Rockline Construction Company vs Doha Bank Qsc

Non­Reportable IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

MISCELLANEOUS APPLICATION NO.460 OF 2023 IN SPECIAL LEAVE PETITION (C)NO.16537 OF 2021

ROCKLINE CONSTRUCTION COMPANY …APPELLANT

VERSUS

DOHA BANK QSC & ORS. ..RESPONDENTS

JUDGMENT

SANJAY KAROL J.

1. The present Miscellaneous Application is filed seeking

Signature Not Verified clarification of the order dated 12.05.2022 passed by this Digitally signed by Deepak Singh Date: 2023.04.24 18:01:55 IST Reason: Court in Special Leave Petition No.16537/2021 titled Rockline

Construction Company v. Doha Bank QSC & Ors., whereby a 2

Judgement and Order of the High Court of Bombay upholding

the setting aside sale of a property by the Debt Recovery

Appellate Tribunal, Mumbai was not interfered with. The

applicant has prayed for the following relief:

“a. Clarify the Order dated 12.05.2022 passed by this Hon’ble Court to the extent of fixing the rate of interest at which the amount deposited by the applicant in 2007 is to be refunded, and also mesne profit, if any to be deducted from the said amount to be refunded to the applicant.”

2. The auction sale confirmed in favour of the applicant M/s.

Rockline Construction Company on 16 th May 2007 was set

aside with the applicant entitled to a refund of the entire sale

amount along with the accrued interest, if any, after deducting

the mesne profits and/or losses. There has been long­standing

litigation inter se the parties regarding this transaction. At this

juncture, it is observed that the present case has a chequered

history, but for brevity, only relevant orders are being referred

to.

3. The order dated 07.07.2014 passed by the Debt Recovery

Appellate Tribunal, Mumbai, in Miscellaneous Appeal bearing

No. 303/2010 titled as “Oman International Bank S.A.O.G. v. 3

M/s Rockline Construction Co. & Anr.”, holding the applicant

entitled to a refund of the amount, is extracted as under:

“(1) The appeal is allowed with no orders as to costs. The order of the DRT is set aside and order of the Recovery Officer has been restored so far the Original Application is concerned.

(2) The Recovery Officer is directed to return Rs.1 Crore deposited by 2nd Respondent Mahendra Kumar Kawad with accrued interest within 7 days from the copy or receipt of the order.

(3) The Original Applicant/1st respondent is also entitled to withdraw the entire sale amount with accrued interest, if any, (after deducting mesne profits or loss) for his wrongful purpose on surrendering the entire possession of the property to the Bank.

(4) The mesne profits can be ascertained by appointing the Advocate/Counsel before the DRT on the application filed by the respective parties.

(5) The Bank is directed to take appropriate steps to recover the amount as per the procedure known to law.” (Emphasis supplied)

4. It is not in dispute that the said order attained finality with the

passing of the order dated 12.05.2022 by this Court in a

Special Leave Petition filed by Rockline Construction Company

(supra). It is a matter of record that much prior thereto, the 4

applicant had already moved an application seeking a refund

of the amount in terms of the order dated 07.07.2014 passed

by the Debt Recovery Appellate Tribunal, Mumbai, in which

vide order dated 13.07.2021, the subject matter of the present

application, passed by the Recovery Officer­I, Mumbai Debt

Recovery Tribunal No.1, the applicant was held entitled to

simple interest @ 9% per annum. This is against the

applicant's claim for interest on such rate and terms as

normally govern business transactions. The relevant portion

of the order reads as under:

“7. Observations :

7.1 From the records it is observed that CH Bank has taken/charged interest @15% in the said loan account. It appears that similarly bank earns interest on the money by lending and it may have also used that money Rs.9.56 crore in further lending that would have been fetched interest over and above 6 percent ranging between 9% to 15% or above. Hence, it would be in the interest of the equity and justice to allow 9% simple interest on the sale consideration given/deposit made by the erstwhile auction purchaser.

7.2 From 2007 the Amount Rs.9.56 core @ 9% for 14 years would become 216056000.00 (Twenty­One Crores Sixty Lacs Fifty Six Thousand only).

7.3 5

In view of the above Rs.58580859.00

(Rs.216056000.00 – Rs.157475141.00) (Rupees Five Crore Eighty Five Lacs Eighty Thousand Eight Hundred Fifty Nine only) is quantified as amount of which erstwhile auction purchaser/ M/s. Rockline Constructions is entitled to withdraw on surrendering the entire possession of the property to the Bank.

xxxxx xxxxx xxxxx xxxx 1. xxx 2. xxx

3. Erstwhile auction purchaser M/s Rockline is entitled for Rs.58580859.00 (Rupees Five Crore Eighty Five Lacs Eighty Thousand Eight Hundred Fifty Nine only) after deducting the mesne profit/loss as per order of the Hon’ble DRAT and Hon’ble Bombay High Court.”

(Emphasis supplied)

5. It is also borne from the record that assailing the same, the

appellant preferred an appeal that is clear from the bare

reading of the instant application.

6. In support of its claim, the applicant has placed

contemporaneous material indicating the market practice at

which the rate of interest is charged about commercial

transactions; it is @14.5% with monthly rests, subject to

change from time to time.

7. There is no dispute that the applicant deposited huge amounts

as part of the auction bid in the year 2007.

6

8. In the backdrop above, it cannot be disputed that the

applicant is entitled to interest. The only two contentious

issues that survive, requiring adjudication, are (i) the rate and

terms of interest to which the applicant would be entitled and

(ii) the determination of mesne profits. In normal course, we

would have ourselves decided the same; however, considering

the fact that the appeal in relation to it is pending before the

adjudicatory authority, being Appeal No.8 of 2022, Debt

Recovery Appellate Tribunal, Mumbai, we refrain from doing

so, enabling the said fact­finding authority to do so,

expeditiously and in accordance with the law.

9. Before us, it is argued that the appeal is perhaps barred with

the efflux of time. We find this objection, in the attending facts

and circumstances, to be untenable given the long­standing

pending litigation inter se the parties to the lis. As such, the

plea of limitation cannot be allowed to stand in the way of the

determination of the applicant's right and entitlement of

monetary claims on merits.

10. Hence, having considered the arguments put forth in the

application as also the written submissions filed on behalf of 7

the respondent, we dispose of the instant application in the

following terms:

A) The parties shall appear before the appellate authority

on 1st May 2023 and place on record a copy of the order;

B) The appellate authority shall decide the appeal

preferred by the applicant strictly on merits, in accordance

with the law, expeditiously and because each day’s delay

would only entail loss by way of the addition of amount

payable as interest, shall decide the same within a period

of two months. All parties shall fully cooperate. The issue

of limitation shall be deemed to have been closed.

C) Liberty reserved to the applicant to approach this

Court should the need so arise specifically.

11. The miscellaneous application stands disposed of.

..........................................J. (KRISHNA MURARI)

.........................................J. (SANJAY KAROL) 8

Dated : 24th April, 2023;

Place : New Delhi.