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IN THE HIGH COURT AT CALCUTTA
REETOBROTO KUMAR MITRA
State Bank of India – Appellant
Versus
Rajnish Infrastructure Private Limited – Respondent
JUDGMENT :
1. This writ-petition has been filed by the State Bank of India seeking to set aside the order passed by the Debts Recovery Appellate Tribunal on August 31, 2022.
2. The principal grievance of the Bank is that the order passed by the Appellate Tribunal directing refund of a sum of Rs. 1.95 Crore to the respondent no. 1, is illegal and should be set aside.
3. The brief facts leading to this writ petition are enumerated hereinafter.
4. The petitioner, pursuant to proceedings initiated by it against the borrower and guarantor for default of a loan, had put the mortgaged properties of such borrower for sale. The sale notice dated December 16, 2014, specifically mentioned that the property included therein for the purpose of sale would be held on “as is where is basis”. It also specified that all intending purchasers would be entitled to inspect the property and the documents of title pertaining to such property.
5. The respondent no. 1 participated in the auction process and was adjudged the highest bidder at Rs. 7.81 Crores. In terms of the notice, the respondent no. 1 had deposited a sum of Rs. 1.95 Crores, aggregating to 25 per cent of the bid amount, on January 21, 2015. The
The DRAT has the power to remand a SARFAESI application to the DRT for fresh adjudication, where the DRT has not considered various disputed issues raised by the parties, including service of notice,....
Rule 9(5) of the SARFAESI Act mandates forfeiture of earnest money for non-payment of the balance auction price, overriding general contract law principles.
Rule 9(5) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 is directory in nature, and forfeiture is justified only to compensate for the pa....
The judgment establishes that failure to disclose material defects in the property and the lack of opportunity to remedy the breach disentitles the seller from forfeiting the deposit. It also emphasi....
The court affirmed the validity of a mortgage auction, emphasizing banks' rights over secured properties despite challenges from subsequent purchasers and procedural compliance in auction processes.
Auction sale under SARFAESI Act upheld; simultaneous civil proceedings do not invalidate the completed transaction, and allegations of undervaluation found unsubstantiated.
Borrower must be informed about date of auction of secured asset.
A bank's misrepresentation of property details in an auction can invalidate the sale, and forfeiture of the deposit is unjustified if the sale is characterized by a lack of fair disclosure.
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