M Sathya vs UNION BANK OF INDIA on 22 September 2026

ORDER

1. This Interlocutory Application is filed by the Certificate Debtor / Appellant praying to refund the amount of Rs.51,40,000/- paid by the petitioners in the above appeal. Averments in the petition

2. It is stated that the petitioners that the petitioners while challenging the Notice issued by the Advocate Commissioner has preferred applications for urgent hearing and stay in pursuance of the Advocate Commissioner Notice.

3. It is stated that during the pendency of the MA for hearing the petitioners made payments to the tune of Rs.51,40,000/- which was taken in the name of “The Registrar, Debts Recovery Tribunal-II at Chennai” on 25.05.2026 drawn on “The Federal Bank” and the same was deposited the same before this Tribunal, which is evident from the order passed by the Recovery Officer.

4. It is also submitted that the petitioner herein was not able to mobilize the fund to make the payments as ordered by the Recovery Officer hence preferred an Appeal before the Ld. Presiding Officer in Appeal No.3 of 2026 along with a petition for stay.

5. The Ld. Presiding Officer, dismissed the stay application against which an appeal is preferred before the Hon’ble DRAT Chennai in AIR No.2152 of 2026 and the same is at the stage of filing counter by the respondent bank.

6. During the pendency of the appeal the petitioner negotiated with the respondent bank and arrived at a settlement, hence seeking the courts permission to refund the amount paid by the petitioner i.e., Rs.51,40,000/-.

7. Heard the Ld. Counsel for the Petitioners / Appellants. Perused the records.

8. After hearing the parties and after perusing the records, the only point that arises for consideration is:

“Whether the Petitioners are entitled for refund of the amount of Rs.51,40,000/- as prayed for?”

9. It will be pertinent to point out here that original the Petitioners / Appellants had filed Appeal Dy. No.842/206 under Section 30(1) of the RDB Act to set aside the order of the Ld. Recovery Officer dated 15.04.2026 in DRC No.124/2023 in OA No.653 of 2018. Pursuant to the objection raised by the Registry of this Tribunal that where an appeal is preferred against any order of the Recovery Officer, under Section 30, by any person from whom the amount of debt is due to a bank or financial institution, such appeal shall not be entertained by the Tribunal unless such person has deposited with the Tribunal fifty percent of debt due as determined by the Tribunal, the Petitioners herein had deposited a demand draft for a sum of Rs.51,40,000/- in compliance of Section 30A of the RDB Act. Further, this Tribunal after considering the arguments advanced by the Petitioners and the Respondent dismissed IA No.895 of 2026 seeking interim stay of all further proceedings pursuant to the warrant of Taking Possession dated 15.04.2026 including taking of physical possession of the schedule property . At this stage when the appeal came up for hearing before this Tribunal on 20.08.2026, the Petitioners / Appellants had filed a memo vide Dy No.5356/2026 stating therein that the petitioners have negotiated with the respondent bank and the matter has been amicably settled between the parties and prayed for permitting the petitioners / appellants to withdraw the appeal. Accordingly, this Tribunal permitted withdrawal of the appeal by the appellants and dismissed Appeal No.3 of 2025 as dismissed as withdrawn. Thereafter, the present application has been filed by the petitioners seeking refund of a sum of Rs.51,40,000/- deposited by the appellants.

10. On a careful consideration of the rival submissions and the materials available on record, it is seen that the amount of Rs.51,40,000/- was deposited by the Petitioners / Appellants pursuant to the statutory requirement under Section 30A of the Recovery of Debts and Bankruptcy Act, 1993, as a condition precedent for entertaining the appeal against the order of the Recovery Officer. The said amount was not deposited voluntarily towards satisfaction of the debt due to the Respondent Bank, but was deposited for the limited purpose of complying with the statutory requirement for maintaining the appeal.

11. It is further seen that the appeal filed by the Petitioners / Appellants was subsequently withdrawn by them on the ground that they had negotiated with the Respondent Bank and arrived at an amicable settlement. The withdrawal of the appeal was permitted by this Tribunal and the appeal came to be dismissed as withdrawn.

12. The contention of the Petitioners / Appellants that, in view of the settlement arrived at with the Respondent Bank, the amount deposited pursuant to the statutory requirement under Section 30A of the Act is liable to be refunded, cannot be accepted merely on the basis of the settlement. The statutory deposit was made as a condition for invoking the appellate jurisdiction of this Tribunal. The subsequent withdrawal of the appeal, pursuant to a settlement between the parties, by itself does not confer an automatic right upon the Petitioners / Appellants to seek refund of the amount deposited in compliance with the statutory requirement.

13. It is also relevant to note that the alleged settlement between the Petitioners / Appellants and the Respondent Bank is a matter between the parties. No material has been placed before this Tribunal to establish that, under the terms of the settlement, the Respondent Bank has agreed to the refund of the statutory deposit or that the said amount is not liable to be appropriated / adjusted towards the dues payable under the proceedings. In the absence of any such material or a specific direction in the settlement with regard to the statutory deposit, the prayer for refund cannot be granted.

14. The fact that the amount of Rs.51,40,000/- was deposited pursuant to the objection raised by the Registry and in compliance with the statutory requirement does not, by itself, create an independent right in favour of the Petitioners / Appellants to seek its refund after withdrawal of the appeal. The consequence of withdrawal of the appeal cannot be equated with adjudication in favour of the Appellants or with setting aside of the order of the Recovery Officer.

15. This Tribunal is therefore of the considered view that the Petitioners / Appellants have not made out any ground for directing refund of the amount of Rs.51,40,000/- deposited by them as the statutory deposit for maintaining the appeal. The subsequent settlement between the parties, in the absence of any specific provision for such refund in the RDB Act or direction regarding refund of the statutory deposit, the relief sought for by the appellants cannot be allowed.

16. Accordingly, the following:

ORDER

IA No.1356 of 2026 is dismissed. No order as to costs.

Sd/- (SHARANG DHAR UPADHYAY) PRESIDING OFFICER DRT-II CHENNAI (Dictated to PS, who typed in the system directly, corrected, signed and pronounced by me in Open Court, on this 22nd day of September, 2026)