Case Title:
Charu Kishor Mehta Vs Prakash Patel & Ors
Date of Order:
22/06/2022
Bench:
Justice C. T. Ravikumar and Justice Sudhanshu Dhulia
Parties:
Charu Kishor Mehta – Petitioner;
Prakash Patel – Respondent;
Subject
Pointing out the influx of frivolous litigation intended to extract compensation, defame, or preoccupy the opposing party, the Supreme Court upheld the Bombay High Court’s decision of extracting a fine of Rs. 5 lakhs from a 78-year-old petitioner. The apex court also indicated its intention of following through with a contempt charge against the old lady but refrained solely due to her senior citizen status.;
Facts;
- The petitioner had extracted a credit amounting to a total of Rs. 277,00,00,000/- from the Oriental Bank of Commerce, who filed for recovery in the Debts Recovery Tribunal of Mumbai, which then issued an order of acceptance on 24/07/2006.;
- The order instructed all the liable parties to pay the dues. But this order was challenged in front of the Debts Recovery Appellate Tribunal along with other steps taken by the Tribunal to the end of recovering the debt under the SARFAESI Act.;
- Her appeal in front of the High Court was to challenge the order by the Trial Court dismissing her suit to stay the proceedings of the auction of her assets under the SARFAESI Act, this suit was dismissed owing to Order VII Rule 11 of the C.P.C.;
- Power of recovery of all the debts was assigned to the M/s. Phoenix A.R.C. Pvt. Ltd. The petitioner entered into a settlement agreement with this entity agreeing to pay an amount no less than Rs.27,31,04,000/- before 30/06/2014. There was an agreement regarding the transfer of secured assets moving from the petitioner to the M/s. Phoenix A.R.C Pvt. Ltd. The petitioner also agreed not to disrupt any proceeding involved in the execution of the recovery certificate.;
- But all of the above agreements were broken by the petitioner as he obstructs the process of obtaining the certificate by huddling the respondent with legal proceedings in various tribunals under the SARFAESI Act, District Court, the Bombay High Court, and the Supreme Court.;
Judgment;
- The Bench took notice of all the list of petitions filed by the petitioner, and the numerous SLPs filed by the party were dismissed or retracted. They were mainly accusations of fraud and connivance on part of the respondents.
- Having already filed an SLP accusing the respondents of fraud and withdrawing it unconditionally, the petitioner has lost the right to file an SLP on the same grounds again, the court held.;
- And the petitioner having hidden the fact that he has filed SLPs previously from the court stipulates that they have not approached the court with clean hands, and are instead, abusing the machinery and integrity of the judicial system by muddling it with unnecessary and frivolous petitions.;
- In a call back to the Judgment of Dalip Singh v. State of Uttar Pradesh, the Supreme Court explained how truth and non-violence were highly regarded as prime virtues, and the pride people took in speaking the truth and helping in facilitating justice without fearing the repercussions. And how the recent prevalence of frivolous litigation culture has been harmful to the Justice System, and the court expressed the need for overcoming this predicament by modifying the rules.;
- Reading from the judgment of Subrata Roy Sahara v. the Union of India, the court brought the plight of people targeted by such frivolous litigations into focus. How they have to bear the inevitable consequences and responsibilities that come along with such litigations.
- Turning toward the maintainability of the current petition by the petitioner, the only argument made by them was that they were excluded from the society where Defendant No. 3 was the President. But the court ruled that even being a member of that society does not improve the petitioner’s standing in the current matter.;
- It was further specified that being a member of that society does not grant rights over the property. Thus, the court held that this argument does not carry any weight.;
CONCLUSION
Therefore, with due consideration of all the facts involved, the court decided that the penalty of Rs.5 lakhs imposed by the Bombay High Court was completely justified. And highlighted how the petitioner’s intent was reflected in his conduct over the years.;
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