Holding

The High Court’s order transferring the execution petition to the Debt Recovery Tribunal was illegal and beyond jurisdiction, and the claim was time‑barred.

Summary

The appellant, a guarantor and director of a liquidated company, challenged the Punjab National Bank's attempt to recover a debt by filing execution petitions. The High Court transferred the third execution petition, filed in 1999, to the Debt Recovery Tribunal (DRT) invoking inherent powers. The Supreme Court held that such transfer was beyond the scope of Section 31 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, which only permits transfer of suits pending at the time of the Tribunal’s establishment, and that the Companies Act could not be used to override the RDB Act. The Court also ruled that the debt was time‑barred under Article 136 of the Limitation Act, as applied by Section 24 of the RDB Act. Consequently, the High Court’s order was set aside and the appeal was allowed.

Issues considered

The High Court’s jurisdiction to transfer an execution petition to the DRT under inherent powers.
Whether Section 31 of the RDB Act allows transfer of execution proceedings filed after the Tribunal’s establishment.
The applicability of Section 446 of the Companies Act, 1956 (as amended) to transfer execution proceedings to the DRT.
The overriding effect of the special RDB Act over the general Companies Act under Section 34.
Whether the execution petition is barred by limitation under Article 136 of the Limitation Act, read with Section 24 of the RDB Act.
The proper method of statutory interpretation (literal rule vs purposive) for Section 31.
The existence of any inherent power of a court to transfer proceedings contrary to express statutory scheme.

Legislation cited

Companies Act, 1956s. 446
Companies (Court) Rules, 1959s. Rule 117, s. Rule 9
Companies (Second Amendment) Act, 2002
Limitation Act, 1963s. Article 136
Recovery of Debts Due to Banks and Financial Institutions Act, 1993s. 17, s. 18, s. 24, s. 31, s. 34

Subjects

Debt Recovery TribunalExecution petitionStatutory interpretationLiteral ruleLimitation periodSpecial vs general statuteInherent powersCompanies ActRDB ActTransfer of jurisdiction

Judgment

RAGHUNA TH RAI BAREJA AND ANR. A
v.
PUNJAB NATIONAL BANK AND ORS.

DECEMBER 6, 2006

(S.B. SINHA AND MARKANDEY KA TJU, JJ.] B

. Recovery of Debts Due to Banks and Financial Institutions Act, 1993-
ss. 17, 18, 24, 31 and 34-Execution petition pending before High Court-
Transfer to Debts Recovery Tribunal-Exercising its jurisdiction under inherent C
powers-Property of-Held: Transfer of execution petition to Debts Recovery
Tribunai was illegal, without jurisdiction and beyond the scope of Section
31 of the Act-There are no such inherent powers of the Court apart from
Section 31 for transferring the execution proceedings to the Tribunal-Court
cannot transfer the proceeding even under Section 446 of Companies Act as
the same is not applicable once 1993 Act came into force as in view of D
Section 34, 1993 Act has overriding effect-Also 1993 Act being special
statute overrides the general statute i.e. Companies Act-Moreover Section
446 (3) has been omitted by Amendment Act-Companies Act, 1956-Section
446--Companies (Court) Rules 1959.

Section 24-Execution petition-pending before company court- E
Transfer of the petition to Debts Recovery Tribunal-After I 2 years-Held:
Recovery in question is time barred-Limitation Act, 1963-Artic/e 136.

Interpretation. of Statutes-Applicability of interpretation-When
permissable-Held: Where the words ofa statute are clear and unambiguous.
recourse cannot be had to the principles of interpretation other than the F
literal rule-Departure from literal rule should only be done in very rare
cases-Court should not seek to amend the law in the garb of interpretation-
There should be judicial restraint in this regard

Legislative intent-Use of in interpretation of statute-Held: It can be G
resorted to when the language is doubtful or ambiguous-When the language
is clear, the legislative intention should be gathered from the language used

Equity and Law-Equity vis-a-vis Law-Prevailing effect of-Held: In
case of conflict between equity and law, law will prevail-Equity can only
287 II
288 SUPREME COURT REPORTS (2006] SUPP. 10 S.C.R.

A supplement the law, but cannot supplant or override it.
Maxim-Maxim dura lex sed lex-Meaning of

Respondent-Bank filed a Company petition for recovery against the
company which had taken loan from the Bank. The Company was already
B wound up. Appellant is the guarantor of the loan and Director of the Company.
Decree was passed in favour of the Bank on 15.1.1987. Bank filed three
execution petitions. First in 1990 which was dismissed; second in 1994 and
the same was also dismissed. In 1999 Bank filed third execution petition
without impleading the appellant as party to the same. Petition was dismissed.
The order in third execution petition was recalled after the bank had filed
C application for restoration of the third execution petition with fresh Memo of
Parties.

In 1998 Bank filed petition under Section 446 of the Companies Act,
1956 read with Rule 117 of Companies (Court) Rules, 1959 seeking leave of
D the Court to commence the Execution proceedigs before the Tribunal which
had come into existance in 1993 by virtue of Recovery of Debts Due to Banks
and Financial Institutions Ad, 1993 (RDB Act). The petition was allowed by
the Company Court. In 2005, Bank filed application under Section 9 of
Companies (Court) Rules read with Sections 17 and 18 of RDB Act for
transfer of the Execution petition to the Tribunal. High Court transferred the
E execution petition to the Tribunal under its inherent powers. Hence the
present appeal.

Allowing the appeal, the Court

HELD: 1.1. The order of the High Court transferring the Execution
F Petition pending before it to the Debt Recovery Tribunal, was clearly beyond
the scope of Section 31 of Recovery of Debts Due to Banks and Financial
Institutions Act, 1993 because Section 31 states that only suits or other
proceeding pending before the Court immediately before the establishment of
the Tribunal under the Act, stand transferred to the Tribunal. Since admittedly
G the Tribunal in the present case, had been established in 1993, and no
proceeding was pending before it on the date when it was established, no
transfer could take place under Section 31ofthe RDB Act. At any event the
third Execution Petition which was transferred by the impugned order was
filed by the respondent-Bank on 11.1.1999, i.e. much after the Tribunal had
been established. Hence obviously there could be no such transfer to the
H Tribunal under Section 31 of the RDB Act. Apart from Section 31, there is
RAGHUNATH RAI BAREJA v. PUNJAB NATIONAL BANK 289
no other provision for transferring a suit or other proceeding pending before A
any Court to the Tribunal. Hence, the impugned order was illegal and without
jurisdiction. [297-G-H; 298-A-C)

1.2. The Companies Act is a general statute, and hence the RDB Act
which is a special Act, overrides the general statute. In any event, in view of
Section 34 of the RDB Act, the said Act will prevail to the extent of B
inconsistency over the Companies Act. [298-F-G]

Allahabad Bank v. Canara Bank and Anr., [2000] 4 SCC 406, relied
on.

1.3. Since Section 24 of the RDB Act applies the provisions of the C
Limitation Act, 1963, to applications filed before the Tribunal, and since Article
136 of the Limitation Act provides a period of limitation of 12 years for filing
an Execution Petition, hence now no such application can be filed since that
period of 12 years expired on 15.1.1999. Hence, the debt became time barred
after 15.1.1999. [299-B-C) D
1.4. Section 446 (3) of the Companies Act was omitted by Companies
(Second Amendment) Act, 2002 and evidently the High Court has overlooked
this Amendment. As a result, the High Court has no power to transfer the
Execution Petition to the Debts Recovery Tribunal. At any event Section 446
has no application once the RDB Act applies because Section 34 expressly E
gives overriding effect to the provisions of the RDB Act. Also, the RDB Act
is a special law and hence will prevail over the general law in the Companies
Act [299-F-H]

ts. In the impugned order; the High Court has, while admitting that it
had no jurisdiction to deal with the execution application. it has, however, in F
the same order relied on the so called "inherent powers" of the Court. There
are no such inherent powers of the Court of transferring the Execution
Proceedings to the Debt Recovery Tribunal. Whatever powers there are of
transfer of proceedings to the Tribunal are contained in Section 31 of the
RDB Act, and no transfer is permissible de hors Section 31. Hence, High G
Court has no inherent powers apart from Section 31 for transferring the
Execution Petition to the Debt Recovery Tribunal. f299-H; 300-C)

1.6. Equity is wholly in favour of the respondent-Bank, since obviously
a Bank should be allowed to recover its debts. However, it is well settled that
when there is a conflict between law and equity, it is the law which has to H
290 SUPREME COURT REPORTS [2006) SUPP. IO S.C.R.

A prevail, in accordance with the Latin maxim 'dura lex sed lex' which means
'the law is hard, but it is the law'. Equity can only supplement the law, but it
cannot supplant or override it. (300-C-E]

Madamanchi Ramappa and Anr. v. Muthaluru Bojjappa, AIR (1963) SC
1633; Council for Indian School Certificate Examination v. Isha Mittal and
B Ors., (2000) 7 SCC 52; P.M Latha and Anr. v. State ofKera/a and Ors., (2003)
3 SCC 541; Laxminarayan R. Bhattad and Ors. v. State of Maharashtra and
Anr., (2003) 5 SCC 413; Nasiruddin and Ors. v. Sita Ram Agarwal, (2003) 2
SCC 577; E. Pa/anisamy v. Palanisamy (Dead) by Lrs. and Ors., (2003) 1
SCC 123 and India House v. Kishan. N. Lalwani, (2003) SCC 393, relied on.
c 1.7. In the present case while equity is in favour of the respondent-Bank,
the law is in favour of the appellant, since the impugned order of the High
Court is cearly in violation of Section 31 of the RDB Act, and moreover the
claim is time-barred in view of Article 136 of the Limitation Act read with
Section 24 of the RDB Act. It is the Bank itself which is to blame because
D after its first Execution Petition was dismissed on 23.8.1990 it should have
immediately thereafter filed a second Execution Petition, but instead it filed
the second Execution Petition only in 1994 which was dismissed on 18.8.1994.
Thereafter, again, the Bank waited for 5 years and it was only on 1.4.1999
that it filed its third Execution Petition. Court fails to understand why the
Bank waited from 1990 to 1994 and again from 1994 to 1999 in filling its
E Execution Petitions. Hence, it is the Bank which is responsible for not getting
the decree executed well in time. (301-E-H)

2.1. A purposive interpretation cannot be put on Section 31 of the RDB
Act. The first and foremost principle of interpretation of a statute in every
F system of interpretation is the literal rule of interpretation. The other rules
of interpretation e.g. the mischief rule, purposive interpretation etc. can only
be restored to when the plain words of a statute are ambiguous or lead to no
intelligible results or if read literally would nullify the very object of the
statute. Where the words of a statute are absolutely clear and unambiguous,
recourse cannot be had to the principles ofinterpretation other than the literal
G rule. The language employed in a statute is the determinative factor of the
legislative intent. The legislature is presumed to have made no mistake. The
presumption is that it intended to say what it has said. Assuming there is a
defect or an omission in the words used by the legislature, the Court cannot
correct or make up the deficiency, especially when a literal reading thereof
H produces an intelligible result. Where the legislative intent is clear from the
RAGHUNATH RA! BAREJA v. PUNJAB NATIONAL BANK 291
language, the Court should give effect to it, the Court should not seek to A
amend the law in the garb of interpretation.
[301-H; 302-A-B; F-H; 303-Al

Allahabad Bank v. Canara Bank and Anr., (20001 4 SCC 406; Mis.
Hiraial Rotan/al v. STO, AIR (1973) SC l 034; Swedish Match AB v. Securities
and Exchange Board, India, AIR (2004) SC 4219; Prakash Nath Khanna v. B
Cl T., (20041 9 SCC 686; Delhi Financial Corporation v. Rajiv Anand, (20041
11 SCC 625; Gov.ernment Andhra Pradesh v. Road Rollers Owners Welfare,
Association, (2004) 6 SCC 210; J.P. Bansal v. State of Rajasthan and Anr.,
AIR (2003) SC 1405; State ofJharkhand and Anr. v. Govind Singh, JT (2004)
IO SC 349; Jinia Keotin v. K.S. Manjh, [2003) l SCC 730; Shiv Shakti Co- C
Operative Housing Society v. Swaraj Developers, AIR 2003 SC 2434;
Narsiruddin v. Sita Ram Agarwal, AIR (2003) SC 1543 and Bhaiji v. Sub-
Divisional Officer, Thandla, (2003) l SCC 692, relied on.

Grundy v. Pinniger, (1852) I LJ Ch 405, referred to.

Hindustan Lever Ltd. v. Ashok Vishnu Kate and Ors., [1995] 6 SCC 326; D
Administrator, Municipal Corporation, Bilaspur v. Dattatraya Dahankar and
Anr., (1992) 1 SCC 361 and Directorate of Enforcement v. Deepak Mahajan
and Anr., (1994] 3 SCC 440, referred to.

'Of Law & Men : Papers and Addresses ofFelix Frankfurter', referred E
to.

2.2. Once the Court departs from the literal rule, then any number of
interpretations can be put to a statutory provision, each Judge having a free
play to put his own interpretation as he likes. This would be destructive of
judicial dicipline, and also the basic principle in a democracy that it is not for F
the Judge to legislate as that is the task of the elected representatives of the
people. Even ifthe literal interpretation results in hardship or inconvenience,
it has to be followed. Hence departure from the literal rule should only be
done in very rare cases, and ordinarily there should be judicial restraint in
this connection. The function of the Court is only to expound the law and not
to legislate. (303-F-H; 305-GI G
Union ofIndia and Anr. v. Hansoli Devi and Ors., 120021 7 SCC; District
Mining Officer v. Tata Iron and Steel Company, [20021 7 SCC 358;
Gurudevdatta VKSSS Maryadit v. State of Maharashtra, AIR (2001) SC 1980;
S. Mehta v. State of Maharashtra, [2001) 8 SCC 257; Patangrao Kaddam v.
Prithviraj Sajirao Yadav Deshmugh, AIR (2001) SC 1121 and C/Tv. Keshab H
292 SUPREME COURT REPORTS [2006) SUPP. 10 S.C.R.

A Chandra Manda/, AIR (1950) SC 265, relied on.

Emperor v. Benoarilal Sarma, AIR (1945) PC 48, 53, referred to.

Principles of Statutory Interpretations by G.P. Singh 9th Edn. pp 45-
49, referred to.
B
2.3. The rules of interpretation other than the literal rule would come
into play only if there is any doubt with regard to the express language used
or if the plain meaning would lead to an absurdity. Where the words are '•
unequivocal, there is no scope for importing any rule of interpretation.
[304-C-D]
c
Pandian Chemicals Ltd v. C./. T, (2003) 5 SCC 590, relied on.

2.4. Resort can be had to the legislative intent for the purpose of
interpreting a provision of law when the language employed by the legislature
is doubtful or ambiguous or leads to some absurdity. However, when the
D language is plain and explict and does not admit of any doubt, the Court cannot
by reference to an assumed legisla.tive intent expand or alter the plain meaning
of an expression employed by the legislative. Where the language is clear,
the intention of the legislature has to be gathered from the language used.
(305-C-E)
E Ombalika Das v. Hulisa Shaw, (20021 4 SCC 539; Grasim Industries
Limited v. Collector of Customs, (2002) 4 SCC 297 and Union of India v.
Hamsoli Devi, (2002] 7 SCC 273, relied on.

2.5. In the present ~ase the literal rule applies, and the other rules have
no application to interpreting Section 31, since the language of Section 31 is
F plain and clear, and cannot be said to be ambiguous of resulting in some
absurdity. (307-A-B)

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 5634 of2006.

From the final Judgment and Order dated 26.5.2003 of the High Court
G of Punjab and Haryana at Chandigarh in C.A No. 5512005 in E.P. No. 1/1999
and E.P. No. 1/1999 in C.A. No. 115/1986 in C.P. No. 46/1984.

M.K. ·Dua for the Appellant.

Dhruv Mehta, Harshvardhan Jha, Yashraj Deora, Manoj Mehta (for Ml
H s. K.L. Mehta & Co.) and Subramonium Prasad for the Respondents.
RAGHUNATHRAIBAREJAv.PUNJABNATIONALBANK[MARKANDEYKATJU,J.] 293

The Judgment of the Court was delivered by A
MARKANDEY KATJU, J. Leave granted.

This appeal has been filed against the impugned judgment and order
dated 26.5.2005 of the Punjab & Haryana High Court in Execution Petition
No. 1-L of 1999 by which the execution proceeding was transferred to the B
Debt Recovery Tribunal, Chandigarh (hereinafter referred to as the 'Tribunal'),
for being disposed of in accordance with law.

Heard learned counsel for the parties and perused the record.

The facts of the case are that on a Company Petition No. 57of1983 Ml C
s. SP. Nagrath & Co. v. Mis. Bareja Knipping Fasteners Ltd., the High Court
vide order dated 23.10.1983 ordered winding up of the Company and an
Official Liquidator was appointed who took over possession of the properties
of the Company.

The respondent-Bank filed a Suit (Company Petitio11 No. 46of1984) for D
recovery of Rs. 14,53,577/- with pendente lite and future interest.

A preliminary decree for recovery-0fRs. 19,07,800/- with future interest
@ 12% per annum was passed by the High Court in favour of the decree-
holder Bank, the respondent herein, on 2.12.1985 in Company Petition No. 46 E
of 1984.

Ultimately, a decree was passed in favour of the Bank on 15.1.1987 in
Company Application No. 115 of 1986.

The aforesaid final decree dated 15 .1.1987 stated as under:
F
"It is hereby ordered and decreed that the mortgaged/pledged/
hypothecated properties in the aforesaid preliminary decree mentioned
or sufficient part thereof be sold, and that for the purpose of such sale
the plaintiff/petitioner shall produce before the Court or such officer
as appointed, all documents in his possession or power relating to the
mortgag~ prop:~rti~s. G
And it is hereby ordered and decreed that the money realized by such
sale shall be paid in the Court and shall be duly applied (after deduction
therefrom ~f ~xpenses of the sale) in the payment of the amount
payable to the plaintiff/petitioner under aforesaid preliminary decree H
294 SUPREME COURT REPORTS [2006] SUPP. 10 S.C.R.

A and under any further orders that may have been passed in this
petition and in payment of any amount which the Court may have
adjudged due to the plaintiff/petitioner for such costs of the petition
including costs of this application and such costs, charges and
expenses as may be payable under Rule l 0 together with such
subsequent interest as may be payable under Rule 11 of Order XXXIV
B of the First Schedule to Code of Civil Procedure, 1908 and that the
balance, if any, shall be paid to the defendants/respondents or other
persons entitled to receive the same."

Under Article 136 to the Schedule of the Limitation Act, 1963 the period
C for applying for execution of any decree is 12 years from the date when the
decree becomes enforceable. Since in the present case the final decree was
passed and became enforceable on 15.1.1987, the period oflimitation for filing
an execution application expired on 15.1.1999.

In the present case, the Bank filed three Execution Petitions. The first
D one, being Execution Petition No. 14-L of 1987, was dismissed on 8.11.1990
by the following order:

"No list of the property sought to be attached has been filed. This
application is dismissed. The petitioner may, however, file a fresh
execution application in accordance with law."
E
It appears that a second Execution Petition thereafter was filed in 1994
being Execution Petition No. 3-L of 1994 by which the decree holder bank
sought attachment and sale of properties which did not belong to the judgment
debtors. After contest by the objectors, this second Execution Petition was
dismissed by a Learned Single Judge of the High Court on 18.8.1994 holding
F that the decree passed against the Company cannot be satisfied by attachment
and sale of properties belonging to other Companies, as these other Companies ,_
are different and distinct juristic personalities with different set of shareholders. [
Thereafter on 4.9.1998, the respondent-bank filed another Company
Petition No. 236 of 1998 undet Section 446 of the Companies Act, 1956 read
G with Rule 117 of the Company (Court) Rules, 1959 seeking leave of the
Company Court to commence the Execution proceedings before the Tribunal
which had come into existence in 1993 under the Recovery of Debts Due to
Banks and Financial Institutions Act, 1993 (hereinafter referred to as 'RDB
Act'). That petition was allowed by the Company Court vide order dated
H 18.12.1998 stating "Learned counsel for the parties are agreed that petitioner
.... RAGHUNATHRAIBAREJA "· PUNJABNATIONALBANK[MARKANDEYKA TJU,J) 295

be granted leave to file execution petition in this Court." A
The decree-holder Bank (respondent in this appeal), then filed a third
Execution Petition No. I of 1999 dated 11.01.1999 against Mis. Bareja Knipping
Fasteners Limited through the Official Liquidator, without impleading the
appellants and Shri K.M.Bareja as parties to the Execution Petition. On this
third Execution Petition, the High Court on 1.4.1999 passed the following B
order:

"Nobody is present on behalf of the petitioner. Counsel for the
Official Liquidator submits that the decree has already been executed
against the assets and properties of the Company. He further submits
that no assets of the Company, moveable or immovable, are available c
with the Official Liquidator. As such, there can be hardly any execution
against the Company.

Petition stands disposed of. Liberty to file proper petition against the
other judgment debtors in accordance with law is granted as they
have not been imp leaded as parties in the Memo of Parties either of D
the execution petition of that of the application."

Thereafter, on 7.4.1999, the Bank instead of filing a petition as directed
by the High Court, filed Company Application No. 173 of 1999 for restoration
of the Execution Petition No. 1 of 1999 along with a fresh Memo of Parties
E
before the High Court. The High Court issued notice on this Application
and then on 22.7.1999 recalled the order dated 1.4.1999.

On 3.1.2005, the decree-holder Bank filed Company Application No. 55
of2005 under Rule 9 of the Company (Court) Rules, 1959 read with Sections
17 and 18 of RDB Act for transfer of the Execution Petition to the Tribunal. F
The appellant filed a reply stating that the High Court has no jurisdiction
to entertain this Application. However by the impugned order dated 26.5.2005
the High Court transferred the Execution Petition pending before it to the
Debt Recovery Tribunal, Chandigarh.

In the aforesaid order dated 26.5.2005, the High Court observed: G
"No doubt, procedure for transfer of execution proceedings as
mentioned in the ROB Act is applicable only with regard to
proceedings pending on the relevant dated i.e. 24.6.1993 and there is
no provision for transfer of application filed after the said date.
H
296 SUPREME COURT REPORTS [2006) SUPP. JO S.C.R.

A There is, h6wever, order dated 18.12.1998 on record whereby the
parties consented that the petitioner may be allowed to file execution
petition in this Court. In view of judgment of the Apex Court in
Allahabad Bank (supra), this Court has no jurisdiction to deal with the
application for execution. The question is whether in exercise of
inherent jurisdiction of this Court, execution petition could be
B transferred to the Debt Recovery Tribunal, Chandigarh, as prayed for
by the decree-holder.

Inherent powers of the Court are in addition to the powers
specifically conferred. The same can be exercised for advancing ends
of justice, subject to the condition that exercise of such powers is not
c in conflict with express provisions of the statute. Learned counsel for
the judgment-debtor is unable to show any decision or principle as
to why inherent power cannot be invoked in the present case, to
achieve the ends of justice. There is no express or implied provision
against exercise of such a power, in a situation which has arisen in
D the present case.

Accordingly, C.A. No. 55 of 2005. is allowed and execution
proceedings are transferred to the Debt Recovery Tribunal, Chandigarh
for being disposed of in accordance with law. Learned counsel for the
decree-holder has made a statement that he wishes to proceed against
E the guarantors in execution proceedings. C.A. No. 415 of 1999 seeking
dismissal of execution application, is accordingly, dismissed."

Learned counsel for the appellant submitted that the aforesaid order
was wholly without jurisdiction.

F Learned counsel for the appellant has invited our attention to Sections
17, 18, 24 and 3 lof the RDB Act. These provisions are as follows:

"17. Jurisdiction, powers and authority of Tribunals-( I) A Tribunal
shall exercise, on and from the appointed day; the jurisdiction, powers
and authority to entertain and decide applications from the banks and
G financial institutions for recovery of debts due to such banks and
financial institutions.

(2) An Appellate Tribunal shall exercise, on and from the appointed
day, the jurisdiction, powers and authority to entertain appeals against
any order made, or deemed to have been made, by a Tribunal under
H
... RAGHUNATH RAJ BAREJA v. PUNJAB NATIONALBANK [MARKANDEYKA TJU,J.] 297
this Act. A
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 Arts. 226 and 227 of the Constitution)
in relation to the matters specified in Section 17. B
24. Limitation-The provisions of the Limitation Act, 1963, shall, as
far as may be, apply to an application made to a Tribunal.

31. Transfer of pending cases.-(1) Every suit or other proceeding
pending before any court immediately before the date of establishment C
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 D
appeal pending as aforesaid before any Court.

(2) Where any suit or other proceeding stands transferred from any
court to a Tribunal under sub-section (1), -

(a) the court shall, as soon as may be after such transfer, forward
the records of such suit or other proceeding to the Tribunal; and E
(b) the Tribunal may, on receipt of such records; proceed to deal
with such suit or other proceeding, so far as may be, in the same
manner as in the case of an application made under section 19
from the stage which was reached before such transfer or from
any earlier stage or de nova as the Tribunal may deem fit." F

Admittedly, the Debt Recovery Tribunal, Chandigarh was established
in 1993 and hence after 1993 the exclusive jurisdiction regarding recovery of
debts pertaining to which the RDB Act applies is with the Tribunal.

In our opinion, the impugned order oft«e High Court dated.26.5.2005, G
transferring the Execution Petition pending before it to the Debt Recovery
Tribunal, Chandigarh was clearly beyond the scope of Section 31 of the RDB
Act because Section 31 states that only suits or other proceeding pending
before the Court immediately before the establishment of the Tribunal under
the Act, stand transferred to the Tribunal. Since, admittedly the Tribunal in H
298 SUPREME COURT REPORTS [2006]SUPP. IO S.C.R.

A the present case, had been established in 1993, and no proceeding was
pending before it on the date when it was established, no transfer could take
place under Section 31 of the ROB Act. At any event, the third Execution
Petition which was transferred by the impugned order was filed by the
respondent-Bank on 11.1.1999, i.e. much after the Tribunal had been
B established. Hence obviously there could be no such transfer to the Tribunal
under Section 31 of the ROB Act. Apart from Section 31, there is no other
provision for transferring a suit or other proceeding pending before any Court
to the Tribunal. Hence, the impugned order dated 26.5.2005 was clearly illegal
and without jurisdiction.

C In this connection learned counsel for the appellant ha5 relied on the
decision of this Court in Allahabad Bank v. Canara Bank & Anr. [2000] 4
SCC 406, In the aforesaid decision this Court observed that the word
'proceedings' in Section 31 of the ROB Act includes 'execution proceedings'
pending before a civil court before the commencement of the Act. In para
50 of the aforesaid decision this Court observed that the ROB Act, 1993
D confers exclusive jurisdiction on the Debt Recovery Tribunal both at the
stage of adjudication of the claim under Section 17 of the Act as well as
execution of the claim. The Court observed that the provisions of the RDB
Act, 1993 are to an extent inconsistent with the provisions of the Companies
Act, 1956, and the latter Act has to yield to the provisions of the former. This
E position holds good during the pendency of the winding-up petition against
the debtor company and also after a winding-up order is passed The Court
further held that no leave of the Company Court is necessary under Section
446 of the Companies Act, 1956 for initiating or continuing the proceedings
under the RDB Act, 1993.

p In the aforesaid decision this Court also upheld the view of some of the
High Courts that the Company Act is a general statute, and hence the ROB
Act which is a special Act, overrides the general statute. At any event, in
view of Section 34 of the RDB Act, the said Act will prevail to the extent of
inconsistency over the Companies Act.

G Since in the aforesaid decision this Court has held that even with regard
to execution the jurisdiction under the ROB Act is exclusive, we cannot agree
with the view taken by the High Court merely because the appellant had given
his consent to the transfer of the Execution Petition to the Tribunal. It is well
settled in law that consent cannot confer jurisdiction.

H In Allahabad Bank v. Canara Bank & Anr., (supra) (vide para 23) this
RAGHUNATH RAI BAREJA 1·. )>UN.JAB NATIONAL BANK [MARKANDEYKATJU.J.J 299
Court observed : A
" ....... .In our opinion, the prescription of an exclusive Tribunal
both for adjudication and execution is a procedure clearly inconsistent
with realization of these debts in any other manner."

Since Section 24 of the ROB Act applies the provisions of the Limitation B
Act, 1963, to applications filed before the Tribunal, and since Article 136 of
the Limitation Act provides a period of limitation of 12 years for filing an
Execution Petition, hence now no such application can be filed since that
period of 12 years expired on 15.1.1999. Hence, in our opinion the debt
became time barred after 15.1.1999.
c
Learned counsel for the respondent-Bank relied on Section 446(1) of the
Companies Act which states that when a winding-up order is passed or the
official liquidator is appointed as a provisional liquidator, no suit or other legal
proceeding shall be commenced, or if pending at the date of the winding-up
order, shall be proceeded with against the company, except by leave of the D
court and subject to such terms as the court may impose.

Learned counsel for respondent-Bank relied on Sub-section (3) of Section
446 of the Companies Act, 1956, whic:1 states :

"(3) Any suit or proceeding by or against the company which is
pending in any Court other than that in which the winding up of the E
company is proceeding may, notwithstanding anything contained in
any other law for the time being in force, be transferred to and
disposed of by that Court."

In this connection, it may be mentioned that Section 446(3) of the F
Companies Act was omitted by Companies (Second Amendment) Act, 2002
and evidently the High Court has overlooked this Amendment. As a result
in our opinion the High Court has no power to transfer the Execution Petition
to the Debts Recovery Tribunal. At any event as held in Allahabad Bank v.
Canara Bank & Anr., (supra), Section 446, has no application once the ROB
Act applies because Section 34 expressly gives overriding effect to the G
provisions of the RDB Act. Also, the ROB Act is a special law and hence
will prevail over the general law in the Companies Act as held in Allahabad
~ Bank v. Canara Bank & Anr., (supra).

In this connection, we may mention that in the impugned order dated
H
300 SUPREME COURT REPORTS (2006] SUPP. 10 S.C.R.

A 26.5.2005 the High Court has, while admitting that in view of the decision of
this Court in Allahabad Bank v. Canara Bank & Anr., (supra), it had no
jurisdiction to deal with the execution application, it has, however, in the same
order relied on the so called "inherent powers" of the Court. In our opinion
there are no such inherent powers of the Court of transferring the Execution
Proceedings to the Debt Recovery Tribunal, Chandigarh. Whatever powers
B there are of transfer of proceedings to the Tribunal are contained in Section
31 of the RDB Act, and no transfer is pennissible de hors Section 31. Hence,
we respectfully disagree with the High Court that it has inherent powers apart
from Section 31 for transferring the Execution Petition to the Debt Recovery
Tribunal.
c Learned counsel for the respondent-Bank submitted that it will be very
unfair if the appellant who is a guarantor of the loan, and director of the
Company which took the loan, avoids paying the debt. While we fully agree
with the learned counsel that equity is wholly in favour of the respondent-
Bank, since obviously a Bank should be allowed to recover its debts, we
D must, however, state that it is well settled that when there is a conflict
between law and equity, it is the law which has to prevail, in accordance with
the Latin maxim 'dura lex sed lex', which means 'the law is hard, but it is the
Jaw'. Equity can only supplement the law, but it cannot supplant or override
it.

E Thus, in Madamanchi Ramappa & Anr. v. Muthaluru Bojjappa, AIR
(1963) SC 1633, (vide para 12) this Court observed:

" ......... what is administered in Courts is justice according to law, and
considerations of fair play and equity however important they may be,
must yield to clear and express provisions of the law" .....
F
In Council for Indian School Certificate Examination v, Isha Mittal &
Anr., [2000] 7 SCC 521, (vide para 4) this Court observed:

" ......... Considerations of equity cannot prevail and do not pennit a
High Court to pass an order contrary to the law."
G
Similarly in P.M Latha & Anr. v. State of Kera/a & Ors., [2003] 3 SCC
541, (vide para 13) this Court observed:

"Equity and law are twin brothers and law should be applied and
interpreted equitably, but equity cannot override written or settled
H law....."
RAGHUNATHRAIBAREJAv.PUNJABNATIONALBANK[MARKANDEYKATJU,J.] 301

In Laxminarayan R. Bhattad & Ors. v. State of Maharashtra & Anr., A
.- [2003] 5 SCC 413, (vide para 73) this Court observed :

"ft is now well settled that when there is a conflict between law
and equity the former shall prevail. "....... .

Similarly in Nasiruddin & Ors. v. Sita Ram Agarwal [2003] 2 SCC 577, B
(vide para 35) this Court observed:

"In a case where the statutory provision is plain and unambiguous,
the court shall not interpret the same in a different manner, only
because of harsh consequences arising therefrom." .....

Similarly in E. Palanisamy v. Palanisamy (Dead) by Lrs. & Ors. [2003]
c
1 SCC 123, (vide para 5) this Court observed :

" ....... Equitable considerations have no place where the statute
contained express provisions." ..... .

In India House v. Kishan N. Lalwani, [2003] 9 SCC 393, (vide para 7) D
this Court held that :

"....... The period of limitation statutorily prescribed has to be strictly
adhered to and cannot be relaxed or departed from by equitable
considerations. "..... .
E
(emphasis supplied)

In the present case, while equity is in favour of the respondent-Bank,
the law is in favour of the appellant, since we are of the opinion that the
impugned order of the High Court is clearly in violation of Section 31 of the F
RDB Act, and moreover the claim is time-barred in view of Article 136 of the
Limitation Act read with Section 24 of the RDB Act. We cannot but comment
that it is the Bank itself which is to blame because after its first Execution
Petition was dismissed on 23.8.1990 it should have immediately thereafter filed
a second Execution Petition, but instead it filed the second Execution Petition
only in 1994 which was dismissed on 18.8.1994. Thereafter, again, the Bank G
waited for 5 years and it was only on 1.4.1999 that it filed its third Execution
Petition. We fail to understand why the Bank waited from 1990 to 1994 and
again from 1994 to 1999 in filing its Execution Petitions. Hence, it is the Bank
which is responsible for not getting the decree executed well in time.

Learned counsel for the respondent-Bank then submitted that a purposive H·
302 SUPREME COURT REPORTS [2006] SUPP. 10 S.C.R.

A interpretation should be put on Section 31 of the RDB Act so that the bank
can recover its dues. He relied on the decisions of this Court in Hindustan
Lever Ltd v. Ashok Vishnu Kate and Ors., [1995] 6 SCC 326, (vide para) 41
& 42), Administrator, Municipal Corporation, Bilaspur v. Dattc;traya
DahankarandAnr., [1992] 1SCC361, (vide para4), Directorate ofEnforcement
B v. Deepak Mahajan and Anr., [1994] 3 SCC 440, (vide para 31), etc. We are
afraid we cannot accept this contention. In fact, in Allahabad Bank v. Canara
Bank (supra), the argument that a purposive interpretation should be put on
the provisions of the RDB Act has been specifically rejected (vide para 34).

In Mis. Hirata/ Ratanlal v. STO, AIR (I 973) SC I034, this Court observed:
c "In construing a statutory provision the first and foremost rule of
construction is the literary construction. All that the Court has to see
at the very outset is what does the provision say. If the provision is
unambiguous and iffrom the provision the legislative intent is clear,
the Court need not call into aid the other rules of construction of
D statutes. The other rules of construction are called into aid only
when the legislative intent is not clear. "

(emphasis supplied)
It may be mentioned in this connection that the first and foremost
E principle of interpretation of a statute in every system of interpretation is the
literal rule of interpretation. The other rules of interpretation e.g. the mischief
rule, purposive interpretation etc. can only be resorted to when the plain
words of a statute are ambiguous or lead to no intelligible results or if read
literally would nullify the very object of the statute. Where the words of a
statute are absolutely clear and unambiguous, recourse cannot be had to the
F principles of interpretation other than the literal rule, vide Swedish Match AB
v. Securities and Exchange Board, India, AIR [2004] SC 4219. As held in
Prakash Nath Khanna v. C./. T., [2004] 9 SCC 686, the language employed in
a statute is the detenninative factor of the legislative intent. The legislature
is presumed to have made no mistake. The presumption is that it intended to
G say what it has said. Assuming there is a defect or an omission in the words
used by the legislature, the Court cannot correct or make up the deficiency,
especially when a literal reading thereof produces an intelligible result, vide
Delhi Financial Corporation v. RajivAnand, [2004] I I SCC 625. Where the
legislative intent is clear from the language, the Court should give effect to
it, vide Government of Andhra Pradesh v. Road Rollers Owners Welfare
H

.. ...
- ,
RAGHUNATH RAJ BAREJA ''·PUNJAB NATIONAL BANK [MARKANDEY KATJU, J.] 303

Association, [2004] 6 SCC 210, and the Court should not seek to amend the A
law in the grab of interpretation.

As stated by Justice Frankfurter of the U.S. Supreme Court (see 'Of
Law & Men : Papers and Addresses of Felix Frankfurter') :

"Even within their area of choice the courts are not at large. They are B
confined by the nature and scope of the judicial function in its
particular exercise in the field of interpretation. They are under the
constraints imposed by the judicial function in our democratic society.
As a matter of verbal recognition certainly, no one will gainsay that
the function in construing a stature is to ascertain the meaning of
words used by the legislature. To go beyond it is to usurp a power C
which our democracy has lodged in its elected legislature. The great
judges have constantly admonished their brethren of the need for
discipline in observing the limitations. A judge must not rewrite a
statute, neither to enlarge nor to contract it. Whatever temptations the
statesmanship of policy-making might wisely suggest, construction D
must eschew interpolation and evisceration. He must not read in by
way of creation. He must not read out except to avoid patent nonsense
or internal contradiction."
..
As observed by Lord Granworth in Grundy v. Pinniger, (1852) I LJ Ch
405: E
"To adhere as closely as possible to the literal meaning of the words
used, is a cardinal rule from which if we depart we launch into a sea
of difficulties which it is not easy to fathom."

In other words, once we depart from the literal rule, then any number F
of interpretations can be put to a statutory provision, each Judge having a
free play to put his own interpretation as he likes. This would be destructive
of judicial discipline, and also the basic principle in a democracy that it is not
for the Judge to legislate as that is the task of the elected representatives of
the people. Even if the literal interpretation results in hardship or
inconvenience, it has to be followed (see G .P. Singh' s Principles of Statutory G
Interpretations, 9th Edn. pp 45-49). Hence departure from the literal rule
should only be done in very rare cases, and ordinarily there should be judicial
restraint in this connection.

As the Privy Council observed (per Viscount Simonds, L.C.):
H
304 SUPREME COURT REPORTS [2006] SUPP. 10 S.C.R.

A "Again and again, this Board has insisted that in construing enacted
words we are not concerned with the policy involved or with the
results, injurious or otherwise, which may follow from giving effect
to the language used."(see Emperor v. Benoari/al Sarma, AIR (1945)
PC 48, pg. 53).

B As observed by this Court in CIT v. Keshab Chandra Manda/, AIR
(1950) SC 265:

"Hardship or inconvenience cannot alter the meaning of the language
employed by the Legislature if such meaning is clear on the face of
the statute".
c
The rules of interpretation other than the literal rule would come into
play only if there is any doubt with regard to the express language used or
if the plain meaning would lead to an absurdity. Where the words are
unequivocal, there is no scope for importing any rule of interpreta.tion vide
D Pandian Chemicals Ltd. v. C.J.T., [2003] 5 SCC 590.

It is only where the provisions of a statute are ambiguous that the Court
can depart from a literal or strict construction vide Narsiruddin v. Sita Ram
Agarwal, AIR (2003) SC 1543. Where the words of a statute are plain and
unambiguous effect must be given to them vide Bhaiji v. Sub-Divisional
E Officer, Thandla, [2003] I sec 692.

No doubt in some exceptional cases departure can be made from the
literal rule of the interpretation, e.g. by adopting a purposive construction,
Heydon's mischief rule, etc. but that should only be done in very exceptional
cases. Ordinarily it is not proper for the Court to depart from the literal rule
F as that would really be amending the law in the garb of interpretation, which
is not permissible vide J.P. Bansal v. State of Rajasthan & Anr., AIR (2003)
SC 1405, State of Jharkhand & Anr. v. Govind Singh, JT (2004) 10 SC 349,
etc .. It is. for the legislature to amend the law and not the Court vide State
of Jharkhand & Arir. v. Govind Singh JT (2004) 10 SC 349. In Jinia Keotin
v. K.S. Manjhi, [2003] l SCC 730, this Court observed : .
G
"The Court cannot legislate ..... under the grab of interpretation ...... "

Hence there should be judicial restraint in this connection, and the temptation
to do judicial legislation should be eschewed by the Courts. In fact, judicial .
legislation is an oxymoron.
H
RAGHUNATH RAI BAREJA v. PUNJAB NATIONAL BANK [MARKANDEY KATJU, J .] 305

In Shiv Shakti Co-operative Housing Society v. Swaraj Developers, A
AIR (2003) SC 2434, this Court observed:

"It is a well settled principle in law that the Court cannot read
anything into a statutory provision which is plain and unambiguous.
A statute is an edict of the legislature. The language emplciyed in a
statute is the determinative factor of legislative intent." B
In. our opinion, Section 31 is plain and unambiguous and it clearly says
that only those suits or proceedings pending before a Court shall stand
transferred to the Tribunal which were pending on the date when the Tribunal
was established
c
The learned counsel for the respondent submitted that we have to see
the legjslative intent when we interpret Section 31. In our opinion, resort can
be had to the legislative intent for the purpose of interpreting a provision of
law when the language employed by the legislature is doubtful or ambiguous
or leads to some absurdity. However, when the language is plain and explicit D
and does not admit of any doubt, the Court cannot by reference to an assumed
·· legi~lative,intent expand or alter the plain meaning of an expression employed
by the legislature vide .Ombalika Das v. Hulisa Shaw, [2002] 4 SCC 539.

Where the language is clear, the intention of the legislature has to be
gathered from the language used vide Grasim Industries Limited v. Collector E
of Customs, [2002] 4 SCC 297, and Union of India v. Hamsoli Devi, [2002]
7 SCC273.

In Union ofIndia and Anr., v. Hanso/i Devi alid Ors., [2002] 7 SCC (vide
para 9), this CClurt observed :
F
"It is a cardinal principle of construction of a statute that when
the language of the statute is plain and unambiguous, then the court
must give effect to the words used in the statute and it would not be
open to the courts to adopt a hypothetical construction on the grounds
that such construction is more consistent with the alleged object and G
policy of the Act."

The function of the Court is only to expound the law and not to legislate
vide District Mining Officer v. Tata Iron and Steel Company, [2002] 7 SCC
358. If we accept the interpretation canvassed by the learned counsel for the
respondent we will really be legislating because in the guise of interpretation H
306 SUPREME COURT REPORTS [2006) SUPP. 10 S.C.R.

A we will be really amending Section 31.
In Gurudevdatta VKSSS Maryadit v. State of Maharashtra, AIR (200 l)
SC 1980, this Court observed :

"It is a cardinal principle of interpretation of statute that the words of
B a statute must be understood in their natural, ordinary or popular
sense and construed. according to their grammatical meaning, unless
such construction leads to some absurdity or unless there is something
in the context or in the object of the statut~ to suggest to the contrary.
The golden rule is that the words of a statute must prima facie be
given their ordinary meaning. It is yet another rule of construction
c that when the words of the statute are clear, plain and unambiguous,
then the Courts are bound to give effect to that meaning, irrespective
of the consequences. It is said that the words themselves best declare
the intention of the law-giver. The Courts are adhered to the principle
tJiat efforts should be made to give meaning to each and every word
D used by the legislature and it is not a sound principle of construction
to brush aside words in a statute as being inapposite surpluses, if they
can have a proper application in circumstances conceivable within
the contemplation of the statute".

The same view has been taken by this Court in S. Mehta v. State of
E Maharashtra, [2001] 8 SCC 257, {vide para 34) and Patangrao Kaddam v~
Prithviraj Sajirao Yadav Deshmugh, AIR {2001) SC 1121.

The literal rule of interpretation really means that there should be no
interpretation. In other words, we should read the statute as it is, without
F distorting or twisting its language.

We may mention here that the literal rule of interpretation is not only
followed by Judges and lawyers, but it is also followed by the lay man in his
ordinary life. To give an illustration, if a person says "this is a pencil", then
he means that it is a pencil; and it is not that when he says that the object
G is a pencil, he means that it is a horse, donkey or an elephant. In other words,
the literal rule of interpretation simply means that we mean what we say and
we say what we mean. If we do not follow the literal rule of interpretation,
social life will become impossible, and we will not understand each other. If
we say that a certain object is a book, then we mean it is a book. If we say
it is a book, but we mean it is a horse, table or an elephant, then we will not
H be able to communicate with each other. Life will become impossible. Hence,
RAGHUNATHRAIBAREJAv.PUNJABNATIONALBANK[MA.RKANDEYKATJU,J.J 307

the meaning of the literal rule of interpretation is simply that we mean what A
we say and we say what we mean.

In the present case, we are clearly of the opinion that the literal rule
applies, and the other rules have no application to interpreting Section 31,
since the language of Section 31 is plain and clear, and cannot be said to be
ambiguous or resulting in some absurdity. B
In view of the above, we are clearly of the opinion that the recovery
in question is time-barred and it is hereby quashed. The impugned order of
the High Court is set aside. The appeals is accordingly allowed. No costs.

K.KT. Appeal allowed.