Supreme Court Criticizes Finance Ministry For Treating Debts Recovery Tribunal As “Subordinate Department”, Seeks Explanation

The report, which was submitted by the Presiding Officer of the DRT, detailed that staff members had to devote substantial time and efforts to collate data requested by the Ministry, which significantly hindered the tribunal's ability to conduct its proceedings.

A bench of Justice Abhay Oka and Augustine George Masih issued notice to the Section Officer (DRT) of the Ministry of Finance, Department of Financial Services seeking explanation as to why the DRT was being treated like a department of the central government. The officer was directed to appear before the Court on October 21, 2024, to provide a full explanation.

“The report records a shocking state of affairs. The Ministry of Finance, Department of Financial Services called upon the learned member of the DRT to submit data. The extent of data called from the DRT is such that a huge exercise was required to be undertaken by the registrar of DRT and therefore the stenographers and staff attached to DRT was required to devote the second session for doing the work of collation of data. Prima facie it appears to us that the Ministry of Finance is treating the office of the Debt Recovery Tribunal as it subordinate office”, the Court observed.

The Court was hearing an SLP challenging the adjournment of a securitization application pending before the tribunal due to a lawyers' strike. The Court has issued a contempt notice against the Vishakhapatnam Bar Association for abstaining from court work, leading to the non-functioning of the DRT.

In the last hearing, the Supreme Court was informed that the DRT had adjourned a securitization application on September 12, 2024, because its staff was preoccupied with preparing statements requested by the Finance Ministry.

The Court, surprised by this, had directed the DRT's Presiding Officer to file a report in a sealed cover, explaining the Ministry's requirement and the nature of the work carried out by the tribunal's staff in response.

Today, the Court perused the report filed by the Presiding Officer of the DRT. The Court observed, “only because of requisitions sent by the Ministry that instead of assisting the learned Presiding Officer of the DRT in performing his judicial duties the staff members remained busy with collection and collation of the data.”

The report also stated that the pronouncement of order will happen on October 1, 2024.

The Court ordered the Registrar of the Supreme Court to prepare an additional copy of the report submitted by the DRT's Presiding Officer, which would be placed on the record and forwarded to the Ministry of Finance officer summoned to appear before the Court.

On the last date, the Court had expressed dissatisfaction with the affidavit filed by the Bar Association, directing it to pass a resolution stating that it would never again call for boycotts under any circumstances.

Today, the Court took on record undertakings by the Bar Association and discharged the contempt notice.

“We make it clear that any further action by the Bar Association contrary to the undertaking must be treated as a case of aggravated criminal contempt. No further directions are required to be issued against the Bar Association. List the matter on 21st October. The notice issued to the Secretary of the Bar Association is discharged”, the Court stated.

Case no. – Special Leave to Appeal (C) No. 11029/2024

Case Title – Superwhizz Professionals Pvt. Ltd. v. Union of India & Ors.

Citation : 2024 LiveLaw (SC) 764

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