Allowed

Asset Reconstruction Company India Limited v. Sr Educational and Charitable Trust

DRAT17 Jan 2025TRANSFER PETITION/4/2024

Case brief

AI extract

What is this about?

The Debt Recovery Appellate Tribunal allowed the appeal seeking transfer of debt recovery proceedings from DRT-I, Chennai to DRT-II, Ernakulam, following the High Court of Kerala's stay on the jurisdictional notification regarding high-value claims.

What did the court decide?

TA No.16/2023 on the file of DRT-I, Chennai is ordered to be transferred to DRT-II, Ernakulam along with records.

Asset Reconstruction Company India Limited versus Sr… — Banking and Recovery | DRAT (2025)

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IN THE DEBT RECOVERY APPELLATE TRIBUNAL AT CHENNAI

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Dated the 17^th day of January, 2025

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PRESENT: HON’BLE MR. JUSTICE G. CHANDRASEKHARAN

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CHAIRPERSON

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TA 4/2024

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(arising out of TA 16/2023 on the file of DRT-I, Chennai)

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Between

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Asset Reconstruction Company (India) Limited (acting in its capacity as trustee of ARCIL-SBPS-008-II-Trust) Rep. by its Authorised Signatory, The Ruby, 10^th Floor, 29, Senapati Bapati Marg, Dadar, Mumbai 400 028.

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…..Appellant

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And

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1. SR. Educational & Charitable Trust, Rep. by its Managing Trustee Mr. Shaji R,

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2. Mr. Shaji R.

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3. Mrs. Sreedevi M.G., W/o Mr. Shaji R.

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4. Mrs. Shilpa Shaji, W/o Dr. AlleShiv Kumar

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Respondents 1 to 4 are at:

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TC/2/2700, Divya Praba, Marapallam, Pattom, Thruvananthapuram 695 004.

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…..Respondents

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Counsel for appellant : M/s Ashwin Shanbhag & Co. Counsel for Respondents : Mr. Pradeep Joy & Co.

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ORDER

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This Transfer Application is filed under Section 17A(2) of RDDB & FI Act is filed seeking transfer of TA No.16/2023 on the file of DRT-I, Chennai to DRT-II, Ernakulam.

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Ld. Counsel for applicant submitted that applicant filed OA No.739/2020 on the file of DRT-II, Ernakulam. Ministry of Finance, Department of Financial Services issued Notification dated 4.10.2022 whereby it was ordered that applications involving debt amount above Rs.100.00 crores falling under the jurisdiction of DRT-I, Chennai, DRT-II, Chennai, DRT-III, Chennai, DRT, Madurai, DRT, Coimbatore, DRT-I, Bangalore, DRT-II, Bangalore, DRT-I, Ernakulam and DRT-II, Ernakulam are to be tried by DRT-I, Chennai. In pursuance of the said notification, OA No.739/2020 on the file of DRT-II, Ernakulam was transferred to DRT-I, Chennai and renumbered as TA 16 of 2023 on the file of DRT-I, Chennai.

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It is further submitted that subsequently, the said notification was challenged by way of Writ Petition in WP (C) No.38962/2022 before Hon’ble High Court of Kerala and Hon’ble High Court of Kerala vide its order dated 2.12.2022 stayed the operation of the said Notification dated 4.10.2022 with regard to transfer of applications involving debt amount above Rs.100 crores.

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It is the further submission of Ld. Counsel for applicant that a Review application was also filed in RP No.895/2024 against the said WP and in the review petition, Hon’ble High Court of Kerala passed order on 23.9.2024 reiterating the stay order already granted and it was made specific that DRT-I, Chennai cannot proceed with the transferred application and it has to be returned to DRT-II, Ernakulam. The relevant portion of the order reads as follows:

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“4. When the High Court stays the operation of a notification, the said notification stands in a state of suspended animation. No rights or obligations can flow out of such a stayed notification. Everything that flows out of such a notification gets suspended. Hence the Tribunal at Chennai cannot proceed with the transferred application. To avoid prejudice to parties, the files ought to have retransmitted back”

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Ld. Counsel further submitted that DRT-I, Chennai cannot deal with transfer application in view of the stay of operation of the Notification dated 4.10.2022 granted by Hon’ble High Court of Kerala and DRT-I, Chennai ought to have returned the file to DRT-II, Ernakulam on being aware of the order of stay granted by Hon’ble High Court of Kerala. Thus contending, Ld. Counsel for applicant seeks transfer of TA 16/2023 from DRT-I, Chennai to DRT-II, Ernakulam.

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Ld. Counsel for respondents objected this transfer application on the following grounds

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a) The transfer applicant did not file authorization to file this application.

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b) There is no reference made in the application with regard to OA 739/2020.

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c) No papers relating to TA 16/2023 is filed before this Tribunal.

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and prayed this Tribunal to dismiss the application.

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I have considered the rival submissions and perused the record.

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There is a stay of operation of Notification dated 4.10.2022 fixing jurisdiction on the DRT-I, Chennai in respect of applications filed for recovery of debt above Rs.100.00 crores. This Notification was stayed by Hon’ble High Court of

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Kerala, as stated above. With the clarification issued in the Review Application, there is a clear direction given to DRT-I, Chennai that the application should be transferred back to DRT-II, Ernakulam. The objections raised by Ld. Counsel for respondents are only objections for the sake of objections and they do not hold water.

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Authorization to file transfer application will be available in the case records. There is no express denial of OA No.739/2020 filed on the file of DRT-II, Ernakulam, which is renumbered as TA No.16/2023 on the file of DRT-I, Chennai. There is also no denial with regard to the fact that both are same matters and not different matters. Therefore, objections raised by the Ld. Counsel for respondents have no merits to stand.

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In the light of the order passed by Hon’ble High Court of Kerala in WP (C) No.38962/2022 and ReviewPetition No.895/2024, TA No.16/2023 on the file of DRT-I, Chennai is ordered to be transferred to DRT-II, Ernakulam along with records as expeditiously as possible.

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In the result, Transfer Application TA 4/2024 is allowed. Parties should bear their own costs.

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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 17^th January , 2025)

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Sd/-

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(JUSTICE G. CHANDRASEKHARAN) CHAIRPERSON

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Asset Reconstruction Company India Limited v. Sr Educational and Charitable Trust

Case brief

What is this about?

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Asset Reconstruction Company India Limited v. Sr Educational and Charitable Trust

Case brief

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