JUDGMENT :

[Bhargav D. Karia, J.]

1. Heard party-in-person Mr. Jatin H. Shah – petitioner no.2 and Managing Director of petitioner no.1 company – original borrower and learned advocate Mr. Rushabh R. Shah for respondent no.1 (auction purchaser). Though served, no one appears for respondent no.2 – Bank of Baroda.

2.The petitioner has challenged the order dated 2.07.2019 passed by the Debts Recovery Appellate Tribunal, Mumbai (For short “DRAT”) in Misc. Appeal No.5/2018 filed by respondent no.1-auction purchaser feeling aggrieved by the judgment and order dated 1.11.2017 in Appeal No.4/2013 passed by the Debts Recovery Tribunal-II, Ahmedabad (For short “DRT”).

3. Facts leading to filing of this writ petition are narrated in nutshell as under :

3.1) The long drawn legal battle that has raged over past two decades or so has its genesis in a loan which respondent no.2 bank advanced to the petitioner no.1 company. Loan was advanced on the basis of equitable mortgage of the properties owned by petitioner no.1 company. The borrower having defaulted in the repayment of loan amount, respondent no.2 bank filed Original Application No.300/2001 and 326/2001 against the petitioners for recovery of its outstanding dues before the Debts Recovery Tribunal.

3.2) The Debts Recovery Tribunal allowed the Original Applications filed by respondent no.2 bank along with other banks vide common order dated 17.09.2010 and issued a Recovery Certificate in favour of the lender bank against the petitioners.

3.3) Thereafter recovery proceedings being Recovery Proceeding No.90/2010 and Recovery Proceeding No. 91/2010 were filed for execution of the Recovery Certificate in favour of the banks. The Recovery Officer of DRT in pursuance to the Recovery Certificate issued Sale Proclamation for sale of Naroli property and Daman property for the first time on 9.12.2011 for auction sale to be held on 27.12.2011. However, due to various objections, sale could not take place and thereafter re-auction notice was issued fixing the auction date on 9.07.2013 in which respondent no.1 auction purchaser became the successful bidder for Rs. 260.1 lakh.

3.4) The auction purchaser deposited 25% of the reserved price as per the terms and conditions of the auction sale notice. The auction purchaser was further directed to deposit balance 75% of the bid amount within a period of 15 days along with requisite poundage fee; however, the auction purchaser filed an application dated 23.07.2013 to extend the time to deposit the balance 75% amount. The Recovery Officer granted further time to the auction purchaser by order dated 24.07.2013 to deposit 75% amount along with poundage fee on or before 8.08.2013, failing which, the Earnest Money deposited by the auction purchaser was ordered to be forfeited.

3.5) The auction purchaser thereafter deposited the balance amount of 75% before 8.08.2013 within the extended time.

3.6) On 8.08.2013, the petitioners filed review application under Rule 87 of the Second Schedule to the Income Tax Act, 1961 (For short “the Rules”) before respondent no.2 to review the order dated 24.07.2013 to the extent of Naroli property and to declare the auction sale held on 9.07.2013 as nullity.

3.7) Respondent no.1 auction purchaser also filed an application requesting the Recovery Officer to confirm the sale. The Recovery Officer by order dated 4.09.2013 rejected the review application dated 08.08.2013 filed by the petitioners and confirmed the auction sale dated 9.07.2013 and ordered to issue Sale Certificate. Recovery Officer also directed Ex-officio Court Receiver to handover possession of the said secured property to auction purchaser. On 10.09.2013, Sale Certificate was issued to the auction purchaser recording that possession was handed over prior thereto. On 11.09.2013, sale proceeds were released in favour of respondent no.2 bank and on 19.09.2013, affidavit before the Recovery Officer was filed by respondent no.2 bank showing appropriation of money.

3.8) Fe