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2009 DIGILAW 269 (ORI)

Surya News Print & Papers Private Limited v. Branch Manager, State Bank of India, Kesinga Branch, Dist. Kalahandi, Orissa

2009-03-26

B.S.CHAUHAN, I.MAHANTY

body2009
JUDGMENT BY THE COURT — In this writ petition the petitioner has challenged the order dated 23.2.2009 passed by the Debts Recovery Appellate Tribunal, Kolkata (hereinafter referred to as “DRAT”) directing the petitioner to make deposit of 25% of the claim amount by 31.3.2009 for the purpose of entertaining the appeal filed by the petitioners before the DRAT for disposal on merit. 2. Learned counsel appearing for the petitioner has sub¬mitted that the petitioner had filed two applications before the Debts Recovery Tribunal, Cuttack Bench, Cuttack and those appli¬cations were registered as M.A. No. 566 of 2008 and M.A. No. 567 of 2008. In those applications prayer was made for a declaration that the DRT has no jurisdiction to hear the pending O.A. No. 187 of 2008 and further praying for reference of the dispute for arbitration. Since the DRT, Cuttack Bench rejected the said applications by order dated 20.1.2009 the present petitioner had filed an appeal before the DRAT, Kolkata and the same was regis¬tered as Appeal Case No. 10 of 2009. 3. Learned counsel for the petitioner submitted that the said appeal of the petitioner was taken up by the DRAT, Kolkata, but by order dated 23.2.2009 the Appellate Tribunal disposed of the petitioners application under Section 21 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (in short, “1993 Act”) directing the petitioners to deposit 25% of the claim amount by 31.3.2009 for the purpose of entertaining the appeal for disposal on merits. 4. The essential contention of the learned counsel for the petitioners is that the appeal had been filed against rejection of an application filed by the present petitioners under Section 19 of 1993 Act by the DRT, Cuttack Bench. Accordingly, learned counsel for the petitioners placed reliance on Section 21 of 1993 Act and submitted that Section 21 in fact shall not have any application to the facts of the present case. Section 21 of 1993 Act reads as under: “21. Accordingly, learned counsel for the petitioners placed reliance on Section 21 of 1993 Act and submitted that Section 21 in fact shall not have any application to the facts of the present case. Section 21 of 1993 Act reads as under: “21. Deposit of amount of debt due, on filing appeal.- Where an appeal is preferred by any person from whom the amount of debt is due to a bank or a financial institution or a consortium of banks or financial institutions, such appeal shall not be entertained by the appellate Tribunal unless such person has deposited with the Appellate Tribunal seventy-five per cent of the amount of debt so due from him as determined by the Tribu¬nal under Section 19. Provided that the Appellate Tribunal may, for reasons to be recorded in writing, waive or reduce the amount to be deposited under this section.” (Emphasis added) 5. It is asserted that since admittedly the main case is still pending determination by DRT, Cuttack Bench it cannot be said that order has been passed determining the amount so due from the petitioners by a competent Tribunal. Therefore, the learned counsel submitted that in the absence of such determina¬tion the direction for pre-deposit for entertaining the appeal does not arise. 6. Mr. Dash, learned counsel appearing for the bank on the other hand strenuously contended that the petitioners are liable to pay huge sum of more than Rs.7 crores with interest, the petitioners have filed appeal under Section 20 before the Tribu¬nal they were bound to comply with the directions passed therein. He further submitted that it was within the jurisdiction of the Appellate Tribunal on considering the nature of the case to pass such order as it may feel just and proper in the interest of justice and therefore, the petitioners could have no grievance against the direction to make pre-deposit of 25% of the claim amount. 7. We have considered the rival submissions of the learned counsel for the parties. But we are constrained to observe that we cannot accept the contention advanced on behalf of the oppo¬site party-bank since Section 21 does not clothe the appellate Tribunal with any authority to pass direction for deposit of any percentage of the claim amount. 7. We have considered the rival submissions of the learned counsel for the parties. But we are constrained to observe that we cannot accept the contention advanced on behalf of the oppo¬site party-bank since Section 21 does not clothe the appellate Tribunal with any authority to pass direction for deposit of any percentage of the claim amount. On the contrary Section 21 which has been quoted hereinabove clearly provides the requirement of pre-deposit of the amount so due by the appellant as would be determined by the Tribunal under Section 19. Undoubtedly in the present case although the bank has filed the Original Application before the DRT, Cuttack Bench and same is pending disposal, in the absence of such adjudication it cannot be presumed in law that there has been any determination of any debt due from the present petitioners. In other words, we are of the considered view that the mandate of Section 21 and the requirement of pre-deposit shall operate only where the appellant approaches the Tribunal after the amount of debt so due from him has been deter¬mined by the Tribunal under Section 19 of the 1993 Act. In the present case, such is not the situation. Accordingly, we have no other alternative than to direct quashing of the order dated 23.2.2009 passed by the Appellate Tribunal, Kolkata in disposing of the petitioners’ application under Section 21 of 1993 Act to the extent of directing the petitioners to make deposit of 25% of the claim amount by 31.3.2009 as a pre-condition for entertaining the appeal and for its disposal on merits. 8. Accordingly, the writ petition is allowed to the aforesaid extent and the Debt Recovery Appellate Tribunal is to take up the appeal filed by the petitioners at an early date and dispose of the same on merits without insisting upon for such pre-deposit. Considering the claim amount of debt on the peti¬tioners, we are of the view that the Appellate Tribunal shall take up the matter expeditiously and dispose of the same prefera¬bly within a period of three months from the date of receipt of this order. Petition allowed.