JALDU KALYAN RAM vs STATE BANK OF INDIA on 13 August 2026

IN THE DEBTS RECOVERY APPELLATE TRIBUNAL AT KOLKATA Appeal Dy. No. 80 of 2026 THE HON’BLE JUSTICE SHRI ANIL KUMAR SRIVASTAVA, CHAIRPERSON Order No. 11 13.08.2026

Jaldu Kalyan Ram

... Appellant --Vs— AO, State Bank of India & Anr.

.... Respondents For Appellant : Mr. Ajit Kumar Mishra, ld. Adv.

For Respondent : Mr. Soudip Pal Chowdhury, ld. Adv. Mr. Nemani Srinivas, ld. Adv. THE APPELLATE TRIBUNAL

Heard learned counsel for the parties and perused the records. I.A. 113 of 2026 is filed for waiver from making pre-deposit by the appellant. Instant appeal is filed against the judgment and order dated 08.12.32025 passed by the learned DRT Visakhapatnam in S.A. 322 of 2023 (Sri Jaidu Kalyan Ram Vs. The AO, State Bank of India) dismissing the S.A. Feeling aggrieved, appellant preferred the appeal. Learned counsel for the appellant would submit that one of his properties has already been sold by the bank and entire sale proceeds have been received by the bank. No debt is due to the bank. Accordingly, waiver from making pre-deposit may be allowed. Per contra, learned counsel for respondent bank would submit that appeal is filed u/s 18 of the SARFAESI Act, 2002. This provision of the Act is mandatory in nature.

In Narayan Chandra Ghosh Vs. UCO Bank & Ors. (2011) 4 SCC 548, Hon’ble Apex Court in Para 7 and 8 has held that- “7. Section 18(1) of the Act confers a statutory right on a person aggrieved by any order made by the Debts Recovery Tribunal under Section 17 of the Act to prefer an appeal to the Appellate Tribunal. However, the right conferred under Section 18(1) is subject to the condition laid down in the second proviso thereto. The second proviso postulates 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 creditors or determined by the Debts Recovery Tribunal, whichever is less. However, under the third proviso to the sub-section, the Appellate Tribunal has the power to reduce the amount, for the reasons to be recorded in writing, to not less than twenty-five per cent of the debt, referred to in the second proviso. Thus, there is an absolute bar to the entertainment of an appeal under Section 18 of the Act unless the condition precedent, as stipulated, is fulfilled. Unless the borrower makes, with the Appellate Tribunal, a pre-deposit of fifty per cent of the debt due from him or determined, an appeal under the said provision cannot be entertained by the Appellate Tribunal. The language of the said proviso is clear and admits of no ambiguity.

8. It is well-settled that when a statute confers a right of appeal, while granting the right, the legislature can impose conditions for the exercise of such right, so long as the conditions are not so onerous as to amount unreasonable restrictions, rendering the right almost illusory. Bearing in mind the object of the Act, the conditions hedged in the said proviso cannot be said to be onerous. Thus, we hold that the requirement of pre-deposit under sub-section (1) of Section 18 of the Act is mandatory and there is no reason whatsoever for not giving full effect to the provisions contained in Section 18 of the Act.In that view of the matter, no court, much less the Appellate Tribunal, a creature of the Act itself, can refuse to give full effect to the provisions of the statute. We have no hesitation in holding that deposit under the second proviso to Section 18(1) of the Act being a condition precedent for preferring an appeal under the said section, the Appellate Tribunal had erred in law in entertaining the appeal without directing the appellant to comply with the said mandatory requirement.” Appellant is a mortgagor. As per demand notice dated 20.10.2016 claim amount was Rs.21,08,61,076/-. But the amount of debt due as on the date of filing appeal is Rs.43,97,02,638.43. As far as issue of sale proceeds is concerned, since auction sale is under challenge in view of the judgment of the Hon’ble Apex Court in Sidha Neelkanth Paper Industries Pvt. Ltd. & Anr. Vs. Prudent ARC Ltd. & Ors. [2023 SCC OnLine SC 12] appellant cannot take advantage of sale proceeds.

The debt due as on the date of filing appeal is Rs.43,97,02,638.43. Accordingly, appellant is required to make pre-deposit 50% of Rs.43,97,02,638.43 as required u/s 18 of the Act. Accordingly, I.A. 113 of 2026 is disposed of with the direction that appellant should make payment 50% of Rs.43,97,02,638.43 as pre-deposit within six weeks. List on 06.10.2026 for further order. (Anil Kumar Srivastava, J) Chairperson Dated : 13.08.2026 04/pkb