Disposed

Fly Express Logistics Pvt. Ltd. v. Presiding Officer Drt Dehradun

DRAT23 Feb 2023MISC APPLICATION/12/2023

Case brief

AI extract

What is this about?

In a misc application under section 17(6) of the SARFAESI Act, the Appellate Tribunal held it could not examine the merits of the pending case regarding Government aid for MSMEs. Instead, reducing the interim deposit condition from Rs. 50 lacs to Rs. 25 lacs, it directed the lower Tribunal to consider the interim relief application most expeditiously.

What did the court decide?

Deposit condition reduced to Rs. 25.00 lacs; liberty granted to move an application for interim relief against auction.

Fly Express Logistics Pvt. Ltd. versus Presiding Officer Drt… — Banking and Recovery | DRAT (2023)

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Misc. Application No. 12/2023 Date: 23.02.2023

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Fly Express Logistics Pvt. Ltd. Vs. Presiding Officer, DRT, Dehradun

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Present: Shri Anil Kumar Tiwari, Senior Advocate assisted by Shri Rang Nath Pandey, counsel for the applicant,

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A mention has been made on behalf of the applicant that there is urgency in the mater, therefore, the case may be taken up today, as the property in question is scheduled to be auctioned tomorrow i.e. 24.02.2023. Hence, the case has been taken-up today.

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Learned counsel for the applicant submits that Govt. of India had launched two policies to support the MSME Companies during the period of Covid-19. Accordingly, the applicant applied for the benefit of the said policy, which was rejected by the Bank vide order dated 31.08.2020. Against the said rejection, the applicant preferred a writ petition no. 2118 of 2021, which was disposed off by the Hon’ble High Court vide order dated 07.03.2022 directing the applicant to approach the Tribunal below under section 17 of the SARFAESI Act within a period of three weeks from the date of the said order. Accordingly, the applicant filed the S.A. No. 67/2022 before the DRT, Dehradun seeking stay of the recovery proceedings under the SARFAESI Act in view of the exemption granted under the policy dated 16.07.2020. It is further contended that the said policy was being managed by a trust of the Govt. of India (Ministry of Finance) and the said trust was not a party either in S.A. filed by the applicant or in the original application filed by the Bank, therefore, an impleadment application being I.A. No. 418/2022 was filed before the Tribunal below on 21.07.2022. It is further contended that the O.A. filed by the Bank was decided ex-parte vide order dated 26.09.2022, against which a recall application being M.A. No.

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27/2022 has also been filed, but without deciding the said applications, the Tribunal below has disposed off the interim application filed by the applicant vide order dated 22.07.2022, wherein it is directed that if the applicant deposits Rs. 50.00 lacs within a period of 30 days, no action shall be taken by the respondent-Bank under the SARFAESI Act. The applicant challenged the said order by filing writ petition before the Hon’ble High Court, which was disposed off and the same was challenged before the Hon’ble Supreme Court and the Hon’ble Apex Court has also dismissed the SLP filed by the applicant.

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The learned counsel for the applicant further submits that the interim protection has been granted by the Tribunal below imposing exorbitant cost of Rs. 50.00 lacs without considering the effect of the policies floated by the Govt. of India during period of Covid-19. If the Tribunal below had decided the extension of benefit of the said scheme, such cost would not have not been imposed upon the applicant for granting the interim relief, because under the said policy, the applicant would get approximately the claim of Rs. 50.00 lacs. As such the Tribunal has erred in granting the conditional interim order, it is, therefore, prayed that the said cost may be waived and the auction of the property scheduled to be held on 24.02.2023 may be stayed till the disposal of the matter pending before the Tribunal below.

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Having heard the learned counsel for the applicant and considering the material available on record, it is undisputed that the present misc. application has been filed under section 17(6) of the SARFAESI Act, which is for direction upon the Tribunal below to decide the matter expeditiously. The Tribunal below vide order dated 22.07.2022 granted the interim relief to the applicant, which is as under:-

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“If applicants shall deposit Rs. 50.00 lacs (Rupees Fifty Lakhs only) within a period of 30 days, the Respondent shall not be entitled to take any action against the applicants under SARFAESI Act, 2002.”

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The only issue, which has been agitated, is, as to whether the benefit of the scheme floated by the Ministry of Finance would be given to the applicant in the proceedings initiated under section 17 of the SARFAESI Act or not. The said issue is still pending consideration before the Tribunal below. Since this petition is filed under section 17(6) of the SARFAESI Act, which empowers this Appellate Tribunal only to issue direction upon the Tribunal below for expeditious disposal of the case, therefore, the merit of the case cannot be touched in the present petition for granting any relief. However, taking lenient view, the cost imposed by the Tribunal below is hereby reduced from Rs. 50.00 lacs to Rs. 25.00 lacs. Further, the applicant is at liberty to move an appropriate application before the Tribunal below along with a draft of Rs. 25.00 lacs seeking interim relief against the auction proceeding initiated by the Bank and Tribunal below shall consider the same in accordance with law most expeditiously.

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In the above terms, the misc. application stands disposed off.

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Justice R. D. Khare Chairperson

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VN Giri

Fly Express Logistics Pvt. Ltd. v. Presiding Officer Drt Dehradun

Case brief

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Fly Express Logistics Pvt. Ltd. v. Presiding Officer Drt Dehradun

Case brief

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