Godavari Laxmi Co-Op. Bank Ltd vs Mohd.Hussain Hamdule
2011 Latest Caselaw 190 Bom

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         IN THE HIGH COURT OF JUDICATURE AT BOMBAY,
                    BENCH AT AURANGABAD




                                            
                    WRIT PETITION NO.4461/2011




                                           
    Godavari Laxmi Co-op. Bank Ltd.
    Through its Managing Director,
    Shri Ashok s/o Totaram Mahajan,




                                 
    31, Navi Peth, Opp.Godavari Hospital
    M.J.College Road, Jalgaon.
                     ig                            .. Petitioner


               Versus
                   
    1]   The Union of India
         Through Ministry of Finance
         [Copy to be served
      


         Additional Solicitor General Standing
         Counsel for Union of India in
   



         the High Court]

    2]   Maharashtra Boiler & Tubing
         Corporation, Prop.Mohd.Shafi





         Mohd.Hussain Hamdule,
         R/o Hamdule Mansion, Plot no.15
         survey no.167, Ajanta Road,
         Near S.T.Workshop, Jalgaon.               ... Respondents





                    ....

    Mr.S.S.Deve,Adv.for petitioner.
    Mr.B.L.Sagar Killarikar,Standing counsel for respondent no.1.
    Mr.A.G.Talhar,Adv.for respondent no.2.

                    ...




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                                 CORAM : NARESH H.PATIL AND




                                             
                                         T.V.NALAWADE, JJ.

                                 DATE      : 9th DECEMBER ,2011




                                            
    ORAL JUDGMENT




                                  
    1]     By an order dated 20/9/2011, notice for final disposal was
                     

issued. Rule. Rule is made returnable forthwith. Petition is heard

finally.

2] The respondent no.2 is borrower of petitioner Godavari

Laxmi Cooperative Bank Ltd. The respondent no.2 filed

proceedings u/s 17 of The Securitisation and Reconstruction of

Financial Assets and Enforcement of Security Interest Act, 2002

[for short the Act of 2002] consequent to the issuance of notice u/s

13(4) of the said Act. By judgment and order dated 7/3/2011, the

Debt Recovery Tribunal, Aurangabad dismissed the Securitisation

Application No.08/2010.

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    3]    Respondent no.2 preferred an Appeal under the provisions of

Section 18 of the Act of 2002 before the Debts Recovery Appellate

Tribunal, Mumbai. Respondent no.2 filed application bearing

No.M.A.328/11 in Appeal No.66/11 seeking waiver of deposit as

prescribed u/s 18 (1) of the Act of 2002 on 24/3/2011. The

appellant filed reply to the said application. By order dated 27/4/11

the Appellate Tribunal allowed the application filed by respondent

no.2 by observing that respondent no.2 herein cannot be asked to

deposit any more amount and no amount is required to be

deposited u/s 18(1) of the Act of 2002. The petitioner bank has

questioned the correctness and legality of the said order in the

present petition.

4] The learned counsel appearing for the petitioner Shri Deve

submits that notice u/s 13 [2] of the Act of 2002 was issued by the

bank on 11/5/2007. A notice was issued resorting the provisions of

Section 13[4] of the Act of 2002 on 26/12/2009. The notice is titled

as possession notice. The relevant portion of the notice which is

ascertained from the original record is reproduced hereinbelow :

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             "Whereas,




                                   
             The undersigned being the Authorised

Officer of the Godavari Laxmi Co-op. Bank Ltd. Jalgaon under the Securitisation And Reconstruction of Financial Assets and

Enforcement of Security Interest [Act 2002 (54 of 2002)] and in exercise of powers conferred under section 13(12) read with rule 9 of the Security Interest (Enforcement) Rules

2002, issued Demand Notice dated 11/05/2007 calling upon the borrower Mohd.

Shafi Mohd. Husen Humduley Prop.

Maharashtra Boiler & Tubining Corporation to repay the amount mentioned in the notice

being Rs.45,61.459.54 + Intt (Rupees Forty Five Lac Sixty One Thousand Four Hundred Fifty Nine & Paise Fifty Four Only) within 60 days from the date of receipt of the said

notice has present outstanding Rs.

24,61,985.54 + intt. + expenses as on

30.11.2009.

The borrower having failed to repay full amount even after many chances, notice is hereby given to the borrower and the public in

general that the undersigned has taken symbolic possession of the property described herein below in exercise of powers conferred on him under section 13(4) of the said Act read with rule 9 on this 26th day of

Dec. of the year 2009.

The borrower in particular and the public in general is hereby cautioned not to deal with the property. Any dealings with the property will be subject to the charge of the Godavari Laxmi Co-op.Bank Ltd. Jalgaon for an amount of Rs.24,61,985.54 and interest, cost

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& expenses thereon."

5] The learned counsel for the petitioner submits that the

Appellate Tribunal erred in clubbing the figures as mentioned in

the notice u/s 13(2) and 13(4) of the Act. There was error on the

part of Tribunal in accepting the contentions of the respondent no.

2 that sum of Rs.41.50 Lakhs was already deposited by the

respondent no.2 with the petitioner subsequent to the notice

issued u/s 13(2) of the Act of 2002. Respondent no.2 did not

comply with the provisions of Section 18(1) of the Act.

6] In the facts of the case, according to the learned counsel for

petitioner, respondent no.2 has not deposited 50% of the amount

which is due from respondent no.2 as claimed by the secured

creditor. The learned counsel has placed reliance on the judgment

reported in AIR 2011 S.C. 1913 [Narayan Chandra Bhosh V/s

UCO Bank and Ors.] in support of his submissions.

7] The learned counsel appearing for respondent no.2 submits

that proceedings were initiated before the Debt Recovery Tribunal,

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Aurangabad consequent to the notice issued by the petitioner u/s

13(4) of the Act 2002. Section 13(4) of the Act of 2002 relates to

the amount claimed by the bank in notice issued u/s 13(2) of the

Act of 2002. The counsel further submits that in the possession

notice, the petitioner bank had referred to outstanding amount of

Rs.45,61,459.54 + interest and the present outstanding amount of

Rs.24,61,985.54 + interest + expenses as on 30/11/2009. It is

submitted that even if these two figures of amount claimed are

clubbed together, it can be ascertained that the respondent no.2

having paid 41.50 lakhs in favour of the petitioner bank, the pre

condition for entertaining Appeal u/s 18 by Appellate Tribunal gets

satisfied. In other words, the respondent no.2 claims that having

deposited 50% of the amount due from respondent no.2 his

Appeal filed before Appellate Tribunal shall be entertained without

calling upon the respondent no.2 to deposit any further amount.

8] We have perused the original record and proceedings, the

impugned order, reply filed by respondent, and the relevant notice

issued by the petitioner to the respondent no.2. We have perused

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the judgment cited supra.

9] There is no dispute between the parties that the bank had

issued notice u/s 13(2) of the Act of 2002 on 11/5/2007. The

petitioner-bank had also resorted to measures as prescribed u/s

13(4) of the Act of 2002 by issuing a possession notice on

26/12/2009. The bank is entitled u/s 13(4) of the Act of 2002 to

take recourse to measures provided under the said provisions to

recover the secured debt on failure of borrower to discharge his

liability in full within the period specified in sub Section 2 of the Act.

10] In the facts of the case and considering the notice issued u/s

13(2) of the Act of 2002, we find that the petitioner bank had

claimed as present outstanding, an amount of Rs.24,61,985.54 Ps.

and accordingly, the charge was kept upon the subject property by

intimating public in general. The bank had described the

immovable property over which the charge was kept in the notice

issued u/s 13(4) on 26/12/2009. Under the provisions of Section

17 of the Act of 2002, any person aggrieved by any of the

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measures referred to in sub Section 4 of Section 13, is entitled to

approach D.R.T. Under the provisions of Section 18 of the said

Act, any person aggrieved by any order passed by D.R.T. u/s 17

may prefer an appeal alongwith such fees as may be prescribed.

The second proviso to Section 18 of the said Act provides that no

appeal shall be entertained unless the borrower has deposited with

the Appellate Tribunal 50% of the amount of debt due from him as

claimed by the secured creditor [emphasis supplied].

11] In the facts of the present case and considering the notice

issued by the petitioner bank to respondent no.2 it is clear that the

amount due and claimed by the petitioner from respondent no.2 for

the purposes of entertaining the appeal by Appellate Tribunal

would be amount of Rs.24,61,985.54 Ps.

12] We find that the Appellate Tribunal committed error in

waiving the mandatory condition of pre deposit by the respondent

no.2 before entertaining the appeal as stipulated under the

provisions of Section 18 of the Act of 2002. In the light of the

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reasonings adopted by us as above, we find that the order passed

by the Appellate Tribunal is required to be quashed and set aside.

13] We accordingly quash and set aside the order passed by the

Debt Recovery Appellate Tribunal, Mumbai in M.A.No.323/2011 in

Appeal No.66/2011 dated 27/4/2001. The D.R.A.T. Mumbai shall

pass appropriate order in the light of provisions of Section 18 of

the Act of 2002 keeping in view the amount due as claimed from

respondent no.2 by petitioner as a secured creditor to the extent of

Rs.24,61,985.54 Ps. Rule is made absolute in the the above

terms.

14] At this stage, learned counsel for respondent no.2 prayed for

stay to the operation of this order for a period of 2 weeks. Request

is refused.

(T.V.NALAWADE, J.) (NARESH H. PATIL,J.)

umg/wp4461-11