NATIONAL POLYMERS Vs. UNION OF INDIA

JUDGEMENT

(1.) Rule, by consent returnable forthwith. With the consent of Counsel and at their request the petition is taken up for hearing and final dis-posal.

(2.) By an order dated 6 April, 2001 the Debts Recovery Appellate Tribunal has di-rected the petitioners to deposit an amount of Rs. 7 Crores. The Debts Recovery Appel-late Tribunal was moved by the petitioners for an order of waiver under section 18 of the Securitisation and Reconstruction of Fi-nancial Assets and Enforcement of Security Interest Act, 2002. An application filed by the petitioners under section 17 was earlier dismissed by the Tribunal on 4 February, 2011. Against the order of rejection, the pe-titioners filed an appeal in which an applica-tion for waiver was made. The impugned or-der decides that application.

(3.) The petitioners have challenged the constitutional validity of the provisions of the first and second provisos to section 18 of the Act on the ground that they are discrimina-tory. The submission is based on a compari-son with the provisions of section 21 of the Recovery of Debts due to Banks and Finan-cial Institutions Act, 1993. According to the petitioners while the Act of 1993 confers a discretion upon the Appellate Tribunal to al-low a complete waiver of the pre-deposit, the discretion of the Appellate Tribunal, while entertaining an appeal under section 18 of the Securitisation Act is curtailed. By the first proviso to section 18(1) an appeal can-not be entertained unless the borrower has deposited an amount of 50% of the debt due as claimed by the secured creditor, or as determined by the Tribunal, whichever is less. By the second proviso, the Appel-late Tribunal is empowered for reasons to be recorded in writing to reduce the amount to not less than 25% of the debt referred to in the second proviso.