Dismissed

Ms Murugan Coir Industry and Anr. v. Canara Bank

DRAT12 Nov 2024MISC APPEAL/7/2022

Case brief

AI extract

What is this about?

Appeal challenging the dismissal of an application for stay of sale. Court held no contempt arose as High Court set aside the deposit order and directed refund. Pending main appeal directed to be disposed on merits. Appeal dismissed.

What did the court decide?

Application for punishment for disobedience of order dismissed by the fee of contempt not arising. Pending main appeal directed to be disposed of on merits.

Ms Murugan Coir Industry and Anr. versus Canara Bank — Banking and Recovery | DRAT (2024)

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IN THE DEBT RECOVERY APPELLATE TRIBUNAL AT CHENNAI

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Dated the 12^th day of November, 2024

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PRESENT: HON’BLE MR. JUSTICE G. CHANDRASEKHARAN

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CHAIRPERSON

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MA (SA) 7/2022

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(arising out of IA 2952/2019 in SA 565/2019 on the file of DRT, Coimbatore)

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Between

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1. M/s Murugan Coir Industry, Rep. by its Proprietor, P. Elavarasan, D.No.27/4, Nanapparppu, Punjai Pugalur, Karur 639 13.

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2. Mr. P. Elavarasan, S/o Palaniyappan, D.No.27/4, Nanapparppu, Punjai Pugalur, Karur 639 113.

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…..Appellants

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And

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The Authorised Officer, Canara Bank, Karur SME Branch, No.37, 1^st Cross, Vaiyapuri Nagar, Karur 639 001.

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…..Respondent Bank Counsel for appellants : Shri G. Sanjeevi Counsel for Respondent Bank : Shri M. Muthukumaran

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ORDER

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This appeal is filed under Section 18 of SARFAESI assailing the order dated 20.11.2019 passed in IA No.2952/2019 in SA 565/2019 on the file of DRT, Coimbatore.

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Ld. Counsel for appellants submitted that appellant filed SA 565/2019, challenging the sale notice dated 1.11.2019 along with an application to stay all further proceedings in IA 2952/2019 and the same IA was dismissed by Tribunal below on 20.11.2019. Aggrieved by the said order, this appeal was filed along with waiver application.

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It is submitted that the Tribunal while ordering waiver petition, directed the appellant to make a pre-deposit of Rs.20.00 lakhs with Registrar of this Tribunal in two instalments, out of which, one instalment of Rs.10.00 lakhs had to be paid within from four weeks and second instalment of Rs.10.00 lakhs to be deposited by four weeks thereafter. In terms of the order, appellants deposited Rs.10.00 lakhs on 24.9.2021 and then he moved a Writ Petition in WP (MP) No.19923/2021 and WMP (MD) No.16618/2021 before Hon’ble High Court of Madras challenging the order passed in the waiver

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petition i.e., IA 36/2020 in AIR (SA) 396/2019 dated 15.9.2021 The Hon’ble High Court of Madras, following the ratio laid down in re, Sree Jeya

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Soundharam Textile Mills Private L imited and others Vs. Canara Bank

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represented by its Manager, Tirupur and others reported in 2019 3 CTC 497 vide its order dated 2.11.2021 set aside the order of this Tribunal passed on

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15.9.2021 and held that appellant is entitled for a refund of Rs.10.00 lakhs deposited in the Registry of this Tribunal.

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It is further submitted that when appellant had time till 21.10.2021 to deposit the second instalment of Rs.10.00 lakhs, respondent bank had registered the Sale Certificate in favour of the auction purchaser on 20.10.2021, therefore, appellants filed an application in IA 626/2021 to punish the respondent bank for willful disobedience of the order of this Tribunal dated 15.9.2021 passed in waiver application i.e., IA 36/2020. Thus contending, Ld. Counsel prayed this Tribunal to allow this appeal.

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In response, Ld. Counsel for respondent bank submitted that appellants no doubt had made a deposit of Rs.10.00 lakhs on 24.9.2021 as per the order of this Tribunal dated 15..9.2021, but, thereafter, appellants chose file WP (MD) No.19923/2021 and WMP (MD) No.16618/2021 and got an order for refund of Rs.10.00 lakhs already deposited on 24.9.2021. It is further submitted that there are no merits in the petition for disobedience of the order of this Tribunal in view of the fact that order dated 15.9.2021 passed in IA 36/2020 by this Tribunal was effectively set aside by Hon’ble High Court of Madras in the said Writ Petition. Thus contending, Ld. Counsel for

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respondent bank prayed this Tribunal to dismiss the appeal as well as the IA 626/2021.

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I have considered the rival contentions of either side and perused the documents.

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As already stated, SA No.565/2019 was filed challenging the sale notice dated 1.11.2019. However, this appeal is filed challenging the order passed in IA 2952/2019 in the said SA. As narrated above, there was a conditional order passed by this Tribunal on 15.9.2021 directing the appellants to deposit a sum of Rs.20.00 lakhs in two instalments, of which, Rs.10.00 lakhs within four weeks from 15.9.2021 and another Rs.10.00 lakhs within four weeks thereafter i.e., after paying the first instalment. It is found that appellants after paying the first instalment and without paying the second instalment approached the Hon’ble High Court of Madras in WP No. WP (MD) No.19923/2021 and WMP (MD) No.16618/2021 to set aside the above order of this Tribunal and Hon’ble High Court of Madras set aside the order and directed this Tribunal to refund Rs.10.00 lakhs deposited by the appellants.

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Under the circumstances the question arises now is whether contempt for registering sale certificate on 20.10.2021 would arise or not. Contempt would arise if the appellants deposited the second instalment of Rs.10.00

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lakhs within the stipulated time. Instead, appellants chose to approach the Hon’ble High Court of madras against the order of this Tribunal dated 15.9.2021 and that order was effectively set aside by the Hon’ble High Court with a direction to this Tribunal for refund of Rs.10.00 lakhs to the appellants. Therefore, this Tribunal is of the view the issue of contempt will not arise now, therefore, IA No.626/2021 filed for disobedience of order of this Tribunal is dismissed accordingly.

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It is seen that SA No.565/2019 I still pending before the Tribunal below. Ld. Presiding Officer, DRT, Coimbatore is directed to dispose of SA 565/2019 as expeditiously as possible, on merits and in accordance with law.

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MA (SA) 7/2022 is disposed of, accordingly.

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11.Parties are directed to bear their own costs. Pending IAs, if any stand closed.

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[Dictated to Steno(SN), transcribed by him, corrected, signed and pronounced by me in open court, this 12^th November, 2024)

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Sd/ - (JUSTICE G. CHANDRASEKHARAN) CHAIRPERSON

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Ms Murugan Coir Industry and Anr. v. Canara Bank

Case brief

What is this about?

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Ms Murugan Coir Industry and Anr. v. Canara Bank

Case brief

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