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ALOK MATHUR
Ganga @ Ganga Ram – Appellant
Versus
State of U. P. – Respondent
JUDGMENT :
ALOK MATHUR, J.
1. Heard Shri Vivek Kumar Singh, learned counsel for the petitioners, learned Standing Counsel for the State, learned counsel for respondent-Bank and perused the material available on record.
2. By means of the present writ petition, the petitioners have challenged the auction proceedings conducted at the behest of the Collector/District Magistrate, District Hardoi whereby the agricultural land of the petitioners situated at Village Janwar, Pargana-Godwa, Tehsil-Sandila, District Hardoi in Gata (Khasra) Nos/area (in Hectare), 1411/4-18-5-0, 1378/0-7-0-0, 1427/0-10-0-0 and 1422/3-12-11-0 have been auctioned and purchased by the State in lieu of the outstanding amount due to respondent no. 4 i.e. State Bank of India.
3. It has been submitted by learned counsel for petitioners that the petitioners had taken an agricultural loan of Rs.8,500/- on 08.01.1983 from the State Bank of India, Branch Sandila, District Hardoi. It is stated that against the said loan, the petitioners had deposited the loan amount of Rs.11,000/- till 28.05.1992 and also an amount of Rs.14,000/- on 22.12.2008 as demanded by the respondent-Bank. It has been stated that some government officia
The auction of mortgaged property for a nominal price without proper valuation and participation is illegal, and the right of redemption persists until a registered sale is completed.
The importance of proper valuation, fair auction, and maximum public participation in the auction process was emphasized by the court.
The court emphasized that auction sales must adhere to statutory requirements and principles of natural justice, ruling that collusion invalidates the auction process.
Auction sales of mortgaged properties must comply with statutory requirements; failure to do so, especially under false pretense, allows for judicial intervention to set aside such sales.
The right of redemption in a mortgage is extinguished upon registration of the sale deed, affirming the need for compliance with repayment orders to avoid auction confirmation.
Confirmed auction sales cannot be set aside for alleged inadequacy of price or lack of publicity without proof of fraud or substantial injury.
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.
The main legal point established in the judgment is the importance of fair valuation, compliance with statutory provisions, and the need to set aside auction-sales with fundamental procedural errors.
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