INTRODUCTION
The High Court of Bombay-Nagpur Bench passed a judgement on 27 April 2023. In the case of YES BANK LIMITED Vs UNION OF INDIA AND 2 ORS IN WRIT PETITION NO. 5229 OF 2022 which was passed by a division bench comprising of HONOURABLE SHRI JUSTICE G. S. KULKARNI and HONOURABLE SHRI JUSTICE RAJESH S. PATIL, the court addressed a writ petition filed by a bank seeking a writ of mandamus to quash certain provisions in the Debts and Recovery Tribunal (Refund of Court fees) Rules, 2013. The bank also sought a direction to the Registrar of the Debt Recovery Tribunal-II (DRT-II) in Mumbai to release the amount specified in the impugned order without insisting on a joint application. The judgment provides clarity on the entitlement to a refund of court fees and the requirement of a joint application in certain circumstances.
FACTS OF THE CASE
The petitioner, a bank engaged in banking activities, had initiated recovery proceedings against a borrower who had defaulted on a loan repayment. However, a settlement was reached between the parties, and the petitioner filed an interlocutory application seeking permission to withdraw the original application. The DRT-II permitted the withdrawal and directed the petitioner to follow the procedure for a refund of court fees as per the refund rules.
Subsequently, the petitioner filed an application for the refund of court fees. However, the DRT-II passed an order stating that a joint application from both the applicant and the defendant was required for the refund to be processed further. This led to the petitioner filing the present writ petition challenging the requirement of a joint application.
ANALYSIS
The court considered the submissions of both parties and examined the relevant provisions of the Debts Recovery Tribunal (Refund of Court Fee) Rules, 2013. Rule 4 of the rules stipulates the amount of refund that may be ordered by the Presiding Officer of the Tribunal. It allows for a refund of 50% of the fees if the matter is settled before the commencement of the hearing and 25% if settled at any stage before the final order is passed.
Rule 5(1) of the rules deals with the procedure for a refund and states that the applicant and the defendant should file a joint application before the Registrar of the Tribunal, indicating the details of the settlement. The court interpreted Rule 5(1) in light of the petitioner’s claim that it becomes difficult to obtain the defendant’s consent or signatures for a joint application in cases where the dispute is settled outside the court and the defendant is not available or unwilling to engage in the refund process.
The court acknowledged that the petitioner, as the applicant in the original application, should have the right to receive the refund of court fees when the dispute is settled and the original application is withdrawn. It held that the requirement of a joint application for refund cannot defeat the legal rights of the applicant, especially when the DRT has already permitted the withdrawal of the original application and the refund of court fees.
The court concluded that Rule 5(1) should be read down to mean that once the DRT has permitted the applicant’s refund of court fees and the entitlement for the refund has been fixed by a judicial order, the Registrar of the DRT cannot insist on a joint application. However, in cases where there is doubt about the applicant’s entitlement or the judicial order does not clearly grant a refund to the applicant alone, the requirement of a joint application may be necessary.
CONCLUSION
The judgment clarifies that the entitlement to a refund of court fees should not be undermined by the requirement of a joint application in cases where the dispute is settled and the applicant seeks to withdraw the original application. The court’s interpretation of Rule 5(1) ensures that the legal rights of the applicant are protected and that the refund process is not unduly burdensome. The judgment provides guidance to the Registrar of the DRT in processing applications for the refund of court fees, including cases like the petitioners.
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JUDGEMENT REVIEWED BY VETHIKA D PORWAL, BMS COLLEGE OF LAW
