Case Note & Summary
The petitioner, M/s. Sterlite Technologies Ltd., filed a writ petition under Article 226 of the Constitution challenging an order of the Debts Recovery Appellate Tribunal (DRAT) dated 22 November 2011. The DRAT had refused to waive the deposit requirement under Section 21 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, and directed the petitioner to deposit 75% of the decretal amount. The Debts Recovery Tribunal (DRT) had earlier decreed the claim of the fourth respondent bank on 28 October 2010, granting a recovery certificate against the petitioner for various sums including Japanese Yen 219,993,455 with interest, and amounts in rupees for insurance charges, warehousing and clearing charges, and legal charges. The petitioner appealed against this decree and sought waiver of the mandatory deposit. The DRAT declined the waiver, leading to the present writ petition. The High Court, after hearing the parties, upheld the DRAT's order, finding no grounds to interfere. The court noted that the petitioner had not made out a prima facie case or demonstrated financial hardship to justify waiver of the deposit. The petition was dismissed.
Headnote
A) Debt Recovery - Deposit Requirement - Section 21 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 - Waiver of Deposit - The DRAT declined to grant waiver of deposit and required the petitioner to deposit 75% of the decretal amount under Section 21. The High Court upheld the order, holding that the petitioner failed to establish a prima facie case or financial hardship to justify waiver. (Paras 1-2)
Issue of Consideration
Whether the Debts Recovery Appellate Tribunal (DRAT) was justified in refusing to waive the deposit requirement under Section 21 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, and directing the petitioner to deposit 75% of the decretal amount.
Final Decision
The High Court dismissed the writ petition, upholding the DRAT order requiring the petitioner to deposit 75% of the decretal amount under Section 21 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993.
Law Points
- Section 21 of the Recovery of Debts Due to Banks and Financial Institutions Act
- 1993
- mandatory deposit requirement
- waiver of deposit
- prima facie case
- financial hardship
Case Details
2011 LawText (BOM) (12) 77
WRIT PETITION (L) NO.2758 OF 2011
D.Y. Chandrachud, A.A. Sayed
Mr. R.A. Dada, Senior Advocate with Mr. Madhur R. Baya for Petitioner; Mr. Rajiv Chavan with Mr. L.T. Satelkar for Respondent No.1; Mr. Dinyar Madon, Senior Advocate with Mr. Umesh Shetty and Mr. Vikash Kumar i/b. Mr. A.T. Agarwal for Respondent No.3; Mr. Rajesh Talekar i/b. K. Ashar & Co. for Respondent No.8
M/s. Sterlite Technologies Ltd.
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Nature of Litigation
Writ petition under Article 226 of the Constitution challenging an order of the Debts Recovery Appellate Tribunal (DRAT) refusing waiver of deposit under Section 21 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993.
Remedy Sought
The petitioner sought to challenge the DRAT order requiring deposit of 75% of the decretal amount and sought waiver of the deposit.
Filing Reason
The DRAT declined to grant waiver of deposit and directed the petitioner to deposit 75% of the decretal amount under Section 21 of the RDB Act.
Previous Decisions
The Debts Recovery Tribunal (DRT) decreed the claim of the fourth respondent bank on 28 October 2010, issuing a recovery certificate against the petitioner for various sums. The petitioner appealed to the DRAT, which refused waiver of deposit.
Issues
Whether the DRAT was justified in refusing to waive the deposit requirement under Section 21 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993.
Submissions/Arguments
Not mentioned in the provided text.
Ratio Decidendi
The DRAT's refusal to waive the deposit under Section 21 of the RDB Act was upheld as the petitioner failed to establish a prima facie case or financial hardship justifying waiver.
Judgment Excerpts
These proceedings under Article 226 of the Constitution are directed against an order of the Debts Recovery Appellate Tribunal (DRAT) dated 22 November 2011 on an application for waiver of deposit under the provisions of Section 21 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993.
By the order impugned, the DRAT has declined to grant any waiver of deposit and has required the Petitioner to deposit 75% of the decretal amount under the substantive provisions of Section 21.
Procedural History
The Debts Recovery Tribunal (DRT) decreed the claim of the fourth respondent bank on 28 October 2010. The petitioner filed an appeal before the Debts Recovery Appellate Tribunal (DRAT) along with an application for waiver of deposit under Section 21 of the RDB Act. The DRAT refused waiver and directed deposit of 75% of the decretal amount on 22 November 2011. The petitioner then filed the present writ petition under Article 226 of the Constitution before the Bombay High Court, which was dismissed on 22 December 2011.
Acts & Sections
- Recovery of Debts Due to Banks and Financial Institutions Act, 1993: Section 21
- Constitution of India: Article 226
