9911796707
TMI Blog2019 (8) TMI 903X X X X Extracts X X X X X X X X Extracts X X X X ..... n 15.03.2017. The amount due to the Bank as on 14.03.2017 was stated to be Rs. 106,07,91,644.26/-. 3. Soon thereafter, three proposals were made by the appellants in quick succession on 27.06.2017, 01.08.2017 and 19.08.2017 offering Rs. 84, 87 and 90 crores respectively for One Time Settlement ("OTS", for short). On 22.08.2017 a possession notice under Section 13(4) of the SARFAESI Act was issued by the Bank in respect of the Project in question. On 29.08.2017 a sale notice was issued in terms of which the concerned properties were to be sold by e-auction on 06.10.2017 with a reserve price of Rs. 120 crores. 4. Immediately an application seeking interim relief being SA No.481 of 2017 was moved by the appellants before the Tribunal Debt Recovery Tribunal-(1), Chandigarh, which prayer was rejected by the Tribunal by its order dated 06.10.2017. On 06.10.2017 itself, the e-auction was conducted by the Bank in which a bid was received from 2nd respondent for Rs. 120,00,11,000/-. This prompted the appellants to revise the OTS proposal to Rs. 140 crores. Such offer was made on 07.10.2017 and was followed by filing of CWP No.2274 of 2017 before the High Court on 10.10.2017 challenging ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pinion with regard to the rights and claims of the State." 6. On 31.10.2017 the Bank rejected the revised OTS proposal for Rs. 140 crores i.e. even before the sum of Rs. 140 crores was deposited by the appellants. The appellants, therefore, filed CMP No.9618 of 2017 seeking modification of the aforementioned order dated 11.10.2017 stating inter alia that deposit of Rs. 100 crores be made subjection to the sanction of the settlement proposal. It may be noted here that as on the date the appellants had deposited a sum of Rs. 40 crores in keeping with the commitment of first three stages as set out in the order dated 11.10.2017. 7. The Bank challenged the order dated 11.10.2017 by filing Special Leave Petition(C) Nos.4898-4904 of 2018 in this Court, submitting inter alia that the High Court ought not to have interfered in the matter while exercising writ jurisdiction, as alternate remedy was available to the appellants. The submission was accepted by this Court and the appeals arising from SLP(C) Nos.4898-4904 of 2018 were disposed of by this Court as under: "Heard learned counsel for the parties. Delay condoned. Leave granted. The respondent is a debtor to the tune of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is pending adjudication before the DRT. While the borrower/guarantors have a right to contest the bank's claim before the DRT, it is highly premature and presumptuous for this Court to comment upon the likely outcome of those proceedings. 10. It goes without saying that if the bank's suit is decreed, fully or partially, the amount of Rs. 40.00 crores, deposited by the petitioners before this Court, is liable to be adjusted/appropriated towards the decretal amount. However, in the event of dismissal of such suit, with a finding that the borrower or the guarantors are no longer under any liability, the amount so deposited by them can be refunded to them. Since all these issues are yet to be adjudicated by the DRT, we are of the view that the prayer made by the borrower/guarantors for refund of the amount is liable to be turned down and we order accordingly. 11. The prayer made by the bank, on the other hand, deserves to be accepted in part to the extent that let the amount of Rs. 40 crores lying deposited with the bank 'without any lien' be deposited with DRT, who in turn is directed to keep the same in a Nationalized Bank to fetch maximum rate of interest. The amount shall rem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... against the secured assets" mentioned in the notice under Section 13(2) of the SARFAESI Act. The nature of pre-deposit in terms of Section 18 of the SARFAESI Act was considered in para 21 and it was concluded that such deposit was neither a 'secured asset' nor was a 'secured debt' and in the circumstances, the prayer for refund of amount in deposit was required to be allowed. This Court also considered the submission that the concerned bank had lien on the deposited amount in terms of Section 171 of the Contract Act, 1872. The submission was rejected. Paragraphs 14, 21, 22 and 23 of the decision of this Court in Axis Bank3 were as under:- "14. A conspectus of the aforesaid provisions shows that under the scheme of the SARFAESI Act, a secured creditor is entitled to proceed against the borrower for the purpose of recovering his secured debt by taking action against the secured assets, in case the borrower fails to discharge his liability in full within the period specified in the notice issued under Section 13(2) of the Act. It is the mandate of Section 13(3) of the Act that the notice issued under Section 13(2) should contain details of the amount payable by the borrower and al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bankers, factors, wharfingers, attorneys and policy-brokers.- Bankers, factors, wharfingers, attorneys of a High Court and policy-brokers may, in the absence of a contract to the contrary, retain as a security for a general balance of account, any goods bailed to them; but no other persons have a right to retain, as a security for such balance, goods bailed to them, unless there is an express contract to that effect." ... ... ... 23. Section 171 of the Contract Act, 1872 provides for retention of the goods bailed to the bank by way of security for the general balance of account. The predeposit made by a borrower for the purpose of entertaining the appeal under Section 18 of the Act is not with the bank but with the Tribunal. It is not a bailment with the bank as provided under Section 148 of the Contract Act, 1872. Conceptually, it should be an argument available to the depositor, since the goods bailed are to be returned or otherwise disposed of, after the purpose is accomplished as per the directions of the bailor." 11. In the present case the deposit of Rs. 40 crores in terms of the order of the High Court on 11.10.2017 was only to show the bona fides of the appellants ..... X X X X Extracts X X X X X X X X Extracts X X X X
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