Disposed

Yashoda Poultry Farm v. Union Bank of India

DRAT23 Apr 2024IA/275/2024

Case brief

AI extract

What is this about?

Appellants filed for urgent relief to proceed with an appeal against a DRAT judgment allowing an O.A. for debt recovery with a mortgage decree. The Tribunal, finding the appellants under financial strain and having a prima facie case regarding a property dispute, directed a specific reduced pre-deposit.

What did the court decide?

Directed deposit of Rs. 25 lakhs as pre-deposit within three weeks; order of stay on execution of impugned order pending deposit.

Yashoda Poultry Farm versus Union Bank of India — Banking and Recovery | DRAT (2024)

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BEFORE THE DEBTS RECOVERY APPELLATE TRIBUNAL, AT: MUMBAI Present: Mr Justice Ashok Menon, Chairperson I.A. No. 275/2024 (WoD)

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Appeal on Diary No. 729/2024

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Between

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Yashoda Poultry Farm & Ors. … Appellant/s

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V/s.

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Union Bank of India …Respondent/s

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Mr. Keshav Patil, i/b Mr. Herbert Noronha, Advocate for Appellants.

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-: Order dated: 23/04/2024:-

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The matter is taken up for hearing by way of praecipe filed by Appellants for seeking urgent relief.

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The Appellants are in appeal impugning the judgment and order dated 07.10.2023 in O.A. No. 220/2022 on the files of the Debts Recovery Tribunal, Aurangabad (D.R.T), which allowed the O.A. for a sum of ₹ 57,33,457.54 together with the interest @ 10% with effect from 01.04.2019. A charge decree was also given with regard to the nine items of mortgaged properties belonging to the Appellants. The Appellants are borrower/guarantors/mortgagers who are aggrieved by the judgment and order and hence, in appeal.

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In order to entertain the appeal, the Appellants will first have to comply with the mandatory provisions of making a pre-deposit as contemplated u/s. 21 of the Recovery of Debts & Bankruptcy Act, 1993 (RDB Act).

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The Appellants state that they have a good prima facie case, in view of the fact that Item No. 1 in the order pertains to a property comprised in Survey No. 1726, Plot No. 6, Gat Nos. 104, 105 and

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106 having an extent of 475.35 sq. mtrs. A reading of the judgment would indicate that this item of property was already sold with the permission of the bank and a sum of ₹ 35 lakhs was appropriated towards the debt. Despite that, the same property is ordered to be sold and referred to as a mortgaged property over which the security interest has been created.

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That apart, it is also contended that there is an error in calculation of the amount, which is actually due from the Appellants. The details of the account statement are, however, not available and it will have to be considered at the time of hearing of the appeal.

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The Appellants have stated that they are under financial strain because their business was adversely affected during the COVID pandemic and that they are yet to recover therefrom. The income tax returns of the 2^nd Appellant alone are available and produced which indicate that he is not capable of depositing 50% of the debt due. The rest of the Appellants are not paying any income tax and therefore, they do not have any income tax returns to furnish.

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It is also stated that Appellant No. 2 is a retired person and Appellant No. 3 is a senior citizen and is 79 years old therefore, the mandatory pre-deposit may be kept as a minimum of 25% of the amount that is due. The Respondent Bank has been served but none appears.

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The Ld. Counsel appearing for the Appellants would contend that going by the impugned order, the amount that is due as of date is ₹ 86,00,187/- and therefore, that may be taken as the threshold amount for calculation of the pre-deposit.

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After having heard the Ld. Counsel appearing for the Appellants and perusal of the documents, I find that the Appellants are under financial strain.

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The Appellants also have a good prima facie case as apparently, the property will have to be sold and has been included in the order as a mortgage asset which is to be proceeded against. They are therefore directed to deposit a sum of ₹ 25 lakhs as pre-deposit for entertaining this appeal. The said amount of ₹ 25 lakhs shall be deposited within three weeks i.e. on or before 14.05.2024. On deposit of the amount, the execution of the impugned order shall stand stayed till further orders. 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/RTGS with the Registrar of this Tribunal. 12. 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 15.05.2024 for reporting compliance concerning the payment.

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Sd/Chairperson

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rm-6

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Yashoda Poultry Farm v. Union Bank of India

Case brief

What is this about?

What did the court decide?

Yashoda Poultry Farm v. Union Bank of India

Case brief

What is this about?

What did the court decide?

What the court decided

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Case details

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