Disposed

Kinsi Hotels and Management Services Pvt. Ltd. v. Bank of India

DRAT14 Sept 2023IA/611/2023

Case brief

AI extract

What is this about?

Matters on an interim application in an appeal challenging SARFAESI measures. The bench found the appellant deserving of an in-prima facie deposit of Rs. 40 lakhs with liberty to argue for waiver. The appeal was deferred contingent on payment of Rs. 5 lakhs by the next date.

What did the court decide?

Defer hearing until compliance; admit interim deposit of ₹40,00,000 with liberty to waive; require payment of ₹5,00,000 overnight.

Kinsi Hotels and Management Services Pvt. Ltd. versus Bank of… — 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. 611/2023 (WoD)

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Appeal on Dairy No. 1391/2023 Between

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Kinsi Hotels & Management Services Pvt. Ltd. … Appellant/s V/s.

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Bank of India …Respondent/s

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Mr Rajesh Nagory, i/b Ms Sanjana Ghogare, Advocate for Appellant.

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Mr A. B. Shinde, Advocate for Respondent Bank.

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-: Order dated: 14/09/2023:-

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The Appellant is a company named M/s. Kinsi Hotels and Management Services Pvt Ltd. is the borrower which defaulted on payment of the loan due from it to the Respondent Bank of India.

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Sarfaesi measures were initiated and steps till sec. 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (‘SARFAESI Act’, for short) have been taken. The possession of the secured assets is intended to be taken on 17.09.2023.

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The Appellant had approached the Debts Recovery Tribunal, (D.R.T) by filing S.A. No. 63/2022 on the files of Debts Recovery Tribunal – I, Ahmedabad (D.R.T) challenging the Sarfaesi measures and vide order dated 06.07.2023 the S.A. was dismissed stating that there are no grounds for challenging the Sarfaesi measures and it is also observed that multiple times the Appellant had attempted to get the debt settled by offering an OTS and then committed default of the OTS. The Appellant is aggrieved and hence in appeal.

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The Appellant would contend that the initial demand u/s. 13 (2) of the SARFAESI Act was for a sum of ₹ 1,01,36,315.60/- and subsequent to that payments have been made by the Appellant and according to the Respondent the outstanding dues as of date is ₹ 91,43,950.46/-. The Appellant will have to cross the hurdle of mandatory pre-deposit u/s. 18(1) of the SARFAESI Act prior to the appeal being entertained.

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The Appellant has filed an application for waiver stating that their hotel business was adversely affected during the Covid and the business has not yet picked up. Hence, they are under financial strain. However, there is no documentary evidence produced. It is stated that no income tax returns have been filed because there is no taxable income. The balance sheet of the company is also not produced to indicate the financial strain of the Appellant.

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The Appellant has also challenged the notice under Sec. 13(2) and the steps u/s. 14 of the SARFAESI Act but most contentions do not prima facie appear worthy of being taken up as satisfactory in view of the detailed order passed by the Ld. Presiding Officer where he has discussed the contentions in detail. Considering the entire facts and circumstances in finding that the Appellant has to deposit at least a sum of ₹ 40,00,000/- as pre-deposit.

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The Ld. Counsel appearing for the Appellant submits that he will be producing a demand draft for ₹ 5,00,000/- tomorrow i.e. on 15.09.2023 and the balance will be paid in instalments. The balance of ₹ 35,00,000/- shall be paid in two equal instalments of ₹

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17,50,000/-each within a gap of two weeks each, as stated hereunder.

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Numbers of Instalments	Payment on or before
1^stInstalment	29.09.2023
2^ndInstalment	13.10.2023

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On producing a draft for ₹ 5,00,000/- tomorrow the possession intended to be taken shall stand deferred till the next date of hearing before the bench In default, the Appeal shall stand dismissed, without any further reference to this Tribunal.

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

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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 03.10.2023 for reporting compliance regarding the payment of the 1^st instalment.

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rm-4

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Kinsi Hotels and Management Services Pvt. Ltd. v. Bank of India

Case brief

What is this about?

What did the court decide?

Kinsi Hotels and Management Services Pvt. Ltd. v. Bank of India

Case brief

What is this about?

What did the court decide?

What the court decided

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