Back
2021 Supreme(Telangana) 343
IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD
Ujjal Bhuyan, C.Sumalatha, JJ.
Cherukuwada Venkata Bangara Raju, S/o Venkatararasimha Raju - Appellant
Vs.
The Debts Recovery Tribunal-I, Rep. by its Registrar, Office of the DRT-I, 3rd floor, Triveni Complex, Abids Road, Hyderabad and another - Respondents
W.P.Nos.18557 of 2020, 21744 and 24280 of 2019
Decided On : 02-12-2021
Advocate Appeared:
For the Appellant : Mr. M. Koteshwara Rao
For the Respondent: Mr.N.V.Subba Raju
Headnote:
Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 - Sections 17 and 13(2) - Auction sale notice - Seeking quash of orders - Recovery of Debts due to Banks and Financial Institutions - Respondent No.1/UCO Bank had issued auction sale notice newspapers scheduling auction - Pursuant thereto, he participated in auction and was the successful bidder - He purchased schedule property in situated at Village District, for an amount of - He had paid entire amount - Petitioner came to know that borrower i.e., Respondent No.2 had filed an application under Section 17 of Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 before Debts Recovery which was registered - Restoration to file and for adjudication of same on merit - From pleaded facts, it is seen that petitioner - Petitioner had availed term loan from UCO Bank - It is stated that for securing loan, petitioner had mortgaged the schedule property, which is an agricultural property – Held, Account of Petitioners-Defendants is currently closed, it would be just and proper to direct Respondent-Applicant Bank to open an ‘interest bearing no lien account’, Petitioners Defendants can deposit the 9 DDs produced before this Tribunal sale of the mortgaged properties held Respondent Applicant Bank is up-held by Hon’ble High Court, the Petitioners-Defendants shall be entitled to amount deposited by them in the ‘interest bearing no lien account’ with accrued interest and if sale of mortgaged properties is set-aside, Auction Purchaser would be entitled to auction amount deposited by him and Respondent-Applicant Bank can appropriate outstanding dues in loan account of Petitioners-Defendants from out of amount deposited by them into the ‘interest bearing no-lien account - once auction sale takes place and the schedule property is purchased, such right of borrower stands extinguished - Auction sale had taken place way back in Seven years was no necessity for Tribunal to have passed further compounded by subsequent order - It would be wholly unjust to act the clock back now - Court had said, of course in a different context, a scrambled egg cannot be unscrambled - Overall consideration of all aspects of matter – Court’s view that no case for interference is made out in Writ Petitions filed by the borrower - Grievance of auction purchaser is concerned, it is stand of UCO Bank that already sale certificate had been issued - Copy of such a certificate has not been placed on record – Court direct that if the certificate of sale has not yet been issued to auction purchaser, same shall be issued in terms of the aforesaid rule, within a period of six weeks from date of receipt of a certified copy of this order - W.P.Nos.24280 of 2019 and 18557 of 2020 are dismissed.
ORDER :
Ujjal Bhuyan, J.
Heard learned counsel for the parties.
2. This order will dispose of W.P.Nos.21744 and 24280 of 2019 as well as W.P.No.18557 of 2020.
3. At the outset, we may briefly narrate the facts relevant for each of the Writ Petitions.
W.P.No.21744 of 2019
4. W.P.No.21744 of 2019 has been filed by the auction purchaser- Bharat Kumar Patel. In this Writ Petition, petitioner has prayed for a direction to respondent No.1/UCO Bank to issue sale certificate in respect of the property purchased by him in the E-auction carried out on 21.10.2013.
5. According to the petitioner, respondent No.1/UCO Bank had issued auction sale notice dated 13.09.2013, in the newspapers scheduling the auction on 21.10.2013. Pursuant thereto, he participated in the auction and was the successful bidder. Consequently, he purchased the schedule property admeasuring Acs.7.00 guntas in Survey No.322 situated at Dundigal Village, Qutbullapur Mandal, Ranga Reddy District, for an amount of Rs.87,02,000.00, which was above the reserve price of Rs.86,27,000.00. He had paid the entire amount of Rs.87,02,000.00, by 29.10.2013, in the following manner :
| Sl.No. | Date | Amount of Rs. |
| 1. | 18.10.2013 | 8,62,700 |
| 2. | 21.10.2013 | 13,50,000 |
| 3. | 25.10.2013 | 23,00,000 |
| 4. | 29.10.2013 | 41,89,300 |
|
| Total | 87,02,000 |
6. Thus, he had paid the entire sale price within fifteen days from the date of sale. Thereafter, respondent No.1/UCO Bank handed over physical possession of the purchased property to the petitioner. But, for one reason or the other, the sale certificate was not issued.
7. On enquiry, petitioner came to know that the borrower i.e., respondent No.2- Cherukuwada Venkata Bangara Raju had filed an application under Section 17 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short ‘the SARFAESI Act’) before the Debts Recovery Tribunal-I, Hyderabad (for short ‘the Tribunal’), which was registered as S.A.No.578 of 2016.
8. The said Securitisation Application was dismissed by the Tribunal on 26.04.2019. Though petitioner had filed an interim application in S.A.No.578 of 2016, seeking a direction for issuance of sale certificate, the same could not be pursued as the Securitisation Application was dismissed.
9. Petitioner had represented before respondent No.1/UCO Bank on 18.12.2018 and 15.07.2019 for issuance of sale certificate, but there has been no response. It is under such circumstances, that the present Writ Petition came to be filed.
W.P.No.24280 of 2019
10. W.P.No.24280 of 2019 has been filed by the borrower, for quashing of orders dated 29.10.2019 and 26.04.2019, passed by the Tribunal, for restoration of S.A.No.578 of 2016 to file and for adjudication of the same on merit. From the pleaded facts, it is seen that petitioner i.e., Cherukuwada Venkata Bangara Raju is the managing partner of the firm- M/s.Jatropha Bio-Tech, which is engaged in agro based business. For the purpose of facilitating the business, petitioner had availed term loan of Rs.25 lakhs from UCO Bank. It is stated that for securing the loan, petitioner had mortgaged the schedule property, which is an agricultural property.
11. For various reasons, petitioner could not repay the loan amount in its entirety. As a result, UCO Bank classified the loan account of the petitioner as a Non-Performing Asset (NPA). Not only that, UCO Bank, in a hurried manner, filed OA.No.204 of 2010, before the Tribunal under the Recovery of Debts due to Banks and Financial Institutions Act, 1993 (for short ‘the RDB Act’).
12. Notwithstanding filing of OA.No.204 of 2010, UCO Bank initiated proceedings under the SARFAESI Act as well and had issued notice under Section 13(2) thereof. Thereafter, UCO Bank took over possession of the schedule property and put the same to auction sale.
13. Petitioner had filed SA.No.209 of 2013 bef
