

M. JAGANNADHA RAO J. & DORAISWAMY RAJU J.

JUDGMENT:

M. JAGANNADHA RAO, J.

L....I..........T.......T.......T.......T.......T.......T..J

Leave granted.

The appellant Bank is the plaintiff in Suit No.410/85

which is pending on the file of the Calcutta High Court.

The respondent-debtor is yet to file its written statement.

By 31.12.98, an amount of Rs.31.13 crores is said to be due

to the Bank. Initially, in the above suit, a compromise

decree was passed by Ajit Kumar Sen Gupta, J. on 29.3.94.

It was contended by the Bank that the compromise was based

upon a non-existent agreement. On appeal, the said judgment

was set aside by a Division Bench of the High Court on

11.8.98 consisting of Ajoy Nath Ray and Dipak Prakas Kundu,

JJ. describing the said judgment as "shocking". The Bench

also observed:

"It was as if a contract was being made attempted to be

made out for the parties ....It is no part of the duty of

the Court to make an agreement for the parties".

The Bench allowed appeal, awarding costs in a sum of

Rs.75,000/-.

As part of the compromise, the learned Single Judge had

stayed another suit on mortgage ( O.C. (Mortgage) suit

No.77 of 1991) filed by the Bank. But the Division Bench

set aside the entire compromise decree.

Thereafter, the suit No.410 of 1985 filed by the

appellant Bank stood restored before the learned Single

Judge. In the meantime, the 'Recovery of Debts Due to Banks

and Financial Institutions Act, 1993' (hereinafter called

the 'Recovery Act, 1993) came into force in West Bengal. It

is stated that it came into force in West Bengal on

27.4.1994. The debtor Company then filed an application

T.No. 276 of 1999 that this suit by the Bank should remain

on the original side of the Calcutta High Court and be not

transferred to the Tribunal under the Act. The contention

was that on the crucial date, 27.4.1994, the suit was not

pending on the original side but the appeal was pending

before the Division Bench and that under section 31(1),

appeals did not stand transferred to the Tribunal. It was

pleaded that even though the appeal was later allowed on

11.8.98 and the suit was remanded to the Single Judge, it

was not a suit "immediately pending" on the original side of

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the High Court before the crucial date i.e. 27.4.94, in the

High Court, as required by Section 31 of the Act.

Therefore, it was not covered by Section 31 of the Act.

This was the contention in the application filed by the

respondent-company seeking retention of the suit on the

original side of the High Court of Calcutta.

The above application filed by the respondent- company

was allowed by another learned Single Judge on 3.9.99 and

the Bank's suit was directed to be retained in the High

Court on the basis that the Act did not apply. By the same

order, the Registrar of the High Court was restrained from

transferring the suit to the Tribunal.

Against the above order dated 3.9.99, the Bank has

preferred the present appeal by special leave.

In this appeal, Sri Dhruv Mehta appeared for the

appellant-Bank and contended that the High Court erred in

not transferring the Bank's suit 410/85 to the Tribunal.

Elaborate arguments were addressed before us by Sri

Shanti Bhushan, learned Senior counsel for the

respondent-company and Dr. Rajeev Dhawan, learned Senior

counsel for the guarantor. We shall deal with these

contentions.

An additional point has been raised before us by the

learned Senior counsel for the respondent company, Sri

Shanti Bhushan that the debtor company had earlier filed

suit No.272 of 1985 against the Bank in the High Court for

specific performance of an agreement with the Bank and for

perpetual and mandatory injunctions and that that suit was

integrally connected with the Bank's suit. It was argued

that inasmuch as a suit for specific performance and

mandatory injunction could not be transferred to the Debt

Recovery Tribunal, this suit filed by the Bank, namely, suit

No.410/1985 must also remain in the High Court. We asked

learned Senior counsel for the Company and the learned

Senior counsel for the guarantor as to whether the said suit

by the company ( suit No.272/1985) was or was not a suit, in

substance, in the nature of a 'counter-claim' and if so, why

sub-sections (8) to (11) of section 19 ( as introduced by

Act 1/2000 by Parliament) could not apply and as to why we

should not hold that that suit also fell within the purview

of the Act. Counsel submitted that that suit did not fall

within the provisions of the Act.

The points that arise for consideration in the appeal

are as follows:

(1) Whether the suit No.410/1985 by the Bank which was

disposed by judgment dated 29.3.94 and which judgment was

set aside by the Bench on 11.8.98 and remanded to the Single

Judge, could not be treated as pending immediately before

the commencement of the Act on 27.4.94 ( in West Bengal) and

whether it could not be transferred to the Recovery

Tribunal?

(2) What is the combined effect of Sections 18 and 31

and of the Act on pending proceedings?

(3) Whether the pendency of suit No.272/1985 filed by

the debtor company against the Bank for specific performance

and for perpetual and mandatory injunctions raising common

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issues between parties in both these suits was a sufficient

reason for retention of the Bank's suit No.410/85 on the

original side of the High Court to be tried alongwith the

Suit No.272/85 filed by the debtor company?

(4) Whether the suit No.272/85 filed by the debtor

company was, in substance, one in the nature of a

"counter-claim" against the Bank and was one which also fell

within the special Act by reason of section 19(8) to (11) of

the Act ( as introduced by Amending Act 1/2000) and if that

be so, whether it could still be successfully pleaded by the

respondent-company that the pendency of the company's suit

272/85 was a ground for retention of Bank's suit No.410/85

on the original side of the High Court?

Points 1 and 2:

Was the Suit 410/85 filed by the Bank pending before

the Single Judge on 27.4.94? That is the crucial question.

That depends on the interpretation of Sections 18, 31 and 34

of the Act.

In the judgment of the High Court now under appeal

before us, the learned Single Judge held that when the Act

came into force on 27.4.94, the suit was not pending before

the Single Judge as the compromise decree was passed on

29.3.94 and in fact the appeal against the said decree was

pending before the Division Bench till 11.8.98 and therefore

the suit would not stand transferred to the Tribunal. It

was assumed that the suit would not get revived from its

institution and that therefore it was not a suit pending

'immediately before the date of establishment of a Tribunal

under this Act" i.e. 27.4.94, as required by section 31(1).

It was also observed that thee proviso to section 31(1)

permitted only appeals pending on that date to be retained

in the Civil Court (here the High Court) and that a remanded

suit was not so saved by the proviso to section 31(1). A

similar argument was advanced before us by the learned

Senior counsel appearing for the respondent-company, Sri

Shanti Bhushan and for the guarantors, by Dr. Rajeev

Dhawan.

Now Section 31(1) of the Act reads as follows:

Section 31: Transfer of pending cases:

(1) Every suit or other proceeding pending before any

court immediately before the date of establishment of a

Tribunal under this Act, being a suit or proceeding the

cause of action whereon it is based is such that it would

have been, if it had arisen after such establishment, within

the jurisdiction of such Tribunal, shall stand transferred

on that date to such Tribunal:

Provided that nothing in this sub- section shall apply

to any appeal pending as aforesaid before any Court.

(2) .................................."

It is true that under sub-clause (c) of Section 31,

every suit or proceeding "pending before any Court

immediately before the date of establishment of the Tribunal

under the Act" shall stand transferred to the Tribunal. It

is also true that under the proviso to section 31(1),

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appeals pending on the date do not stand transferred. The

suit of the Bank was in fact, pending in appeal on 27.4.94.

and it is clear that this provision for transfer does not

apply to an appeal pending as aforesaid before any Court.

But, it is now well settled that an order of remand by

the appellate Court to the trial Court which had disposed of

the suit revives the suit in full except as to matters, if

any, decided finally by the appellate Court. Once the suit

is revived, it must, in the eye of the law, be deemed to be

pending - from the beginning when it was instituted. The

judgment disposing of the suit passed by the Single Judge

which is set aside gets effaced altogether and the

continuity of the suit in the trial court is restored, as a

matter of law. The suit cannot be treated as one freshly

instituted on the date of the remand order. Otherwise

serious questions as to limitation would arise. In fact, if

any evidence was recorded before its earlier disposal, it

would be evidence in the remanded suit and if any

interlocutory orders were passed earlier, they would revive.

In the case of a remand, it is as if the suit was never

disposed of (subject to any adjudication which has become

final, in the appellate judgment). The position could have

been different if the appeal was disposed of once and for

all and the suit was not remanded.

Applying the above principle, we are of the view that

the suit 410/85 filed by the Bank in 1985, even though it

was disposed of by judgment dated 29.3.94, it stood revived

with continuity by the remand order passed by the Division

Bench on 11.8.98, and cannot be treated as a freshly

instituted on 11.8.98 before the Single Judge but must, in

the eye of the law, be treated as pending on the crucial day

i.e. 27.4.94.

It was argued that on 27.4.94, the crucial date, if the

appeal was pending before the Division Bench, the suit could

not have also been pending simultaneously. The pendency of

appeal before the appellate Court may be the de facto

position. But, we are concerned here with the position in

law, and as to the effect of the remand order. Once the

appeal is allowed, the intermediate events - of disposal of

the suit and the appeal - vanish into the air and the

continuity of the suit before the trial Court is restored.

There is yet another important reason as to why the

suit must be held as one falling within the Act. This

reason flows from Section 18 of the Act, which reads as

follows:

Section 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."

The bar of the said section, as we shall elaborate,

applies and, in fact, Section 34 of the Act gives overriding

effect to the provisions of the Act.

Now, it is well settled that it is the duty of a Court,

whether it is trying original proceedings or hearing an

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appeal, to take notice of the change in law affecting

pending actions and to give effect to the same. (See G.P.

Singh, Interpretation of Statutes, 7th Ed.p.406). If, while

a suit is pending, a law like the 1993 Act that the Civil

Court shall not decide the suit, is passed, the Civil Court

is bound to take judicial notice of the statute and hold

that the suit - even after its remand - cannot be disposed

of by it.

In some statutes the legislature no doubt says that no

suit shall be 'entertained' or 'instituted' in regard to a

particular subject matter. It has been held by this Court

that such a law will not affect pending actions and the law

is only prospective. But, the position is different if the

law states that after its commencement, no suit shall be

"disposed of" or "no decree shall be passed" or "no court

shall exercise powers or jurisdiction". In this class of

cases, the Act applies even to pending proceedings and has

to be taken judicial notice of by the civil Courts.

A Constitution Bench of this Court in Shah Bhojraj

Kuverji Oil Mills & Ginning Factory Vs. Subhash Chandra

Yograj Sinha ( 1962(2) SCR 159 ( AIR 1961 SC 1590) was

considering a situation where a law was made ousting the

jurisdiction of the Civil Court where a suit was pending.

The words used in the statute were 'a landlord shall not be

entitled to the recovery of possession of any premises ....'

These words were contained in the Bombay Rent, Hotel and

Lodging House Rates Control Act, 1947. It was held that the

provision barring a decree to be passed applied to pending

suits and applied at the time the decree was to be passed.

Another Constitution Bench in Mst. Rafiquennessa and Anr.

Vs. Lal Bahadur Chetri and Ors. ( 1964(6) SCR 876 = AIR

1964 SC 1511) held that the prohibition against passing a

decree for possession would apply even at the appellate

stage, unless of course, appeals were kept outside the

impact of the new Act, as in the proviso to Section 31 of

the Act. Even the appellate Court has to apply the law

ousting its jurisdiction.

If indeed the contention of the learned Senior counsel

for the respondents, Sri Shanti Bhushan and Dr. Rajeev

Dhawan is to be accepted, a strange result would follow

inasmuch as, on a combined reading of Sections 18 and 34 of

the Act, the suit can neither be transferred to the Tribunal

nor can it be decided by the learned Single Judge in view of

the clear prohibition in Section 18 of the Act. If it is

not to be transferred to the Tribunal and if it is to be

retained in the Civil Court, without disposal as contended,

then there will be a stalemate. It has to be kept

perpetually pending in the Civil Court and necessarily the

file has to be consigned to the record room. Or the plaint

will have to be returned for presentation before the proper

court or Tribunal. That was surely not the intendment of

the Act of 1993. When this aspect was put to the learned

Senior counsel for the respondents, there was practically no

answer. It was, no doubt, faintly suggested by Dr. Rajeev

Dhawan that the bar in section 18 does not apply to remanded

suits but we are unable to agree. As stated earlier, they

stand revived in law with continuity and therefore the bar

under Section 18 clearly applies.

The above result is also reached by the application of

the principle of purposive construction.

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In regard to purposive interpretation, Justice

Frankfurter observed as follows:

"Legislation has an aim, it seeks to obviate some

mischief, to supply an inadequacy, to effect a change of

policy, to formulate a plan of government. That aim, that

policy is not drawn, like nitrogen, out of the air; it is

evidenced in the language of the statute, as read in the

light of other external manifestations of purpose ("Some

Reflections on the Reading of Statutes) 47 Columbia LR 527

at 538) (1947)"

That principle has been applied to this very Act by

this Court recently in Allahabad Bank Vs. Canara Bank ( JT

2000(4) SC 411). If the said principle is applied, it is

clear that the provision in section 31 must be construed in

such a manner that, after the Act, no suit by the Bank is

decided by the civil Court and all such suits are decided by

the Tribunal.

Today, it is said that Rs.52,000 crores of monies are

due to Banks and financial institutions from the borrowers.

The Act of 1993 was indeed enacted to provide a speedy

remedy for the recovery of these monies and for taking these

suits out of the purview of the civil Courts. If speedy

disposal is the purpose of the Act, then if the respondent's

contention is accepted, this suit 410/85 instead of getting

transferred to the Tribunal for expeditious disposal, would

perpetually remain pending on the original side of the

Calcutta High Court because of the prohibition in section 18

of the Act. Surely, that would place the Bank in a worse

position after the 1993 Act than before inasmuch as before

the Act, there was at least the possibility of the Bank's

suit being decided by the civil Court on some future day,

however, remote.

An argument was advanced by Dr. Rajeev Dhawan that the

proviso to section 31 retained appeals in the Civil Court

and hence the suit remanded in appeal would also get

retained. It was also argued that there was no specific

provision regarding remanded suits and this was a case of a

'causus omissus' and the said omission in the statute could

not be filled by judicial interpretation. Otherwise, it

would amount to judicial legislation. That was the

argument.

We cannot agree with either contentions. The remanded

suit cannot remain in the Civil Court with no chance of

disposal. Again, our decision that the restoration of the

suit is with continuity from the date of original

institutions of the suit does not amount to legislation but

is the result of the application of a fundamental principle

of law applicable to the civil procedure. It cannot

therefore be said that we have encroached upon the

jurisdiction of the legislature.

In this context the following words of Justice Holmes

are apposite. He said:

"I recognise without hesitation that Judges do and must

legislate, but they do so only interstitially; they are

confined from molar to molecular motion" (1917) (Southern

Pacific Co. vs. Jensen 244 U.S. 205 at 221).

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Again, Justice Cardozo said that though the powers of

interpretation of the Courts are narrow, yet they can fill

up gaps. He said:

"No doubt, the limits for the Judge are narrower. He

legislates only between gaps. He fills the open spaces in

the law" (B.Cargozo, The Nature of the Judicial Process

(1921) at p. 131).

In the present case, we do not have to legislate, even

interstitially.

There is yet another aspect of the matter. Even

assuming that the suit was not pending 'immediately' before

the establishment of the Tribunal before the Single Judge

but came before him on remand after 27.4.94, the crucial

date, and even assuming that the Registrar of the High Court

could not have transferred the suit to the Tribunal on

27.4.94 as the appeal was pending before the Division Bench,

it would, in view of the prohibition in section 18, be

necessary for the High Court to transfer the Bank's suit

under Article 227 of the Constitution of India to the

Tribunal.

For the aforesaid reasons, we hold that the principle

of purposive interpretation is to be applied to sections 18

and 31 of the Act and that suit 410/1985 filed by the Bank

in 1985 and which stood remanded by the appellate Court on

11.8.98 must in the eye of the law be deemed pending before

the Single Judge and that it would stand transferred to the

Tribunal. The High Court was, therefore, in error in

retaining the same on the original side. Points 1 and 2

decided in favour of the appellant.

Points 3 and 4:

As stated earlier, learned senior counsel for the

respondents contended that the issues arising in the suit

410/55 filed by the Bank are integrally connected with the

issues arising in the other Suit No.272 of 1985 filed by the

respondent company against the Bank and that the said suit

being one for specific performance, and perpetual and

mandatory injunctions could not be tried by the Tribunal and

that consequently, the suit by the Bank 410/85, which

contains some common issues must be retained in the Civil

Court (i.e. the High Court).

Learned senior counsel was then asked by us as to what

in reality was the "substance" of the suit 272 of 1985 filed

by the Company against the Bank and whether, it was indeed

one falling within the purview of the 1993 Act as amended by

Act 1 of 2000? The answer by the counsel was that it was

not. We shall therefore consider this aspect in some

detail.

We shall first refer to the averments of the 1st

respondent in its suit 272 of 1985 filed against the Bank.

The plaint states that the plaintiff acquired the Tea estate

from Kamini Tea Co. (Pvt.) ltd. in or about April, 1979,

under a registered deed, that initially the shares in the

plaintiff's company were held by 1st and 2nd plaintiffs,

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that at the instance of this Bank, the plaintiff 3 purchased

the shares on 13.1.82, that in or about December 1981 and

January 1982, it was "duly agreed" between the Bank and the

Tea Company and the plaintiffs 3 and 4 and by plaintiff 2

that (i) 'defendant would not charge interest on its

outstanding upto the season 1981-82 since July 1, 1981, (ii)

that the said outstanding dues would be paid by plaintiff

company at Rs. 75,000 p.m., (iii) that the Bank would

extend credit facilities according to its needs from the

season 1982-83, which advance interest would be recovered

out of the proceeds of sale of Tea. It was also alleged

that these terms would appear from the records and

correspondence between the parties and also from the course

of conduct and/or dealings. A dispute is also raised about

the correctness of the amount claimed by the Bank as per its

accounts. It was pleaded that a certain amount of

Rs.1,55,951 paid by the Bank to workmen for 81-82 season had

to be adjusted for 1981-82 which was a free-interest period,

that similarly credit had to be given for Rs.64,083.10 for

the season 1982-83, that the sum of Rs.7 lakhs sanctioned

for 1983-84 at 13% interest was repayable by annual

instalment of Rs.1 lakh from June 1984 and that excess

interest at rate 3% was charged, that interest for 1984-85

on Rs.7 lakhs was to be at 15% p.a. and not 18% p.a., that

for the year 1985- 86, the Bank advanced Rs. 5.22 lakhs and

was charging 15% and it illegally stopped or suspended

advances. It was contended that the correct position of the

amounts due was shown in Schedule D of the plaint and that

on the arrears due upto 81-82, no interest was to be

charged, the moratorium was unilaterally withdrawn on 8.4.85

by the Bank, that interest could not have been charged from

1.7.81 to 31.3.85, that the letter 'E' of the plaintiff

company agreeing to pay interest was void/voidable, that the

demand by letter dated 11/12-4- 85 for Rs.3,31,25,054.27

inclusive of interest upto 31.3.1985 was wrong, mala fide

and inflated. It was contended that the Bank guarantee for

Rs.72,330 could not be encashed, that the defendant promised

to render financial assistance and could not have stopped it

and that the principle of promissory estoppel applied.

Plaintiff 4 was a shareholder Director and plaintiffs 3 and

4 stood guarantee only for lawful dues, it was said. The

plaint then referred to certain payments by the plaintiff

upto a sum of Rs.14,25,000. It was said that the plaintiff

was entitled to specific performance of the agreement as

pleaded in para 4 of the plaint and to a perpetual

injunction that the Bank should not charge interest upto

1981-82 and that with effect from 1.7.81, that only

Rs.75,000 per month could be recovered. A mandatory

injunction was sought for further financial assistance at

less than Rs.10/- per Kg. per season w.e.f. 1985-86

season, for damages allegedly suffered by plaintiff and for

rectification of accounts and to declare the letter of

demand 'D' dated 8.4.85 as void.

From the above, it will be noticed that the plea of the

Company is that there is an agreement not to charge interest

and that that agreement is to be enforced, that interest is

not liable to be charged on arrears or interest cannot be

charged at a higher rate, that only Rs.75,000 is to be

recovered per month and that the damages suffered by

plaintiff are to be deducted and further financial

assistance is to be given in future.

In our view, the above pleas raised by the respondent

company are all inextricably connected with the amount

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claimed by the Bank. The plea of the company is that

interest is not to be charged or is to be charged at a

lesser rate, that instalments are to be permitted and more

monies should have been advanced. In our view, these claims

made by the Company in its suit 272/85 against the Bank

amount to 'counter claim' and fall within sub-clauses (8) to

(11) of section 19 of the Act (as introduced by Act 1/2000).

The plea for deduction of damages is in the nature of a 'set

off' falling under sub-clauses (6) and (7) of section 19.

Sub-clauses (6) to (11) of section 19 read as follows:

"(6) Where the defendant claims to set- off against the

applicant's demand any ascertained sum of money legally

recoverable by him from such applicant, the defendant may,

at the first hearing of the application, but not afterwards

unless permitted by the Tribunal, present a written

statement containing the particulars of the debt sought to

be set- off.

(7) The written statement shall have the same effect as

a plaint in a cross- suit so as to enable the Tribunal to

pass a final order in respect both of the original claim and

of the set-off.

(8) A defendant in an application may, in addition to

his right of pleading a set-off under sub-section (6), set

up, by way of counter-claim against the claim of the

applicant, any right or claim in respect of a cause of

action accruing to the defendant against the applicant

either before or after the filing of the application but

before the defendant has delivered his defence or before the

time limited for delivering his defence has expired, whether

such counter-claim is in the nature of a claim for damages

or not.

(9) A counter-claim under sub-section (8) shall have

the same effect as a cross-suit so as to enable the Tribunal

to pass a final order on the same application, both on the

original claim and on the counter-claim.

(10) The applicant shall be at liberty to fine a

written statement in answer to the counter-claim of the

defendant within such period as may be fixed by the

Tribunal.

(11) Where a defendant sets up a counter-claim and the

applicant contends that the claim thereby raised ought not

to be disposed of by way of counter-claim but in an

independent action, the applicant may, at any time before

issues are settled in relation to the counter- claim, apply

to the Tribunal for an order that such counter-claim may be

excluded, and the Tribunal may, on the hearing of such

application make such order as it thinks fit."

Sub-clause (6) says that a 'set-off', if claimed, can

be adjudicated by the Tribunal. Sub-clause (7) states that

the written statement pleading a set-off shall have the same

effect as a plaint in a cross-suit to be adjudicated by the

Tribunal. Similarly, sub- clause (8) of section 19 permits

a defendant to make a 'counter-claim' by way of an

application and sub-clause (9) of section 19 states that

such a 'counter-claim' shall have the same effect as a

'cross-suit' so as to enable the Tribunal to pass a final

order on the same application, both on the original claim

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and on the counter claim as a 'cross-suit'. Sub-clause (11)

of section 19 is important and it permits the Bank or

financial institution to apply to the Tribunal that

particular claim raised by the debtor against the Bank or

financial institution, as the case may be, ought not to be

disposed of by way of a counter-claim but that the debtor

must be directed to file an independent action. The

Tribunal would then consider whether the debtor should be

directed to file an independent action in regard to any part

of the debtor's claim.

In our view, the Company's suit 272/85 in so far claims

a relief for specific performance, perpetual and mandatory

injunctions, it is in substance in the nature of a

counter-claim under sub-clauses (8) to (10) of section 19

and are in the nature of a counter-claim. The plea for

deduction of damages is in the nature of a set-off falling

within section 19(6) and (7). Both are equated to

cross-suits. If a set-off or a counter claim is to be

equated to a cross suit under section 19, afortiori there

can be no difficulty in treating the cross-suit as one by

way of set-off and counter claim, and as proceedings which

ought to be dealt with simultaneously with the main suit by

the Bank. In fact, the Bank has not objected to such a

course. Indeed, section 19(11) says that if any particular

counter-claim raised in the suit 272/85 cannot be decided by

the Tribunal while deciding the Bank's suit, the defendant

may apply to the Tribunal for exclusion of such a

counter-claim. But such a question does not arise in this

case. In our view, in the context, the word 'counter-claim'

in section 19(8) to (11) which is equated to a cross-suit,

includes a claim even if it is made in an independent suit

filed earlier. An agreement not to charge interest, the

specific performance of which is claimed is nothing but a

plea that the Bank could not charge interest. A permanent

injunction directing the Bank not to charge interest because

of an alleged agreement in that behalf is likewise a plea

that no interest is chargeable. So far as the plea for

further financial assistance is concerned, it is also,

broadly, in the nature of a 'counter-claim'. All these fall

under section 19(8) to (10). Again, the plea for deducting

'damages' though raised in the suit is indeed broadly a plea

of "set off" falling under sub-clause (6) and (7) of section

19.

Both the suits, the one by the Bank against the

respondent (suit 410/85) and the other by the debtor against

the Bank (suit 272/85) which raises claims or pleas in the

nature of set-off or counter-claim are interconnected. The

respondent's suit falls under sub- clauses (6), (7) and (8)

to (11) of section 19, as stated above. Our decision in

regard to the real nature of suit 272/85 has become

necessary in the context of a plea by the debtor-company

that the company's suit 272/85 is liable to be retained in

the civil Court and on account of the plea that the

connected suit by the Bank 410/85 is also to be retained.

Such a plea, as shown above, cannot be accepted. Thus, both

the suits are suits falling within the Act.

We, therefore, direct the Bank's suit 410/85 to be

transferred by the Registrar, Calcutta High Court to the

appropriate Tribunal under the Act. So far as the

debtor-company's suit 272/85 is concerned, action has to be

taken likewise by the Registrar in the light of our finding

which finding has become necessary in view of the contention

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on behalf of the debtor company before us, as explained

above.

For the aforesaid reasons, we hold under Point 3 that

the pendency of the company's suit 272/85 in the High Court

is not a ground for retaining the Bank's suit 410/85 in the

Calcutta High Court. The suit 272/85 filed by the debtor

company is also a suit to be necessarily tried only by the

Tribunal. The pendency of the Company's suit 272/85 in the

High Court is no reason for keeping the Bank's suit 410/85

in the High Court. The suit 410/85 is liable to be

transferred to the Tribunal. Incidentally, we also hold

that even suit 272/85 is to be tried only by the Tribunal.

The appeal is allowed. The order of the learned Single

Judge is set aside and suit 410/85 is directed to be

transferred by the Registrar, High Court to the Tribunal.

In the light of our finding as to the real nature of the

company's suit 272/85, it will be for the Registrar of the

High Court to pass appropriate orders. We hope that

appropriate orders will be passed in relation to suit 272/85

expeditiously, at any rate, within one month from today.

We direct the respondent-company to file its written

statement in suit 410/85 within one month from today. We

also direct the Tribunal to dispose of both the suits within

a period of six months from today, the suits being very old

suits of 1985. There will be no order as to costs.