Allowed

Santosh Nivrutti Wagh v. Au Small Finance Bank Ltd.

DRAT30 Jun 2023IA/392/2023

Case brief

AI extract

What is this about?

The Debt Recovery Appellate Tribunal directed appellants to deposit ₹20,00,000 as pre-deposit to entertain an appeal against dismissal of an application to condone delay in filing a securitisation application, noting previous measures initiated by the bank.

What did the court decide?

Directing deposit of ₹5,00,000 immediately and balance in two instalments to stay further SARFAESI measures until appeal disposal.

Santosh Nivrutti Wagh versus Au Small Finance Bank Ltd. — Banking and Recovery | DRAT (2023)

¶1

BEFORE THE DEBTS RECOVERY APPELLATE TRIBUNAL, AT: MUMBAI Present: Mr Justice Ashok Menon, Chairperson I.A.No.392/2023(WoD)

¶2

¶3

Appeal on Dairy No. 734/202

¶4

Between

¶5

Santosh Nivrutti Wagh & Ors.

¶6

… Appellant/s

¶7

V/s.

¶8

AU Small Finance Bank Ltd Through Its authorized officer.

¶9

…Respondent/s

¶10

Mr. Vikrant Shinde, Advocate for Appellant.

¶11

Mr. Sanjay Anabhawane, Advocate for Respondent.

¶12

-: Order dated: 30/06/2023:-0

¶13

The matter is taken up for hearing by way of a Praecipe filed by the Appellants for seeking urgent relief.

¶14

The Appellants are in appeal aggrieved by the order dated 21.04.2023 in I.A. No. 1197/2021 dismissing the prayer for condoning 716 days delay in filing the Securitisation Application u/s. 17 (1) of the Securitisation & Reconstruction of Financial Assets & Enforcement of Security Interest Act, 2002 (“ the SARFAESI Act”, for short) by the Debts Recovery Tribunal, Aurangabad (D.R.T). The Appellants have filed the present application for waiver of the pre-deposit contemplated under Sec.18(1) of the SARFAESI Act. 2. The Ld. Presiding Officer had dismissed the application observing that there were no sufficient grounds for condoning the

¶15

¶16

unreasonable delay. The Respondent Bank has appeared and filed a reply stating that there is an outstanding due of ₹ 42,79,761.83 as of 19.06.2023 and there are no grounds for reducing the amount of predeposit contemplated u/s 18 (1) of the SARFAESI Act.

¶17

The Appellants have pleaded that the 3rd Appellant is going under medical treatment for cancer and huge amounts have been spent for his treatment. That apart, it is also contended that the business of the Appellants has run into loss and therefore the Appellants pray that indulgence may be shown to reduce the amount to be deposited u/s. 18 (1).

¶18

Apart from the pleading regarding the difficulties faced by the Appellants there is no specific pleading regarding the Appellant facing any financial strain. There is also no evidence regarding the income of the Appellants and no income tax returns have been filed. The Appellants have attributed the unreasonable delay of 716 days in filing the application to the reason that they have not been served with the notice with regard to the Sarfaesi proceedings and therefore they were not aware of the proceedings.

¶19

The Ld. Counsel appearing for the Respondent Bank submitted that symbolic possession was taken after fixing the notice u/s. 13 (4) and therefore the Appellants cannot be heard to state that they were not aware of the Sarfaesi measures initiated by the Respondent Bank.

¶20

After having heard the rival contentions, on perusal of the documents available, I find that the Appellants have not made only prima facie cases and have also not sufficiently explained their

¶21

¶22

financial strain so as to get the pre-deposit amount reduced to the minimum of 25% as contemplated under third proviso u/s. 18 (1) of the SARFAESI Act.

¶23

This Tribunal considers that the Appeal has to be heard on merits and therefore an opportunity has to be granted to the Appellants who are directed to deposit a sum of ₹ 20,00,000/- as pre-deposit for the appeal to be entertained.

¶24

The Ld. Counsel appearing for the Appellants submits that he is depositing a Demand Draft for ₹ 5,00,000/- today and the balance of ₹ 15,00,000/- shall be paid within two equal instalments within a gap of two weeks each. The first instalment of ₹ 7,50,000/- shall be payable on or before 14.07.2023 and the second instalment of ₹ 7,50,000/- shall be payable on or before 28.07.2023. In default, the Appeal shall stand dismissed, without any further reference to this Tribunal.

¶25

The amount shall be deposited in the form of a Demand Draft with the Registrar of this Tribunal.

¶26

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.

¶27

Since the Appellants have deposited ₹ 5,00,000/- today the further Sarfaesi measures shall stand stalled till the disposal of the appeal.

¶28

With these observations, the I.A. is disposed of. The

¶29

¶30

Respondent is at liberty to file a reply in the Appeal with an advance copy to the other side.

¶31

Post on 17.07.2023 for reporting compliance regarding the payment of 1^st instalment.

¶32

Sd/Chairperson

¶33

rm-10

¶34

Santosh Nivrutti Wagh v. Au Small Finance Bank Ltd.

Case brief

What is this about?

What did the court decide?

Santosh Nivrutti Wagh v. Au Small Finance Bank Ltd.

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

Bank of Baroda versus M/s Paresh Chemicals

Ritesh Oil Mills Pvt. Ltd. & Anr. versus Bank of Baroda & Ors.

Icici Bank Ltd. versus M/S Kankairya Automobiles Pvt. Ltd.

Mr. Usmani Amjad Mukhtar and Anr. versus Hdfc Ltd.

Tarun Madanmohan Das Sole Proprietor Ms. Ananda Aahar Veg versus Indian Bank (Allahabad Bank)

Zain Shaukat Sheikh and Ors. versus Kotak Mahindra Bank Limited