The main legal point established in the judgment is that the amount to be deposited by the borrower for preferring an appeal to the Debts Recovery Appellate Tribunal should be determined with reference to the amount demanded in the notice under Section 13(2) of the SARFAESI Act.

D.MURUGESAN, J.

1. The petitioners, viz., Sivakumar Textiles and its sole proprietor, have come up before this Court assailing the order of the Debts Recovery Appellate Tribunal, the first respondent herein, passed in I.A.No.1188 of 2011 in AIR (SA) No.796 of 2011 dated 04.10.2011.

2. The facts in nutshell are as follows:

The petitioners availed agricultural loan on 21.02.2006 from the third respondent-ICICI Bank, to the tune of Rs.2.33 crores and created an equitable mortgage by mortgaging agricultural properties including a piece of land with buildings as security for the said loan. As the petitioners defaulted in repayment of loan, the third respondent-bank proceeded against the petitioners by invoking the provisions of the SARFAESI Act and issued a notice dated 28.10.2009 under Section 13(2) of the Act calling upon them to pay a sum of Rs.2,89,03,317.54 within a period of 60 sixty days from the date of the notice. As the petitioners have not responded to the said notice, possession notice dated 27.10.2009 under Section 13(4) of the Act was issued taking symbolic possession of four properties described therein. One of the properties was brought for auction on 08.12.2009 by the bank, against which, the petitioners preferred Sarfaesi Appeal No.123 of 2009 before the Debts Recovery Tribunal, Coimbatore.

3. By an interim order dated 01.11.2010, the petitioners were directed to pay a sum of Rs.25,00,000/- and the same was complied with. Again, by order dated 27.04.2011, the petitioners were directed to pay further sum of 25% to the third respondent, which was challenged before the Debts Recovery Appellate Tribunal under Section 18 of the Act. In compliance of the order of the Debts Recovery Appellate Tribunal, a further sum of Rs.60,00,000/- was deposited with the 2nd respondent.

4. In the meantime, the Sarfaesi Appeal was dismissed by the Debts Recovery Tribunal, Coimbatore, by order dated 06.09.2011 sustaining the possession notice dated 27.10.2009. As against the said order, the petitioners have filed AIR (SA) No.796 of 2011 before the Debts Recovery Appellate Tribunal along with an interlocutory application in I.A.No.1188 of 2011 seeking waiver of pre-deposit. Before the Appellate Tribunal, the respondent-bank claimed by way of counter-affidavit that the petitioners are liable to pay a sum of Rs.3,27,13,618.47p as on 2.9.2011, of course, after giving due credit to all the payments made by the petitioners pursuant to the notice under Section 13(2) of the Act.

5. The Debts Recovery Appellate Tribunal, by the impugned order dated 04.10.2011, directed the petitioners to deposit Rs.81,78,404/- being 25% of Rs.3,27,13,618.47 as claimed by the respondent-bank, on or before 17.11.2011 with a further direction restraining the Authorised Officer to proceed further in the event the amount is deposited and in case of default, to proceed further. It is the said order which is challenged in this writ petition on the sole ground that as per the second proviso to Section 18 (1) of the Act, the Debts Recovery Appellate Tribunal ought to have directed to pay 25% on the amount claimed by the third respondent in the possession notice dated 27.10.2009 or on the amount determined by the Debts Recovery Tribunal and not on the amount claimed by the third respondent before the Debts Recovery Appellate Tribunal as on 02.09.2011 and that too, by way of counter-affidavit, which is unsustainable and untenable.

6. A counter-affidavit has been filed on behalf of respondents 2 and 3, in which it is stated that the property which was brought for sale is not an agricultural property and the same has been put to commercial use. According to the respondents, the provisions of the Act empowers the Appellate Tribunal to direct deposit of 50% of the amount claimed by the secured creditors or as determined by the Debts Recovery Tribunal, whichever is less and the Debts Recovery Appellate Tribunal has rightly taken into consideration the earlier depo