ORDER :

1. The petitioners are before this Court calling in question e-auction notice dated 08-09-2021 which was notified to sell the property of the petitioners and have also sought quashment of sale certificate issued in favour of the 4th respondent/auction purchaser and seek consequential direction to consider the case of the petitioners under the OTS scheme.

2. Brief facts that lead the petitioners to this Court in the present petition, as borne out from the pleadings, are as follows:

The 1st petitioner (hereinafter referred as the ‘petitioner’ for the sake of convenience) was the proprietor of M/s Sree Mahadeva Rice Mill, Tumkur as described in the schedule appended to the petition. The petitioner was into the rice processing business after the property had fallen to his share from a family partition on 21-10-2005. In order to expand his business the petitioner sought and was granted a credit limit of Rs. 2 crores and a term loan of Rs. 30 lakhs under small scale industry category by the erstwhile State Bank of Mysore (‘the Bank’ for short). The title deeds of properties were mortgaged with the Bank as collateral security for grant of the said loan. Up to the year 2017-18 the loan was paid at regular intervals. It is the averment in the petition that from the year 2017-18 in view of market fluctuations the petitioner suffered huge loss and the account slipped into a non-performing asset and was treated as such on 29-12-2017.

3. A notice under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest At, 2002 (hereinafter referred to as ‘the Act’ for short) was issued upon the petitioner seeking to discharge liabilities within 60 days from the date of the said notice. When the petitioner did not comply with the contents of the notice, symbolic possession of the scheduled property was taken under Section 13(4) of the Act in terms of a communication dated 31-03-2018 and later physical possession was handed over to the 3rd respondent by order of the Deputy Commissioner dated 30-05-2019 in terms of Section 14(1) of the Act. It appears that the loan account of the petitioner was transferred to Stressed Assets Recovery Branch of the 1st respondent Bank who on 19-10-2020 issued a notice to the petitioner offering one time settlement. The one time settlement that was offered on 19-10-2020 was for Rs. 1,72,49,708/-. The petitioners claim that due to out-break of COVID-19 they could not avail of the said settlement and that too passed by.

4. The Bank, later seeks to sell the property to redeem the amount that was in due as it was the secured creditor of the property of the petitioner. In the year 2018 efforts were made to sell the property at a reserve price and when no buyer came forward to buy the property, the reserve price was grossly reduced and was sold ultimately at Rs. 5.78 crores on 29-09-2021. The sale fructified on 29-09-2021 after four auction notices issued by the Bank. Those auction notices were challenged by the petitioner before the Debts Recovery Tribunal which were all dismissed. Later auction was conducted by the Bank on 29-09-2021 in which the 4th respondent purchases the property and pursuant thereof a certificate of sale was issued in his favour by the Bank. It is these actions that are called in question in the case at hand.

5. Heard Sri Ashok Haranahalli, learned senior counsel appearing for the petitioners, Sri B.N. Tulsi Kumar, learned counsel appearing for respondents 1 to 3 and Sri Udaya Holla, learned senior counsel appearing for respondent No. 4.

6. The learned senior counsel Sri.Ashok Haranahalli appearing for the petitioners would contend with vehemence that the schedule property whose reserve price as on the date it was sold was Rs. 12.75 crores; it was grossly undervalued at Rs. 5.78 crores and sold to the 4th respondent; the sale is in blatant violation of Rule 8 o