Case No: Civil Petition for Leave to Appeal No. 112 of 1990
Judge: ATM Afzal ,
Court: Appellate Division ,,
Advocate: S.R. Pal,Mr. Mokhlesur Rahman ,,
Citation: 42 DLR (AD) (1990) 221
Case Year: 1990
Appellant: New Ideal Engineering Works Ltd.
Respondent: Bangladesh Shilpa Bank and others
Delivery Date: 1990-05-21
Shahabuddin Ahmed, CJ.
MH Rahman, J.
ATM Afzal, J.
Mustafa Kamal, J.
Latifur Rahman, J.
New Ideal Engineering Works Ltd.
Bangladesh Shilpa Bank and ors.
May 21, 1990
The Bangladesh Shilpa Bank Order, 1972
Articles 33, 34 & 35
The Constitution of Bangladesh, 1972,
Articles 32 & 47
Upon a close examination of the provisions of Articles 33, 34 and 35 of the Order, it will appear that different means have been provided for enforcement of claims and realization of dues of the Bank provided the conditions mentioned in the opening clauses of the respective Articles are satisfied. The management and administration of the industrial concern may be taken over and the property pledged/ mortgaged may be sold for realisation of the claims and dues of the Bank both under Article 33 and Article 34, the difference is that whereas it can be done through the intervention of Court under Article 33, it can also be done without such intervention under Article 34. The argument that Article 34 cannot be resorted to without complying with Article 33 overlooks the absurd consequence that in that case Article 34 is rendered otiose altogether, for, the same relief can be had under both the Articles………………(8)
Md. Moksudur Rahman, Senior Advocate, instructed by Md. Aftab Hossain, Advocate-on-Rccord— For the Petitioner.
S R Pal, Senior Advocate (Tofazzal Islam, Advocate with him) instructed by Shamsul Hoque Siddique, Advocate-on-Record — For the Respondent Nos. 1-3.
Not Represented— Respondent No.4.
Civil Petition for Leave to Appeal No. 112 of 1990
(From the Judgment and Order dated 22 April, 1990 passed by the High Court Division, Dhaka in Writ Petition No. 763 of 1990.)
1. This petition is from an order dated 22 April, 1990 passed by the High Court Division, Dhaka summarily rejecting the Writ Petition No.763 of 1990, filed by the petitioner.
2. The petitioner in the said writ petition challenged the decision of the Bangladesh Shilpa Bank (briefly BSB), respondent No.1, dated 10.4.90 (Annexure P) for sale of the industrial concern under Article 34 of the Bangladesh Shilpa Bank Order, 1972, hereafter referred to as the Order and the notice for sale of the same (Annexure Q) published in the daily newspaper "Dainik Bangla" on 12.4.90.
3. Facts of the case, briefly, as in the writ petition are, that the BSB sanctioned a local currency loan of Tk. 23,00,000/- to the petitioner for setting up a light engineering workshop at the BSCIC Industrial Estate, Tongi, Dhaka vide memo No.06/4226/4576 dated 3.6.80. Out of the said amount the BSB disbursed a total of Tk. 17,00,000/- to the petitioner on different dates in three phases including part of 1st instalment on 17.10.80. It was stipulated in the sanction letter that the entire amount of the loan would be repaid in 21 half-yearly instalments of which 20 instalments are to be of Tk. 1,10,000/-each and the last instalment to cover the entire balance due and that the repayment of loan money would commence from 30.9.82. The petitioner paid the first and second instalments on 27.8.82 and 31.3.83 and by June 1984 in all paid Tk. 17,75,000/-. The Bank by its letter dated 26.7.86 issued notice for recovery of dues under Article 35(1) of the Order claiming Tk. 20,92,787/- as on 30.6.86 and started a certificate case being CC No. 28-BSB/86 for realisation of Tk. 21,11,411/- under the Public Demands Recovery Act, 1913. The petitioner filed Title suit No. 5 of 1987 challenging the certificate case and the order cancelling the loan agreement which, however, ended in a compromise and the suit was dismissed for non-prosecution on 13.12.87. The petitioner paid a sum of Tk. 6,50,000/- and the Bank by its letter dated 28.5.88 re-scheduled the outstanding dues for repayment by 31.12.89.
4. The BSB, however, issued a notice on 17.8.89 (Annexure F) under Rule 4(1) of the Bangladesh Shilpa Bank (Direct Sale of Mortgaged Property) Rules, 1980 asking the petitioner to show cause as to why the Bank should not take over the management and administration of the project of the Company under Article 34 of the Order and sell the mortgaged project, assets for realisation of its dues of Tk. 23,01,144/- as on 30.6.89 alleging "admitted defaults in payment and performance of the loan agreements". In reply (Annexure G) the petitioner requested the BSB to afford him an opportunity to repay the outstanding dues in instalments of Tk. 40,000/- per month. The petitioner also made representation to the Vice-President, who is in charge of the Ministry of Industries, but the BSB upon considering everything took the decision to sell the industrial concern.
5. Mr. M. Moksudur Rahman, learned counsel for the petitioner, it appears, raised two points for consideration of the High Court Division, 1) that the BSB having recalled the loan under Article 32 of the Order, it cannot proceed under Article 34 without first taking recourse to Article 33 thereof and 2) that without determining the liability of the petitioner the BSB had no authority to order direct sale under Article 34.
6. As to the second contention, the High Court Division found that the petitioner in his reply (Annexure G) to the claim of the Bank (as in Annexure F) nowhere challenged the said claim and that the petitioner did not disputes that there was default in paying the installments of loan as per agreement with the BSB. As to the first contention it was found that Articles 33 and 34 of the Order are exclusive of each other and vest the BSB with independent power to proceed either under Article 33 or 34.
7. The learned Counsel now seeking leave to appeal from the impugned order reiterated his first contention and submitted that the interpretation given by the High Court Division of Articles 33 and 34 of the Order is wrong in that it was not appreciated (1) that the non-obstante clause in Article 34 does not give the Bank an option to proceed either under Article 33 or 34 for realising its loan inasmuch as it cannot be the intention of the legislature that some claims will be investigated by the District Judge and in respect of some claims the Bank can avoid investigation which would be violative of Article 31 of the Constitution; (2) that in the scheme of recovery of loans, the non-obstante clause in Article 34 introduces only an additional step in the event the liability found by the District Judge remains undischarged despite the steps taken by him under Article 33; (3) that Articles 33 and 34 visualise two different situations not inconsistent with each other and the non-obstante clause in Article 34 does not override the provision of Article 33 and (4) that the claim or demand made by the Bank does not become a liability unless it is adjudicated upon and determined and found to be established by the District Judge under Article 33.
8. Mr. Rahman gave his interpretation of Articles 33 and 34 unaided by any reference to any principle or precedent. To answer his submissions, briefly, it may be observed that the Order is a protected legislation under Article 47(2) of the Constitution and no provision thereof shall be deemed to be void or unlawful on the ground of inconsistency or repugnance to any provision of the Constitution. Secondly, it is to be observed that a non-obstante clause is usually used in a provision to indicate that, that provision should prevail despite anything to the contrary in the provision mentioned in such non-obstante clause. The High Court Division, therefore, rightly referred to the said clause in Article 34 in taking the view that recourse to Art 34 is not dependent upon compliance of the provisions of Article 33. Indeed, upon a close examination of the provisions of Articles 33, 34 and 35 of the Order, it will appear that different means have been provided for enforcement of claims and realisation of dues of the Bank provided the conditions mentioned in the opening clauses of the respective Articles are satisfied. The management and administration of the industrial concern may be taken over and the property pledged/ mortgaged may be sold for realisation of the claims and dues of the Bank both under Article 33 and Article 34, the difference is that whereas it can be done through the intervention of Court under Article 33, it can also be done without such intervention under Article 34. The argument that Article 34 cannot be resorted to without complying with Article 33 overlooks the absurd consequence that in that case Article 34 is rendered otiose altogether, for, the same relief can be had under both the Articles.
9. In Ocean Industries Ltd. Vs. IDBP 18 DLR (SC) 354 the Supreme Court of Pakistan considered sections 39, 40 and 41 of the Industrial Development Bank of Pakistan Ordinance, 1961 which corresponds to Articles 33, 34 and 35 of the Order. It has been held that, "Upon a careful examination of those provisions we are unable to agree that the ordinance provides these methods as alternative methods of enforcing the claims of the Bank. Section 40 itself indicates that the taking over of the management of the concern can be made notwithstanding anything contained in section 39. Thus it cannot be said that if action under section 39 is taken action under section 40 cannot thereafter be taken. It is equally incorrect to say that if the management is taken over under section 40 then the provisions of section 39 cannot be resorted to. The terms of section 40 itself show that the bank can even after taking over the management of the concern sell or realise any property pledged, mortgaged or hypothecated. There is nothing in these sections to indicate that the bank cannot obtain such an order for sale by resorting to the provisions of section 39 or under the latter section obtain an order for the transfer of the management of the concern, even though it can itself enter upon such management and sell the property under section 40. Again, section 41 clearly indicates that the power thereunder given to the bank is without prejudice to the provisions of either section 39 or section 40. The fact that recourse has been had to the provision of section 39 or 40 does not preclude the bank from resorting again to its rights under section 41 to recover its dues as arrears of land revenue."
The aforesaid observation supports the view that any of the Articles can be resorted to by the Bank and may even be combined and it is not incumbent upon the Bank to take recourse to Article 33 at the first instance before proceeding under Article 34 as contended by the learned advocate for the petitioner. Furthermore, in view of the fact that the liability as claimed by the Bank is not disputed by the petitioner, we do not find any merit in the contention raised.