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Judgment
Ashok Menon, Chairperson
The matter is taken up for hearing by way of a praecipe filed by the Appellants for seeking urgent relief.
The Appellants are in appeal impugning the order dated 22.12.2023 in Securitization Application (S.A.) No. 865/2023 on the files of the Debts Recovery Tribunal-II, Ahmedabad (D.R.T.) whereby the Ld. Presiding Officer declined to grant any interlocutory relief concerning the measures taken by the Respondent Financial Institution against the Appellants under the provision of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (“SARFAESI Act” for short).
The Appellants are challenging the Sarfaesi measures on various grounds which include the classification of the loan account as Non-Performing Assets (NPA) being improper. The notice u/s 13
(2) does give a bifurcation of the principal amount and interest. It is also contended that the part of the amount mentioned in the demand notice is not a secured debt. It is further contended that the order u/s 14 passed by the Chief Judicial Magistrate (CJM), Surat is also not proper and will have to be set aside. The demand notice issued u/s 13(2) demanded a sum of ₹54,88,944.44. The Appellants are challenging the Sarfaesi measures u/s 13 (2) and 13 (4) and therefore, as per the decision of the Hon’ble Supreme Court of India in Sidha Neelkanth Paper Industries Pvt. Ltd. & Ano. vs. Prudent ARC Ltd & Ors., 2023 SCC OnLine SC 12, the Appellants are liable to deposit 50% of the amount demanded in the demand notice issued u/s 13(2) subject their having a possible of getting a concession to get it reduced to 25% under the 3rd proviso to section 18(1) of the SARFAESI Act.
The Appellants have pleaded that they have a good prima facie case. It is also contended that they are under financial strain. But there is no documentary evidence to support the pleading that they are under financial strain. Hence, taking the amount demanded in demand notice as the threshold amount, the Appellants are directed to deposit a sum of ₹ͅ27 lakhs as pre-deposit for entertaining the appeal. The Ld. Counsel appearing for the Appellants submits that the demand draft of ₹10 lakhs is being produced today and the balance of ₹17 lakhs shall be deposited within two weeks, i.e. on or before 18.01.2024.
Given the deposit of ₹10 lakhs today toward the pre-deposit, the further Sarfaesi measures shall stand stalled till the next date of hearing.
Default in payment of any of the instalments/amount shall entail the dismissal of the appeal without any further reference to this Tribunal.
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 Respondents is at liberty to file a reply in the Appeal with an advance copy to the other side.
Post on 19.01.2024 for reporting compliance