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TMI Blog2019 (6) TMI 1198X X X X Extracts X X X X X X X X Extracts X X X X ..... oviso to Sub-section (1) of Section 18 to determine the amount of deposit as a pre-condition for entertaining the appeal, the discretion is not an absolute one, but a limited one, and the Tribunal is not competent to reduce the amount of deposit below twenty-five per cent of the debt. The Court held that Debts Recovery Appellate Tribunal has misguided itself on the clear mandate of law and wrongly granted complete waiver of pre-deposit of the amount. Thus the second proviso below sub-section (1) of Section 18 of the Securitisation Reconstruction of Financial Assets Enforcement of Security Interest Act, 2002, is of a mandatory nature. The Debts Recovery Appellate Tribunal does not get its jurisdiction to decide the appeal on merits unless there is a compliance of requirement of at least third proviso below Sub-section (1) of Section 18. If there is a failure to comply with such requirement, the appeal itself becomes incompetent, leaving no jurisdiction with the Debts Recovery Appellate Tribunal to consider and decide it on merits. It is not an error in exercise of the jurisdiction but the Debts Recovery Appellate Tribunal was suffering from inherent lack of jurisdiction to de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ms are satisfied by this order in favour of respondent no.6 in respect of movable and immovable properties of Alampur Unit as well as Nagpur Unit. [05] I.A. No. 166/11 filed by the proposed intervener, M/s. Coventry Springs Ltd., is decided by passing separate order, whereby I.A. No. 166/11 is rejected. [06] No order as to costs. 4. The aforesaid decision was the subject-matter of challenge in Appeal No. 135 of 2011 filed by the borrower as well as guarantors under Section 18 of the Securitisation Reconstruction of Financial Assets Enforcement of Security Interest Act, 2002. On 11th April, 2012, the Debts Recovery Appellate Tribunal passed an order of a total waiver of deposit which was the subject-matter of challenge before this Court in Writ Petition No. 5005 of 2012 filed by the present petitioner. The matter was admitted on 1st November, 2012, and on the same date, the Court passed an interim order permitting the proceedings before the Debts Recovery Appellate Tribunal to proceed further, subject to the result of the Writ Petition. This Writ Petition was dismissed in default on 21st August, 2013. 5. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2012 and this Court was aware of the order dated 13th January, 2014 passed by the Debts Recovery Appellate Tribunal allowing the appeal on merits. But, we do not find any reference to the said order in the ultimate decision of this Court rendered in Writ Petition No. 5005 of 2012. 8. Shri M. G. Bhangde, the learned Senior Advocate, has urged that the order dated 13th January, 2014 impugned in this petition is liable to be set aside on the sole ground that the Debts Recovery Appellate Tribunal had no jurisdiction to proceed further with the appeal and decide it on merits in the absence of pre-deposit of the amount of not less than twenty-five percent of the debts. According to him, the order dated 11th April, 2012 passed by the Debts Recovery Appellate Tribunal was a complete waiver of the deposit and this order has been set aside by the Division Bench of this Court in Writ Petition No. 5005 of 2012 which has attained the finality and, therefore, the order impugned in the petition is liable to be set aside on this sole ground. Reliance is placed upon the findings recorded by this Court in its order passed in Writ Petition No. 5005 of 2012 as well as the decision of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ribunal 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: Provided further that no appeal shall be entertained unless the borrower has deposited with the Appellate Tribunal fifty per cent of the amount of debt due from him, as claimed by the secured creditors or determined by the Debts Recovery Tribunal, whichever is less : Provided also that the Appellate Tribunal may, for the reasons to be recorded in writing, reduce the amount to not less than twenty-five per cent of debt referred to in the second proviso. The Appellate jurisdiction under Section 18(1) is circumscribed by the condition of deposit of fifty percent of the amount of debt due against the borrower as specified in the second proviso. In the third proviso, the Appellate Tribunal has discretion to reduce it to not less than twenty-five percent of the debt due. 12. It is an undisputed position that when the Debts Recovery Appellate Tribunal decided the appeal on merits on 13th Ja ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Lal Patni v. Kali Nath it was held : The validity of a decree can be challenged in execution proceedings only on the ground that the court which passed the decree was lacking in inherent jurisdiction in the sense that it could not have seisin of the case because the subject-matter was wholly foreign to its jurisdiction or that the defendant was dead at the time the suit had been instituted or decree passed, or some such other ground which could have the effect of rendering the court entirely lacking in jurisdiction in respect of the subject-matter of the suit or over the parties to it. 15. Keeping in view the law laid down by the Division Bench of this Court in Writ Petition No. 5005 of 2012 and the law laid down by the Apex Court in Budhia Swain and Others making a distinction between the orders suffering from lack of jurisdiction and a mere error in exercise of jurisdiction, we are of the view that the second proviso below sub-section (1) of Section 18 of the Securitisation Reconstruction of Financial Assets Enforcement of Security Interest Act, 2002, is of a mandatory nature. The Debts Recovery Appellate Tribunal does not get its jurisdi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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