Karnataka High Court
Spectrum Consultants India Private ... vs M/S Pridhvi Asset Reconstruction And ... on 29 June, 2022
Author: P.S.Dinesh Kumar
Bench: P.S.Dinesh Kumar
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 29TH DAY OF JUNE, 2022
PRESENT
THE HON'BLE MR. JUSTICE P.S.DINESH KUMAR
AND
THE HON'BLE MR. JUSTICE C.M. POONACHA
W.P.No.17801/2021(GM-DRT)
BETWEEN
SPECTRUM CONSULTANTS INDIA
PRIVATE LIMITED
A COMPANY REGISTERED UNDER THE
COMPANIES ACT, 1956,
HAVING ITS OFFICE AT NO.780,
HAL 2ND STAGE,
1ST CROSS, 12TH MAIN,
INDIRANAGAR,
BANGALORE -560038,
REPRESENTED BY ITS
GENERAL MANAGER
MS S.VIJAYALAKSHMI
...PETITIONER
(BY SRI DHANANJAY JOSHI, SR. ADVOCATE FOR
SRI VACHAN.H.U, ADVOCATE)
AND
M/S PRIDHVI ASSET RECONSTRUCTION AND
SECURITISATION COMPANY LIMITED
NO.1-55, RAJA PRAASADAMU,
WING -1,
4TH FLOOR, MASJID BANDA ROAD,
KONDAPUR,
2
HYDERABAD-500084,
REPRESENTED BY ITS VICE PRESIDENT
AND AUTHORISED OFFICER
MR K. V. RAMAKRISHNA PRASAD
...RESPONDENT
(BY SRI VINAY SWAMY C., ADVOCATE)
THIS WRIT PETITION IS FILED ARTICLE 227 OF THE
CONSTITUTION OF INDIA PRAYING TO SET ASIDE THE
IMPUGNED ORDER, DATED 15.09.2021, PASSED BY THE
HON'BLE DEBT RECOVERY APPELLATE TRIBUNAL, CHENNAI, IN
AIR 352/2019 AT ANNEXURE-A AND DIRECT THE HON'BLE
APPELLATE TRIBUNAL TO PROCEED WITH THE HEARING AND
DISPOSAL OF THE PETITION ON ITS MERITS.
THIS WRIT PETITION COMING ON FOR PRELIMINARY
HEARING IN 'B' GROUP, THIS DAY P.S. DINESH KUMAR J.,
MADE THE FOLLOWING:
ORDER
This Writ Petition is filed with following prayers:
To set aside the impugned order dated 15.09.2021, passed by the Hon'ble Debt Recovery Appellate Tribunal, Chennai, in AIR 352/2019 at ANNEXURE-A and direct the Hon'ble Appellate Tribunal to proceed with the hearing and disposal of the petition on its merits and pass such other orders/or directions as this Hon'ble Court may deem fit and proper in the facts and circumstances of the case.3
2. Heard Sri.Dhananjay Joshi, learned Senior Advocate for the petitioner and Sri Vinay Swamy C., learned Advocate for the respondent.
3. Writ petitioner claims to be a tenant in the property which was mortgaged to the Indian Overseas Bank. Respondent, a asset reconstruction Company has taken over the loan and the asset. The respondent initiated proceedings under Section 17 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 ( for short 'SARFAESI Act') and brought the property in question for auction. Petitioner approached the Debt Recovery Tribunal (for short 'the DRT') in I.R. No.2294/2019. By its order dated 23.09.2017, the DRT dismissed the I.R. No.2294/2017. Petitioner challenged the said order before the Debt Recovery Appellate Tribunal (for short 'DRAT') with regard to payment of Court Fee by the petitioner. This Court has decided that issue in W.P. No.6605/2020 and remitted the case to the DRAT. After remand, DRAT has held that 4 petitioner is liable to make Pre-Deposit. Hence, this writ petition.
4. Sri Dhananjay Joshi, learned Senior Advocate submitted that petitioner has been in possession of the property prior to the date of mortgage. Therefore, he is not liable to make the pre-deposit as held in INDIABULLS HOUSING FINANCE LTD., Vs. VAIBHAV JHAWAR AND ORS.1 decided on 12.12.2018 (at para No.16).
5. Sri Vinay Swamy, learned Advocate for the respondent, placing reliance on the decision in the case of SREE JEYA SOUNDHARAM TEXTILE MILLS PVT.LTD., VS. CANARA BANK2 (para Nos.11 and 12) submitted that petitioner claims to have derived title from the borrower. Therefore, he is liable to be pay.
6. In Sree Jeya Soundharam Textile Mills Pvt.Ltd, Madras High Court after considering the case of borrower and tenants has held as follows:
1
W.P.(C) 4237/2018 - D.D.12.12.2018 2 LAWS [(MAD) - 2019-4-146] 5
(ii) The 3rd parties, who had purchased the property prior to the date of mortgage or derived/accrued title or right or tenancy right over the property prior to the date of mortgage, are not liable to make any pre-deposit for preferring an appeal before the Debt Recovery Appellate Tribunal, provided that they establish before the Debt Recovery Appellate Tribunal that they derived/accrued title or right or tenancy right over the property prior to the date of mortgage and that the property was mortgaged with the Bank without their knowledge. If such 3rd parties file applications for waiver and if they establish that they have purchased the property or that they derived/accrued title, right or tenancy right prior to the date of mortgage and the property was mortgaged with the Bank without their knowledge, the Debt Recovery Appellate Tribunal shall give a finding with regard to the same and give exemption to such 3rd parties from making pre-deposit.
7. In the case of Indiabulls, the petitioners before the Delhi High Court were share holders.
8. The DRAT has recorded petitioner's contention with regard to liability to pay the pre-deposit would be considered at the time of final hearing and directed the 6 petitioner to make the pre-deposit. Unless the issue whether the appellant before the DRAT is a tenant is decided, the question of petitioner making the pre-deposit does not arise. Therefore, this issue has to be decided at the first instance.
9. In the circumstances, in our view, the impugned order directing the petitioner to make pre- deposit without recording a finding with regard to exemption is not sustainable in law. Hence, following:
ORDER
(i) Writ petition is allowed.
(ii) Order dated 15.09.2021 passed by the DRAT is set aside. The matter is remitted to DRAT to record a finding in terms of the decision of Madras High Court in the case of Sree Jeya Soundharam Textile Mills Pvt. Ltd., and thereafter, pass an order with regard to the pre-deposit.7
(iii) As requested by Sri. Vinay Swamy, learned Advocate for the respondent, we request the DRAT to expedite the matter.
No costs.
Sd/-
JUDGE Sd/-
JUDGE BS