Statutory provisions mandating payment of the balance amount within a specified period and the principle that court orders cannot cause prejudice to anyone.

ORDER :

Ujjal Bhuyan, J.

This order will dispose of both W.P.No.4378 of 2016 and Contempt Case No.1539 of 2016.

2. Heard Mr. K. Pavan Kumar, learned counsel for the petitioner and Mr. A. Krishnam Raju, learned counsel for the respondent.

3. Mr. K. Sarangapani as the petitioner has filed the Writ Petition being W.P.No.4378 of 2016 seeking a declaration that the in-action on the part of the respondent in conducting survey and fixing boundaries of the auctioned property and on the otherhand insisting upon the petitioner to pay balance sale amount before 13.02.2016 is arbitrary and violative of the principles of natural justice, thus illegal. Petitioner further seeks a direction to the respondent to conduct survey and fix the boundaries of the auctioned property and thereafter to permit the petitioner to pay the proportionate balance amount.

4. Case of the petitioner is that respondent is State Bank of Hyderabad, represented by its Authorized Officer, Stressed Assets Management Branch.

4.1. Respondent had notified e-auction on 24.12.2015 for conducting auction of the schedule property of the defaulter who had availed loan from the respondent. The description of the property is as under:-

Vacant land bearing Municipal No.19-11-41 (old), corresponding to Municipal No.19-1-96 (new), admeasuring 3332.09 square yards or 2785.90 square meters situated at Ward No.9, Block No.11, Shambunipet, Warangal (within Warangal Municipal Corporation).

5. In the e-auction of the schedule property which was subsequently held on 30.01.2016 petitioner was declared as the successful bidder. He had already paid a sum of Rs.5,10,000.00 towards Earnest Money Deposit (E.M.D) on 29.01.2016. As per the Tender Notification petitioner had to pay a sum of Rs.7,64,000.00 towards 25% of the bid amount, which was also paid by the petitioner on 30.01.2016.

6. Respondent issued letter dated 01.02.2016 informing the petitioner that being the highest bidder, he had to pay the balance amount of Rs.38,19,000.00 on or before 13.02.2016.

7. In the meanwhile, petitioner inspected the schedule property. On such inspection, local villagers objected to and claimed part of the auction sold land to an extent of 700 square yards on the ground that the said 700 square yards was meant for performing “Dasara Festival” being a village property.

8. Faced with such a situation, petitioner sent a representation through registered post on 08.02.2016 to the respondent requesting the latter to fix the boundaries and fence the subject land. However, the respondent did not appreciate the aforesaid problem faced by the petitioner; rather respondent had kept on insisting the petitioner to pay the balance amount by 13.2.2016, failing which it was stated that the 25% of the bid amount deposited by the petitioner (Rs.5,10,000.00+Rs.7,64,000.00 = Rs.12,74,000.00) would be forfeited.

9. It is in such circumstances that the present Writ Petition came to be filed by the petitioner seeking the reliefs as indicated above.

10. This Court by order dated 11.02.2016 issued notice. After noting that there was a dispute with regard to the 700 square yards of land of the auctioned land, it was directed that petitioner should pay Rs.25,00,000/- on or before 13.02.2016, whereafter the respondent would not insist for payment of the entire amount, pending disposal of the Writ Petition.

11. Counter affidavit has been filed on behalf of the respondent through Mr. M. Naga Mohan, Chief Manager, State Bank of Hyderabad, Stressed Assets Recovery Management Branch, Hyderabad acting as Authorized Officer of the respondent under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short “The SARFAESI Act”).

12. It is stated that M/s. Bhavani Traders, a partnership firm, availed credit facilities from the State Bank of Hyderabad, M.S.M.E.Branch, Warangal. The schedule land standing in the name of Sri G. Shashikanth and Smt. G. Madhavi was mortgaged to the said Bank as one of the s