The requirement of pre-deposit under Section 21 of the RDB Act is mandatory for legal heirs of deceased guarantors in recovery proceedings.

JUDGMENT :

SUBRAMONIUM PRASAD, J

1. The Petitioner has invoked the Writ jurisdiction of this Court under Article 226 and 227 of the Constitution of India against the observations and directions passed by the Debt Recovery Appellate Tribunal (hereinafter referred to as “DRAT”) vide judgment dated 28.02.2025 in Misc. Appeal No. 39 of 2025 and 40 of 2025; as well as against the observations and directions passed by the Debt Recovery Tribunal (hereinafter referred to as “DRT”) vide common judgment dated 14.02.2025 in Appeal No. 01 of 2025 and TMA 23 of 2024.

2. The DRAT vide the impugned Judgment has refused to entertain the appeal without pre-deposit as mandated under Section 21 of the Recovery of Debts And Bankruptcy Act, 1993 (hereinafter referred to as 'the RDB Act').

3. Shorn of unnecessary details, the facts as admitted by the Petitioner leading to the filing of the present Writ Petition are as follows:-

i. Mr. Prakash Srivastava, the husband of the Petitioner, along with other persons stood as mortgagor qua the loan granted by the Union Bank of India (Respondent No. 1) in favour of M/s Green World International Private Limited (Respondent No. 3) on 19.02.2013.

ii. The husband of the Petitioner hypothecated his residential property bearing address – A-3, South City – 1, Gurgaon, Haryana (hereinafter referred to as “Property in Question”) in lieu of the above-mentioned mortgage.

iii. The husband of the Petitioner died on 11.06.2013.

iv. After the death of the husband of the Petitioner, the Property in Question was divested in the name of the Petitioner, and her two sons, namely Mr. Anurag Srivastava (Respondent No. 9), and Mr. Anuj Srivastava (Respondent No. 13).

v. Respondent No.1 renewed the terms of the loan as was sanctioned to the Respondent No. 3/company on 13.03.2015.

vi. The loan account of Respondent No. 3 was declared as a Non-Performing Asset on 30.01.2016. Further, a notice u/s 13(2) of the SARFAESI Act, 2002, was issued by Respondent No. 1 to the directors of Respondent No. 3 on 29.02.2016 demanding remission of dues owed by Respondent No. 3 to Respondent No. 1.

vii. The Respondent No. 1 filed an Original Application No. 30 of 2017 on 16.12.2016 against the Respondent No. 3 and its directors for recovery of the said loan to the tune of Rs. 10,42,51,321.10 along-with pendente lite and future interest at 15% per annum till realization. Notices were issued to the Defendants in the Original Application, but on failure to appear, they were proceeded ex-parte on 25.08.2017.

viii. DRT-3, Delhi, vide its final order dated 23.08.2019 directed all the Defendants in the Original Application to pay to the Applicant Bank, jointly or severally, a sum of Rs. 10,42,51,321.10/- together with cost and future interest @15% per annum, from the date of filing of the O.A. till the date of realization; failing which the said amount would be recovered from the sale of mortgaged properties.

ix. Subsequently, recovery proceedings were initiated before the Learned Recovery Officer of the DRT-1, in TRC No. 155 of 2022, wherein the Tribunal vide its Order dated 03.07.2024 ordered impleadment of LRs of the deceased CD – Mr. Prakash Srivastava. The LRs, namely Mrs. Suman Srivastava (Petitioner), Mr. Anurag Srivastava, and Mr. Anuj Srivastava, were given notice under Rule 85 of Second Schedule of the Income Tax Act, 1961, that step