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2015 DIGILAW 1099 (KAR)

K. L. Kumaraswamy v. Dhanalaxmi Bank Ltd. ,

2015-09-18

G.NARENDAR, N.KUMAR

body2015
ORDER 1. The petitioner is neither a borrower nor a guarantor. His grievance is the property bearing No.17 situated at Vardhamanaiah Block, 5th cross, Shankarapuram, Bangalore is now sought to be brought to sale by the Debt Recovery Tribunal. He claims title to the said property under a decree for specific performance passed in O.S. No.1977/1996, which is under challenge before this Court in R.F.A. No.1166/2011. However, no sale deed is executed in his favour, as the property was brought to sale. In the meanwhile, his property was brought to sale by the Debt Recovery Tribunal under Section 17 of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short `the SARFAESI Act’). 2. Being aggrieved by the measures taken, the petitioner filed an application under subSection (4) of Section 13 of the SARFAESI Act. The Debt Recovery Tribunal, after contest, has dismissed the said application by its order dated 21.11.2012 as per Annexure `E’. 3. Aggrieved by the said order, the petitioner has preferred an appeal under Section 18 of the SARFAESI Act before the Debt Recovery Appellate Tribunal at Chennai. On the memorandum of the appeal, he paid a Court fee of Rs.350/calculating the same under Section 13(2)(1)(e) of the Security Interest (Enforcement) Rules (for short `the Rules’). The office raised an objection contending that the correct provision applicable is Section 13(2)(1)(c) & (d) and therefore, he is liable to pay a sum of Rs.53,250/on the memorandum of appeal, whereas he has paid only Rs.350/and therefore, the deficit Court fee payable is Rs.52,900/. The petitioner contended before the Appellate Tribunal that the said calculation is incorrect and the correct provision, which is applicable is Section 13(2)(1)(e) and not Section 13(2)(1)(d). The Tribunal after taking note of the various judgments of the Tribunals, came to the conclusion that the petitioner is an “aggrieved person” and therefore, Rule 13(2)(1)(e) is not attracted and therefore what is attracted is Section 13(2)(1) (c) and (d) and therefore, it has dismissed the appeal. 4. Aggrieved by the said order, the present writ petition is filed. 5. 4. Aggrieved by the said order, the present writ petition is filed. 5. Sri.Kallesh Gowda, learned counsel appearing for the petitioner assailing the impugned order contended that as he is neither a borrower nor a guarantor, when he has filed an application under Section 17 of the SARFAESI Act and when he has paid a sum of Rs.200/as a Court fee on the said application, in appeal he has to pay only Rs.200/as the Court fee under Rule 13(2)(1)(e) and not under Section 13(2)(1)(c) & (d) and therefore, he submits that the impugned order requires to be setaside. 6. Section 17 of the SARFAESI Act provides for right to appeal. It reads as under: 17. Right to appeal.–(1) Any person (including borrower), aggrieved by any of the measures referred to in subsection (4) of section 13 taken by the secured creditor or his authorised officer under this Chapter, may make an application along with such fee, as may be prescribed to the Debts Recovery Tribunal having jurisdiction in the matter within forty five days from the date on which such measure had been taken: Provided that different fees may be prescribed for making the application by the borrower and the person other than the borrower. 7. As could be seen from the aforesaid provision, any person including a borrower aggrieved by any of the measures referred to in subsection (4) of Section 13 of the Act taken by the secured creditor is conferred a statutory right of appeal. The proviso makes it clear that different fees may be prescribed for making the application by the borrower and the person other than the borrower. Section 18 provides for an appeal to the Tribunal. It reads as under: 18.AppealtoAppellateTribunal.– (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: 8. As in the case of Section 17, the proviso to Section 18 also provides different fees may be prescribed for filing an appeal by the borrower or by the person other than the borrower. 9. As in the case of Section 17, the proviso to Section 18 also provides different fees may be prescribed for filing an appeal by the borrower or by the person other than the borrower. 9. In pursuance of the power conferred by subsection (1) and clause (b) of Subsection (2) of Section 38 read with Subsection (4), (10) & (12) of Section 13 of the SARFAESI Act, the Central Government has made the Secured Interest Enforcement Rules, 2002. Rule 13 reads as under: 13.Fees for applications and appeals under section 17 and 18 of the Act.(1) Every application under sub section (1) of section 17 or an appeal to the Appellate Tribunal under subsection (1) of section 18 shall be accompanied by a fee provided in the subrule (2) and such fee may be remitted through a crossed demand draft drawn on a bank or Indian Postal Order in favour of the Registrar of the Tribunal or the Court as the case may be, payable at the place where the Tribunal or the Court is situated. (2) The amount of fee payable shall be as follows: No. Nature of application Amount of fee payable Application to a Debt Recovery Tribunal under subsection (1) of section 17 against any of the measures referred to in subsection (4) of section 13(a) Where the applicant is a borrower and the amount of debt due is less than Rs.10 lakhs Rs.500 for every Rs.1 lakh or part thereof (b) Where the applicant is a borrower Rs.5,000 + Rs.250 for and the amount of debt due is Rs.10 lakhs and above every Rs.1 lakh or part thereof in excess of Rs.10 lakhs subject to a maximum of Rs.1,00,000 (c) Where the applicant is an aggrieved party other than the borrower and where the amount of debt due is less than Rs.10 lakhs Rs.125 for every Rupees One lakh or part thereof (d) Where the applicant is an aggrieved party other than the borrower and where the amount of debt due is Rs.10 lakhs and above Rs.1,250 + Rs.125 for every Rs.1 lakh or part thereof in excess of Rs.10 lakhs subject to a maximum of Rs.50,000 (e) Any other application by any person Rs.200 2. Appeal to the Appellate Authority against any order passed by the Debt Recovery Tribunal under section 17 Same fees as provided at clauses (a) to (e) of serial number 1 of this rule] 10. Therefore, it is clear that the said Rules provides for different fees for making an application as well as filing of an appeal by the borrower or by the person other than the borrower. Insofar as “by the person other than the borrower” is concerned, a distinction is made between an ‘aggrieved party’ and ‘any person’. Rule 13(2)(a) & (b) prescribes the court fee payable by the borrower. Rule 13(2) (c) & (d) prescribes the fee payable by an “aggrieved party” other than the borrower. Rule 13(2)(e) provides for persons other than the borrower and the “aggrieved party”. Thus, the Rules provide for three categories of persons (a) Borrower; (b) Aggrieved party; and (c) Any person. Therefore, the Rules specifically prescribe what is the fee payable by different category of persons. 11. It is not in dispute that it is the property that the petitioner claims under a decree for specific performance is sought to be sold in Court auction. He is aggrieved by the same. Therefore, he is an aggrieved party. The definition of ‘borrower’ contained in Section 2(f) of the Act includes a `guarantor’. He is neither a borrower nor a guarantor. But because his property is brought to sale in a proceeding, in which he is not a party, he is aggrieved by such measures taken under Subsection (4) of Section 13 of the SARFAESI Act by the secured creditor. If the amount of debt is less than Rs.10 lakhs, clause (c) applies. If the amount is more than Rs.10 lakhs, then clause (d) applies. That is what the Appellate Authority has held. When the Rules specifically provides for Court fee payable by the borrower, or by the aggrieved party other than the borrower and any other person, who does not fall within the description as aforesaid, the intention of the legislature is clear, unambiguous. Therefore, the contention that because the petitioner is neither a borrower nor a guarantor, he is to be construed as ‘any person’ and not an ‘aggrieved party’ and given the benefit of clause (c) does not arise. In that view of the matter, we do not see any merit in this petition. Accordingly, petition is dismissed. 12. Therefore, the contention that because the petitioner is neither a borrower nor a guarantor, he is to be construed as ‘any person’ and not an ‘aggrieved party’ and given the benefit of clause (c) does not arise. In that view of the matter, we do not see any merit in this petition. Accordingly, petition is dismissed. 12. However, the Tribunal has granted four weeks’ time from the date of its order to pay deficit Court fee failing which, it is made clear that the appeal shall stand rejected. As the said order is challenged before us and we are also dismissing the petition, the interest of justice demands that the petitioner should be given an opportunity to pay the Court fee and prosecute the appeal. Hence, four weeks’ time from today is granted to the appellant to pay the deficit Court fee of Rs.52,900/. If the said amount is paid within four weeks from today, the Appellate Authority shall hear the appeal on merits. No costs.