Kerala High Court
Dillens.T.D vs The Authorised Officer, South Indian ... on 23 April, 2024
Author: N.Nagaresh
Bench: N.Nagaresh
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE N.NAGARESH
TUESDAY, THE 23RD DAY OF APRIL 2024 / 3RD VAISAKHA, 1946
OP (DRT) NO. 123 OF 2024
AIR NO.158 OF 2024 OF DEBT RECOVERY APPELLATE
TRIBUNAL, CHENNAI
PETITIONERS/APPELLANTS:
1 DILLENS.T.D, AGED 42 YEARS
S/O.T.P.DAVIS, THATTIL CHEENIKKAL HOUSE,
NEAR R C CHURCH, NEDUMPUZHA.P.O.,
KOORKKANCHERRY, THRISSUR., PIN - 680007
2 SEMONA DILLENS, AGED 37 YEARS
W/O.DILLENS.T.D, THATTIL CHEENIKKAL HOUSE,
NEAR R C CHURCH, NEDUMPUZHA.P.O.,
KOORKKANCHERRY, THRISSUR., PIN - 680007
BY ADVS.
ZAKEER HUSSAIN
K.A.SANJEETHA
MOHAMMED ZAMAN
RESPONDENTS/RESPONDENTS:
1 THE AUTHORISED OFFICER,
SOUTH INDIAN BANK LTD
SIB HOUSE, T.B.ROAD, MISSION QUARTERS,
THRISSUR., PIN - 680001
2 SOUTH INDIAN BANK LTD
KOORKKANCHERY, THRISSUR.
REP. BY ITS BRANCH MANAGER., PIN - 680007
BY ADVS.
SRI.SUNIL SHANKAR A
SMT.VIDYA GANGADHARAN(K/000424/2020)
THIS OP (DEBT RECOVERY TRIBUNAL) HAVING COME UP FOR
ADMISSION ON 23.04.2024, ALONG WITH OP (DRT).147/2024,
THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
O.P.(DRT) Nos.123 & 147 of 2024
:2:
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE N.NAGARESH
TUESDAY, THE 23RD DAY OF APRIL 2024 / 3RD VAISAKHA, 1946
OP (DRT) NO. 147 OF 2024
IA NO.108/2024 IN AIR NO.158 OF 2024 OF DEBT RECOVERY
APPELLATE TRIBUNAL, CHENNAI
PETITIONERS/APPELLANTS:
1 DILLENS.T.D
AGED 42 YEARS
S/O.T.P.DAVIS, THATTIL CHEENIKKAL HOUSE,
NEAR R C CHURCH, NEDUMPUZHA.P.O.,
KOORKKANCHERRY, THRISSUR., PIN - 680007
2 SEMONA DILLENS
AGED 37 YEARS
W/O.DILLENS.T.D, THATTIL CHEENIKKAL HOUSE,
NEAR R C CHURCH, NEDUMPUZHA.P.O.,
KOORKKANCHERRY, THRISSUR., PIN - 680007
BY ADVS.
ZAKEER HUSSAIN
K.A.SANJEETHA
MOHAMMED ZAMAN
RESPONDENTS/RESPONDENTS:
1 THE AUTHORISED OFFICER,
SOUTH INDIAN BANK LTD
SIB HOUSE, T.B.ROAD,
MISSION QUARTERS, THRISSUR.,
PIN - 680001
2 SOUTH INDIAN BANK LTD
KOORKKANCHERY, THRISSUR.
REP. BY ITS BRANCH MANAGER., PIN - 680007
O.P.(DRT) Nos.123 & 147 of 2024
:3:
BY ADVS.
SRI.SUNIL SHANKAR A
SMT.VIDYA GANGADHARAN(K/000424/2020)
SRI.JERIN GEORGE(K/863/2023)
THIS OP (DEBT RECOVERY TRIBUNAL) HAVING COME UP FOR
ADMISSION ON 23.04.2024, ALONG WITH OP (DRT).123/2024,
THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
O.P.(DRT) Nos.123 & 147 of 2024
:4:
N. NAGARESH, J.
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O.P.(DRT) Nos.123 and 147 of 2024
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Dated this the 23rd day of April, 2024
JUDGMENT
~~~~~~~~~
The petitioners, who are husband and wife,
availed financial facilities from the South Indian Bank Limited.
In OP(DRT) No.123/2024, the petitioners seek to set aside
Ext.P16 order of the Debts Recovery Appellate Tribunal,
Chennai in waiver application IA No.108/2024 in AIR (SA)
No.158/2024. In OP(DRT) No.147/2024, the petitioners seek
to set aside Ext.P4 order of the Debts Recovery Appellate
Tribunal, Chennai in IA No.211/2024 in IA No.108/2024.
2. The pleadings in the OP(DRT) would indicate that
the petitioners had availed substantial amount as financial
advance/loan and failed to maintain the loan account. The
petitioners failed to maintain the loan account to the
O.P.(DRT) Nos.123 & 147 of 2024
satisfaction of the Bank. The Bank therefore initiated
coercive proceedings under the Securitisation and
Reconstruction of Financial Assets and Enforcement of
Security Interest Act, 2002. The petitioners thereupon filed
SA No.303/2021 before the Debts Recovery Tribunal-II,
Ernakulam. In the meanwhile, the Bank obtained Ext.P2
order from the Chief Judicial Magistrate's Court, Thrissur
under Section 14 of the SARFAESI Act whereby the Chief
Judicial Magistrate's Court appointed an Advocate
Commissioner to take physical possession of the property
mortgaged by the petitioners. The petitioners filed Ext.P3 IA
No.1503/2022 in SA No.303/2021 seeking to stay Section 14
proceedings.
3. The Debts Recovery Tribunal directed the
petitioners to deposit an amount of ₹150 lakhs and directed
the Bank to defer dispossession as per Ext.P4 order dated
06.07.2022. The Debts Recovery Tribunal-II heard the stay
petition again on 11.01.2024 and dismissed the same as per
Ext.P8 order. The petitioners filed Ext.P9 appeal before the
O.P.(DRT) Nos.123 & 147 of 2024
Debts Recovery Appellate Tribunal, Chennai. The
petitioners also filed a stay petition along with the appeal.
The petitioners also filed Ext.P11 waiver application IA
No.108/2024. As the DRAT did not take up the waiver
application, the petitioners filed IA No.109/2024 seeking to
take up Ext.P11 waiver application on an urgent basis.
4. The DRAT allowed IA No.109/2024 and took up IA
No.108/2024 for hearing on 08.03.2024. In IA No.108/2024,
the DRAT ordered to make a deposit of ₹2,34,63,756/- on or
before 22.03.2024 as per Ext.P16 order dated 08.03.2024.
In Ext.P16 order, the DRAT made it clear that on the failure
to deposit the amount before the stipulated date, the appeal
will stand rejected.
5. The petitioner states that while passing Ext,P16
order, the DRAT, Chennai did not consider the fact that the
Bank had already appropriated more than 50% of the amount
demanded in Ext.P1 demand notice. Therefore, the direction
to remit a sum of ₹2,34,63,756/- is highly arbitrary and
unsustainable.
O.P.(DRT) Nos.123 & 147 of 2024
6. While OP(DRT) No.123/2024 was pending, the
petitioners filed IA No.211/2024 before the DRAT to enlarge
the time for pre-deposit. The said IA was dismissed as per
Ext.P4 order dated 26.03.2024. Hence, the petitioners have
filed OP(DRT) No.147/2024 seeking to set aside Ext.P4
order of the DRAT in IA No.211/2024.
7. The Standing Counsel entered appearance on
behalf of the Bank and resisted the OP(DRT), filing counter
affidavit. On behalf of the Bank, the Standing Counsel
submitted that Ext.P1 demand notice dated 31.05.2021 was
issued to the petitioners seeking payment of the outstanding
amount of ₹6,08,57,404.08 together with future interest. The
petitioners submitted objection. The objection was disposed
of by the Bank. As the petitioners failed to discharge the
liability, the Bank issued possession notice dated
02.11.2021.
8. Subsequently, the Bank initiated Section 14
proceedings and the Advocate Commissioner issued notice
dated 16.03.2022 to the petitioners seeking vacant
O.P.(DRT) Nos.123 & 147 of 2024
possession of the secured assets. The Bank filed OA
No.673/2023 before the Debts Recovery Tribunal-II,
Ernakulam for recovery of ₹4,49,29,314.80 together with
interest from 03.11.2023.
9. When the petitioners approached the Appellate
Tribunal, the Appellate Tribunal passed Ext.P16 order
directing to deposit ₹2,34,63,756/- on or before 22.03.2024.
The respondents state that as on 25.03.2024, an amount of
₹4,72,55,664.85 is due from the petitioners. In view of the
second proviso to Section 18 of the SARFAESI Act, no
appeal can be entertained unless the borrower has
deposited with the Appellate Tribunal 50% of the amount of
debt due from the borrower. The Appellate Tribunal has
correctly exercised its discretion in not granting any waiver.
The original petitions are therefore liable to be dismissed.
10. I have heard the counsel for the petitioners and
learned Standing Counsel representing the respondents.
11. The challenge in OP(DRT) No.123/2024 is on
Ext.P16 order of the Debts Recovery Appellate Tribunal,
O.P.(DRT) Nos.123 & 147 of 2024
Chennai in waiver application IA No.108/2024 in AIR(SA)
No.158/2024 filed by the petitioners. The petitioners also
seek to direct the DRAT to consider and pass orders on
Ext.P9 appeal on merits, without insisting on any deposit
under Section 18(1) of the SARFAESI Act. In OP(DRT)
No.147/2024, the petitioners seek to set aside Ext.P4 order
of the DRAT in IA No.211/2024. IA No.211/2024 was filed
seeking to enlarge the time for making pre-deposit.
12. As per Section 18(1) of the SARFAESI Act dealing
with the appeal to the DRAT, 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 creditors or determined by the Debts
Recovery Tribunal, whichever is less. The Appellate Tribunal
has been granted discretion to reduce the amount to not less
than 25% of debt.
13. The Bank has initiated securitisation measures as
per Ext.P1 demand notice dated 31.05.2021 for a sum of
₹6,08,57,404.08. After deducting payments made by the
O.P.(DRT) Nos.123 & 147 of 2024
petitioners, the claim of the Bank is ₹4,69,27,512/-.
Therefore, the Tribunal, by Ext.P16 order, ordered the
petitioners to deposit 50% of ₹4,69,27,512/- which comes to
₹2,34,63,756/- within a period of two weeks from 08.03.2024,
the date of Ext.P16 order. The petitioners therefore ought to
have paid the said amount on or before 22.03.2024.
14. The contention of the petitioners is that they have
made substantial remittances and the Bank has appropriated
a total amount of ₹3,11,59,093.83 from the account of the
father of the 2nd petitioner and credited the same towards the
loan account of the petitioners. The DRAT has found that
after deducting all payments, the claim of the Bank is
₹4,69,27,512/-. Therefore, I do not find any illegality in
Ext.P16 proceedings requiring interference by this Court
under Article 227 of the Constitution of India. OP(DRT)
No.123/2024 is therefore liable to be dismissed.
15. The prayer in OP(DRT) No.147/2024 is to enlarge
the time granted by the DRAT by four weeks. Taking into
consideration the facts of the case and pendency of
O.P.(DRT) Nos.123 & 147 of 2024
OP(DRT) No.123/2024, I am of the view that interest of
justice demands that the petitioners shall be granted a
reasonable time to pay the pre-deposit so that the DRAT can
consider the appeal filed by the petitioners on merits.
OP(DRT) No.123/2024 is therefore dismissed.
OP(DRT) No.147/2024 is disposed of setting aside Ext.P4
order of the Debts Recovery Appellate Tribunal, Chennai in
IA No.211/2024 in IA No.108/2024 in AIR No.158/2024. The
petitioners are granted two weeks time from today to make
the pre-deposit. On the petitioners making the payment as
directed above, the Debts Recovery Appellate Tribunal,
Chennai shall restore the appeal to file and hear the matter
on merits.
Sd/-
N. NAGARESH, JUDGE
aks/18.04.2024
O.P.(DRT) Nos.123 & 147 of 2024
APPENDIX OF OP (DRT) 123/2024
PETITIONERS' EXHIBITS
Exhibit.P1 TRUE COPY OF THE DEMAND NOTICE DATED
31/05/2021 ISSUED BY THE 1ST
RESPONDENT.
Exhibit.P2 TRUE COPY OF THE ORDER DATED
17/05/2022 IN CRL.M.P.NO.1833/2022 OF
THE CHIEF JUDICIAL MAGISTRATE COURT,
THRISSUR.
Exhibit.P3 TRUE COPY OF THE STAY PETITION IA
NO.1503/2022 IN SA NO.303/2021 DATED
01/07/2022 FILED BY THE PETITIONERS
BEFORE THE DRT-II, ERNAKULAM.
Exhibit.P4 TRUE COPY OF THE PROCEEDINGS/ORDER
DATED 06/07/2022 IN SA NO.303/2021 OF
THE DRT-II, ERNAKULAM .
Exhibit.P5 TRUE COPY OF THE COMMUNICATION DATED
26/07/2022 ISSUED BY THE 2ND
RESPONDENT BANK REGARDING THE
REMITTANCE OF RS.17,47,062.83 TOWARDS
THE PETITIONERS LOAN ACCOUNT.
Exhibit.P6 TRUE COPY OF THE COMMUNICATION DATED
27/07/2022 ISSUED BY THE 2ND
RESPONDENT REGARDING THE REMITTANCE OF
RS.2,94,12,031/- TOWARDS THE
PETITIONERS LOAN ACCOUNT.
Exhibit.P7 TRUE COPY OF THE JUDGMENT DATED
19/12/2023 IN OP(DRT) NO.349/2022.
Exhibit.P8 TRUE COPY OF THE ORDER/PROCEEDING
DATED 11/01/2024 IN I.A.NO.1503/2022
IN S.A. NO.303/2021 OF DRT-II,
ERNAKULAM.
Exhibit.P9 TRUE COPY OF THE APPEAL AIR (SA)
NO.158/2024 DATED 27/01/2024 FILED BY
THE PETITIONERS BEFORE THE DRAT,
CHENNAI (WITHOUT ANNEXURES).
Exhibit.P10 TRUE COPY OF THE STAY PETITION DATED
27/01/2024 IN AIR (SA)NO.158/2024
FILED BY THE PETITIONERS BEFORE THE
DRAT, CHENNAI.
O.P.(DRT) Nos.123 & 147 of 2024
Exhibit.P11 TRUE COPY OF THE WAIVER APPLICATION
I.A. NO. 108/2024 IN AIR(SA)
NO.158/2024 DATED 27/01/2024 FILED BY
THE PETITIONERS BEFORE THE DRAT,
CHENNAI.
Exhibit.P12 TRUE COPY OF THE URGENT APPLICATION IA
NO.109/2024 IN AIR (SA) NO.158/2024
DATED 27/01/2024 FILED BY THE
PETITIONERS BEFORE THE DRAT, CHENNAI.
Exhibit.P13 TRUE COPY OF THE NOTICE DATED
09/02/2024 ISSUED BY THE ADVOCATE
COMMISSIONER IN CMP NO.1833/2022 OF
THE CHIEF JUDICIAL MAGISTRATE COURT,
THRISSUR.
Exhibit.P14 TRUE COPY OF THE JUDGMENT DATED
28/02/2024 IN OP(DRT) NO.94/2024.
Exhibit.P15 TRUE COPY OF THE COUNTER IN IA
NO.108/2024 IN APPEAL AIR (SA)
NO.158/2024 OF THE DRAT, CHENNAI.
Exhibit.P16 TRUE COPY OF THE ORDER DATED
08/03/2024 IN I.A.NO.108/2014 IN
AIR(SA)NO.158/2024 OF THE DRAT,
CHENNAI.
O.P.(DRT) Nos.123 & 147 of 2024
APPENDIX OF OP (DRT) 147/2024
PETITIONERS' EXHIBITS
Exhibit.P1 TRUE COPY OF THE WAIVER APPLICATION
I.A. NO. 108/2024 IN AIR NO.158/2024
DATED 27/01/2024 FILED BY THE
PETITIONERS BEFORE THE DRAT, CHENNAI.
Exhibit.P2 TRUE COPY OF THE ORDER DATED
08/03/2024 IN I.A.NO.109/2024 IN
I.A.NO.108/2024 IN AIR NO. 158/2024 OF
THE DRAT, CHENNAI.
Exhibit.P3 TRUE COPY OF THE IA NO.211/2024 IN
I.A.NO.108/2024 IN APPEAL AIR
NO.158/2024 DATED 22/03/2024.
Exhibit.P4 TRUE COPY OF THE ORDER DATED
26/03/2024 IN IA NO.211/2024 IN
I.A.NO.108/2024 IN AIR NO.158/2024 OF
DRAT, CHENNAI.
