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2019 (2) TMI 467 - HC - Indian LawsRequirement of pre-deposit of half of the amount for maintainability of appeal - Section 13(2) of the SARFAESI Act - Interpretation of statute - whether respondent Nos. 1 to 5, who were neither the borrowers nor the guarantors are liable to make pre-deposit of half of the amount of the debt, which has been claimed by the petitioner herein under Section 13(2) of the SARFAESI Act? Held that:- The provision of pre-deposit has been prescribed in second proviso to Section 18(1) of the SARFAESI Act. The said proviso clearly states that “no appeal shall be entertained unless the borrower has deposited with the Arbitral Tribunal 50% of the amount of debt”. It must be noted that even though the appeal under Section 18(1) can be filed by “any person” aggrieved, as it starts with those words, but when it comes to pre-deposit with the Arbitral Tribunal for entertaining the appeal, reference is made to “borrower” - On a reading of the definition of “borrower”, the same would include a guarantor as well but not a person other than borrower / guarantor. The only interpretation given to second proviso to Section 18(1) shall be that if a person other than borrower / guarantor files an appeal before the Arbitral Tribunal then the stipulation of the pre-deposit of 50% (or 25%) of the amount of debt due from him as claimed by the secured creditors or determined by the DRT shall not be insisted upon. This is the only interpretation, which can be given to second proviso to Section 18(1) read with Section 2(f) of the SARFAESI Act. It is a well settled law of interpretation that “when the words of the statute are clear, plain or unambiguous, ie., they are reasonably susceptible to only one meaning, the Courts are bound to give effect to that meaning irrespective of consequences - there is no ambiguity in the provisions of Section 18 of the SARFAESI Act. The provisions of Section 18 of the SARFAESI Act, are determinative of the fact that the legislature intended that it is only the borrower and the guarantor, who should be under obligation to make the pre-deposit. The same is clear on a literal and grammatical meaning of the words “borrower” and “any person aggrieved” as found mentioned in Section 18 and 2 (f) of the Act. There is no inconsistency within the provision of Section 18(1) of the Act. The only way, second proviso to Section 18(1) can be interpreted is that it is either the borrower or the guarantor, who is liable to make pre-deposit on an appeal filed by him / her against the order of the DRT. The DRAT has rightly rejected the contention made on behalf of the petitioner for the pre-deposit to be made by the respondent. Petition dismissed - decided against petitioner.
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