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Judgment
Ashok Menon, Chairperson
The matter is taken up for hearing by way of Praecipe filed by the Appellants seeking urgent relief.
The Appellants who are the borrowers, are in the Appeal challenging the order of Debts Recovery Tribunal.-I, Ahmedabad (D.R.T) dated 23.11.2022 in Securitisation Application (S.A.) No. 313/2022 declining to grant the interlocutory relief to stall the Sarfaesi proceedings.
The Appellants have taken up several contentions in the S.A. which starts with the improper classification of the debt asNon-Performing Asset NPA), the inadequacy of the Demand notice issued u/s 13 (2) of the Securitisation &Reconstruction of Financial Assets & Enforcement of Security Interest Act, 2002 (‘SARFAESI Act’, for short) for failing to give the bifurcation of the amount claimed as required u/s 13 (3). The subsequent Sarfaesi measures u/s 13 (4) as also u/s 14 stand challenged in the S.A.
The Ld. Presiding Officer has in the impugned order dealt with in detail the various contentions raised by the Appellants, and found that they have not made a prima facie case for interlocutory relief of stay, and consequently, the interim relief sought was declined, and the S.A. was posted for final disposal on 28.02.2023. The Applicant is aggrieved and hence, in the Appeal.
The Ld. Counsel for the Respondent bank vehemently opposed the application for waiver of pre-deposit stating that the Appellant was no prima facie case and that the Appellant could not have any case to get the amount reduced from the mandatory 50% contemplated under the second proviso to section 18(1) of the SARFAESI Act.
On going through the application it is seen that the Appellants have pleaded that they have suffered loss and hardship because their business activity suffered and the bank was not of any help to them therefore, pray that the mandatory pre-deposit may be reduced to 25% excising the jurisdiction of this Tribunal under the 3rd proviso to section 18 (1) of the SARFAESI Act.
After having considered the rival submission made by the parties, I find that the Appellant has an arguable case, and therefore, the Appeal need not be thrown overboard at the threshold and needs to be entertained. The Appellant has also pleaded financial stress and therefore some indulgence needs to be granted. The Appellant is therefore directed to deposit the sum of ₹ 20 lakhs as pre-deposit for entertaining this Appeal payable in two equal instalments.
The Ld. Counsel appearing for the Appellant undertakes to produce the Demand Draft of ₹ 10 lakhs today and for the balance of ₹ 10 lakhs he seeks time. The balance of ₹ 10 lakhs shall be deposited within a period of three weeks on or before 10.02.2023.
There shall be an interim stay of the further Sarfaesi measures with regard to the secured assets belonging to the Appellant.
The amount shall be deposited in the form of a Demand Draft with the Registrar of this Tribunal.
As and when the said amounts are deposited, they shall be invested in term deposits in the name of Registrar, DRAT, Mumbai, with any nationalised bank, initially for 13 months, and thereafter to be renewed periodically.
With these observations, the I.A. is disposed of. The Respondent is at liberty to file a reply in the Appeal with an advance copy to the other side.
Post on 13.02.2023 for reporting compliance payment of the 2nd instalment.