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2017 (4) TMI 476 - HC - Indian LawsPre-deposit by Third party who is not a borrower within the meaning of Section 2 (f) of the Securitization Act as a pre-condition for having his appeal heard - whether the appellants before the Debt Recovery Appellate Tribunal, Delhi, who are neither borrowers, nor guarantors and have not pledged or mortgaged any property to the Respondent Bank can be called upon to deposit a percentage of the loan amount claimed and/or adjudicated against the borrower as the condition precedent for entertaining their appeal under Section 18 of the Securitization Act? Held that:- Section 18 makes it absolutely clear that an appeal may be filed by any person aggrieved, whether or not, he is a borrower within the meaning of Section 2 (1) (f). This is evident from the first proviso to Section 18 (1), which provides that different fees may be prescribed for appeals by the borrower or by the person other than the borrower. The Second proviso reads that no appeal is to be entertained unless the borrower has deposited with the Appellate Tribunal 50% of the amount of debt due from him, as claimed by the secured creditors or as determined by the Debts Recovery Tribunal, whichever is less. The second proviso relates to the appeal of a borrower, for a third party, who has not obtained any finance from a Bank or a financial institution is under no obligation to pay. The second proviso reads that no appeal is to be entertained, unless the borrower has deposited with Appellate Tribunal 50% of the debt due from him. If the proviso is to be read literally to mean that no appeal, be it of a borrower or a third person, is to be entertained unless the borrower has deposited 50% of the amount of debt due from him, appeals by third persons would in effect and substance, be rendered nugatory for a third person, who would never be able to get his appeal entertained. Significantly, in this case each of the appellants have been directed to pay 50%, which means that the total deposit would far exceed the amount due and payable by Ajay Kumar Gupta.The writ petition is allowed. The impugned order is set aside to the extent that each of the appellants have all been required to pay 50% of the amount due from Ajay Kumar Gupta.
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