M/S VISUAL INSTINCT INDIA PRIVATE LTD vs INDIAN OVERSEAS BANK on 2 September 2026

1. Present as under:

Mr. Yash Naik, i/b Mr. Radhe Agrawal (through VC), Counsel for Applicants/Appellants. Ms. Sunita Rawat along with Mr. Rajesh Dubey, Counsel for Respondent No.1/Bank. Mr. Vishal K., Counsel for Respondent No.2 & 3 appeared through VC.

2. The matter is taken up for hearing by way of praecipe filed by the Applicants/Appellants for seeking urgent relief.

3. The Learned Counsel for the Respondent No.1/Bank tenders the Vakalatnama and reply. Same are taken on record.

4. The Learned Counsel for the Applicants/Appellants would submit that there is a delay of 65 days in filing the Appeal for which I.A. No. 524/2026 has been filed with the Appeal.

5. The Learned Counsel for the Respondents raises an objection that the Applicants/Appellants have neither made the mandatory pre- deposit as required under Section 18 of the SARFAESI Act nor filed an application seeking waiver of the mandatory pre-deposit to the extent of 25% as contemplated under the third proviso to Section 18 of the SARFAESI Act. Therefore, the application for condonation of delay cannot be heard.

He would rely upon the judgment dated 18.03.2016 passed by the Hon’ble High Court of Bombay in Writ Petition No. 2533/2014 in Deluxe Cotton Corporation & Ors Vs. Bank of Baroda. The relevant portion of the said judgment of the Hon’ble High Court of Bombay is reproduced hereunder:-

17. We therefore hold that an appeal accompanied by an application for condonation of delay in filing the appeal, is nevertheless, an appeal in the eyes of law and the order, dismissing the application of for condonation of delay in filing the appeal, is nevertheless, a decision in the appeal itself. Section 21 of the said Act, as noted earlier, in peremptory terms provides that an appeal instituted by a person from whom the amount of debt is due to a bank shall not be entertained by the Appellate Tribunal unless such person has deposited with the Appellate Tribunal 75% per cent of the amount of debt so due from him as determined by the Tribunal under section 19 for the said act. No doubt, the proviso to section 21 empowers the Appellate Tribunal, for reasons to be recorded in writing, to waive or reduce the amount to be deposited under section 21 of the said Act. Therefore, until such person deposits the amount prescribed or secures a waiver or reduction under the proviso, there is no question of Appellate Tribunal entertaining the appeal under section 21. In view of the legal position discussed earlier, an appeal accompanied by an application for condoning the delay in filing the appeal, is itself an application in the appeal for the purposes of section 20 of the said Act. Accordingly,, unless the predicates on section 21 of the said Act were complied with, there was no question of DRAT even entertaining the appeal or application for condonation of delay in filing the appeal.

6. Considered.

7. In the interest of justice, second proviso to Section 18 (1) of the SARFAESI Act read as under: “Provided further that no appeal shall be entertained unless the borrower has deposited with the Appellate Tribunal fifty per cent of the amount of debt due from him, as claimed by the secured creditor or determined by the Debts Recovery Tribunal, whichever is less”.

8. At this stage, the Learned Counsel for the Applicant/Appellant seeks time to make the mandatory pre-deposit as required under law.

9. The Learned Counsel for the Applicants/Appellants are directed to make the mandatory pre-deposit as required under Section 18 of the SARFAESI Act within three days failing which the Appeal shall stand rejected. In the event the mandatory pre-deposit is made within three days the matter be placed before this Appellate Tribunal on 10.09.2026. Sd/- Chairperson Psa-01