Disposed

Raman Dharmpal Kapoor v. State Bank of India

DRAT11 Jul 2023IA/447/2023

Case brief

AI extract

What is this about?

Appellants sought waiver of the pre-deposit for appealing an order under the SARFAESI Act. The Tribunal denied the 10% waiver but allowed the dedication of an existing ₹76.25 lakh deposit towards the required ₹1.25 crore sum.

What did the court decide?

Bank to deposit ₹76.25 lakhs and accrued interest as pre-deposit; appellants to deposit remaining balance within four weeks in Demand Draft.

Raman Dharmpal Kapoor versus State Bank of India — Banking and Recovery | DRAT (2023)

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BEFORE THE DEBTS RECOVERY APPELLATE TRIBUNAL, AT: MUMBAI Present: Mr Justice Ashok Menon, Chairperson I.A. No. 447/2023 (WoD) In Appeal on Diary No. 789/2023

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Between

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Raman Dharmpal Kapoor & Anr. … Appellant/s V/s. State Bank of India & Anr. …Respondent/s

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K.B. Deshpande, Advocate for Appellants.

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Mr. Vivek Sawant, Advocate for Respondent No.1

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Mr. Gajendra A. Rajput, Advocate for Respondent No.3 & 4 (Auction Purchaser)

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The Appellants are in appeal impugning dismissal of Securitization Application (S.A.) No. 358/2022 by the Debts Recovery Tribunal - Aurangabad (D.R.T.) vide order dated 17.04.2023. The Appellants have filed Interlocutory Application (I.A.) No. 447/2023 u/s 18 (1) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (“the SARFAESI Act” for waiver of pre-deposit contemplated under the said provision. 2. The Appellants are husband and wife who had borrowed the amount from the 1^st Respondent SBI. They also had a firm by the name KNK Hospitality of which they were the sole partners and some amount was borrowed in the name of the firm as well. The property belonging to the Appellants was mortgaged for both loans. The bank initiated Sarfaesi measures for the recovery of debts.

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Notice demanding a sum of ₹ 1, 92, 99,269/- was issued on 03.06.2019. The Appellants did not respond to the demand notice. Thereafter the symbolic possession was taken u/s 13 (4) of the SARFAESI Act and the secured property was put up for sale. It was sold on 25.08.2022 to the 2^nd Respondent who was the highest bidder. For getting physical possession of the property application was filed u/s 14 of the SARFAESI Act before Chief Judicial Magistrate and an order was passed to hand over possession of the property vide order dated 10.03.2022.

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The Appellants filed S.A. No. 358/2022 on 01.09.2022 wherein they raised contentions challenging the notice u/s 13 (2), the steps taken u/s 13 (4) as also the order obtained u/s 14 of the SARFAESI Act. It is pertinent to note that the Appellants have not raised any objections regarding the Sarfaesi measures till the order passed u/s 14 for handing over physical possession of the secured assets but in their application filed before the D.R.T. contentions were raised challenging the demand notice u/s 13 (2) as also the steps taken u/s 13 (4).

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During the pendency of the application the Appellants negotiated for the settlement and undertook to pay off the debt and admitted the liability to the tune of ₹ 2.65 Crores with respect to the loan avail by the Appellants in their individual capacity. They also undertook to clear the debts pertaining to KNK Hospitality to the tune of ₹ 2 Crores. However, the Appellants could not pay any amount as undertaken. As per the direction of the D.R.T., the Appellants have deposited ₹ 76, 25,000/- in a no-lien account with

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Respondent Bank which is still lying in deposit.

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The property was sold for ₹ 2.46 Crores to the 2^nd Respondent and possession is yet to be handed over. The outstanding amount as per the loan avail by the Appellants in their individual capacity at present is ₹ 278.58 lakhs. The Appellants contend that the amount deposited in the bank may be brought to this Tribunal and considered a sufficient pre-deposit for the purpose of section 18 (1). It is also submitted that they are under financial strain. However, no income tax returns are filed to prove the financial status.

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In view of the fact that the Appellants had mediated and agreed to pay a sum of ₹ 2.65 Crores towards the clearing of the entire debt, suggests that they have waived the entire challenge to the Sarfaesi measures till the sale of the property. Under the circumstances, there is no prima facie case made out by the Appellants in their favour to maintain the appeal. The Appellants are therefore not entitled to any indulgence on the part of this Tribunal to invoke the 3^rd proviso to section 18 (1) of the SARFAESI Act. Considering the threshold amount for determining the pre-deposit of ₹ 2.78 Crores the Appellants are directed to deposit a sum of ₹ 1.25 Crores as pre-deposit.

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The Ld. Counsel appearing for Respondent Bank submitted that the in the O.A. which has been filed an application has been filed to attach ₹ 76,25,000/- toward the debt due from the Appellants. However, no order of attachment has yet been passed. Moreover, there is also a direction in the impugned order by the D.R.T. to return the said amount to the Appellants.

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Under the circumstances, the 1^st Respondent Bank is directed to produce a sum of ₹ 76,25,000/-together with the accrued interest if any shall be produced before this Tribunal and that will be considered as a deposit towards the pre-deposit amount. The balance amount to make the total amount of ₹ 1.25 Crores shall be deposited by the Appellants within a period of four weeks from today, i.e. on or before 08.08.2023. On deposit of the amounts, Respondents Nos. 3 and 4 are directed to not create any third- party over the property till the disposal of the appeal The amounts shall be deposited in the form of a Demand Draft in favour of the Registrar of this Tribunal. 9. 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.

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With these observations, the I.A. is disposed of. The Respondent is at liberty to file a reply in the Appeal with an advance copy to the other side.

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Post on 09.08.2023 for reporting compliance.

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psa-06

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Sd/Chairperson

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Raman Dharmpal Kapoor v. State Bank of India

Case brief

What is this about?

What did the court decide?

Raman Dharmpal Kapoor v. State Bank of India

Case brief

What is this about?

What did the court decide?

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