Disposed

Arjun Ganesh Gaikward v. State Bank of India

DRAT20 Jun 2025IA/335/2025

Case brief

AI extract

What is this about?

The Debt Recovery Appellate Tribunal sitting at Chennai heard an application seeking waiver of statutory pre-deposit under Section 18(1) of the SARFAESI Act, 2002. The Tribunal rejected the waiver, observing the appellant purchased property subsisting a mortgage without verifying encumbrances, thus failing to prove bonafide status. It directed deposit of 30% of dues.

What did the court decide?

The application for waiver of pre-deposit was rejected. The appellant was directed to deposit Rs. 11,60,759 (30% of dues) in two instalments. Failure to deposit shall lead to rejection of the appeal.

Arjun Ganesh Gaikward versus State Bank of India — Banking and Recovery | DRAT (2025)

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DEBT RECOVERY APPELLATE TRIBUNAL-MUMBA) (SITTING AT -CHENNAI)

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LA. No. 335/2025 (WoD) In Misc. Appeal Dy No. 904/2025

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Dated: 20.06.2025.

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The matter is taken up for hearing by way of a Praecipe filed by the Petitioner/Appellant for seeking urgent relief.

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This Application is filed seeking waiver of statutory deposit required under Section 18(1) of the SARFAESi Act, 2002, for entertaining the Appeal.

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Learned Counsel for Petitioner/Appellant submitted that Petitioner/Appellant filed S.A. No. 269/2025 challenging the order passed by Learned Additional Chief Judicial Magistrate. Esplanade, Mumbai on 16.01.2024, under Section 14 of the SARFAESI Act, 2002. It is his submission that the Petitioner/Appellant purchased his property from his owner on 16.06.2021 for valid consideration of Rs.34 Lakhs. He got NOC from the concerned society namely New Parivartan CHSL. Suppressing this fact, the order under Section 14 was obtained from teamed Additional Chief Judicial Magistrate. Therefore, this appeal is filed along with wavier application.

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In response, teamed Counsel for Respondent No. 1 Bank submitted Respondent Nos. 2 and 3 are the borrowers, they borrowed a sum of Rs. 23 Lakhs on 31.07.2018. The loan facility was-extended for a sum Rs.12.65 lakhs on 23.10.2019. Loans were covered by mortgage by secured asset, which is now purchased by the Petitioner/Appellant. In aforesaid mortgage transactions, NOC was obtained from the concerned society on

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25.07.2018 and on 22.10.2019. The mortgage is in prior point of time. When the mortgage was subsisting, the Pctitioner/Appellant purchased this property. Therefore, the purchaser is not a bonafide purchaser.

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Considered the rival submissions and perused the records. It is seen from the submissions that there is a valid mortgage and the property was purchased subsisting mortgage. It is also seen that the Pctitioner/Appellant filed FIR No. 874/2021 on 03.12.2021 against borrower for forgery. He also pleaded in the application stating that he was r eady and willing to settle the account under OTS. It is also recorded that OTS was not submitted by Petitioner/AppcHant.

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Taking note of all these factors, this Tribunal is of the view that the purchase was made subsisting mortgage, and the Petitioner/Appellant was not a prudent and bonafide person as he has not verified whether there was encumbrance prior to purchase of the property. The pre deposit is mandatory for entertaining the Appeal. As per demand notice dated 20.09.2024, the amount due is Rs.38,69,195/-. Therefore, this Tribunal is of the view that directing the Pctitioner/Appellant to deposit 30% of Rs.38,69,195/-, in two equal instalments, would meet the requirement under Section 18(1) of the SARPAESI Act, 2002, for entertaining the appeal.

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Admittedly, 30% Of Rs.38,69,195/comes to Rs.ll,60,758.50p (round off.Rs.11,60,759/-.) Therefore, Pctitioner/Appellant shad deposit Rs.11,60,759/in two instalments, 1.»‘ installment of Rs.5,80,379.50p shall be deposited on or-before 04.07.2025 and 2^ instalment of Rs.5,80,379.50p shall be deposited on or before 18.07.2025.

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It is made dear that failure to deposit of either of the
instalments, the Appeal shall stand rejected. On making such
deposit by Petitioner/Appellant, Registrar, DRAT, Mumbai.is to
invest the same in a Nationalized Bank, from lime to time, till
■further orders are passed.
22.07.2025, for reporting Compliance. List the case on	5
CHAIJ®,CHEXNAI (til CKATOE, DRAT. MUMBAfi
MKS

Arjun Ganesh Gaikward v. State Bank of India

Case brief

What is this about?

What did the court decide?

Arjun Ganesh Gaikward v. State Bank of India

Case brief

What is this about?

What did the court decide?

What the court decided

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Statutes considered

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