NAGPUR FOUNDRIES LIMITED Vs. UNITED COMMERCIAL BANK
DEBTS RECOVERY APPELLATE TRIBUNAL
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(1.) BEING aggrieved by the respondent's notice dated 3.7.2003 under Section 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short the 'Securitisation Act') culminating into taking physical possession of the secured assets on 22.10.2003, the Borrower has filed this appeal.
(2.) The property involved is land and factory premises of the appellant No. 1 situated in Nagpur.
By the impugned notice, the respondent Bank called upon the appellant to pay Rs. 2,30,91.458/- with interest thereto within 60 days failing which possession of land, factory premises, etc., being the appellant's security was to be taken. In reply dated 23.9.2003, the respondent stated that it is ready to pay the amount in one time settlement provided the actual figures are informed and sufficient time is given for making the payment. The notice was said to be illegal. Notwithstanding the reply, the respondent took possession on 22.10.2003 as stated above.
(3.) THE appellant thereupon filed writ being No. 4317 of 2003 in High Court Bench at Nagpur. By Order dated 16.7.2004 THEir Lordships disposed of the writ with liberty to file this appeal which is how the appeal has been instituted.
THE main grounds of appeal are as below:
(i) Notice under Section 13(2) is not signed by the officer competent to sign it;
(ii) Notice under Section 13(2) of the Securitisation Act is illegal inter alia because it does not give details as provided by Section 13(3) of the Securitisation Act;
(iii) Action under Section 13(4) is illegal since the respondent Bank did not give reply to the representation to the notice under Section 13(2) of the Securitisation Act even while there was a duty on the Bank cast by the Apex Court by judgment in Mardia Chemical's case;
(iv) THE action under Section 13(4) is in contravention of Section 13(9) inasmuch as there are outstandings of other secured lenders (Union Bank of India, Canara Bank, NSIC) aggregating to Rs. 7.45 crores and odd amount at against the respondent's claim of Rs. 2.66 crores. THErefore, right under Section 13(4) of the Securitisation Act could have been exercised only if secured creditors representing not less than 3/4th in value of the amount outstandings as on recorded date as consented for the same which is admittedly not done in this case; '
(v) THE respondent Bank would have to be held to have abandoned the action under Securitisation Act since it had filed Original Application being No. 75/2003 on 22.12.2003 i.e. after issuance of notice under Section 13(4) of Securitisation Act;;
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