Legal Reference Library

The Supreme Court in Axis bank vs. SBS Organics Private Limited has held that the partial deposit before the Debt Recovery Appellate Tribunal (DRAT) as a pre-condition for considering the appeal on merits in terms of Section 18 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act), is neither a secured asset, nor a secured debt, and hence refundable to the appellant on disposal of appeal. Apex Court Bench comprising of Justices Kurian Joseph and R.F. Nariman made this observation while dismissing an appeal filed by Axis Bank against the Gujarat High Court Judgment wherein it was held that the deposit made before DRAT is refundable to the appellant therein. Section 18 of the SARFAESI Act states that, for the Tribunal to ‘entertain’ the appeal, the aggrieved person has to make a deposit of fifty per cent of the amount of debt due from him as claimed by the secured creditors or determined by the DRT, whichever is less. T...

In the matter of M/S MADRAS PETROCHEM LTD. & ANR.  Vs BIFR & ORS., by  a judgment dated 29 Jan 2016, the Hon'ble Supreme Court opined that the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 prevails over the Sick Industrial Companies (Special Provisions) Act, 1985 to the extent of inconsistency therewith. The judgment has given in the context of a rather convoluted matter wherein petitions and appeals have been filed before several High Courts, DRTs and DRAT, primarily due to the difference in the opinion of various courts of law on primacy of several important Acts having Non Obstante clauses. The Hon'ble court in a 32 page judgement, the court stated that the following two questions which arise on the facts of this case::- (1) Whether the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 prevails over the Sick Industrial Companies (Special Provisions) Act, 1...