Date of Decision: 19.12.2023

JUSTICE R. D. KHARE, CHAIRPERSON

Both the abovementioned appeals have been preferred by

the appellant-Bank under section 18 of the Securitization

and Reconstruction of Financial Assets and Enforcement of

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Security Interest Act, 2002 (in short “the SARFAESI Act”)

against the judgment dated 01.08.2019 passed by the DRT,

Patna, whereby the S.As. filed by the borrowers and the

auction purchaser were allowed, therefore, these appeals

are being decided by this common order.

The brief facts of the matter taken from the Appeal Dy. No.

283/2019 are that the respondent No. 2 was granted a cash

credit limit of Rs. 70.00 lacs by the appellant-Bank on

04.12.2012. In order to secure the said loan, the

respondent No. 2 & 3 stood as guarantor in their personal

capacity and respondent no. 3 also created an equitable

mortgage over his property by depositing the title deed with

the Bank. The borrowers did not adhere to the terms of the

loan agreement, therefore, the account was classified as

NPA on 28.11.2017 and a demand notice dated 29.11.2017

was issued under section 13(2) of the SARFAESI Act for a

sum of Rs. 1,01,54,053/-. Since the borrowers did not pay

any heed to the said demand, therefore, the appellant-bank

took the symbolic possession of the property in question on

07.02.2018 by issuing possession notice dated 07.02.2018

under section 13(4) of the said Act and the same was

published in two newspapers on 13.02.2018. Thereafter,

the sale notice dated 11.05.2018 was issued, but the

auction sale could not be materialized for want of bidder.

Subsequently, the appellant-Bank issued sale notice dated

20.07.2018 scheduling the auction of the property in

question on 27.08.2018 and the property was sold and sale

was confirmed in favour of the respondent-No. 1 by the

Bank vide letter dated 28.08.2018, which is at page No. 39

of the memo of the appeal.

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The respondents borrowers challenged the auction sale

notice dated 20.07.2018 including entire proceedings of the

Bank by filing S.A. No. 221/2018 before the Tribunal below.

4.

It appears that pursuant to the auction sale dated

28.08.2018, the respondent No. 1-auction purchaser

deposited 25% of the bid amount within stipulated time,

but for the deposit of remaining 75% of the sale amount,

the auction purchaser vide letter dated 10.09.2018

requested the Bank for grant of time i.e. upto 29.09.2018,

which was granted vide letter dated 12.09.2018. The

auction purchaser again requested the Bank vide letter

dated 28.09.2018 for further extension of time i.e. upto

29.10.2018, which was also granted by the Bank vide letter

dated 29.09.2018. Again on 29.10.2018, a letter was sent

by the respondent No. 1 seeking another one month’s time

i.e. upto 29.11.2018 for deposit of remaining 75% of the

bid amount on the ground of ill health condition, which was

also granted by the Bank vide letter dated 29.10.2018

directing the respondent no. 1 to deposit the same upto

29.11.2018. The respondent No. 1-auction purchaser once

again issued a similar letter dated 28.11.2018 (at Page No.

53) requesting therein that two months’ further time may

be granted considering his health problem, but the

appellant-Bank had not granted any further time, instead

directed to deposit the balance bid amount within the

extended time i.e. 29.11.2018 and also informed that if the

said amount is not deposited, 25% amount deposited by

the auction purchaser shall be forfeited without any further

notice.

5.

Thereafter, the respondent No. 1 auction purchaser filed the

S.A. No. 1/2019 before the Tribunal below praying that the

S.A. may be accepted by setting aside the entire action of

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the Bank taken under SARFAESI Act and return 25% of the

auction amount to the auction purchaser.

6.

The Tribunal below has allowed both the Securitization

applications filed by the applicant/borrower (S.A. No.

221/2018) and the auction purchaser (S.A. No. 01.2021)

vide order impugned setting-aside the e-auction sale notice

dated 20.