Myna Homes Pvt Ltd vs Union Bank Of India And Ors
2018 Latest Caselaw 6648 Del

* IN THE HIGH COURT OF DELHI AT NEW DELHI
%                               Date of decision: November 02, 2018

+       W.P.(C) 2019/2017, CM No. 8935/2017
        MYNA HOMES PVT LTD                                   ..... Petitioner
                       Through:      Mr. Mukul Gupta, Sr. Adv. with
                                     Mr. Vibhor Gara, Mr. Deepanshu
                                     Panwar, Mr. Saurabh Sapra & Mr.
                                     Sumit Mishra, Advs.

                       versus

        UNION BANK OF INDIA AND ORS                       ..... Respondents
                       Through:      Mr. O.P. Gaggar, Adv.


 CORAM:
 HON'BLE THE CHIEF JUSTICE
 HON'BLE MR. JUSTICE V. KAMESWAR RAO

V. KAMESWAR RAO, J. (ORAL)

1. This petition has been filed by the petitioner Company

challenging the orders dated November 15, 2016 and December 21,

2016 whereby the DRAT has directed the petitioner to pre-deposit

50% of the amount demanded by the Bank in its notice under

Section 13(2) of the SARFAESI Act and on failure on the part of

the petitioner to deposit the said amount, dismissed the Misc.

Appeal No. 367/2016.

2. Some of the relevant facts are, the respondent No.2 had

taken a loan of Rs.7 Crores from the respondent No.1 Bank and

mortgaged the property being No. U-29, Green Park Main, New

Delhi. It appears that subsequent thereto, the respondent No.2 Ms.

Preeti Bansal entered into a Collaboration Agreement with the

petitioner on June 03, 2015 with respect to re-construction and

development of the said property. Ms. Preeti Bansal failed to repay

the loan, which resulted in the respondent No.1 Bank initiating

action under the SARFAESI Act. It is a conceded position that Ms.

Preeti Bansal has not challenged the notice issued by the respondent

No.1 Bank under Section 13(2) of the SARFAESI Act. Rather, it is

the petitioner through its Director, Maneet Singh Bhatia had filed

the application under Section 17 of the SARFAESI Act. In the

application under Section 17 of the SARFAESI Act, the DRT had

refused to stay the sale of the property being U-29, Green Park

Main, New Delhi. Rather, it directed the Bank to go ahead with the

auction after giving 15 days notice to the petitioner herein.

3. The petitioner challenged the order of the DRT before the

DRAT. When the matter was listed before the DRAT, an issue

arose whether the appeal filed by the petitioner shall be

maintainable in view of the provisions of Section 18 of the

SARFAESI Act. The DRAT, noting the fact that the application

under Section 17 and the appeal have been signed by Maneet Singh

Bhatia, who was also an attorney of the respondent No.2, held that

proceedings under Section 17 and the appeal, are as good as having

been initiated by the respondent No.2 the borrower and as such it is

not an appeal by a third party, as sought to be contended on behalf

of the petitioner. According to the DRAT, the plea was advanced

only to avoid compliance of mandatory requirement of pre-deposit

of 50% of the debt amount. The DRAT also held that the

compliance of second proviso to Section 18 of the SARFAESI Act

is must before the appeal is entertained, and accordingly directed

the deposit of 50% of the demanded amount.

4. Mr. Mukul Gupta, learned Senior Counsel appearing for the

petitioner submits that the petitioner being a third party, having

entered into a Collaboration Agreement and not a borrower /

mortgagor and being aggrieved by the notice issued by the Bank

under Section 13(2) of the SARFAESI Act, was within its right to

file an appeal and such an appeal cannot presuppose the pre-deposit

of 50% of the demanded amount. He has drawn our attention to the

Collaboration Agreement in support of his submission. He also

relied upon the judgment of a Coordinate Bench of this Court dated

February 01, 2017 in the case of Manju Devi & Ors v. M/s R.B.L.

Bank Ltd. & Ors W.P.(C) No. 11766/2016 in support of his

submission, that a third party is not required to make a pre-deposit.

5. On the other hand, Mr. O.P. Gaggar, learned counsel

appearing for the respondent No.1 Bank opposes the submission

made by Mr. Gupta by stating that the DRAT had rightly dismissed

the appeal, on failure of the petitioner to make 50% pre-deposit. It

is his submission that the mortgage of the property with the Bank

was made on December 31, 2013 pursuant to a loan of Rs.7 Crores

granted to the respondent No.2. As a matter of fact, the petitioner

and the respondent No.2, without the knowledge of the Bank

entered into a Collaboration Agreement and also the respondent

No.2 granted a General Power of Attorney in favour of the Director

of the petitioner No.1 Company on June 03, 2015. He submits that

the parties could not have dealt with the land, after the same has

been mortgaged with the Bank. He states, in the given facts, it is

not a case where this Court must exercise the jurisdiction under

Article 226 of the Constitution of India.

6. In rejoinder, Mr. Mukul Gupta submits that the petitioner, in

terms of Collaboration Agreement and the General Power of

Attorney was required to construct the plot for which the loan was

taken. During his arguments, he concedes that the petitioner has a

right in the land on which the construction is being made.

7. Having heard the learned counsel for parties, the fact that

Maneet Singh Bhatia had filed an application under Section 17 and

the appeal as an Attorney of the respondent No.2 has not been

denied, by Mr. Gupta. If that be so, the proceedings under Section

17 and the appeal are as good as proceedings initiated by the

respondent No.2 the borrower / the mortgagor. It appears that the

plea of third party is only taken as a ploy to escape the liability of

pre-deposit for filing the appeal. The learned DRAT was justified

in dismissing the appeal filed by the petitioner, reasons for which

have already been enumerated above. Further, it is not the case of

the petitioner, that the Collaboration Agreement or the General

Power of Attorney were executed with the approval of the Bank.

8. The reliance placed by Mr. Gupta on the judgment of

Manju Devi & Ors (supra) is concerned, the same is not applicable

to the facts of this case. In the said case the petitioners therein have

purchased shop rooms / rooms situated in the premises, which was

the subject matter of the SARFAESI proceedings much before the

property was mortgaged with the Bank, which is not the case herein,

inasmuch as the mortgage with the Bank was earlier to the

execution of Collaboration Agreement / General Power of Attorney

entered between the petitioner and the respondent No.2. Further,

this Court in Manju Devi and ors (supra) has held as the total

deposit would far exceed the amount payable by the borrower, the

petitioners therein need not make 50% pre-deposit. The judgment is

distinguishable.

9. In the case in hand, in view of the conclusion of the learned

DRAT that Mr. Maneet Singh Bhatia was also an attorney of the

respondent No.2, the DRAT has rightly directed the pre-deposit

before hearing of the appeal; with which conclusion we agree. The

present petition filed by the petitioner is without any merit and the

same is dismissed.

CM No. 8935/2017 Dismissed as infructuous.

V. KAMESWAR RAO, J

CHIEF JUSTICE

NOVEMBER 02, 2018/ak