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UJJAL BHUYAN, A.VENKATESHWARA REDDY
Bandi Mohan – Appellant
Versus
Union Bank of India – Respondent
Key Points: - The petitioners were highest bidders in e-auction on 19.08.2020, deposited 25% (Rs. 21,68,750) on auction day, and were granted extension till 12.10.2020 for balance 75% (!) (!) (!) (!) . - Petitioners requested further time due to COVID-19, paid full balance (Rs. 86,75,000) on 14.12.2020, 25 days after extended period (!) (!) (!) . - Respondents refused sale certificate due to delay beyond 90 days under Sub-Rule (4) of Rule 9 but had no objection to accepting full payment if court directed (!) (!) . - Rule 9(3) requires 25% payment on auction day; Rule 9(4) requires balance within 15 days of sale confirmation or agreed extension not exceeding 3 months (!) (!) . - Court took judicial notice of COVID-19 hardships, citing Supreme Court orders extending limitations till 28.02.2022 (!) (!) . - Court relaxed Rule 9(4) rigour due to extraordinary COVID-19 circumstances, prior court precedents, and respondents' non-opposition (!) (!) (!) (!) (!) . - Court directed respondents to accept payment, issue sale certificate within 15 days, and register it (!) . - Writ petition disposed with no costs; pending miscellaneous petitions closed (!) (!) .
ORDER :
1. Heard Mr. Alladi Ravinder, learned counsel for the petitioners and Mr. Murali Manohar, learned counsel for respondent Nos. 1, 2 and 3. Insofar added respondent No. 4 (original borrower), he was duly served in terms of the order dated 21.02.2022. But for default, Court decided to proceed ex-parte against him by the aforesaid order.
2. It appears that respondent No. 4 was a borrower of respondent Nos. 1, 2 and 3, but defaulted in repayment of loan for which respondent Nos. 1, 2 and 3 invoked provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short ‘the SARFAESI Act’).
3. In consequence of the above, respondent No. 2 issued sale notice for sale of the scheduled property on 03.08.2020. As per the sale notice, outstanding dues of the borrowers was quantified at Rs. 75,46,576.00. The reserve price of the schedule property was fixed at Rs. 86,25,000.00 and Earnest Money Deposit (EMD) at Rs. 8,62,500.00.
4. E-auction was held on 19.08.2020 in which both the petitioners participated. In fact, petitioners were the highest bidders at their bid amount of Rs. 86,75,000.00. Petitioners deposited 25% of the bid amount
The main legal point established in the judgment is the court's authority to relax statutory time limits, particularly in extraordinary circumstances such as the COVID-19 pandemic, to address the har....
Court while it is true that the statute does mandate and envisage the deposit being made in accordance with the provisions made in sub rule (3), this Court cannot shut its eyes to the unprecedented s....
Point of Law : Court while it is true that the statute does mandate and envisage the deposit being made in accordance with the provisions made in sub-rule (3), this Court cannot shut its eyes to the ....
The extended period for payment after an auction sale should exclude the duration of any stay order, and the threat of forfeiture of deposit should consider the impact of any stay order.
Writ court declines jurisdiction over SARFAESI auction disputes with factual issues; directs to DRT under Section 17.
Compliance with the provisions of the SARFAESI Act, particularly Rule 9(3), is crucial in challenging auction processes, and appellants are not entitled to additional time for making the necessary de....
The main legal point established in the judgment is the interpretation of Rule 9(4) and 9(5) of the Security Interest (Enforcement) Rules, 2002, highlighting the requirement for the purchaser to pay ....
The court emphasized the importance of complying with statutory provisions and ensuring that orders and directions are issued in accordance with the law, while also considering the bona fides of the ....
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