Pre-deposit requirement for statutory appeal upheld as a valid condition that does not violate Article 14.

A statutory right of appeal under the Securitisation Act may be subjected to a pre-deposit condition, because the right of appeal is not inherent and the legislature may regulate its exercise. The second proviso to Section 18(1), which requires deposit of fifty per cent of the debt due with discretion to reduce it to twenty-five per cent, was found neither arbitrary nor confiscatory. The challenge under Article 14 therefore failed, and the constitutional validity of the pre-deposit scheme was upheld.

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Issues: Whether the second proviso to Section 18(1) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, requiring pre-deposit as a condition for entertaining an appeal, is ultra vires Article 14 of the Constitution of India.

Analysis: The right of appeal is a creature of statute and not an inherent or absolute right. The Legislature is competent to attach conditions for the exercise of that right, including a pre-deposit requirement. The provision in question does not insist on deposit of the entire disputed amount, but only fifty per cent of the debt due, with further reduction permissible up to twenty-five per cent. Similar conditional appeal provisions have been upheld as constitutionally valid, and the Court found no illegality or arbitrariness in the scheme.

Conclusion: The pre-deposit condition under the second proviso to Section 18(1) is not violative of Article 14 and is valid.

Final Conclusion: The challenge to the constitutional validity of the pre-deposit requirement failed, and the writ petition was dismissed.

Ratio Decidendi: A statutory right of appeal may be conditioned by a pre-deposit requirement, and such a condition does not offend Article 14 if it is not arbitrary or confiscatory.

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