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HIGH COURT OF JAMMU & KASHMIR AND LADAKH AT SRINAGAR
SINDHU SHARMA, SHAHZAD AZEEM
Abdul Rouf Bhat, S/o Ali Mohammad Bhat – Appellant
Versus
Jammu and Kashmir Bank Ltd. – Respondent
JUDGMENT :
Shahzad Azeem, J.
1. The petitioners have called in question the auction sale notice/tender notice issued and published on April, 19 2024 by the respondent-Bank under Rule 8(6) of Security Interest (Enforcement Rules) 2002 (Rules of 2002) made under the Securitization & Reconstruction of Financial Assets & Enforcement of Security Interest Act, 2002 (SARFAESI Act) and also sale certificate dated June, 07 2024.
2. The controversy on hand lies in short compass. The petitioners have availed loan facility for an amount of Rs. 20.00 lacs vide sanction letter dated Feb, 18 2013 from the respondentBank and said facility was secured by way of hypothecation of stocks and equitable mortgage of immovable property. After some time, the loan account of the petitioners was turned irregular and despite, they were provided multiple opportunities by way of reminders to regularize their loan account but they failed, thus, the account was classified as Non Performing Asset (NPA) w.e.f March, 31 2017. As a consequence, proceedings under SARFAESI Act came to be initiated and accordingly, demand notice under Section 13 (2) of the SARFAESI Act was issued on April, 04 2018. The petitioner did not t
Recovery of debt – Mortgaged property cannot be put to auction sale without affording 30 days’ time to petitioner to clear demand.
The right of redemption under SARFAESI Act is extinguished after the issuance of a sale certificate, rendering claims by lessees during such proceedings legally unsustainable.
The court affirmed the validity of auction proceedings under the SARFAESI Act, emphasizing compliance with mandatory notice provisions is essential, and that prior acknowledgment of debts restricts o....
The auction sale under the SARFAESI Act may be annulled on equitable grounds if procedural delays, not attributable to borrowers, prevent confirmation and violate statutory requirements.
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