The main legal point established in the judgment is that the right of redemption under Section 13(8) of the SARFAESI Act can be forfeited if the borrower fails to clear the dues, and the delay in filing a claim under Section 17 can result in it being grossly barred by limitation.

JUDGMENT :

Vipin Sanghi, J.

1. The present petition assails the order dated 14.12.2020 passed by the DRAT, whereby the petitioners' appeal assailing the DRT's order dated 24.09.2020 which rejected its S.A. (SARFAESI Application), has been dismissed. Under the impugned order, the DRAT, while dismissing the petitioners' appeal, has granted them three months' time to surrender possession of the property in their occupation to the respondent no. 1/bank.

2. The petitioner/Major Singh Sidhu, represented by his legal heirs in the present petition, approached the DRT by way of an application under Section 17 of the SARFAESI Act being SA No. 726/2011 on 16.12.2011 impugning notice dated 05.02.2008 issued by the respondent no. 1/bank to Shri Parmanand Jha/respondent no. 2. In the said S.A., the possession notices dated 08.11.2011 and 28.11.2011 were also assailed and it was prayed before the DRT that the bank be directed to accept the payments made by the petitioner towards the outstanding dues of respondent no. 2/the borrower. The case set up by the petitioner before the DRT was that he was a bonafide purchaser of property bearing no. B-39, HIG Flat, 3rd Floor, Dilshad Extension, Delhi, having purchased the same for a consideration of Rs. 12 lakhs from respondent no. 2 by way of registered power of attorney dated 30.12.2004. It was his case that though he was in possession of the subject property ever since the date of purchase, he had not received any notice either from respondent no. 1/bank or from respondent no. 2 till November, 2011 and in fact, for the very first time on 18.11.2011, upon return from an outstation visit, he found a possession notice dated 08.11.2011 lying in the subject property. It is only then that he learnt that the borrower/respondent no. 2 had mortgaged the subject property to respondent no. 1 in order to secure the repayment of the loan availed by him in the year 2004, and upon his failing to clear the dues of the bank, the mortgaged property had been sold in a public auction in January 2008 to respondent no. 3/Shri Anil Kumar and his wife. It was claimed that he then learnt that though the respondent no. 2 had earlier preferred an application under Section 17(1) of SARFAESI Act being S.A. NO. 51/2008 to protect the subject property mortgaged in favour of the bank, but as the property had already been auctioned by then, the DRT, vide its order dated 20.02.2008, disposed of the respondent no. 2's application by directing that if respondent no. 2 was desirous of redeeming the mortgage, he should clear the dues of the bank within the time granted. Owing to the respondent no. 2's failure to clear the dues as directed by the DRT, the bank confirmed the sale of the subject property and issued a sale certificate in favour of respondent no. 3 on 30.06.2008.

3. Upon S.A. No. 726/2011 being filed by the petitioner, the DRT after noticing that the petitioner was ready and willing to pay the outstanding dues to the bank, permitted the petitioner to deposit the same with a direction to the bank to keep the same in a no lien interest bearing account till the disposal of the S.A. In the meanwhile, the bank was also directed to maintain status quo in respect of the subject property. The S.A., however, came to be rejected by the DRT vide its order dated 24.09.2020, by inter alia holding that the S.A. was barred by limitation. While holding so, the DRT noted the fact that the petitioner/Shri. Major Singh Sidhu had earlier filed an intervention application being MA No. 210/2008 in the S.A. filed by the borrower/respondent no. 2 being S.A. No. 51/2008, which application was disposed of on 25.11.2008. The petitioner, however, did not take any steps thereafter for over three years and filed a belated S.A. on 16.12.2011. The DRT also rejected the petitioner's claim that he was the owner of the property as the subject property stood transferred in his favour by way of a GPA dated 30.12.2004 claimed to have been executed in his favour by