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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 27.10.2023 in Interim Application (I.A.) No. 2188/2023 in Miscellaneous Application (M.A.) No. 183/2023 which is for condonation of delay in filing the S.A. u/s 17 (1) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (“SARFAESI Act” for short) before the Debts Recovery Tribunal, Nagpur (D.R.T.). The Appellants had filed the I.A. for interim relief to protect the possession of the secure assets which was declined. M.A. No. 183/2023 is an application for condonation of delay in filing the S.A.
According to the Appellants they have sound grounds for maintaining the S.A. It is stated that there is no bifurcation of the principal, interest and other charges due in the demand notice in compliance with sub-section (3) of section 13 of the SARFAESI Act. The Appellants have also challenged the measures taken u/s 13 (4) and section 14.
However, admittedly there is a delay in filing S.A. which could not have been entertained without first condoning the delay. The application for condoning the delay is still under consideration by the D.R.T. and therefore, it cannot be said that the Appellants have a prima facie case. The Appellants have also not established that they are under financial strain and therefore, they are not entitled to any relief of getting the amount of the pre-deposit contemplated u/s 18(1) reduced to the minimum of 25%. The auction sale notice had already been issued concerning the secured assets.
Notice has been served on the Respondent financial institution but no one appeared. The sale notice produced by the Appellants along with the appeal indicates that the amount of ₹1,72,92,562/- is due and outstanding as of 28.11.2017, the date of the demand notice, and interest also must have accrued on that. Once the notice for E-Auction is issued the amount together with the interest will have to be taken as the threshold amount. The total outstanding as of 05.10.2023 is shown as ₹2,05,40,396/- in the sale notice. The Appellants have made the payment of ₹27 lakhs directly to the Respondent financial institution following the order of the Hon’ble High Court of 08.11.2023. The Appellants are, therefore, directed to deposit a sum of ₹75 lakhs as pre-deposit for entertaining the appeal. The Ld. Counsel appearing for the Appellants undertakes to deposit a sum of ₹10 lakhs by 19.01.2024 and a balance of ₹65 lakhs shall be paid in two instalments within a gap of three weeks each, as stated hereunder.
Numbers of Instalments
Payment on or before
1st Instalment of ₹ 30,00,000/-
09.02.2024
2nd Instalment of ₹ 35,00,000/-
01.03.2024
Subject to deposit a sum of ₹10 lakhs, on or before 19.01.2024 the possession intended to be taken by the Respondent shall stand deferred till the next date of hearing.
Default in payment of any amount/instalment shall entail 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 22.01.2024 for reporting compliance