ICICI Bank Limited v. Aarnawas Infrastructure Pvt. Ltd.

1. The aforesaid writ petitions have been filed by the ICICI Bank Ltd. raising a common grievance. The ICICI Bank Ltd. — being a lender institution,in the course ofits business,has been advancing loans,and when there are delaults, the bank has been filing the Original Applications for recovery ofthe amounts due before the Debts Recovery Tribunal(DRT). In several cases where the Original Applications are allowed and Recovery Certificates are issued directing rellind of the principal amount due along with interest - during pendency of the recovery proceedings before the Recovery Officer, the bank arrives at a settlement with the borrower and accepts in full & final settlement an amount whieh may be less than the amount due under the Recovery Certificate.

2. In all these eases before us,that is the situation. When the petitioner bank informed the Recovery Officer that it is satisfied with the amount (, recovered and doesnotwish to pursuetherecoveryproceedingsfurther,the approach of the Recoveiy Officer in all these cases has been that the Recovery Certificate directs recovery of larger amount than the amount received by the certificate-holder bank and hence the request of the certificate-holder bank for closure of the Recovery Certificate cannot be allowed.

3. We may setouthereinbelow one such order passed bythe Recovery Officer in R.C.No.190/2017 titledICICIBank Vs. AarvanssInfrastructure (arisingoutofO.A.No.618/2016)reads asfollow: 3 uQjrficEOFTHERECOVERYOFFICER-II DEBTSRECOVERYTRIBUNAL-II,DELHI Item No. 20 190/17: JCICIBank VsAarvanssInfrastructure Dated: 12,12.2019 Present: Sh.RakeshSingh,CoumelfortheCHBank. Counselfor the CHBonk submitted that the matter has been sZedM an an,ounl of ""'fCmZZi affidavit ofsatisfaction ofthisRCnde diary no. 12998dated 24.10.2019andrequested to close thisRC. On perusalofrecord it has been observedthatthe matter has beefettledunder OTS.AspertheRC,thisForum « to recover Rs:27,07,471/- along with pendente-hte andJutur^ interest(a)1035%+ cost, butthefullamounthas notyet been Tcfer® Hence, the requestofthe CHBankfor closure of thisRCis notmeritconsideration bythis fiRT CHBank may approach the Hon'ble Presiding Officer, DR itSiZL/faUclosureofthisRCundertheprovisionof Section 26ofRDDB Act,1993. Let a copy of this order be given dasti to CH Bank for compliance •c Letthis matter be listed on 22.02.2020. (Awinash Chandra).Recovery Officer-II DRT-Il, Delhi"

4. The submission of learned counsel for the petitioner is that the approach adopted by the Recover}' Officer is fallacious. He submits that once the certificate-holder bank is satisfied with the amount recovered and does not wish to press the recovery proceedings further, the Recovery Officer has no business to insist on continuation ofthe recovery proceedings on the ground that the amount recovered is less than what is awarded under the Recovery Certificate.

5. We find merit in this submission oflearned counsel for the petitioner. It is entirely for the certificate-holder bank/ institution to make decisions with regard to its business dealings. If the certificate-holder bank has entered into a settlement to recover a certain amount from the certificatedebtor in lull &final settlement ofits claims under the Recovery Certificate, that is a commercial decision of the certificate-holder bank and the same cannot be called in question by the Recovery Officer. His only job is to effect the recoveiy under the Recovery Certificate. However, if the certificate-holder bank is satisfied with the amount received from the certificate-debtor, the Recovery Officer cannot insist that he must continue with the recovery proceedings despite the certificate-holder bank recording its satisfaction in respectofthe Recovery Certificate.

6. This position is also clear from a reading of Order XXI Rule 2 CPC oc which slates that:'"''Where any money payable under a decree ofany kind is paid outofthe court, or a decree ofany kind is otherwise adjusted in whole or in part to the satisfaction ofthe decree holder, the decree holder shall certify such payment or adjustment to the court whose duty it is to execute the decree, and the courtshallrecordthesame accordingly.

7. Thus,when the certificate-holder bank itselfrecords its satisfaction, it is no longer the concern of the.Recovery Officer to proceed with the rccoveiy proceedings in terms ofthe Recovery Certificate.

8. We allow these petitions and direct that the Recovery Officers should accept the affidavit of satisfaction filed by the ceitificate-holder bank/ financial institution and not continue the recovery proceedings to make any further recovery in terms ofthe Recovery Ceitificate. The impugned orders passed by the Recovery Officers in these matters are, accordingly, quashed and the rccoveiy proceedings before the Recoveiy Officer in all these cases are closed.

9. The petitions stand disposed ofin the aforesaid terms. ^ VIPMSiNGHIyO ^// j/jASMEETSINGH, AUGUST.10,2021 B.S. Roheita \.