Delhi High Court
Arvind Aggarwal vs Punjab Antional Bank & Anr on 2 November, 2015
Author: G. S. Sistani
$~28
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ W.P.(C) 10022/2015
% Judgment dated 2nd November, 2015
ARVIND AGGARWAL ..... Petitioner
Through : Mr. Bharat Bhushan Bhatia, Advocate
versus
PUNJAB ANTIONAL BANK & ANR ..... Respondents
Through : Mr. Rajinder Wali, Advocate
CORAM:
HON'BLE MR. JUSTICE G.S.SISTANI
HON'BLE MS. JUSTICE SANGITA DHINGRA SEHGAL
G.S.SISTANI, J (ORAL)
1. Petitioner is aggrieved by the order dated 08.10.2015 passed by the Debts
Recovery Appellate Tribunal(hereinafter referred to for short as „DRT‟), by
which the petitioner has been directed to make a pre-deposit of 25% of the
notice amount to enable the Tribunal to hear the appeal.
2. Mr. Bhatia, learned counsel for the petitioner submits that the order with
respect to pre-deposit for 25% of the notice amount is harsh as the Tribunal
has failed to consider that a fraud has been played by the principal
borrowers in connivance with the officers of the Bank upon the petitioner.
It is contended that the petitioner did not stand as a guarantor and neither
mortgaged any immovable property in favour of the Bank.
3. Mr. Wali enters appearance on advance copy and submits that the
allegations made in the writ petition are false and scandalous. He submits
that the petitioner had mortgaged the immovable property by deposit of
title deeds and has also signed and executed various documents. He further
submits that the allegation of fraud are an afterthought and have been
raised only after the legal notice was issued and prior thereto no objection
was raised. He further submits that pre-deposit of 25% is a mandatory
requirement as per Section 18 of the Act and this cannot be waived.
4. We have heard learned counsel for the parties. Section 18 of the
Securitisation and Reconstruction of Financial Assets and Enforcement of
Security Interest Act, 2002(SARFAESI Act) reads as under:
"18. Appeal to Appellate Tribunal
(1) Any person aggrieved, by any order made by the Debts
Recovery Tribunal under section 17, may prefer an appeal
alongwith such fee, as may be prescribed to the Appellate
Tribunal within thirty days from the date of receipt of the order
of Debts Recovery Tribunal:
PROVIDED that different fees may be prescribed for filing
an appeal by the borrower or by the person other than the
borrower:
PROVIDED FURTHER that no appeal shall be entertained
unless the borrower has deposited with the Appellate Tribunal
fifty per cent. of the amount of debt due from him, as claimed by
the secured creditors or determined by the Debts Recovery
Tribunal, whichever is less:
PROVIDED ALSO that the Appellate Tribunal may, for the
reasons to be recorded in writing, reduce the amount to not less
than twenty-five per cent. of debt referred to in the second
proviso.
(2) Save as otherwise provided in this Act, the Appellate
Tribunal shall, as far as may be, dispose of the appeal in
accordance with the provisions of the Recovery of Debts Due to
Banks and Financial Institutions Act, 1993 (51 of 1993) and rules
made thereunder."
5. In the case of Narayan Chandra Ghosh v. UCO Bank and Others, (2011)
4 SCC 548, in paras 7 and 8, it was held as under:
"7. Section 18(1) of the Act confers a statutory right on a person
aggrieved by any order made by the Debts Recovery Tribunal
under Section 17 of the Act to prefer an appeal to the Appellate
Tribunal. However, the right conferred under Section 18(1) is
subject to the condition laid down in the second proviso thereto.
The second proviso postulates that no appeal shall be entertained
unless the borrower has deposited with the Appellate Tribunal
fifty per cent of the amount of debt due from him, as claimed by
the secured creditors or determined by the Debts Recovery
Tribunal, whichever is less. However, under the third proviso to
the sub-section, the Appellate Tribunal has the power to reduce
the amount, for the reasons to be recorded in writing, to not less
than twenty-five per cent of the debt, referred to in the second
proviso. Thus, there is an absolute bar to the entertainment of an
appeal under Section 18 of the Act unless the condition
precedent, as stipulated, is fulfilled. Unless the borrower makes,
with the Appellate Tribunal, a pre-deposit of fifty per cent of the
debt due from him or determined, an appeal under the said
provision cannot be entertained by the Appellate Tribunal. The
language of the said proviso is clear and admits of no ambiguity.
8. It is well-settled that when a statute confers a right of appeal,
while granting the right, the legislature can impose conditions for
the exercise of such right, so long as the conditions are not so
onerous as to amount to unreasonable restrictions, rendering the
right almost illusory. Bearing in mind the object of the Act, the
conditions hedged in the said proviso cannot be said to be
onerous. Thus, we hold that the requirement of pre-deposit under
sub-section (1) of Section 18 of the Act is mandatory and there is
no reason whatsoever for not giving full effect to the provisions
contained in Section 18 of the Act. In that view of the matter, no
court, much less the Appellate Tribunal, a creature of the Act
itself, can refuse to give full effect to the provisions of the
statute. We have no hesitation in holding that deposit under the
second proviso to Section 18(1) of the Act being a condition
precedent for preferring an appeal under the said section, the
Appellate Tribunal had erred in law in entertaining the appeal
without directing the appellant to comply with the said
mandatory requirement."
6. In the light of the statutory provision and in view of the observations of the
Supreme Court in the case of Narayan Chandra Ghosh(supra), we find no
ground to interfere with the order passed by the DRAT.
7. The writ petition is devoid of any merit; the same is accordingly dismissed.
CM.APPL 24605/2015
8. Application stands dismissed in view of the order passed in the writ
petition.
G.S.SISTANI, J
SANGITA DHINGRA SEHGAL, J
NOVEMBER 02, 2015
pst
