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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
MANISH PITALE, SHREERAM V.SHIRSAT
Hill Top Estate – Appellant
Versus
Union Of India Through Its Secretary – Respondent
JUDGMENT :
Manish Pitale, J.
A bank and an auction purchaser are before this Court in these two writ petitions to challenge an order passed by the Debt Recovery Tribunal-III, Mumbai (DRT), whereby an auction conducted by the petitioner bank, wherein the auction purchaser was successful in its bid, has been set aside and the petitioner bank has been directed to take steps afresh. The order was passed in an interim application filed by the respondent guarantors in their pending securitisation application. The petitioners have directly filed these writ petitions without resorting to the remedy of filing appeals before the Debt Recovery Appellate Tribunal (DRAT), claiming that the impugned order passed by the DRT is without jurisdiction as it is in the teeth of the provisions of the SECURITISATION AND RECONSTRUCTION OF FINANCIAL ASSETS AND ENFORCEMENT OF SECURITY INTEREST ACT , 2002 (for short 'Securtisation Act') and judgements of the Supreme Court. It is further claimed that the DRT has granted relief beyond the prayers made in the interim application and also in the final prayers made in the securitisation application by the respondent guarantors. It is also claimed that by the impugn
Right of redemption under SARFAESI Act extinguishes on publication of auction notice; DRT cannot thereafter set aside auction and permit effective redemption, rendering such order without jurisdictio....
Mandatory compliance with procedural requirements under the SARFAESI Act is essential; failure to adhere prejudices borrowers' rights and invalidates auction proceedings.
The right of redemption under the Securitisation Act ceases upon auction notice publication, but the Debt Recovery Tribunal can still adjudicate borrower grievances.
The court established that the right of redemption under the SARFAESI Act is extinguished upon the issuance of a sale certificate, and timely challenge to bank actions is essential.
The main legal point established in the judgment is the interpretation of Rule 9(4) and 9(5) of the Security Interest (Enforcement) Rules, 2002, highlighting the requirement for the purchaser to pay ....
Court ruled that non-compliance with SARFAESI rules voided sale; observed that the rights of borrowers can be waived through their conduct and failure to assert them timely.
(1) Auction sale of secured asset – Unless and until a clear 30 days' notice is given to borrower, no sale or transfer can be resorted to by a secured creditor. Secured creditor cannot effect sale or....
The right to redeem mortgaged property under the SARFAESI Act is extinguished once the auction notice is published, indicating no entitlement to challenge the sale thereafter.
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