Badar Durrez Ahmed, J.

Caveat No.145/2009

Mr. Tanveer Ahmed Mir appears. The caveat stands discharged.

WP (C) 13042 of 2009:

1. With the consent of the counsel for the parties this matter is taken up for final hearing.

2. This writ petition is directed against the order dated 15.10.2009 passed by the Debts Recovery Appellate Tribunal (hereinafter referred to as “DRAT”) in Miscellaneous Application No.441/2009 in Appeal No.219/2009 arising out of S.A. 21/2008, which was disposed of by the Debts Recovery Tribunal by an order dated 30.06.2009. The said Miscellaneous Application No. 441/2009, which was disposed of by the impugned order passed by the DRAT, was one for waiver of pre-deposit. Section 18 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as “the said Act”), which makes provision for an appeal to the Appellate Tribunal from any order made by the DRT, reads as under:-

“18. Appeal to Appellate Tribunal. – (1) Any person aggrieved, by any order made by the Debts Recovery Tribunalunder section 17, may prefer an appeal to an Appellate Tribunal within thirty days from the date of receipt of the order of Debts Recovery Tribunal.

Provided that different fees may be prescribed for filing an appeal by the borrower or by the person other than the borrower.

Provided further that no appeal shall be entertained unless the borrower has deposited with the Appellate Tribunal fifty percent of the amount of debt due from him, as claimed by the secured creditors or determined by the Debts Recovery Tribunal, whichever is less. Provided also that the Appellate Tribunal may, for the reasons to be recorded in writing, reduce the amount to not less than twenty-five per cent of debt referred to in the second proviso.

(2) Save as otherwise provided in this Act, the Appellate Tribunal shall, as far as may be, dispose of the appeal in accordance with the provisions of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (51 of 1993) and rules made thereunder.”

The second proviso to Section 18 (1) clearly indicates that no appeal should be entertained by the Appellate Tribunal unless the borrower has deposited with the said Appellate Tribunal, fifty percent of the amount of debt due from him, as claimed by the secured creditors or determined by the DRT, whichever is less. The third proviso to the said Section 18(1) gives further leeway to the Appellate Tribunal to reduce the amount of pre-deposit, but not below twenty five per cent of the debt referred to in the second proviso.

3. In the present case, the DRAT made the following order:-

“The applicant/appellant shall deposit an amount of Rs.10.21 crores with the 1st respondent – Bank by 15.11.2009 with an undertaking by way of an affidavit by 16.10.2009 before the Registrar of this Tribunal to do so. In case the said undertaking in the form of an affidavit is given before the Registrar of this Tribunal by 16.10.2009 by 4 p.m, then the confirmation of sale shall remain stayed till 15.11.2009. The matter shall come up before this Tribunal on 16.11.2009 for further appropriate orders depending upon the deposit/non-deposit of the above amount of Rs.10.21 crores.”

We may point out, at this stage, that the amount of debt shown due in the notice under Section 13(2) of the said Act, which was issued on 19.07.2007 to seven persons, including the petitioner, was to the extent of Rs 40,87,65,819/-. We are also aware of the fact that pursuant to Section 13(4) proceedings, a collateral asset belonging to the principal borrower (the company), a sum of Rs 8.60 crores was recovered through the sale of the same by the respondent No.1 bank.

4. The DRAT has computed the figure of 25% of the debt amount to be Rs 10.21 crores by taking the debt due to be Rs 40,87,65,819/-. The DRAT has ignored the interest component which was claimed by the respondent No.1 bank in the O.A. filed by it before the DRT. The