The tribunal had rejected the DCHL petition, calling it not maintainable as the tribunal had no jurisdiction to accept an appeal against the order passed by CMM under Section 14 of the SARFAESI Act
The Madras HC has set aside the Chennai Debt Recovery Tribunal order that had dismissed media house Deccan Chronicle Holdings’ petition against a lower court order, confirming the recovery of assets in a Rs 347-crore default case filed by Canara Bank.
The high court has remanded the case back to tribunal for fresh consideration. The tribunal had rejected the petition of Deccan Chronicle Holdings as not maintainable as the tribunal had no jurisdiction to entertain an appeal against the order under Section 14 of the SARFAESI Act passed by the chief metropolitan magistrate (CMM).
After the verdict, Deccan Chronicle Holdings moved the high court seeking to quash tribunal’s order.
The high court bench comprising Justice Satish K Agnihotri and Justice M Venugopal ruled that an appeal at the instance of the borrower or guarantor against the order passed under Section 14 of the SARFAESI Act by the CMM or district magistrate was maintainable under Section 17 of the SARFAESI Act. “In the instant case, an appeal under Section 17 of the SARFAESI Act against the order passed under Section 14 is maintainable. The presiding officer, Debts Recovery Tribunal erred in coming to the conclusion that no appeal against the order passed by the CMM under Section 14 of the SARFAESI Act is maintainable,” the bench said.
The court said that accordingly, the order of tribunal impugned in the writ petition has been set aside and the application is held as maintainable. “The matter is remitted back to the Debts Recovery Tribunal-II, Chennai for a decision in accordance with law and on its own merit. It is stated at the bar that recovery proceedings is pending for the last three years. As such, the tribunal is directed to conclude the proceedings at the earliest not later than three months from the date of receipt of copy of this order. The parties are further directed not to seek adjournment unnecessarily to delay the proceedings pending before the tribunal,” the bench said.
Deccan Chronicle Holdings, which has been fighting a slew of default and recovery cases with a number of banks, became a defaulter on account of non payment of loan amount to the Canara Bank some three years ago..
Accordingly, a demand notice under provisions of Section 13(2) of the SARFAESI Act for a sum of Rs 347 crore was served on the company.