Yashwant Singh And Ors. vs Indian Bank And Ors.

S.N.H. Zaidi, J

Mr. Awasthi points out that he is representing the respondent Bank before the DRT and is filing his memo of appearance today. Mr. Bajaj points out that respondent No. 3 was impleaded in the S.A. subsequently as he was having some dispute with the appellants qua the first floor of the property in question but he is not a necessary party for the purposes of this appeal and notice to him be dispensed with, which is allowed.

Heard parties' Counsel on appeal. This appeal has been directed against the order dated 29.1.2013 of DRT-I, Delhi passed on I.A. No. 47/2013 filed by the applicant in S.A. No. 25/2010 whereby the interim reliefs sought have been declined and the Bank has been given the liberty to proceed in accordance with law.

Mr. Bajaj points out that the Bank had extended three credit facilities to the appellants, including two term loans and one car loan after the property in question was mortgaged with it. He further points out that the Bank classified the said loan accounts as NPA on 1.12.2009 and after issuing a demand notice under Section 13(2) on 17.12.2009 claiming an amount of Rs. 5,16,31,365/-, the Bank took symbolic possession of the secured asset. He also points out that the appellant has deposited an amount of Rs. 63 lacs and filed the S.A. on 12.3.2010 and also deposited an amount of Rs. 10 lacs on 16.3.2010. Mr. Bajaj submits that the DRT had directed the Bank not to proceed against the secured asset as an interim measure, provided the appellants deposit Rs. 10 lacs per month and the appellants continued to deposit the said amount. He further submits that as there had been a default in payment of full amount for the month of October, 2011, the appellants moved application before the DRT for condonation of delay, which was allowed and the instalment of November, 2011 was paid along with the deficiency of the payment for the month of October. He also submits that subsequently the appellants continued to deposit Rs. 10 lacs up to June, 2012 and moved an application before the Tribunal in July, 2012 for disposing of the S.A. in an expeditious manner but the Bank opposed that application and it is still pending for disposal. Mr. Bajaj points out that the appellants have filed their evidence in February, 2012, but the Bank has not filed its evidence as yet. He further points out that on 22.12.2012 the Bank has put the ground floor of the mortgaged property for sale and the bids are to be received by today, which shall be opened tomorrow, i.e., on 1.2.2013. It is also pointed out by him that the appellants have cleared off their car loan.

Mr. Bajaj also contends that the appellants have challenged in the S.A. the reserve price fixed by the Bank as well as the correctness of the valuation report obtained by the Bank as the valuation report obtained by them from a Government approved valuer shows that there is a huge variation in the valuation of each floor of the property in both the reports. He points out that in an appeal filed by the Bank against the order of the DRT, this Tribunal, had observed that instead of proceeding to sell the entire secured asset, the Bank should sell such specific portion or storey of the secured asset, which could suffice to realise the outstanding amount of debt and the Bank was directed to obtain separate valuation report for each storey of the property before proceeding to sell the secured asset. He further submits that as per Bank's valuation report, the ground floor of the building has two independent dwelling units and as per Bank's claim, the outstanding dues as on date is about Rs. 4.34 crores and since according to the Bank's valuation report, the total valuation of the ground floor is about Rs. 12 crores, therefore, instead of proceedings against the entire ground floor, the Bank should have proceed against one dwelling unit of the ground floor to realise its outstanding amount. He, however, suggests that from July, 2012 to January, 2013 seven instalments have become due and since the appellants are ready to deposit Rs. 70 lacs within three working days, the respondent Bank be directed to proceed only against one dwelling unit of the ground floor and confirmation of the sale of the entire ground floor be kept on hold and in the meantime the DRT be directed to dispose of the S.A. within a reasonable time.

Mr. Awasthi, on the other hand, submits that the appellant had committed default thrice in depositing the amount as per the direction of the DRT. He, however, admits that the appellants had cleared off the car loan account, but according to him at present an amount of more than Rs. 4 crores is due against the appellants and since the property in question is situated in such an area, which is a posh locality of Delhi, where the buyers generally do not purchase small areas, therefore, sale of single dwelling unit may not fetch the best price and that is why the Bank is proceeding to sell the entire ground floor. He also points out that this Tribunal, vide order dated 7.2.2012 had already directed the Bank to sell only that portion/storey of the property which could be sufficient to liquidate the debt and the Bank is accordingly proceeding to sell only one floor of the property.

Considering the submissions of the parties and looking to the circumstance that after the classification of the account as NPA on 1.12.2009, the appellants have deposited more than Rs. 3 crores and they are also ready to deposit Rs. 70 lacs within three days and also looking to the outstanding amount of debt, which is about Rs. 4.34 crores, it is directed that the respondent Bank may receive and open the bids, but the sale shall not be confirmed until the S.A. is disposed of by the Tribunal below, provided the appellants deposit an amount of Rs. 70 lacs by 5.2.2013 with the Bank and keep on depositing Rs. 10 lacs by the end of every month and file an undertaking on affidavit to that effect with the Registrar of this Tribunal. Needless to say that in case of failure either to file the undertaking or deposit any two consecutive instalments, the respondent Bank would be at liberty to proceed in accordance with law. The Tribunal below is directed to make an endeavour for expeditious disposal of the S.A., if possible, within three months from the date a copy of this order is placed before it. With the above direction, the appeal is disposed of. Mr. Bajaj offers a cheque of Rs. 70, which has been handed over to Mr. Awasthi for deposit in the account of the appellant. The deposit shall, however, be made without prejudice to the rights of the parties.

Copy of this order be furnished to the parties and be also sent to the DRT concerned.