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Judgment
Ashok Menon, Chairperson
The matter is taken up for hearing by way of a praecipe filed by the appellant for seeking urgent relief.
The appellant is in appeal impugning the dismissal of the Interlocutory Application (I.A.) No. 7 of 2025 in Securitisation Application (S.A.) No. 427 of 2024 by the Debts Recovery Tribunal-II, Mumbai (DRT) vide order dated 09.01.2025. The application was an amendment to incorporate a prayer challenging the demand notice under Sec. 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (“SARFAESI Act”, for short) issued by the respondent bank for recovery of amount due from the appellant and other borrower who are impleaded as respondents Nos. 3 to 5. In the S.A., as it was originally filed, a challenge was raised to the earlier demand notice under Sec.13(2) dated 25.01.2023. The respondent bank did not proceed with that demand notice, but instead issued a fresh demand notice on 01.02.2023. The appellant contends that the demand notice dated 25.01.2023 was inadvertently mentioned in place of the demand notice dated 01.02.2023 and hence, sought an amendment to correct the pleadings. However, the prayer for amendment has been dismissed. Aggrieved by that dismissal, the appellant is in appeal.
The appellant will have to comply with the mandatory requisite of making a pre-deposit under Sec. 18(1) of the SARFAESI Act. The amount demanded as per the demand notice dated 01.02.2023 is ₹1,93,15,219/-. However, it is pointed out that there was an arbitration award and it was modified by the High Court of Delhi reducing the claim to ₹60.50 lakhs and interest at the rate of 10% per annum. The amount paid by the appellant was to be deducted from the principal amount and therefore, the approximate amount that is due would be around ₹1.30 crores, although a demand is put forth for ₹1.93 crores. Hence, for the payment of the pre-deposit, I take a sum of ₹1.30 crores as the threshold amount. The appellant has not produced any documents to show that he is under financial strain. It is stated that he is not paying any income tax. Therefore, the income tax returns are not available. But it is pertinent to note that the rest of the respondents are also borrowers and any order that the appellant gets, benefits them as well. Therefore, the pecuniary strain of those respondents will also have to be considered for granting a waiver of 25% of the pre-deposit amount. Hence, the appellant is directed to deposit a sum of ₹65 lakhs as a pre-deposit for entertaining the appeal.
The Ld. Counsel appearing for the respondent bank stated that two rooms have already been sealed and taken over possession.
The Ld. Counsel appearing for the appellant submits that the RTGS transfer would be made today for ₹5.00 lakhs and another ₹5 lakhs to be paid by tomorrow i.e. 11.01.2025 and the balance amount of ₹55 lakhs shall be paid in two equal instalments within two weeks each as stated hereunder.
Numbers of Instalments
Payment on or before
1st Instalment of ₹ 27,50,000
24.01.2025
2nd Instalment of ₹ 27,50,000
07.02.2025
Default in payment of any of the amount/instalment on time shall entail the dismissal of the appeal without any further reference to this Tribunal.
Since a sum of ₹5 lakhs was paid today, subject to that payment, the possession intended to be taken today shall be deferred and the status quo shall be maintained till the next date of hearing.
The amount shall be deposited in the form of a Demand Draft/RTGS with the Registrar of this Tribunal. Payment by RTGS shall be communicated to the Registry for verification and intimated to the counsel for the respondents.
As and when the said amounts are deposited, they shall be invested in term deposits in the name of Registrar, DRAT, Mumbai, with any Nationalized bank, initially for 13 months, and thereafter to be renewed periodically.
With these observations, the I.A. is disposed of. The Respondents are at liberty to file a reply in the Appeal with an advance copy to the other side.
Call on 13.01.2024 to report compliance regarding the payment of ₹10 lakhs.