Allowed

Hashmi Sayed Nisar Ahmed Sayed Murtuza v. State Bank of India

DRAT24 Aug 2023MISC APPEAL/31/2024

Case brief

AI extract

What is this about?

Appealed against order requiring predeposit for entertaining appeal under Section 21 of RDB Act. TX granted exemption from predeposit because no-due certificate proved entire debt paid, making predeposit based on decree amount impossible.

What did the court decide?

Exemption from payment of any amount as predeposit under Section 21 of the RDB Act granted.

Hashmi Sayed Nisar Ahmed Sayed Murtuza versus State Bank of… — Landlord and Tenant | DRAT (2023)

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BEFORE THE DEBTS RECOVERY APPELLATE TRIBUNAL, AT: MUMBAI Present: Mr Justice Ashok Menon, Chairperson I.A. No. 490/2023 (WoD) In

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Appeal on Diary No. 1215/2023

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Between

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Hashmi Sayed Nisar Ahmed Sayed Murtuza … Appellant/s V/s. State Bank of India & Ors. …Respondent/s Mr R.P. Adgaonkar, Advocate for Appellant. Ms. Darshana Kambli, Advocate for Respondent No.1 Bank.

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-: Order dated: 24/08/2023:-

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The Appellant has come up with an appeal challenging the order of Debts Recovery Tribunal, Aurangabad (D.R.T) dated 07.07.2023 in I.A. No. 1113/2023 in Appeal No. 2/2023 wherein the Appellant had sought for exemption from payment of any amount as predeposit u/s. 31A of the Recovery of Debts and the Bankruptcy Act,1993 (“ RDB Act”, for short).

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The Ld. Presiding Officer had insisted that an amount of ₹ 68,85,656/- was due as a debt from the Appellant towards which an amount of ₹ 13,00,000/- is already being paid leaving a balance of ₹ 55,85,656/- is due, and therefore, the Appellant was directed to pay a sum of ₹ 27,92,828/- as court fees (SIC) and disposed of I.A. No. 1113/2023.

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The Appellant is aggrieved and hence, in appeal. For entertaining the appeal u/s. 21 the Appellant will have to comply with the mandatory provisions or a pre-deposit before this Tribunal.

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The Ld. Counsel appearing for the Appellant submits that the order of the Ld. Presiding Officer, D.R.T is erroneous. 50% of the amount which is due as debt to the bank which needs to be deposited before entertaining the appeal u/s. 30 of the RDB Act. In the instant case, there are no outstanding dues.

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The Appellant has produced a ‘no due certificate’ issued by the bank, and the bank has also issued a letter stating that the amount due has been paid completely and the account settled under a scheme and that even prior to the e-auction, a letter was addressed to the Recovery Officer to cancel the e-auction on account of the settlement.

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However, the Recovery Officer ignored and proceeded with the sale without paying any heed to the letter written by the bank. Hence, the order of the Recovery Officer dated 20.06.2023 in Recovery Proceeding No. 145/2002 was challenged in appeal before the Ld. Presiding Officer in Appeal No. 2/2023.

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On going through the records, I find that u/s. 30A of the RDB Act the Appellant is only liable to pay 50% of the amount that is due from him. Since there is no amount due from him for having paid the entire dues to the bank and obtained a no-due certificate, he cannot be asked to deposit 50% of an imaginary amount based on the decree of the Debts Recovery Tribunal, (D.R.T).

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It is also relevant to note that the Ld. Presiding Officer has discounted a sum of ₹ 13,00,000/- which was paid by the debtor. If that amount can be discounted the entire amount which has been paid would also have to be discounted which remains with no

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outstanding liability to be paid.

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The Ld. Counsel appearing for the Bank also concedes that a no-due certificate has been issued by the bank on payment of the entire amount. 10. The question that now arises for consideration is whether the Appellant can be granted an exemption from payment of the predeposit as contemplated u/s. 21 of the RDB Act.

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The reading of Sec. 21 also would state that 50% of the amount of debt is due from the Appellant as determined by the Tribunal u/s. 19 is to be paid by him.

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In view of the no-due certificate there is no amount which is payable by the Appellant and hence, he cannot be directed to pay an imaginary amount based on the original decree passed in the O.A. Hence, the Appellant is granted exemption from payment of any amount u/s. 21 of the RDB Act for entertaining the appeal.

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I.A. is allowed and the Appeal shall be taken on file if there are no other defects to be cured.

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Post on 01.09.2023 for hearing.

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Sd/Chairperson

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Hashmi Sayed Nisar Ahmed Sayed Murtuza v. State Bank of India

Case brief

What is this about?

What did the court decide?

Hashmi Sayed Nisar Ahmed Sayed Murtuza v. State Bank of India

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

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