KUMAR ALUMINIUM LTD Vs. ASSET RECONSTRUCTION COMPANY INDIA LTD AND ANR
Supreme Court of India (Division Bench (DB)- Two Judge)
Appeal (Civil), 8258 of 2016, Judgment Date: Aug 23, 2016
NON-REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.8258 OF 2016
(Arising out of SLP(C) No.34859 of 2014)
KUMAR ALUMINIUM LTD .....APPELLANT
VERSUS
ASSET RECONSTRUCTION COMPANY
INDIA LTD AND ANR ....RESPONDENTS
J U D G M E N T
Kurian, J.
Leave granted.
The appellant is aggrieved by the impugned judgment dated 19.8.2014
passed by the High Court of Delhi in Writ Petition (Civil) No.3896 of 2013.
As per the impugned judgment, the High Court declined to interfere
with the order passed by the Debt Recovery Appellate Tribunal, Delhi (for
short, the 'DRAT'). The DRAT had turned down the prayer of the appellant
for refund of the amount deposited in compliance of the requirement of the
second proviso to section 18(1) of the Securitization and Reconstruction of
Financial Assets and Enforcement of Security Interest Act, 2002, for
maintaining an appeal.
This Court has considered a similar issue in the case of Axis Bank
vs. SBS Organics Private Limited & Anr., in Civil Appeal No.4379 of 2016
and held as under :
“22. The Appeal under section 18 of the Act is permissible only against
the order passed by the DRT under section 17 of the Act. Under section 17,
the scope of enquiry is limited to the steps taken under section 13(4)
against the secured assets. The partial deposit before the DRAT as a pre-
condition for considering the appeal on merits in terms of section 18 of
the Act, is not a secured asset. It is not a secured debt either, since the
borrower or the aggrieved person has not created any security interest on
such pre-deposit in favour of the secured creditor. If that be so, on
disposal of the appeal, either on merits or on withdrawal, or on being
rendered infructuous, in case, the appellant makes a prayer for refund of
the pre-deposit, the same has to be allowed and the pre-deposit has to be
returned to the appellant, unless the Appellate Tribunal, on the request of
the secured creditor but with the consent of the depositors, had already
appropriated the pre-deposit towards the liability of the borrower, or with
the consent, had adjusted the amount towards the dues, or if there be any
attachment on the pre-deposit in any proceedings under section 13(10) of
the Act read with Rule 11 of the Security Interest (Enforcement) Rules,
2002, or if there be any attachment in any other proceedings known to law.”
Accordingly, we dispose of this appeal, set aside the impugned
judgment of the High Court as well as the order of the DRAT impugned before
the High Court and remit the matter to DRAT for consideration afresh.
Liberty is given to all parties to raise all contentions available to
them before the DRAT which may pass fresh orders in accordance with law.
The parties before this Court shall appear before the Debt Recovery
Appellate Tribunal, Delhi, on 3.10.2016.
...................J
[KURIAN JOSEPH]
......................J
[ROHINTON FALI NARIMAN]
NEW DELHI;
AUGUST 23, 2016.