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2012 Supreme(All) 3119

[2013(2) ADJ 497]
ALLAHABAD HIGH COURT
BEFORE : DILIP GUPTA, J.
MOHAN LAL SARAF ....Petitioner
Versus
CHAIRPERSON, DEBTS RECOVERY APPELLATE TRIBUNAL, ALLAHABAD AND OTHERS ....Respondents
(Civil Misc. Writ Petition No. 50624 of 2011, decided on 5th December, 2012)

Advocates:
Counsel :
R.P. Agarwal for the Petitioner; M.P. Sarraf, Satish Madhyan for the Respondents.

Headnote:Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002—Sections 13, 17 and 18—Security Interest (Enforcement) Rules, 2002—Rules 8, 12 and 13—Security interest—Enforcement of —Appeal—Non-deposit of requisite Court-fee—Implication of—Petitioner guarantor and mortgagor of the loan taken—Proceedings initiated against Section 13—DRAT by impugned order dated 14.7.2011 dismissed the appeal filed by petitioner under Section 18 on ground that the requisite Court-fee was not deposited and 50% of amount of debt due also not deposited—Challenge against—Condition of pre-deposit under proviso to Section 18(1) of Act—Insisting on pre-deposit is mandatory condition under the Act—And the amount could be reduced to not less than 25% of the debt on an application for waiver having been filed—Appellate Tribunal committed no illegality in dismissing the appeal on account of failure to make the pre-deposit as contemplated under the Second proviso to Section 18 (1) of the Act. [Paras 13 to 35]

       

JUDGMENT

Hon’ble Dilip Gupta, J.—The petitioner as the guarantor and mortgagor of the loan taken by Hyper Chemicals & Cosmetics Pvt. Ltd. from the Kanpur Branch of the State Bank of Patiala (hereinafter referred to as the ‘Bank’) and against whom proceedings under Section 13 of the Securitisation & Reconstruction of Financial Assets & Enforcement of Security Interest Act, 2002 (hereinafter referred to as the ‘Act’) were initiated by the respondent-Bank, has filed this petition for quashing the order dated 14th July, 2011 passed by the Debts Recovery Appellate Tribunal, Allahabad (hereinafter referred to as the ‘Appellate Tribunal’) by which the appeal filed by the petitioner under Section 18 of the Act against the order dated 11th April, 2011 passed by the Debts Recovery Tribunal Allahabad (hereinafter referred to as the ‘Tribunal’) was dismissed for the reason that the requisite Court fee was not deposited and for the reason that the petitioner had not deposited 50% of the amount of debt due as required under the second proviso to Section 18(1) of the Act. Further relief that has been claimed in this petition is for a direction upon the Appellate Tribunal to decide the appeal filed by the petitioner on merits without requiring the petitioner to make any further payment of Court fee or deposit any amount under the second proviso to Section 18(1) of the Act.

2. It is stated that the Bank had filed Original Suit No. 549 of 1996 against Hyper Chemicals & Cosmetics Pvt. Ltd. and others, (principal borrowers) and the guarantors/mortgagors on 16th May, 1996 for recovery of dues to the extent of Rs. 13,89,430/-. The petitioner was impleaded as a defendant in the said suit in the capacity of a guarantor and mortgagor of his half share in the House No. 2797, Chirkhana, Gali Matawali, Chandani Chowk, Delhi. The suit was filed by the Bank with the allegation that equitable mortgage of the said property was created by the petitioner by depositing the title deeds on 15th February, 1992. The said suit was subsequently transferred to the Tribunal and was renumbered as T.A. 507 of 2000. The defendants filed a counter claim/set off, but the Tribunal by the judgment dated 18th February, 2003 allowed the claim of the Bank in full and dismissed the counter claim/set off. This judgment of the Tribunal was challenged by the defendants in an appeal before the Appellate Tribunal which remanded the case back to the Tribunal for fresh adjudication with liberty to the parties to adduce additional evidence. This order of remand was challenged by the defendants in Writ Petition No. 18606 of 2004 in which further proceedings before the Tribunal were stayed by the order dated 17th May, 2006, and the interim order is said to be operating till date.

3. It is further stated that thereafter the Bank initiated proceedings against the petitioner by issuing a notice dated 10th May, 2007 under Section 13(2) of the Act by which the petitioner was called upon to discharge the dues of the Bank aggregating to Rs. 1,19,56,663.67/- within sixty days from the date of receipt of the notice. The petitioner sent a reply denying his liability to pay the amount. The objections were, however, rejected by the Bank by the order dated 2nd June, 2007 and thereafter the petitioner received a notice captioned ‘Possession Notice’ dated 13th March, 2008. The petitioner sent a reply dated 10th April, 2008 inter alia pointing out that the notice did not specify the date on which the alleged possession was taken or would be taken and nor was the notice affixed at the outer door or at any other conspicuous place of the house in question and nor it was published in two newspapers having circulation in the locality. When no reply was received from the Bank, the petitioner believed that the Bank had dropped the proceedings but by way of abundant caution sought information from the Bank under the Right to Information Act on 12th March, 2010. The Bank supplied information dated 15th April, 20





































































































































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