The right of redemption of the mortgagor/borrower is not extinguished until the sale certificate is issued and the sale is registered in favor of the auction purchaser, even under the SARFAESI Act.

ORDER :

C. PRAVEEN KUMAR, J.

As these three writ petitions are interconnected, the same are disposed of by this common order:-

2. Heard Sri Mirza Nisar Ahmed Baig Nizami, learned counsel for the petitioners, Ms. V. Dyumani, learned Standing Counsel for the respondent/bank and Sri Sasanka Bhuvanagiri, learned counsel for the auction purchaser.

3. W.P.No.15580 of 2022 came to be filed to declare the e-auction dated 24.02.2022, in respect of non-agricultural land admeasuring Ac.17.56 Cents in Survey Nos.1.1, 1.3, 2.1 & 10.1 situated at Mydgolam Village, Lepakshi Mandal, Hindupur, for recovery of Rs.2,45,86,880.66 ps., as contrary to the orders passed in W.P.No.3988 of 2022 and to declare the action of the fourth respondent in issuing the undated Notice Memo for execution of warrant as against Section 13(8) of Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 [for short, “SARFAESI Act”] as bad in law.

4. W.P.No.15632 of 2022 came to be filed to declare the action of respondent nos.1 to 4 in issuing the Sale Confirmation Letter dated 24.05.2022 pursuant to e-auction dated 24.02.2022 with respect to above land as illegal.

5. W.P.No.23932 of 2020 is filed questioning the action of the respondents in issuing Sale Certificate dated 02.06.2022, in favour of fifth respondent therein in respect of the above property, without adjusting/transferring the amount of Rs.1,38,50,000/- deposited on 31.05.2022 in the two loan accounts, as highly illegal, improper and incorrect.

6. The facts, which lead to filing of the above three writ petitions, are as under:-

(a) The petitioners in all the three writ petitions secured loan from the respondent/bank under two loan accounts. As the petitioners committed default in payment of the amount, both the accounts were declared as Non-Performing Assets [NPA] and the respondent/bank demanded an amount of Rs.2,39,90,868.20 ps. and Rs.5,96,012.46 ps. [totalling to Rs.2,45,86,880.66 ps.] towards outstanding loan amount. At that point of time, the petitioners made an application for One Time Settlement [OTS] vide representation dated 15.12.2021. Inaction on the part of the respondent/bank, lead to filing of W.P.No.30522 of 2021. Pending the said writ petition, the respondent/bank issued e-auction Sale Notice for Sale of immovable properties which were mortgaged to the bank. The e-auction notice was challenged in W.P.No.1534 of 2022. However, the auction did not materialize, and as such, both the writ petitions were dismissed as infructuous on 08.03.2022. Thereafter, a second e-auction notice for sale of immovable properties mortgaged to the bank came to be issued. Challenging the same, the petitioners filed W.P.No.3988 of 2022.

(b) On 23.02.2022, in I.A.No.1 of 2022, this Court passed the following interim order, which is as under:-

“…Taking into consideration the facts in issue, the auction shall go on and the same shall not be finalized for a period of five weeks, subject to petitioners depositing a sum of Rs.1,00,00,000/- to the credit of loan account within a period of four weeks from today, in default, the stay stands vacated automatically and the respondent-Bank can proceed further, in accordance with law.

‘List after five weeks’.

(c) Thereafter, final order came to be passed in W.P.No.3988 of 2022 on 21.04.2022, wherein the petitioner was directed to deposit a sum of Rs.1,00,00,000/- within a period of four (4) weeks and the balance amount with interest and other charges within a period of four (4) weeks thereafter.

(d) The claim of the petitioners is that they approached the respondent/bank on 16.05.2022 and 20.05.2022 to deposit the amount but on both the occasions, the bank officials refused to receive the money, on the ground that they have neither received any order from the High Court nor their Standing Counsel informed them about the order. However, on 23.05.2022, the Registry of the High Court dispatched a copy of the order dated 21.04.2022, which was received