SHRINATH COTFAB Vs. AUTHORISED OFFICER, CANARA BANK

JUDGEMENT

(1.) The challenge raised in this writ petition is to the order dtd. 2/12/2024 passed by the Debts Recovery Appellate Tribunal ' DRAT on the application made by the petitioners for waiver of 25% of the amount of pre-deposit under Sec. 18(1) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short, the Act of 2002). The DRAT by the impugned order directed the petitioners to deposit an amount of Rs.24.00 crores in three instalments on the premise that the outstanding dues on the date of filing the appeal were Rs.48,87,37,359.31.

(2.) Mr. Vineet Naik, learned Senior Advocate for the petitioners submits that since the petitioners were merely challenging the sale of the secured asset, it was only the amount at which the sale was effected that was required to be taken into consideration for the purposes of determining the amount of pre-deposit. The bid for an amount of Rs.2,97,00,000.00 had been accepted as noted by the Debts Recovery Tribunal - DRT. Referring to the auction notice dtd. 9/8/2024, it was pointed out that the reserve price for the subject property was Rs.2,96,00,000.00. This figure also could have been taken into consideration while determining the amount of pre-deposit. The DRAT however took into consideration the entire amount due and payable. He referred to paragraph 34 of the judgment of Supreme Court in Sidha Neelkanth Paper Industries Private Limited and Anr. vs. Prudent ARC Limited and Ors., 2023 SCC OnLine SC 12 and submitted that the petitioners were not challenging any measures taken under Sec. 13(4) of the Act of 2002. Hence, the figure of Rs.2,97,00,000.00 ought to be taken into consideration for determining the amount of pre-deposit under Sec. 18(1) of the Act of 2002. The DRAT failed to consider this aspect thereby causing prejudice to the petitioners. It was thus submitted that the impugned order was liable to be set aside.

(3.) Mr. Gajendra Rajput, the learned counsel for the respondent no.1 supported the order and submitted that a Sale Certificate is yet to be issued to be auction purchaser. The auction was conducted and the bid for an amount of Rs.2,97,00,000.00 was accepted. 25% of the amount was deposited by the auction purchaser. He too relied on the decision in Sidha Neelkanth Paper Industries Private Limited and Anr. (supra) and submitted that there was no reason to interfere in exercise of writ jurisdiction.