SHIVA STAINLESS STEEL PRIVATE LIMITED, Vs. CANARA BANK

JUDGEMENT

(1.) This appeal is filed against the judgment of the learned Single Judge dtd. 15/12/2020.

(2.) Brief facts of the case are as under:-

(3.) The appellant original petitioner was borrower and the respondent Canara Bank is a secured creditor. The petitioner did not repay the dues to the bank with interest. The bank therefore initiated steps under the Secularization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter to be referred to as the "Act of 2002"). The petitioner challenged the action initiated under Sec. 13 (2) and (4) of the Act of 2002. The order of the Debt Recovery Tribunal (DRT) became the subject-matter of appeal before the Debt Recovery Appellate Tribunal (DRAT). The DRAT passed the order dtd. 16/10/2020 in which it was noted that against the principal outstanding sum of the borrower of Rs.21,89,63,764.00, as insurance claim the bank had already recovered Rs.6,58,86,707.00, which was the insurance claim paid by the insurance company directly to the bank for and on behalf of the petitioner. After adjusting the said sum already recovered by the bank, the DRAT held that there are still dues of Rs.15,30,77,057.00. To maintain the appeal as per Sec. 18 of the Act of 2002, the appellant would have to deposit 50% of the disputed sum which can be reduced by the Appellate Tribunal up to 25% of the disputed sum. In the order dtd. 16/10/2020, the Appellate Tribunal indicated the desire to reduce the requirement of pre-deposit to 25% of the remaining sum of Rs.15,30,77,057.00. However, since the company was unable to deposit this amount also, the appeal was dismissed making the following observations:-