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CS Professional · Insolvency and Bankruptcy - Law and Practice · Debt Recovery and Securitization

A Recovery Officer attaches and sells a property of Verma Traders to recover a bank's certificate debt. Verma Traders, from whom Rs 6,00,000 is due as determined by the Tribunal, appeals under section 30 against the Recovery Officer's order. Which statement is correct regarding the deposit?

The appeal will not be entertained unless Rs 3,00,000 is deposited with the Tribunal. Section 30A requires fifty per cent of the debt due, as determined by the Tribunal, to be deposited for appeals against Recovery Officer orders under section 30.

  1. ANo deposit is needed because the appeal is against a Recovery Officer, not the Tribunal
  2. BThe appeal will not be entertained by the Tribunal unless Rs 3,00,000 is deposited with itCorrect
  3. CThe appeal will not be entertained unless Rs 4,50,000 is deposited with the Appellate Tribunal
  4. DA deposit of Rs 1,50,000 suffices, being 25 per cent

Explanation

Section 30A applies to appeals against Recovery Officer orders under section 30. The Tribunal cannot entertain the appeal unless fifty per cent of the debt due, as determined by the Tribunal, is deposited with the Tribunal. 50% of Rs 6,00,000 is Rs 3,00,000. The deposit goes to the Tribunal, not the Appellate Tribunal, and section 30A contains no 25 per cent reduction proviso.

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