The borrower failed to apply to the Recovery Officer to set aside the auction sale on the grounds of material irregularity, mistake or fraud in publishing or conducting it within a period of thirty days from the date of sale of immovable property.

JUDGMENT

M.R. Shah, J.

Feeling aggrieved and dissatisfied with the impugned judgment and order dated 30.07.2021 passed by the High Court of Judicature at Bombay, Bench at Aurangabad in Writ Petition No. 570 of 2012, by which the High Court has allowed the said writ petition preferred by respondent no.1 herein and has set aside the auction sale in respect of the lands in question and also ordered that the Sale Certificate dated 19.01.2011 executed by the appellant-bank in Civil Appeal No. 818/2022 in favour of the auction purchaser stands cancelled, both, the Bank as well as the auction purchaser have preferred the present appeals.

2. The facts leading to the present appeals in a nutshell are as under:

One Vaishnavi Hatcheries Company Limited, of which respondent no.1 herein is the Director (hereinafter referred to as the 'borrower'), borrowed loan from the appellant-bank and one Vaidanath Nagari Sahakari Bank. As a security to the said loan, four properties, i.e., survey nos. 102, 440, 437 & 439 were mortgaged. Property survey No. 439 was mortgaged with Vaidanath Bank, property survey No. 437 was mortgaged with the appellant-bank and property survey Nos. 440 & 102 were jointly mortgaged with the appellant-bank and Vaidanath Bank.

2.1 That the borrower defaulted in payment of the appellant-bank and Vaidanath Bank in the year 2010. Both the banks initiated separate recovery proceedings against respondent no.1 and the borrower. A Recovery Certificate dated 6.2.2010 was issued in favour of the appellant-bank under Section 101 of Maharashtra Co-operative Societies Act, 1960 (hereinafter referred to as the 'MCS Act, 1960'). According to the appellant-bank, a proclamation was published in the daily newspaper 'Sakal' on 22.02.2010 as well as on 23.02.2020, followed by the publication in the daily newspaper 'Sakal' on 24.02.2010. According to the appellant-bank, a proclamation as per Rule 107(11) of the Maharashtra Co-operative Societies Rules, 1961 (hereinafter referred to as the 'MCS Rules, 1961') was issued on 26.05.2010 giving 30 days' time to respondent no.1 to pay the amount.

2.2 That the Deputy Joint Registrar, Co-operative Societies fixed the upset price at Rs. 98,10,000/- vide communication dated 26.07.2010. Vaidanath Bank also initiated the process of auction of the property in survey no. 439 in terms of the recovery certificate issued in its favour. The said proceedings so far as the Vaidanath Bank is concerned had attained finality. Upset price fixed by the Deputy Joint Registrar, Cooperative Societies was challenged by respondent no.1 by way of Revision Petition No. 58/2010 before the Divisional Joint Registrar.

2.3 The appellant-bank issued a tender notice to sell the mortgaged properties on 9.9.2010, which was published in the daily newspaper on 14.09.2010. On the date fixed for submission of tender, the Divisional Joint Registrar, Co-operative Societies granted stay of the auction proceedings in Revision Application No. 58/2010 filed by respondent no.1 herein. However, subsequently, the Divisional Joint Registrar dismissed the said Revision Application vide order dated 23.11.2010. On dismissal of the revision application and vacating the stay, bids were opened on 29.11.2010. The appellant in Civil Appeal No. 819/2022 -Ratnakar Gutte was found to be the highest bidder and he offered the bid of Rs. 1,26,00,000/-. The auction purchaser deposited 15% of the said amount on the same day, i.e., on 29.11.2010. Thereafter, an application was made to the District Deputy Registrar for seeking approval to accept the balance 85% of the amount from the auction purchaser which according to the bank was required as per the circular issued by the Co-operative Commissioner & Registrar dated 23.07.2004. The approval was received from the District Deputy Registrar on 29.12.2010. Immediately on receipt of the approval, the auction purchaser deposited the remaining 85% of the amount on 12.01.2011, which was within 15 days from the date of approval.