IMPORTANT POINT
DRT has power to cancel Debt Recovery Certificate once issued.

S. Manikumar, J.—The petitioner has availed Over Draft facility of Rs.15 lakhs (Rupees Fifteen lakhs only) from Tamilnad Mercantile Bank Ltd., Royapettah, Chennai 600 014. Due to financial distress, she could not repay the loan amount. After her loan account was classified as NPA, she had paid Rs.1 lakh (Rupees One lakh only), on 28.11.2011. Thereafter, on 08.02.2012, she moved an application under the SARFAESI Act, 2002, in S.A.No.30 of 2012, before the Debts Recovery Tribunal, Madurai. An interim order was passed, directing the petitioner, to deposit Rs.6 lakhs in two instalments. In compliance of the same, Rs.2,50,000/- and Rs.3,50,000/- were deposited, on 09.12.2012 and 08.03.2012, respectively. The petitioner has submitted that S.A.No.30 of 2012 was closed.

2. The petitioner has filed S.A.No.18 of 2015, challenging sale notice, dated 19.12.2014 and that the same is pending, on the file of the Debts Recovery Tribunal, Madurai. In S.A.No.18 of 2015, a conditional order was passed, in I.A.No.114 of 2015, dated 23.01.2015, staying the sale auction notice, dated 19.12.2014, by which, auction was to be held, on 27.01.2015. Pursuant to the conditional stay order, petitioner deposited Rs.9 lakhs, in two instalments.

3. When the matter stood thus, the Debts Recovery Tribunal - II, Chennai, has issued a recovery certificate, in D.R.C.No.122 of 2016, dated 02.02.2016, to the Recovery Officer, for a sum of Rs.24,28,024.22, as hereunder:—

S. Item of costs Amount

No. (in Rs.)

1. Amount determined

against the defendants 18,69,520.00

2. Interest @ 9% p.a (simple)

on Rs.18,69.520.00 from

21/12/2012 to 1/12/2015 4,96,004.22

3. Application/Court fees 22000

4. Advocate fees (as per

cost memo Sr.No.10333) 40500

5. Others (As per cost

memo SR.No.10333) Nil

Total 24,28,024.22

4. According to the petitioner, as the interest of the Bank had already been secured by the conditional order, in S.A.No.18 of 2015, on the file of the Debts Recovery Tribunal, Madurai, issuance of Recovery Certificate, in D.R.C.No.122 of 2016, was not necessary. The petitioner has further submitted that a sum of Rs.16 lakhs, deposited in the Tribunal, during the pendency of S.A.No.30 of 2012 and S.A.No.18 of 2015, on the file of the Debts Recovery Tribunal, Madurai, has not been taken note of, while issuing the Recovery Certificate in D.R.C.No.122 of 2016, dated 02.02.2016.

5. In such circumstances, the petitioner was constrained to file I.A.No.4869 of 2016, in D.R.C.No.122 of 2016, in O.A.No.219 of 2014, on the file of the Debts Recovery Tribunal - II, Chennai, to stay the proceedings of the Recovery Officer, based on the recovery certificate, issued in D.R.C.No.122 of 2016, dated 02.02.2016, pending disposal of S.A.No.18 of 2015, on the file of the Debts Recovery Tribunal, Madurai. She has also filed I.A.4870 of 2016, in D.R.C.No.122 of 2016, before the Debts Recovery Tribunal - II, Chennai, with a prayer to withdraw the recovery certificate issued in D.R.C.No.122 of 2016, dated 02.02.2016, pending disposal of S.A.No.16 of 2016, on the file of the Debts Recovery Tribunal, Madurai.

6. The Tribunal, which considered the averments relating to the deposit of Rs.15 lakhs, in S.A.No.30 of 2012 and S.A.No.18 of 2015, on the file of the Debts Recovery Tribunal, Madurai and payment of Rs.1 Lakh, not being taken note of, while issuing the recovery certificate, dated 02.02.2016, in O.A.No.219 of 2014, vide order, dated 21.06.2016, rejected the M.A.SR.No.4870 of 2016, as hereunder:—

“Counsel for the petitioner in M.A.SR.No.4870 of 2016 and Liaison Officer of applicant bank present. Passed over and called again. M.A.Sr.No.4870 of 2016 is filed to recall DRC. But OA is allowed by this Tribunal and DRC was issued as per the OA. DRC cannot be recalled. Hence, this M.A.SR.No.4870 of 2016 is not maintainable and is rejected.”

7. Being aggrieved by the same, the borrower/petitioner has filed the instant writ petition, to quash the proceedings, stated supra.

8. While ordering no