The court emphasized the necessity of a pre-deposit for appeals under the SARFAESI Act and found no prima facie case for the appellant against the Sarfaesi action.

-: Order dated: 31/01/2025:-

The matter is taken up for hearing by way of a praecipe filed by the appellant for seeking urgent relief.

The appellant who is the second applicant in the Securitisation Application (S.A.) No. 59 of 2020 on the files of the Debts Recovery Tribunal-II, Mumbai (DRT) is in appeal anticipating an adverse order in the Interlocutory Application filed as I.A. No. 150 of 2025 in the aforesaid S.A. to protect her from the Sarfaesi action taken by the respondent financial institution for recovery of the debt allegedly due under the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (“SARFAESI Act”, for short). It is submitted that the application was heard in detail and listed for orders today but till now the orders have not been uploaded and pronounced before in the open Tribunal and therefore, it is anticipated that it is going to interim application of the appellant. Moreover, the appellant is apprehensive that the possession of the subject property will be taken tomorrow as scheduled, and hence, the Ld. Counsel appearing for the appellant submits that this is an appeal not only under Sec. 18 of the SARFAESI Act but also exercising the jurisdiction of this Tribunal under Rule 17-A of the Recovery of Debts and Bankruptcy Act, 1993 (“RDB Act”, for short) Recovery of Debts and Bankruptcy Act, 1993 (“RDB Act”, for short) which confers supervising jurisdiction to this Tribunal over the DRTs. 2. To entertain this appeal, the appellant will first have to comply with the mandatory requisite of making a pre-deposit under Sec. 18(1) of the SARFAESI Act. The appellant has challenged the Sarfaesi measures on various grounds, mainly, on the ground that the demand notice issued under Sec. 13(2) of the SARFAESI Act is defective and it is also contended that the order passed under Sec. 14 of the SARFAEASI Act authorizes a controlling judicial clerk to take possession of the secured asset which according to the Ld. Counsel appearing for the appellant is not a person who is capable and competent of taking possession of the secured asset.

3. The appellant has also produced income tax returns indicating that the income derived by the appellant is limited and not sufficient to make 50% of the debt as a pre-deposit. It is also pointed out that the appellant is suffering from Alzheimer’s disease and medical documents in support are also produced.

4. The Ld. Counsel appearing for the respondent has vehemently opposed the application stating that this is a speculative appeal. No order has been passed as yet and therefore; it is to make sure on the part of the appellant to file this appeal. It is also contended that only one of the applicants has come up in appeal. The first applicant who is the husband of the appellant has not preferred this appeal and that it is for the medical condition as well as the impecuniosity condition of the appellant alone being to be considered for the impecuniosity of the appellant.

5. As regards the demand notice under Sec. 13(2) indicates that there is no name and designation of the authorised officer who had issued the demand notice has not been mentioned. It is pertinent to note that the respondent has the opportunity to produce evidence to indicate the capability of the person who has issued the demand notice to establish that the person is competent as per the Rules to issue the demand notice under Sec. 13(2) and therefore, it is too early at this point of time to conclude that the notice issued under Sec. 13(2) is defective for that reason. Secondly, coming to the capability of a controlling judicial clerk to handle the situation of taking over possession. It has to be observed that it is the prerogative of the Magistrate to appoint an officer who is subordinate to him to take over possession. The Ld. Counsel appearing for the appellant has relied upon the decision of the Hon’ble Supreme Court in NKGSB Co- operative Bank Ltd.