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Judgment
The matter is taken up for hearing by way of a praecipe filed by the /Petitioners/Appellants for seeking urgent relief.
This appeal is filed against the interim order passed in I.A. No.1061/2026 in S.A. No. 661/2025 on 27.05.2026, dismissing the interim relief prayed by the Petitioners/Appellants in the pending S.A. No. 661/2025. The S.A. No. 661/2025 has been filed to set aside the measures initiated under Sections 13 (2), 13 (4) and 14 of the SARFAESI Act. When the matter was pending, it is prayed for staying all further proceedings and that was not favourably considered by the Learned Presiding Officer, DRT-II, Ahmedabad on the ground that an interim order had already been passed and the Petitioners/Appellants failed to comply with the commitment made to submit OTS proposal.
Learned Counsel for the Petitioners/Appellants submitted that the Petitioners/Appellants are facing a financial crunch and therefore they are not be able to deposit 50%, but, are ready to deposit 25%. It is also submitted that the Petitioners/Appellants have already made a payment of Rs.66,61,656/-. No other ground is raised in support of waiver of the pre-deposit.
In reply, the Learned Counsel for the Respondent Financial Institution submitted that the Tribunal had already passed an order on 18.02.2026 directing the Petitioners/Appellants to pay a sum of ₹20 lakhs on or before 20.02.2026 and a sum of ₹46,61,656/- to the Respondent Financial Institution within a week from the date of possession. There was also a direction issued to Petitioners/Appellants to submit One Time Settlement proposal for consideration of the Respondent Financial Institution. That was not done. The total outstanding as per the order dated 18.02.2026 was ₹6,61,65,605/-. After considering the payment of ₹66,61,656/-, still there is due of ₹6,30,16,130/-. The pre-deposit is mandatory. It is further submitted that in view of the non-submission of the OTS proposal as undertook earlier and filing of repeated Interlocutory Applications, thwarting the attempts of the Bank to proceed further under the SARFAESI measures, the Petitioners/Appellants should be directed to make mandatory statutory deposit of 50% of ₹6,30,16,130/-.
Considered the rival submissions of the parties and perused the records.
The property is not sold so far and the physical possession is also not taken. The pre-deposit is mandatory under Section 18 of the SARFAES Act, for entertaining the Appeal. The debt due is inclusive of interest as defined under section 2 (g) of the Recovery of Debts and Bankruptcy Act, 1993 ("RDB Act" for short) and settled by the Hon'ble Supreme Court in M/s. Sidha Neelkanth Paper Industries Pvt. Ltd. & Anr. Vs Prudent ARC Ltd. & Ors. 2023 SCC OnLine SC 12.
Under the circumstances, this Tribunal is of the view that an opportunity should be given to the Petitioners/Appellants to pay and settle the loan amount and save his property from being sold. Therefore, this Tribunal directs the Petitioners/Appellants to make a pre-deposit of 30% of ₹6,30,16,130/- which comes to ₹1,89,04,839/- in two equal instalments. The 1st of instalment of ₹94,52,419.50p shall be deposited on or before 22.07.2026 and 2nd instalment of ₹94,52,419.50p shall be deposited on or before 05.08.2026.
It is made clear that on failure to deposit of either of the instalments, the Appeal will stand rejected. On making such deposit by Petitioners/Appellants, Registrar, DRAT, Mumbai is to invest the same in a Nationalized Bank, from time to time, till further orders are passed.
List the case on 07.08.2026 for reporting compliance.