The Tribunal held that the DRT exceeded its jurisdiction by granting relief for restoration of possession and settlement not sought in the application. The appeal allowing the bank was allowed.
Impugned order dated 29.10.2021 passed by DRT Siliguri is set aside. No costs.
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IN THE DEBTS RECOVERY APPELLATE TRIBUNAL AT KOLKATA
Appeal No. 108 of 2022 (Arising out of IA 478 OF 2021 IN S.A. 94 of 2018 in DRT- Siliguri)
THE HON’BLE MR. JUSTICE ANIL KUMAR SRIVASTAVA CHAIRPERSON
15.03.2023
Indian Bank, Head Office at 254-260, Avvai Shanmugham Salai, Royapettah, Chennai – 600014 and Zonal office at Siliguri, 2, Church Road, Darjeeling.
… Appellant
-Vs-
… Respondents
Mr. S. Pal Chowdhury, ld. Counsel with Ms. S. Sikdar, ld counsel for the appellant.
Ms. Kum Kum Mukherjee, ld. counsel for the respondent.
THE APPELLATE TRIBUNAL :
Instant appeal has arisen against the order dated 29.10.2021 passed by learned DRT, Siliguri in I.A. 478 of 2021 arising out of S.A. 94 of 2018 [Ma Sarada Residency Pvt. Ltd. & ors. Vs. Allahabad Bank & Ors.] wherein learned DRT had issued direction for restoration of physical possession of the property i.e. Hotel to the S.A. applicant along with direction for making payment in six installments and also extended the time for payment and further direction to approach the bank for settlement. Being aggrieved the appellant bank has preferred the appeal.
action initiated by the appellant bank. I.A. 478 of 2021 was filed for setting aside the auction sale notice dated 11.10.2021 and to
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grant status quo till disposal of the S.A. In the S.A. respondents
have made following prayers :
“a. Declaration that all steps and actions taken by the defendants under the Act of 2002 and Rules of 2002 against the scheduled properties and against the appellants are null and void; b. Pass orders setting aside the purported notice dated 29.05.2018 bearing reference No. SLG/Securities/Station 17-18/49 issued by the authorized officer Allahabad Bank purportedly u/s 13(2) of the Act of 2002 and all steps/actions and decisions arising therefrom and consequent thereto.
c. Set aside all the measures initiated u/s 13(4) of the Act of 2002 read with Rules of 2002 against the scheduled property by the defendants.
d. Pass orders quashing the purported notice dated 10.10.2017 issued by the A.O. Allahabad Bank purportedly issued u/s 13(4) of the Act and all steps actions and decisions arising therefrom and consequent thereto.
e. Pass orders setting aside the purported notice dated 28.08.2018 issued by the Authorized officer Allahabad Bank purportedly issued under Section 13(4) of the Act and all steps/actions and decisions arising therefrom and consequent thereto. f. Declaration that the defendant Bank authorities did not have any right to proceed any further under Act of 2002 against the petitioners or the scheduled properties. g. To pay such costs and compensations to the applicant for such lawful and arbitrary act as Hon’ble Tribunal may deem fit and proper.”
observed in the impugned order that an amount of Rs.6.14 crores
have already been received by the bank through auction sale. Thereafter learned DRT has recorded its finding to the effect that the borrower has to be given opportunity to revive its assets, since during the Pandemic period he could not reconstruct business. It would not be appropriate to sale the mortgage property at throw away price rather it is in the interest of the borrower as well as creditor to revive the unit by running the Hotel business. On the basis of the observation made above learned DRT passed following orders :
“The Respondent Bank is directed to hand over the physical possession of the hotel to the Applicant borrower within a week from the receipt
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of copy of the order, so that he will run the business and make the payment of the dues.
The applicants are directed to make payment of periodical instalments after the physical possession is taken over by the borrower. The Applicants will make the first instalment on 1st December, 2021 and simultaneously the borrower will approach the Respondent Bank and submit a proposal for settlement which will be sympathetically considered by the Respondent Bank. The entire payment of the borrower is to be made within six months thereafter. In the meantime, the sale notice dated 11.10.2021 in the matter is stayed and defendants are directed to maintain status quo with regard to the mortgaged property. With the above observations I.A. No. 478 of 2021 stands disposed of.”
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ORDER
File be consigned to record room.
Copy of the order be supplied to the appellant and the respondents and a copy be also forwarded to the concerned DRT.
Copy of the judgement/Final Order be uploaded in the Tribunal’s website.
Order dictated, signed and pronounced by me in the open Court.
(Anil Kumar Srivastava,J) Chairperson
Dated: 15 March, 2023 / 20/pkb
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2 issues framed by the court
Whether the Debt Recovery Tribunal could grant relief for restoration of physical possession and settlement which was not expressly prayed for in the applications.
Whether a Debt Recovery Tribunal is competent to direct a borrower to approach the bank for settlement.
Indian Bank
MA Sarada Residency Pvt. Ltd.
Rakesh Kumar Srivastava
Savita Srivastava
Anil Kumar Srivastava
As recorded by the court registry
6 orders share this CNR
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