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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
ARAVIND KUMAR, ASHUTOSH J. SHASTRI, JJ.
RELIABLE POLYESTERS PRIVATE LIMITED – Appellant
Versus
AUTHORISED OFFICER BANK OF BARODA – Respondent
Letters Patent Appeal No. 1002 of 2022, Special Civil Application No. 10802 of 2022, Civil Application (For Interim Relief) No. 1 of 2022
Decided On : 04-01-2023
Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 – Section 13, 14, 18 – Recovery of Debts and Bankruptcy Act, 1993 – Section 19 – Security of Interest (Enforcement) Rules, 2002 – Rule 8 – Petitioners were sanctioned certain credit facilities by the respondent-Bank of Baroda account having been classified ‘Non Performing Asset’ - NPA resulted in a notice issued to petitioners by secured creditor calling upon appellants been replied by debtor – Held, Court unable to subscribe to view expressed by learned Single Judge where under it has been held that amount as quantified by secured creditor is amount due and payable by debtor – Now turning our attention to it would clearly indicate that in notice issued claimed and in application interpretation if put-forward would amount to doing violence to provision secured creditors” or “determined by Debt Recovery – Court doctrine of noscitur a sociis would surface or said doctrine would be applicable words in a statute will have to be understood by taking into consideration words accompanying said provision – Appeal is allowed.
JUDGMENT :
ARAVIND KUMAR, J.
1. The short point that arises for consideration in this appeal is:
2. Petitioners were sanctioned certain credit facilities by the respondent-Bank of Baroda (hereinafter referred to as “Secured Creditor”) on 31.09.2019. Said loan account having been classified on 08.03.2020 as a ‘Non Performing Asset’ - NPA resulted in a notice under Section 13(2) of SARFAESI Act being issued to petitioners by the secured creditor on 10.07.2020 (Annexure-P) calling upon appellants to pay Rs. 6,20,41,349/-. The said notice is said to have been replied by the debtor.
3. The secured creditor initiated proceedings for taking symbolic possession of the secured asset and also filed an application under Section 14 of the SARFAESI Act before the jurisdictional Magistrate. The secured creditor has filed an application under Section 19 of the Recovery of Debts and Bankruptcy Act, 1993 (for short “RDB Act”) in O.A. No. 463 of 2020 on 30.07.2020 for recovery of Rs. 6,29,98,547.04ps.
4. Pursuant to the notice issued under Section 13(2) of the SARFAESI Act, notice under Section 13(4) read with Rule 8(1) of Security of Interest (Enforcement) Rules, 2002 also came to be issued on 24.09.2020. Challenging the said measures taken by the respondent – secured creditor, petitioners filed an application under Section 17 before the jurisdictional Tribunal in S.A. No. 435 of 2020. The Tribunal by order dated 27.01.2022 rejected the prayer for interim injunction sought for by the appellants from preventing the measures taken by the secured creditor against petitioners. On account of Chairperson of Debt Recovery Appellate Tribunal, Mumbai, lying vacant, petitioners approached this Court in Special Civil Application No. 2907 of 2022 for grant of interim relief which was granted to petitioners on 11.03.2022 to be in operation for seven days after the learned Chairperson of Debt Recovery Appellate Tribunal assumes charge. On 21.03.2022, the Chairperson of Debt Recovery Appellate Tribunal, Mumbai was appointed and as such order passed by the Tribunal dated 27.01.2022 was challenged in appeal before DRAT by the petitioners by filing an appeal under Section 18 of SARFAESI Act namely Miscellaneous Appeal No. 14 of 2022. Along with said application, an interlocutory application was filed for waiver of pre-deposit in I.A. No. 40 of 2022. Said application came to be resisted to by the secured creditor and DRAT by order dated 01.06.2022 called upon the appellants to pre-deposit a sum of Rs. 2.50 Crores for entertaining the appeal. After accepting the statement made by the learned counsel for the secured creditor namely the bank that an amount of Rs. 7,75,64,475.67ps. is the amount due, Tribunal directed payment of the said amount to be made by debtor in installments as indicated in paragraph-14 of the order dated 01.06.2022. It reads as under:
5. Being aggrieved by the aforesaid order, the appellants herein approached the learned Single Judge in Special C
Point of law: High Court has no jurisdiction to entertain writ petitions under Article 226 of the Constitution of India, relating to matters coming under the purview of SARFAESI Act, 2002, where a st....
The court upheld the DRAT's order denying waiver of pre-deposit under the SARFAESI Act, emphasizing the need for a prima facie case and clarifying that financial hardship is not determinative.
A writ petition under Article 226 is not maintainable when an effective statutory remedy exists under the Securitisation Act, especially in recovery related matters.
Point of Law- On perusal of the above provisions of section 18 of SARFAESI Act, more particularly, second proviso which provides that the appeal can be entertained only when borrower has deposited wi....
Appeal – Quantum of pre-deposit cannot be more than apparent subject matter of appeal.Case Referred:
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