IN THE HIGH COURT OF DELHI
Vipin Sanghi, Rekha Palli, JJ.
Sheikh M. Maroof - Appellants
Vs.
Phoenix ARC Pvt. Ltd. and Ors. - Respondent
W.P. (C) 4539/2021
Decided On : 22-04-2021
Contumacious Conduct - Debt Recovery - SARFESI Act, RDDBFI Act - Section 17, Section 19(25) - The court discussed the petitioner's claim as a tenant, his failure to comply with conditions set by the court, and the dismissal of his applications. The court highlighted the contumacious conduct of the petitioner, his failure to honor undertakings, and the impact of M/s. Prestige Lights Limited v. State Bank of India on the decision.
Fact of the Case:
The petitioner sought relief against dispossession from properties mortgaged for loan repayment. The court found the petitioner's conduct contumacious, as he failed to comply with conditions set by the court and dishonored undertakings given to the court.
Finding of the Court:
The court found the petitioner's conduct dishonest and contumacious, leading to the dismissal of his applications and the imposition of costs.
Issues: The issues involved the petitioner's claim as a tenant, his failure to comply with court conditions, and the impact of his contumacious conduct on the court's decision.
Ratio Decidendi: The court's decision was based on the petitioner's failure to honor undertakings, his contumacious conduct, and the impact of M/s. Prestige Lights Limited v. State Bank of India on the decision.
Final Decision: The court dismissed the petitioner's applications and imposed costs on him due to his contumacious conduct and failure to comply with court conditions.
JUDGMENT :
Vipin Sanghi, J.
CM APPL. 13901/2021
Exemption allowed, subject to all just exceptions. The application stands disposed of.
W.P.(C) 4539/2021 & CM APPL. 13900/2021
1. The petitioner has preferred the present writ petition to seek the following reliefs:-
"(a) set aside order dated 23.03.2021 passed by the Hon'ble Debts Recovery Appellate Tribunal, New Delhi thereby dismissing application Miscellaneous Appeal No. 128 of 2020 titled as Sheikh M. Mahroof Versus Phoenix ARC and others pending before the Hon'ble Debts Recovery Appellate Tribunal; dismissing securitisation application no. 78 of 2020 pending before the learned Debts Recovery Tribunal; and also forfeiting the amount of Rs. 30.00 lakhs deposited by the Petitioner along with interlocutory application no. 66 of 2021 seeking extension of time to deposit a sum of Rs. 2.00 crores directed to be deposited vide order dated 09.11.2020;
(b) restore Miscellaneous Appeal No. 128 of 2020 titled as Sheikh M. Mahroof Versus Phoenix ARC and others, pending before Hon'ble Debts Recovery Appellate Tribunal. with direction to be heard and decide the same on merits;
(c) restore Miscellaneous Securitisation Application No. 78 of 2020 titled as Sheikh M. Mahroof Versus Phoenix ARC and Others, pending before the learned Debts Recovery Tribunal, with direction to be heard and decide the same on merits;
(d) order for the refund of Rs. 30.00 lacs deposited by the petitioner, with the Hon'ble Debts Recovery Appellate Tribunal, Delhi.
2. Respondent no. 1/Phoenix ARC Pvt. Ltd., as the assignee of the loan granted by the Canara Bank to the respondent nos. 2 and 3 i.e. ZAZ Mustang, a partnership firm and ZAZMAN Exports another partnership firm, has been pursuing its remedies-under both the SARFESI Act and the RDDBFI Act. The respondent no. 1 sought to invoke its powers under the SARFEASI Act, in order to take possession of the mortgaged properties i.e., two flats-being Flat No. 3, Taj Apartments, situated on Plot No. 2B, Rao Tula Marg, Sector 12, R.K. Puram, New Delhi and Flat No. 3, Taj Apartments, situated on Plot No. 2C, Rao Tula Marg, Sector 12, R.K. Puram, New Delhi. The petitioner claims that he is a tenant in these two flats, and on that premise sought to move a Securitisation Application (S.A.) before the DRT under Section 17 of the SARFEASI ACT. The petitioner also sought protection against dispossession before the DRT.
3. The DRT did not find any merit in the said claim for interim relief on the premise that the petitioner had not been able to establish, even prima facie, that he is a tenant in the said property, as the petitioner did not produce any rent receipts, or other record to establish that the petitioner is a tenant, or had been paying any rent. Moreover, the petitioner is the brother-in-law of the partner of the debtor firms. Consequently, the DRT dismissed his application to seek stay against dispossession. This led to the petitioner preferring Miscellaneous Appeal (M.A.) No. 128/2020 before the DRAT. When the matter came up before the DRAT on 09.11.2020, the petitioner again pressed for stay of dispossession; wherein, the DRAT granted a conditional stay against the dispossession to the petitioner, by directing that he should pay Rs. 2 crores to the Receiver, in case the Receiver approaches the petitioner to take physical possession of the properties. The dues against the respondent nos. 2 and 3 herein were to the tune of Rs. 4.55 crores in the loan account in question, whereas the total liability of the respondent nos. 2 and 3 is stated to be to the tune of Rs. 185 crores. Thus, the petitioner was not immediately dispossessed on account of the passing of the said conditional order of stay by the DRAT.
4. However, the petitioner was not satisfied with the aforesaid order passed by the DRAT and preferred W.P.(C) No. 9329/2020 before this Court to assail the order dated 09.11.2020. The said writ petition was rejected by this Court on 24.11.2020, by observing that the order passed
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