Disposed

Jaffar sab v. Canara Bank

DRAT26 Jul 2022REGULAR APPEAL/31/2022

Case brief

AI extract

What is this about?

The Debt Recovery Appellate Tribunal directed the appellant to deposit 50% of the demand notice amount under Section 13(2) of the SARFAESI Act, 2002, for entertaining the appeal, rejecting the request to reduce the deposit to 25% despite possession of property.

What did the court decide?

Appellant directed to deposit Rs.16,55,865/- representing 50% of the Notice amount of Rs.33,11,731.14 within two weeks.

Jaffar sab versus Canara Bank — Banking and Recovery | DRAT (2022)

¶1

IN THE DEBT RECOVERY APPELLATE TRIBUNAL AT CHENNAI

¶2

IA 173/2021 In A.IR:43/2021

¶3

Jaffarsab V/S Canara Bank & Anr

¶4

26/07/2022

¶5

This Application is filed seeking waiver of statutory deposit required under Section 18 (1) of the SARFAESI Act, 2002 for entertaining the Appeal.

¶6

Appellant preferred this Appeal under Section 18 of SARFAESI Act, 2002 challenging the Order dated 05.01.2021 in SA 490/2019 passed by DRT-I, Bengaluru.

¶7

My Predecessor in office by Order dated 03.03.2021, directed Petitioner/Appellant to deposit Rs.28 Lakhs for entertaining the Appeal. As against that Order, Petitioner/Appellant filed an Application IA 244/2021 to review the Order dated 03.03.2021 and said Order was dismissed on 17.03.2021. Petitioner/Appellant herein filed WP No.102125/2021 (GM-DRT) challenging the said Order and Hon’ble High Court of Karnataka by Order dated 24.11.2021 directed this Tribunal to reconsider the matter with regard to quantification of pre deposit in light of the discussions made in the said Order.

¶8

Heard Learned Advocates of both parties.

¶9

Learned Advocate for Petitioner/Appellant submitted that Petitioner/Appellant deposited a sum of Rs.20 Lakhs into Bank on 10.07.2020 which is subsequent to issuance of Section 13(2) Notice, and as possession of property is already taken, Petitioner/Appellant is not able to generate any income therefore, statutory deposit may be reduced to 25%.

¶10

On the other hand, Learned Advocate for Respondent No.1 Bank opposed the request of Petitioner/Appellant, and submitted that according to Bank the amount due as on date of filing of the Appeal is around Rs.70 Lakhs, and as per Section 18 (1) of SARFAESI Act, 2002, amount claimed by the Secured Creditor is to be taken into consideration for the purpose of statutory deposit. He submitted that Petitioner/Appellant has not made out any grounds for reducing the statutory deposit and he has to deposit 50% of the amount due to the Secured Creditor as on the date of filing of the Appeal.

¶11

I have perused the material papers including the Waiver Application.

¶12

Though Waiver Application runs into 19 paras and 19 pages, not even a single para reflects about financial status of Petitioner/Appellant or the reasons for reduction of statutory deposit from 50% to 25%. No doubt, my Predecessor has not indicated anything in the Order dated 03.03.2021 whether the amount directed would be 50% or 25% of the amount claimed, but he fixed a lump sum amount of Rs.28 Lakhs.

¶13

Hon’ble High Court of Karnataka observed that quantification of amount i.e. amount of auction sale proceeds, has nothing to do with the amount of debt, and the debt as on the date of filing of the Appeal is to be determined by the DRAT, and if that were to be so, the amount of Rs.28 Lakhs as quantified by the DRAT requires to be reconsidered. According to Advocate for Respondent No.1 Bank, the amount due to Bank as on the date of filing of

¶14

the Appeal is around Rs.70 Lakhs, but the contention of Petitioner/Appellant is that after issuance of Section 13(2) Notice, they have paid Rs.20 Lakhs to Bank.

¶15

Considering these submissions, without going into correctness, merits and demerits of both parties, I am of the view that amount indicated in Demand Notice issued under Section 13(2) of SARFAESI Act, 2002, though it is dated 01.08.2014, is to be taken into consideration for the purpose of deciding the quantum of amount to be deposited for entertaining the Appeal.

¶16

Admittedly, amount demanded through Notice under Section 13(2) of SARFAESI Act, 2002, is Rs.33,11,731.14p. As Petitioner/Appellant has not made out any grounds for reduction of statutory deposit, I do not find any reasons for reducing statutory deposit, and therefore, Petitioner/Appellant shall deposit 50% of notice amount.

¶17

Considering these aspects, Petitioner/Appellant is directed to deposit 50% of Notice amount of Rs.33,11,731.14p, which comes to Rs.16,55,865/- within two weeks from today i.e., on or before 08.08.2022.

¶18

It is made clear that failure to deposit of above amount, on or before 08.08.2022, the Appeal shall stand automatically rejected. On making such deposit, Registrar shall invest the same in a Nationalized Bank for a reasonable period and renew it periodically, till further orders are passed.

¶19

Post the case on 10.08.2022, for compliance of payment.

¶20

Sd/Chairperson

Jaffar sab v. Canara Bank

Case brief

What is this about?

What did the court decide?

Jaffar sab v. Canara Bank

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

Coram

Case details

All orders in this case

Similar cases

Shameem versus a O the City Co-Op Bank Ltd. and Ors.

M S Kotak Mahindra Bank Ltd. versus a Anand Prasad and Anr.

Mrs.R.Chitra versus Indian Bank & Anr.

Iob versus K Palanisamy Ors.

Ms Ganekar And Co. versus Canara Bank

M.Chandra Rao & Anr. versus Central Bank of India & Ors.

What is this about?

What did the court decide?

What is this about?

What did the court decide?

What the court decided

A compact analysis

Shameem versus a O the City Co-Op Bank Ltd. and Ors.

M S Kotak Mahindra Bank Ltd. versus a Anand Prasad and Anr.

Mrs.R.Chitra versus Indian Bank &amp; Anr.

Iob versus K Palanisamy Ors.

Ms Ganekar And Co. versus Canara Bank

M.Chandra Rao & Anr. versus Central Bank of India & Ors.

Mrs.R.Chitra versus Indian Bank & Anr.