2011 (9) TMI 1260 - HC - Indian Laws

Appeal Granted: DRT to Expedite Appeal Decision in 2 Months, Recovery Halted for Petitioner Meeting Deposit Condition.

M/s Gulshan Rai Jain Ii, Through Its Partners And Ors. Versus Debts Recovery Appellate Tribunal Allahabad And Ors.

The appeal is allowed, setting aside the impugned order, and directing the DRT to decide the appeal expeditiously within two months. Recovery proceedings ... - Issues:1. Interpretation of orders passed by the Debts Recovery Tribunal and the Appellate Authority.2. Compliance with the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002.3. Delay in adjudication of appeals under Sections 17 and 18 of the Act.4. Failure of the Appellate Authority and the Appellate Tribunal to discharge statutory duties.Analysis:The case involves a petitioner who took a commercial loan from a bank and faced recovery proceedings due to default. The Debts Recovery Tribunal issued orders allowing the bank to proceed with auction and sale of the secured assets if the bid exceeded a specified amount. The Appellate Authority permitted the bank to proceed with the auction but gave the petitioner the option to pay dues before the auction of a second property. The judgment discusses the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, emphasizing the expeditious disposal of applications by the Tribunal. Section 17 of the Act mandates timely resolution of applications and provides for appeals to the Appellate Tribunal.The judgment criticizes the Tribunal for keeping the matter pending with interim orders instead of deciding it on merit. It highlights that the Tribunal's power is not to prolong matters indefinitely but to adjudicate promptly. The Appellate Tribunal also failed to direct the timely resolution of the appeal, impacting the Act's objectives. The judgment stresses the importance of ensuring appeals are decided within the statutory period to avoid frustration of the Act's purpose. It directs the Presiding Officers to ensure timely resolution of appeals and avoid unnecessary delays due to repeated interim orders.In conclusion, the appeal is allowed, setting aside the impugned order and directing the Debts Recovery Tribunal to decide the appeal expeditiously within two months. Recovery proceedings are suspended for two months if the petitioner deposits a specified amount within one month. The Chairman of the Debts Recovery Tribunal is instructed to circulate the order for compliance by the Tribunals. The judgment underscores the need for timely resolution of appeals under the Act to uphold its objectives and prevent undue delays in the legal process.