W.P.(C)--4237/2018. Case: INDIABULLS HOUSING FINANCE LTD Vs. VAIBHAV JHAWAR AND ORS.. High Court of Delhi (India)
| Case Number | W.P.(C)--4237/2018 |
| Citation | NA |
| Judgement Date | December 12, 2018 |
| Court | High Court of Delhi (India) |
IN THE HIGH COURT OF DELHI AT NEW DELHI
Judgment reserved on: November 14, 2018
Judgment delivered on: December 12, 2018
+ W.P.(C) 4237/2018
INDIABULLS HOUSING FINANCE LTD
..... Petitioner Through: Mr. Ashwini Kumar Mata, Sr. Adv. with Ms. Aastha Lumba, Adv.
versus
VAIBHAV JHAWAR AND ORS.
..... Respondents Through: Mr. S.L. Gupta, Mr. N. Raja Singh,
Ms. Manisha Chaudhary and Mr. Mithlesh Pal, Advs. for R1 to R5.
Mr. Gaurav Gupta and Mr. Jaspal Singh, Advs. for R7 to R12 and R15 to R18.
CORAM:
HON'BLE THE CHIEF JUSTICE
HON'BLE MR. JUSTICE V. KAMESWAR RAO
J U D G M E N T
V. KAMESWAR RAO, J
1. The challenge in this writ petition is to the order dated March 14, 2018 of the Debt Recovery Appellate Tribunal (for short „Appellate Tribunal‟) in Misc. Appeal No. 72/2018 whereby the learned Appellate Tribunal has rejected the objection of the petitioner herein insisting on the pre-deposit of half of the
amount, which had been claimed by the petitioner under Section 13(2) of the SARFAESI Act for entertaining the appeal of the respondent.
FACTS:-
2. The borrower M/s Surya Construction Pvt. Ltd. (respondent No.6), had mortgaged the property J-14, Community Centre, Rajouri Garden, New Delhi in favour of the petitioner. On its failure to honour the terms of the Loan Agreement, the petitioner initiated action under the SARFAESI Act by issuing a notice under Section 13(2) of the SARFAESI Act to the said respondent.
3. It is the case of the petitioner that it took symbolic possession of the secured asset on January 05, 2015. On July 24, 2017, a sale notice was issued for recovery of `4,16,04,827/-. The DRT-I set aside the sale notice dated July 24, 2017 on the ground that the complete description of the property had not been given. The petitioner again issued a demand notice for recovery of an amount of `12,33,78,319/- along with future interest. It is the case of the petitioner that it took symbolic possession of the secured asset for non-compliance of demand notice by the
borrower. It appears, a sale notice of the secured asset was issued by the petitioner with auction date of October 30, 2017.
4. An SA titled Vaibhav Jhawar and Ors. v. Indiabulls Housing Finance Ltd. bearing No. 244/2017 was filed before the DRT by respondent Nos.1 to 5. It is the case of the petitioner that the respondent Nos. 1 to 5 are neither the owners of the property nor do they have any interest in the said property. On October 30, 2017, the DRT-1 rejected the interim relief application and directed that the auction sale shall remain subject to the final outcome of the SA. On December 05, 2017, an application under Order 7 Rule 11 CPC was filed by the petitioner seeking dismissal of the SA on the grounds that the respondent Nos.1 to 5 have no locus to prefer a securitization application challenging the SARFAESI action of the petitioner against the said property. The secured asset was auctioned on October 30, 2017 and sale was confirmed. A sale certificate was issued on January 03, 2018 in favour of the auction purchaser against the payment of entire sale consideration of Rs.25,04,10,000/-.
5. On February 17, 2018, the learned DRT, New Delhi allowed the application under Order 7 Rule 11 CPC of the petitioner and dismissed the SA. On February 27, 2018,
respondent Nos. 1 to 5 preferred an appeal before the DRAT impugning the order dated February 17, 2018 passed by the learned DRT, New Delhi. The DRAT vide the impugned order, entertained the appeal without directing the respondent Nos.1 to 5 to make pre-deposit as required under the SARFAESI Act. The case of the respondent Nos.1 to 5 before the Ld. DRAT was that they have invested a sum of `5.71 crores with the borrowerrespondent No.6 M/s Surya Construction Pvt. Ltd. The said loan was without any interest clause. The grievance of the respondent Nos.1 to 5 in the SA was that the property has been sold at much lower price. In other words, the grievance of the respondent Nos.1 to 5 was that, had the property been sold at a fair market value, it would have fetch much more than what was recoverable from the borrower and in that way, the dues which the borrower owes to the respondent Nos.1 to 5 would have also been recovered and the circumstances gives the appellant, a locus standi to challenge the action of the petitioner.
6. We may state here that the DRAT while rejecting the objection of the petitioner herein relied upon a judgment of this Court in the case of Manju Devi and Ors v. M/s RBL Bank Ltd.
and Ors. W.P.(C) No. 11766/2016 decided on February 01, 2017 to reject the plea on behalf of the petitioner challenging the locus standi of the respondent nos. 1 to 5, herein, before it.
7. Mr. Ashwini Kumar Mata, learned Senior Counsel appearing for the petitioner submitted that the instant petition has been filed by the petitioner against the order dated March 14, 2018 passed by the Presiding Officer, Debts Recovery Appellate Tribunal (hereinafter referred to as “DRAT”) wherein the Appeal filed by the respondents 1 to 5 has been entertained and notice has been issued without calling upon the respondents No. 1 to 5 to make the mandatory pre-deposit in terms of the proviso to Section-18 (1) of the SARFAESI Act. The impugned order, according to Mr. Mata, as such, is prima facie in violation of the statutory provision of Section-18, SARFAESI Act and its interpretation by the Supreme Court of India and various High Courts.
8. It is stated that the respondent Nos. 1 to 5 herein are alleged to be the shareholders of M/s. Surya Constructions Pvt. Ltd. (respondent No.6) i.e., the borrower of the petitioner and have approached the DRAT against an order passed by the DRT-I vide which the Securitization Application filed by the
respondents was dismissed while deciding the application filed by the petitioner Under Order 7 Rule 11 of the CPC.
9. He submitted, the Supreme Court of India has categorically interpreted Section-18 of SARFAESI Act along with its proviso in the case titled “Axis Bank v. SBS Organics Private Ltd. and Anr.”(2016) 12 SCC 18 . According to him, the aforementioned judgment of the Supreme Court clearly interprets the provision of pre-deposit and provides that any “aggrieved person” which includes borrowers, guarantors and any third party, against an order passed by the DRT under Section 17 is entitled to prefer an appeal. For the purpose of preferring an appeal, a fee is prescribed for the Tribunal, however, to entertain to said appeal the aggrieved person has to make a deposit of 50% of the amount.
10. According to him...
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