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Supreme Court of India

OM AGGARWALversusHARYANA FINANCIAL CORPORATION AND OTHERS

Citation
2015 INSC 147
Decided
23 February 2015
Disposal
Dismissed

Holding

A civil suit filed by a defaulter challenging a recovery notice under the Haryana Public Moneys (Recovery of Dues) Act, 1979 is barred by Section 3(4) and cannot be entertained by a civil court.

Summary

The appellant, a promoter of a limited company, entered into a buy‑back agreement with Haryana Financial Corporation, which later issued a recovery notice under the Haryana Public Moneys (Recovery of Dues) Act, 1979 claiming arrears of land revenue. The appellant filed a civil suit seeking declaration that the agreement and the recovery notice were void. The corporation moved to reject the plaint under Order VII Rule 11(d) of the CPC, invoking Section 3(4) of the Act which bars civil courts from entertaining any suit relating to recovery from a defaulter. The trial court, the Additional District Judge and the High Court all dismissed the suit, holding it barred. On appeal, the Supreme Court examined the definitions of "defaulter" and "financial assistance" under the Act and applied the principle from S.K. Bhargava, concluding that the suit fell squarely within the bar of Section 3(4). The Court rejected the appellant's reliance on the Unique Butyle case, noting the statutory differences, and affirmed the dismissal of the appeal.

Issues considered

  • The applicability of Section 3(4) of the Haryana Public Moneys (Recovery of Dues) Act, 1979 to a civil suit challenging a buy‑back agreement and a recovery notice.
  • Whether the civil court has jurisdiction to entertain a suit filed by a defaulter against a corporation under the Act.
  • The relevance of the decision in Unique Butyle Tube Industries v. U.P. Financial Corporation to the present case.

Legislation cited

Subjects

jurisdictioncivil courtstatutory barOrder VII Rule 11defaulterfinancial assistancebuy‑back agreementrecovery of dues

Judgment

                  [2015] 2 S.C.R. 505


                   OM AGGARWAL                          A

                          v.
    HARYANA FINANCIAL CORPORATION AND
                 OTHERS
                                                        B
          (Civil Appeal No. 4942 of 2007)

                FEBRUARY 23, 2015
             [RANJAN GOGOi AND
          ABHAY MANOHAR SAPRE, JJ.]
                                                        c
     Code of Civil Procedure, 1908 - 0. VII r. 11 (d) -
Rejection of plaint - Jurisdiction of civil court - Suit
for declaration by appellant-one of the promoter of
the limited company that the Buy Back Agreement D
executed by the appellant with respondent no. 1-State
Financial Corporation; and the recovery notice issued
by the Corporation be declared null and void -
Application u/0. VII r.11 rw s.21 by respondent no. 1
that the suit claiming the said relief was not E
maintainable - Dismissal of suit as not maintainable
by the courts below, by taking recourse to 0. VII r. 11 (d
) - Interference with - Held: Not called for - On facts,
appellant was a 'defaulter' as defined uls.2(c); the
investment made by the Corporation pursuant to an F
agreement was in the nature of the 'financial
assistance' as defined uls.2(d); demand raised by
Corporation was in relation to the amount given by
way of financial assistance u/s. 3 and the subject G
matter of the suit fell uls. 3(4)(a), (b), thus, the bar
contained in s. 3(4) in filing the civil suit by the
defaulter attracted - Haryana Public Moneys

                         505                            H
506        SUPREME COURT REPORTS              [2015] 2 S.C.R.


A     (Recovery of Dues) Act, 1979 - ss. 2(b), (c), (d), 3(4).

          Dismissing the appeal, the Court

      HELD: 1.1 Section 3 of the Haryana Public
8 Moneys (Recovery of Dues) Act, 1979 empowers
  the Corporation to make recovery of its
  outstanding dues from the defaulter as arrears
  of land revenue by getting the certificate of
  recovery of the amount issued from the
C competent authority whereas sub-section (4) of
  Section 3 in clear terms takes away the
  jurisdiction of the civil court to entertain or/and
  adjudicate "any case" relating to the recovery
  of any sum due from the defaulter. It also takes
0 away the jurisdiction of civil court to proceed
  with any pending case involving such issue. If
  any such case is pending on the date of
  commencement of the Act, such case shall
  stand abate. [Para 23) [518-E-G]
E     1.2 Applying the principle of law laid down in
  S.K. Bhargava case, it is clear by mere reading of
  the plaint that firstly, the plaintiff was a 'defaulter'
  as defined under section 2(c) of the Act; secondly,
  the investment made by defendant No.1-
F Corporation pursuant to an agreement was in the
  nature of the 'financial assistance' as defined
  under Section 2 (d) of the Act; thirdly, the demand
  raised by the respondent was in relation to the
  amount given by way of financial assistance
G under Section 3 of the Act and lastly, the subject
  matter of the suit viz., challenge to the legality of
  the agreement and the demand fell under Section
  3(4)(a) and (b) of the Act. In the light of the facts,
  which are clearly discernable from the averments
H
     OM AGGARWAL v. HARYANA FINANCIAL                        507
              CORPORATION

made in the plaint, the provisions of the Act get A
attracted to the case in hand which, in turn, attract
the bar contained in sub-section (4) of Section 3 in
filing the civil suit by the defaulter. The suit is,
therefore, apparently barred by virtue of bar contained
in Section 3(4) of the Act. It was thus, rightly dismissed B
by the courts below by taking recourse to Order VII
Rule 11 (d) of the Code. [Paras 25 and 26] [520-A-E]

    S.K. Bhargava v. Collector, Chandigarh and others
(1998) 5 SCC 170: 1998 (2) SCR 1158 - relied on.      C
                     '
    Unique Butyle Tube Industries (P) Ltd. v. U.P.
Financial Corporation and Others (2003) 2 SCC 455:
2002 (5) Suppl. SCR 666 - held Inapplicable.
                                                              D
                   Case Law Reference

 1998 (2) SCR 1158          referred to          Para 25

 2002 (5) Suppl. SCR 666 held inapplicable      Para 32
                                                              E
   CIVILAPPELLATE JURISDICTION: Civil Appeal No.
4942 of 2007

     From the Judgment and Order dated 03.03.2005 of
the High Court of Punjab & Haryana at Chandigarh in F
Civil Revision No. 3127 of 2004.

   Suresh Singh, Rohit Tandon, Ruchi Kohli for the
Appellant.
                                                              G
    Birendra Kumar Choudhary, AAG, Sanjay Kumar
Visen, Amarjit Singh Bedi, Amit Dayal for the Respondents.

      The Judgment of the Court was delivered by
                                                              H
508        SUPREME COURT REPORTS               [2015] 2 S.C.R.


A      ABHAY MANOHAR SAPRE, J. 1. This civil appeal
  is filed by the appellant/plaintiff (hereinafter referred
  to as "the plaintiff) against the judgment/order dated
  03.03.2005 passed by the High Court of Punjab &
  Haryana at Chandigarh in Civil Revision No. 3127 of
B 2004 which arises out of order dated 26.03.2004
  passed by the Additional District Judge, Hisar in Civil
  Appeal No. 87/2003/2004.

      2. In order to appreciate the issue involved in the
C appeal, few relevant facts need to be mentioned in
  brief.

      3. The plaintiff is one of the promoters of a limited
  company known as "Mis lndo Britain Agro Farms
D Limited Hisar" which is engaged in the manufacture
  of ordinary white buttons "Mushroom" at Hisar
  (Haryana).

      4. Respondent No.1/defendant No.1-Haryana
E Financial Corporation (hereinafter referred to as
  "defendant No.1 "), established under the State
  Financial Corporation Act, 1951 is a "Corporation"
  under Section 2 (b) of the Haryana Public Moneys
  (Recovery of Dues) Act, 1979 (for short "the Act").
F
          5. The plaintiff had taken various kinds of financial
      assistance from defendant No.1 for running his
      business.

      6. In May 1995, defendant No.1 with a view to
G extend financial assistance to the plaintiff's Company
  purchased 3 lacs equity shares of the said company
  at the rate of Rs.10/- per share and, accordingly,
  invested a sum of Rs.30 Lacs. This investment led
H the parties to enter into further business transactions.
     OM AGGARWAL v. HARYANA FINANCIAL                  509
   CORPORATION [ABHAY MANOHAR SAPRE, J.)

  After several rounds of negotiations and A
  correspondence between the parties, the plaintiff
  entered into an agreement styled as "Buy Back
· Agreement" with defendant No.1 on 16.07.1996
   (Annexure P-6).
                                                          B
      7. In terms of the aforesaid agreement, the
  plaintiff's company was to enhance its equity share
  capital by issuing further shares to the extent of
  Rs.485.59 lacs whereas defendant No.1 was to
  subscribe Rs. 30 lacs towards the share capital of the C
  plaintiff's Company by way of financial assistance for
  augmenting the business. The agreement, inter-a/ia,
  provided the terms specifying therein, the manner in
  which the plaintiff was to secure the investment made
  by defendant No.1, right of the plaintiff to purchase/ D
  buy-back the shares of defendant No.1 Corporation
  at the specified rates, right of defendant No.1 to
  nominate its nominee directors in the Board of
  Directors of the plaintiff's Company to monitor its
  affairs, right of defendant No.1 to recover their E
  investment including a right to claim damages
  sustained in the transaction as arrears of land revenue
  from the plaintiff by taking recourse to the provisions
  of the Act for making recovery in the event of any F
  default committed by the plaintiff of any term of the
  aforesaid agreement etc.

     8. Defendant No.1, however, found that the
 plaintiff has failed to ensure compliance of the terms
 of the aforesaid agreement. They were, therefore, G
 constrained to invoke the terms of the agreement and
 got the notice issued through Tahsildar against the
 plaintiff for recovery of Rs.18.03 Lacs under the Act
 as arrears of land revenue on 28.02.2002 (Annexure H
510        SUPREME COURT REPORTS            [2015] 2 S.C.R.


A     P-14).

      9. It is with the aforesaid facts of the case, which
  were pleaded in the plaint, the plaintiff filed a suit for
  declaration being Civil Case No. 328-C of 2002 in the
B Court of Civil Judge at Hisar (Annexure P-15) against
  the defendants for a declaration that the Buy-back
  agreement dated 16.07.1996 be declared null and
  void and in alternative the recovery sought to be made
  by defendant No.1 by issuance of notice of demand
C for recovery of Rs.18.03 lacs (Annexure P-14)
  pursuant to the said agreement is also bad in law and
  be set aside.

         10. The reliefs claimed in the plaint reads as
o     under:

         "It is, therefore, prayed that a decree for
         declaration to the effect that the Buy-back
         Agreement dated 16.7.1996 executed by the
E        plaintiff at Hisar with defendant No. 1 is
         null and void ab initio and is liable to be
         set-aside and in the alternative for
         declaration to the effect that the recovery
         of defendant No. 1 on the basis of this
F        agreement has become time barred and
         that the Recovery Certificate issued by the
         Managing Director of the defendant No. 1
         on the basis of this Agreement is null and
         void ab initio and is liable to be set-aside
G        with the consequential relief of permanent
         injunction (prohibitory) restraining the
         defendants from        implementing the
         Recovery Certificate against the plaintiff in
         any manner including his arrest may kindly
H
    OM AGGARWAL v. HARYANA FINANCIAL                      511
  CORPORATION [ABHAY MANOHAR SAPRE, J.]

    be passed in favour of the plaintiff(s) and            A
    against the defendant(s) with costs.

       Any other relief to which the plaintiff(s)
    is/are found entitled may also be granted."
                                                           8
    11. The aforesaid reliefs were founded
essentially on the allegation that the agreement in
question was executed by the plaintiff on account
of undue pressure, coercion and duress exercised
by defendant No.1 on him. The plaintiff, in para 21        c
of the plaint, also averred that he is aware of the
fact that the civil suit is barred by virtue of the
provision$ of the Act. Para 21 of the said plaint reads
as under:
                                                           D
   "That the plaintiff is aware of the fact that
   the jurisdiction of the civil court is barred
   under Haryana Public Moneys (Recovery
   of Dues) Act, 1979. But he is also aware
   of the law laid down by the Hon'ble 5                   E
   Judges of the Apex Court of India reported
   in AIR 1969 SC 78 that in case the
   Statutory Authorities do not act in
   accordance with the procedure prescribed
   in the Statues, then the Civil Court alone              F
   has the jurisdiction to entertain and try
   every suit. The present suit is no
   exception to the law laid down by the
   Hon'ble Supreme Court of India."
                                                    G
    12. On receipt of the notice of the suit, the
defendants entered appearance and filed an
application under Order VII Rules 10 & 11·read with
Section 21 of the Code of Civil Procedure, 1908
(hereinafter referred to as "the Code"). Defendant H
512      SUPREME COURT REPORTS             [2015] 2 S.C.R.


A  No.1 contended that the suit of this nature for
  claiming the aforementioned reliefs was not
  maintainable by virtue of express bar contained in
  Section 3(4) of the Act, which in clear terms provided
B that no Civil Court shall have jurisdiction to entertain
  or adjudicate upon any case relating to the recovery
  of any sum due from the defaulter and if any such
  suit is pending at the commencement of the Act in
  any Civil Court then it shall abate. Defendant No.1,
c therefore, contended that since the plaintiff has
  challenged the agreement as also the recovery notice
  issued by the Tahsildar under Section 3 of the Act in
  the Civil Suit, the same was not maintainable being
  barred by Section 3(4) of the Act. It was, therefore,
D liable to be dismissed under Order VII Rule 11 (d) of
  the Code read with Section (3)4 of the Act.

      13. The plaintiff opposed the aforesaid
  application. According to him, the provisions of the
E Act were not applicable to the case in hand
  notwithstanding the bar contained in Section 3(4) of
  the Act for filing a civil suit in the civil court and,
  therefore, the civil ·suit was maintainable.

F     14. The trial Court, by order dated 16.8.2003,
  allowed the application filed by defendant No.1 and,
  in consequence, dismissed the suit. It was held that
  having regard to the averments made in the plaint
  and the nature of the reliefs claimed in the suit, the
G bar contained in Section 3(4) of the Act was attracted
  and hence, the suit was liable to be dismissed as not
  maintainable.

      15. Felt aggrieved, the plaintiff filed an appeal
H before the Additional District Judge, Hisar being Civil
    OM AGGARWAL v. HARYANA FINANCIAL                         513
  CORPORATION [ABHAY MANOHAR SAPRE, J.]

Appeal No. 87/2003/2004.           By order dated             A
26.03.2004, the Additional District Judge dismissed
the appeal.
     16. Against the said order, the plaintiff filed Civil
Revision in the High Court. The High Court, by                B
impugned judgment, dismissed the revision in limine
and upheld the order of the trial court. It is against
this judgment/order the plaintiff has filed this appeal
by way of special leave.
                                                              c
    17. The short question, which arises for
consideration in this appeal, is whether the courts
below were justified in dismissing the plaintiff's civil
suit as being barred by law.
                                                           D
      18. Mr. Suresh Singh, learned counsel appearing
 for the appellant/plaintiff, while assailing the legality
 and correctness of the impugned order, contended
 that the courts below committed an error in dismissing
 the plaintiff's suit as barred by law. Placing reliance E
 on the decision of this Court in Unique Butyle Tube
 Industries (P) Ltd. vs. U.P. Financial Corporation
And Others (2003) 2 SCC 455, learned counsel
contended that the suit should have been held
maintainable for adjudication of reliefs claimed therein F
in the light of the law laid down in Unique Butyle
case (supra) wherein this Court has held that a
demand for recovery of the amount cannot be raised
by taking recourse to the provisions of the U.P. Public
Moneys (Recovery of Dues) Act, 1972.                       G

     19. In contra, learned counsel for the defendants,
while supporting the impugned order, contended that
it does not call for any interference.
                                                              H
514        SUPREME COURT REPORTS                [2015] 2 S.C.R.


A         20. Having heard the learned counsel for the
      parties and on perusal of the record of the case, we
      find no merit in this appeal.

          21. It is apposite to take note of the provisions of
B     Order VII Rule 11 of the Code and some of the
      provisions of the Act, which have a bearing over the
      issue involved in the present appeal.

                        "Order VII, Rule 11 (d) CPC
c
          11. Rejection of plaint-The plaint shall be
          rejected in the following cases:-

D        (a) ............................ .

         (b) ............................ .

         (c) ............................ .

E        (d) where the suit appears from the
         statement in the plaint to be barred by
         any law;

          Section 2(b)(c)(d) and 3 of the Act, 1979:
F
                                 Section 2(b)

           "Corporation" means the Haryana
         Fwancial Corporation established under the
         State Financial Corporations Act, 1951, and
G        includes any other Corporation owned or
         controlled by the Central Government or the
         State Government which the State
         Government may, by notification, specify;

H
  OM AGGARWAL v. HARYANA FINANCIAL            515
CORPORATION [ABHAY MANOHAR SAPRE, J.]

                Section 2(c)                   A

 "Defaulter" means a person who, either as
 principal or as surety is a party-

  (i) to any agreement relating to a loan,
                                               B
  advance or grant given under that
  agreement or relating to credit in
  respect of, or relating to hire purchase
  of goods sold by the State Government
  or the Corporation, by way of financial      c
  assistance, or

  (ii) to any agreement relating to a loan,
  advance or grant given under that
  agreement or relating to credit in
                                               D
  respect of, or relating to hire-purchase
  of goods sold by a Government
  company under the State-sponsored
  scheme; or

  (iii) to any agreement relating to a         E
  guarantee    given  by    the    State
  Government or a Corporation in respect
  of a loan raised by an industrial
  concern; or
                                               F
  (iv) to any agreement providing that any
  money payable thereunder to the State
  Government shall be recoverable a~
  arrears of land revenue, and such
  person makes any default in re-payment       G
  of the loan or advance or any instalment
  thereof or, having become liable under
  the conditions of the grant to refund the
  grant or any portion thereof, makes any
                                               H
516    SUPREME COURT REPORTS                 [2015) 2 S.C.R.


A      default in the refund of such grant or
       portion or any instalment thereof or
       otherwise fails to comply with the terms
       of the agreement;

B                      Section 2(d)

      "financial assistance" means any financial
      assistance:-

       (i)    for     establishing, expanding,
c      modernizing, renovating or running any
       industrial undertaking; or

       (ii)   for the purposes of vocational training;
       or
D
       (iii)  for the development of agriculture,
       horticulture, animal husbandry or agro-
       industry; or
       (iv)    for the purposes of any other kind
E      of planned development; or

       (v)    for relief against distress;

                        Section 3

F      3. Recovery of certain dues as arrears
       of land revenue - (1) Where any sum is
       recoverable from a defaulter:-

       (a) by the State Government, such
G      officer as it may, by notification appoint
       in this behalf;

       (b) by a Corporation or a Government
       company, the Managing Director
H
  OM AGGARWAL v. HARYANA FINANCIAL                517
CORPORATION [ABHAY MANOHAR SAPRE, J.]

  thereof;                                         A

  Shall determine the sum due from the
  defaulter.

   (2)   The officer or the Managing               B
  Director, as the case may be, referred to
  in sub-section (1 ), shall send a certificate
  to Collector mentioning the sum due from
  the defaulter and requesting that such           c
  sum together with the cost of
  proceedings be recovered as if it were an
  arrear of land revenue.

   (3)   A certificate sent under sub-section      D
  (2) shall be conclusive proof of the
  matters stated therein and the Collector,
  on receipt of such certificate, shall
  proceed to recover the amount stated
                                                   E
  therein as an arrear of land revenue.

  (4)    No Civil      Court    shall    have
  jurisdiction:-
                                                   F
  (a)   to entertain or adjudicate upon any
  case; or

  (b)    to adjudicate upon or proceed with
  any pending case,        relating to the         G
  recovery of any sum due as aforesaid
  from the defaulter. The proceedings
  relating to the recovery of the sums due
  from the defaulters, pending at the
                                                   H
518      SUPREME COURT REPORTS               [2015] 2 S.C.R.


A         commencement of this Act in any Civil
          Court, shall abate."

       22. An application for rejection of the plaint can
  be filed, if the allegations made in the plaint taken to
B be correct as a whole on its face value show the suit
  to be barred by any law. The question as to whether
  a suit is barred by any law or not would always
  depend upon the facts and circumstances of each
  case. However, for deciding this question, only the
C averments made in the plaint are relevant. Since the
  question of jurisdiction of the Civil Court to entertain
  and try the civil suit goes to the very root of the case
  and hence it can be raised at any time by the
  defendant by taking recourse to the provisions of
D Order VII Rule 11 of the Code. Indeed, this principle
  of law is well settled.

       23. So far as the prov1s1ons of the Act are
  concerned, Section 3 of the Act empowers the
E Corporation to make recovery of its outstanding dues
  from the defaulter as arrears of land revenue by
  getting the certificate of recovery of the amount issued
  from the competent authority whereas sub-section (4)
F of Section 3 in clear terms takes away the jurisdiction
  of the Civil Court to entertain or/and adjudicate "any
  case" relating to the recovery of any sum due from
  the defaulter. It also takes away the jurisdiction of Civil
  Court to proceed with any pending case involving such
G issue. If any such case is pending on the date of
  commencement of the Act, such case shall stand
  abate.

     24. The prov1s1ons of the Act and especially
H Section 3 thereof came to be interpreted by this Court
    OM AGGARWAL v. HARYANA FINANCIAL                 519
  CORPORATION [ABHAY MANOHAR SAPRE, J.]

in S.K. Bhargava vs. Collector, Chandigarh and A
others ( 1998)5SCC 170 and hence its interpretation
is no more res integra. Justice B. N Kirpal, speaking
for the Court, held in para 8 as under:

    "8. It is clear from the perusal of the above-    E
    quoted section that before a certificate can
    be issued by the Managing Director under
    sub-section (2) of Section 3, he must
    determine the "sum due" from the defaulter
    as enjoined upon him by Section 3(1)(b). It       c
    is difficult to appreciate the contention of
   the learned counsel for the respondent
    Financial Corporation that any such
    determination can take place without notice
   to the defaulter. The jurisdiction of the          D
    civil courts to go into the question as to
   what is the amount due is expressly ousted
    by sub-section (4) of Section 3. In its
    place, the power has been given to the
    Managing Director under Section 3(1 )(bl to       E
   determine as to what is the amount due
   from the defaulter. There can be no doubt
   that any such determination by the
   Managing Director will result in civil
                                                      F
   consequences ensuing. The determination
   being final and conclusive, would have the
   result of the passing of a final decree,
   inasmuch as the defaulters from whom any
   amount is found to be due, would become            G
   liable to pay the amount so determined and
   the Collector will have the right to recover
   the same as arrears of land revenue."
                          (Emphasis supplied)
                                                      H    "~
520        SUPREME COURT REPORTS             [2015] 2 S.C.R.


A      25. Applying the aforesaid principle of law to the
  facts of the case in hand, it is clear by mere reading
  of the plaint that firstly, the plaintiff was a "defaulter"
  as defined under Section 2(c) of the Act; secondly,
  the investment made by defendant No.1-Corporation
B pursuant to an agreement dated 16.07.1996 was in
  the nature of the "financial assistance" as defined
  under Section 2 (d) of the Act; thirdly, the demand
  raised by the respondent was in relation to the amount
  given by way of financial assistance under Section 3
C of the Act and lastly, the subject matter of the suit
  viz., challenge to the legality of the agreement and
  the demand fell under Section 3(4)(a) and (b) of the
  Act.

D     26. In the light of the four aforementioned facts,
  which are clearly discernable from the averments
  made in the plaint, we are of the considered opinion
  that the provisions of the Act get attracted to the case
  in hand which, in turn, attract the bar contained in
E sub-section (4) of Section 3 in filing the civil suit by
  the defaulter. The suit is, therefore, apparently barred
  by virtue of bar contained in Section 3(4) of the Act.
  It was thus rightly dismissed by the courts below by
F taking recourse to Order VII Rule 11 (d) of the Code.

      27. We do not find any force in the submission
  urged by the learned counsel for the plaintiff that on
  the basis of law laid down in Unique Buty/e case
  (supra), the suit should be held as maintainable for
G adjudication of the reliefs claimed therein on merits.

         28. On perusal of the decision rendered in Unique
      Butyle case (supra), it is clear that the said decision
      was rendered in a writ petition filed by the defaulter
H
    OM AGGARWAL v. HARYANA FINANCIAL                 521
  CORPORATION [ABHAY MANOHAR SAPRE, J.]

against the Corporation wherein the question involved A
was whether the proceedings for recovery initiated by
the U.P. Financial Corporation under the U. P. Public
Moneys (Recovery of Dues) Act, 1972 are
maintainable in view of Section 34(2) of the Recovery ·
of Debts Due to Banks and Financial Institutions Act B
1993.

    29. This Court examined the aforesaid question
in the light of the provisions of the aforementioned
two Acts and held that the proceedings initiated under C
the U. P. Public Moneys (Recovery of Dues) Act, 1972,
are not maintainable in view of overriding effect given
to the Central Act by virtue of Section 34(2) of the
Central Act over the State Act.
                                                        D
    30. It is pertinent to mention that while deciding
the question, their Lordships took note of the law laid
down in S.K. Bhargava case (supra) and held that
the provisions of U.P. Act and that of the Haryana Act
are not similar. This is what was held in para 15:      E

   "We may notice here that to strengthen his
   arguments, learned counsel for the
   appellant referred to the decision of this
   Court in S.K. Bhargava vs. Collector,               F
   Chandigarh. The said case related to the
   Haryana Public Moneys (Recovery of Dues)
   Act, 1979 (in short "the Haryana Act").
   With reference to certain observations in
   para 8 of the said judgment, it was                 G
   submitted that a process of adjudication is
   inbuilt, even when the Managing Director
   of the Corporation takes action. We notice
   that Section 3 of the Haryana Act is
                                                      H
522      SUPREME COURT REPORTS              [2015] 2 S.C.R.


A      couched differently from Section 3 of the
       U.P. Act. Reference was made in the said
       case to Director of Industries Case, (1980)
       2 sec 332 and held that while upholding
       the validity of Section 3 of the U.P. Act, the
B      Court was not called upon to deal with the
       question as to whether the principles of
       natural justice were implicit in the said
       Section. We also do not think it necessary
       to go into that question."
c
       31. In the light of several distinguishing features
  noticed in the case in hand and the facts of Unique
  Butyle case (supra) such as the question as to
  whether the suit filed in the Civil Court was barred or
o not, which is the subject matter of this case, was not
  decided in Unique Butyle case. Secondly, the case
  in hand arose out of Haryana Act whereas the Unique
  Butyle case (supra) arose out of U.P Act and thirdly,
  both Haryana Act and U.P. Act were held not identical
E in their wordings.

       32. In the light of these distinguished features, no
  reliance can be placed on the law laid down in Unique
  Butyle case (supra) for deciding the issue involved in
F the present case. It has, in our considered opinion,
  no application to the case in hand.

      33. Before parting with the case, we consider it
  apposite to clarify that we have not examined the
G legality and correctness of the demand on its merits
  once it is held that Civil Court has no jurisdiction to
  entertain the civil suit. In other words, once it is held
  that the Civil Court has no jurisdiction to try the suit
  on merits, the question as to whether the demand
H impugned in the suit is legal or not cannot be gone
    OM AGGARWAL v. HARYANA FINANCIAL                      523
  CORPORATION [ABHAY MANOHAR SAPRE, J.]

into nor it was gone into.                                 A

    34. In view of foregoing discussion, we find no
merit in the appeal, which thus fails and is hereby
dismissed.
Nidhi Jain                           Appeal dismissE)d.    B


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