dmt 1 wp9389-11 IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO. 9389 OF 2011 Navalakha Agencies & Anr. .. Petitioners. versus Indian Bank & Ors. .. Respondents. ..... Mr. Rushabh Shah with Mr. Punit Gogad and Ms. Rita Yadav i/by Raval Shah & Co. for Petitioners. Ms. Rathina Maravarman for Respondents. ...... CORAM : DR.D.Y.CHANDRACHUD & A. A. SAYED, JJ. 14 November 2011. P.C. : This Petition arises out of an order passed by the Debt Recovery Tribunal requiring the Petitioner to deposit an dmt 2 wp9389-11 amount representing 25% of the debt as indicated in the notice under Section 13(2) of the Securitisation & Reconstruction of Financial Assets & Enforcement of Security Interest Act, 2002. 2. In the present case the Debt Recovery Tribunal issued a recovery certificate on 7 October 2003 in the amount of Rs. 28.59 lacs. In the appeal filed by the Petitioners before the Appellate Tribunal an amount of Rs. 14.29 lacs has been deposited. The First Respondent issued a notice under Section 13 (2) on 3 December 2008 in which the amount due is stated to be Rs. 3.70 crores. An application under Section 17 was filed by the Petitioners which was dismissed by the Tribunal on 26 August 2011. The Petitioners have now filed an appeal in which they have been directed to deposit an amount representing 25% of the debt due as claimed in the notice under Section 13 (2). 3. Section 18 stipulates that no appeal shall be entertained against an order of the Tribunal unless the borrower deposits with the Appellate Tribunal 50% of the amount of the dmt 3 wp9389-11 debt due from him, as claimed by the secured creditors or determined by the Debts Recovery Tribunal, whichever is less. The discretion of the Appellate Tribunal to reduce the amount of the deposit which is conferred by the third proviso to sub- section (1) of Section 18 is also structured. The Appellate Tribunal, for reasons to be recorded in writing, may reduce the amount to not less than twenty-five per cent of the debt referred to in the second proviso. This provision has been construed by the Supreme Court in Narayana Chandra Ghosh Vs. UCO Bank & Ors., 2011 (4) SCALE 93 in the following terms : Thus, there is an absolute bar to entertainment of “ an appeal under Section 18 of the Act unless the condition precedent, as stipulated, is fulfilled. Unless the borrower makes, with the Appellate Tribunal, a pre-deposit of fifty per cent of the debt due from him or determined, an appeal under the said provision cannot be entertained by the Appellate Tribunal. The language of the said proviso is clear dmt 4 wp9389-11 and admits of no ambiguity. It is well-settled that when a Statute confers a right of appeal, while granting the right, the Legislature can impose conditions for the exercise of such right, so long as the conditions are not so onerous as to amount to unreasonable restrictions, rendering the right almost illusory. Bearing in mind the object of the Act, the conditions hedged in the said proviso cannot be said to be onerous. Thus, we hold that the requirement of pre-deposit under Sub-section (1) of Section 18 of the Act is mandatory and there is no reason whatsoever for not giving full effect to the provisions contained in Section 18 of the Act. In that view of the matter, no court, much less the Appellate Tribunal, a creature of the Act itself, can refuse to give full effect to the provisions of the Statute. ” dmt 5 wp9389-11 The High Court under Article 226 of the Constitution cannot exercise its jurisdiction contrary to the terms of the statute. This aspect was emphasised once again by the Supreme Court in United Bank of India vs. Satyawati Tandon & Ors, (2010) 8 SCC 110. 4. Learned Counsel appearing on behalf of the Petitioners submits that an amount approximately of Rs. 97 lakhs has been realised by the Petitioners. This has been out of the sale of secured assets (representing twenty five per cent of the sale consideration) besides which an amount of Rs. 14 lakhs was deposited by the Petitioners in the appeal before the Appellate Tribunal under the RDBI Act. We have given due consideration to this submission. In its judgment in Indian Bank vs. Blue Jaggers Estates Ltd. & Ors., AIR 2010 SC 2980, the Supreme Court while considering a similar situation observed that the appeal of the mortgagee therefrom was still subject to confirmation by Appellate Tribunal which had not passed any order in that regard. A similar position holds the dmt 6 wp9389-11 field in the present case. The Court cannot be unmindful of the fact that the statute mandates requirement of a pre-deposit of fifty per cent of the amount of debt due as claimed by the secured creditor or as determined by the Debts Recovery Tribunal whichever is less. In the present case, after taking into account all the facts and circumstances, the Tribunal has reduced the amount to be deposited to twenty five per cent of the amount claimed in the notice under Section 13 (2). This was the outer limit within which the Tribunal had to exercise its jurisdiction under the statute. In that view of the matter the directions which have been issued by the Tribunal are consistent with the statutory frame-work and are unexceptionable. No case for interference under Article 226 of the Constitution is made out. The Petition is dismissed. However, time to deposit is extended for a further period of three weeks from today. 5. We clarify on the request of the learned Counsel appearing on behalf of the Petitioners that the observations contained in this order are confined to the disposal of the dmt 7 wp9389-11 petition challenging an order requiring pre-deposit and shall not amount to an expression of opinion by this Court on the merits of the matter which will fall for the consideration of the Appellate Tribunal. In the event the Petitioners fail to deposit the amount as directed within the period as extended by this Court, the necessary consequences will ensue. (Dr. D.Y. Chandrachud, J.) (A. A. Sayed, J.)