High Court Of Madhya Pradesh DIVISION BENCH: HON'BLE SHRI JUSTICE SUJOY PAUL HON'BLE SHRI JUSTICE PRANAY VERMA M.P. No.5688/2019 (CENTRAL BANK OF INDIA Vs THE DEBTS RECOVERY APPELLATE TRIBUNAL AT ALLAHABAD AND OTHERS)

M.P. No.246/2021 (SMT. PINKY MUNDRA Vs. DEBTS APPELLATE RECOVERY TRIBUNAL AT ALLAHBAD)

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Shri Dheeraj Singh Panwar, learned counsel for Central Bank of India in M.P. No. 5688/2019 Shri Sunil Kumar Sharma, learned counsel for Central Bank of India in M. P. No. 246/2021 Shri Akshat Agrawal, learned counsel for the borrowers in both the petitions.

Shri Hitendra Tripathi, learned counsel for the Auction Purchasers in both the petitions.

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O R D E R

(Delivered on this 09 ^th day of December , 2021)

PER PRANAY VERMA, J Since both theses petitions are directed against the same order passed by the Debts Recovery Appellate Tribunal, Allahabad, they have been heard together and are being decided by a common order.

02. The facts of the case reveal that Central Bank of India, (the “Bank”)

had sanctioned a loan of Rs.108.50 Lacs to the borrower M/s. Porwal Agro Facilities whose partners were Sunil Porwal, Mayank Porwal, Smt. Padma Devi and Smt. Shrikanta Devi Porwal. It appears that default was made by the borrowers in the matter of re-payment of the loan amount. Consequently, notice under Section 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 ('the Act, 2002') was issued against the borrowers on 11.05.2015. The said notice is stated to have been served upon Mayank Porwal on 28.05.2015, upon daughter of Late partner Sunil Porwal on 03.06.2015 and upon Smt. Shrikanta Devi Porwal on 06.06.2015. The notice was also received by Mayank Porwal on 28.05.2015 on behalf of late Sunil Porwal, Padma Devi and Smt. Shrikanta Devi Porwal as power of attorney holder. However, despite service of notice upon them the borrowers failed to repay the outstanding loan amount as per the notice.

03. The Bank hence on 12.08.2015 issued possession notice under Section

13(4) of the Act, 2002 read with Rule 9 of the Security Interest (Enforcement) Rules, 2002 as regards the mortgaged properties of the borrowers. Subsequently, on 04.09.2015 auction notice was published by the Bank for sale of the mortgaged properties scheduling the same for 07.10.2015. Challenging the aforesaid proceedings, Mayank Porwal, Smt. Shrikanta Devi Porwal and Swati Dabkara, heir of deceased partner Sunil Porwal, (“the borrowers) preferred a Securitisation application under Section 17(1) of the Act, 2002 before the Debt Recovery Tribunal, Jabalpur, contending inter alia that no clear notice of thirty days was given by the Bank in terms of Rule 8 (6) of the Rules, 2002, that Rule 8 (7) has not been complied with, that procedure prescribed under Rule 8 (1) and Rule 8 (5) has not been followed while putting the properties in auction, that valuation of the properties has been arbitrarily made and only one of the property was sufficient for satisfying the entire outstanding loan amount but both the properties have been put to auction and that the entire proceedings initiated by the Bank are illegal.

04. The auction of the mortgaged property as published was held on

07.10.2015 and the Bank informed the DRT that with regard to property No.2 i.e.

land bearing Kharsa No. 2528. P.H. No.33, District Neemuch a bid has been received. The DRT ordered that sale with regard to property No.2 shall be subject to final outcome of the S.A. on 08.10.2015, the Bank issued sale confirmation letter in favour of the auction purchasers and they were directed to deposit the balance amount of the purchase price within a period of 15 days i.e. by 23.10.2015. The sale was also made subject to outcome of the S.A. By their letter dated 21.10.2015 the auction purch