RA (SA) 41/ 2017 & RA (SA) 154/2017

1

IN THE DEBT RECOVERY APPELLATE TRIBUNAL AT CHENNAI

Dated the 30^th of June, 2022

PRESENT: Hon’ble Mr. Justice S. Ravi Kumar

CHAIRPERSON

RA (SA) 41/2017

RA (SA) 154/2017

RA (SA) 41/2017

Between

Bank of India,

Rep. by its Authorised Officer, Mr. A. Sivasubramanian,

Purasawalkam Branch,

Palace Regency (1^st Floor),

No. 80-93, Purasawalkam High Road,

Kellys, Chennai – 600 010.

……Appellant

And

1. Mrs. K. Shyamala,

W/o Mr. M. Krishna Vijayam,

Old No.117, New No.22, Gengu Road,

Egmore, Chennai – 600 008.

2. Mr. R. Ram Mohan,

No.12, Parthasarathy Swamy Street,

Triplicane, Chennai – 600 005.

…..Respondents

RA (SA) 41/ 2017 & RA (SA) 154/2017

2

Between

Mr. R. Ram Mohan,

Auction Purchaser,

No.12, Parthasarathy Swamy Street,

Triplicane, Chennai – 600 005.

……Appellant

And

1. K. Shyamala,

W/o M. Krishna Vijayam,

Old No.117, New No.22, Gengu Road,

Egmore, Chennai – 600 008.

2. Bank of India,

Rep. by its Authorised Officer,

Purasawalkam Branch,

Palace Regency, First Floor,

No. 80-93, Purasawalkam High Road,

Kellys, Chennai – 600 010.

…..Respondents

COMMON ORDER

1. These two Appeals are preferred against Order dated

04.04.2017 of DRT-I, Chennai in SA 39/2015.

RA (SA) 41/ 2017 & RA (SA) 154/2017

3

2. First Respondent in both Appeals herein filed SA 39/2015

challenging the measures of Bank of India initiated under the

provisions of SARFAESI Act, 2002, and Tribunal below on a

consideration of contentions and rival contentions of parties,

accepted the contentions of 1^st Respondent (borrower) in both

Appeals to some extent, and allowed SA, aggrieved by which,

Bank, which is 1^st Respondent in SA 39/2015 preferred Appeal

RA (SA) 41/2017 and 2^nd Respondent in SA 39/2015 i.e. Auction

Purchaser preferred RA (SA) 154/2017.

3. Parties are hereinafter referred to as Borrower, Bank and

Auction Purchaser for better understanding.

4. Borrower filed SA 39/2015 contending that Authorised

Officer has not followed Rule 9 (4) of the Security Interest

(Enforcement) Rules, 2002, (hereinafter called the Rules, 2002)

according to which, the Auction Purchaser shall pay balance

purchase price before the 15^th day of confirmation of sale and

according to Sub- rule (5) of Rule 9 of Rules, 2002, in default of

payment of balance purchase price within the time stipulated in

RA (SA) 41/ 2017 & RA (SA) 154/2017

4

Sub-Rule (4) of Rule 9 of Rules, 2002, Authorised Officer shall

forfeit the amount deposited by bidder and the property be resold.

It is the contention of Borrower that Auction Purchaser has not

deposited the balance sale price within 15 days. Borrower also

contended that the property was sold at a very low bottom price

and thereby auction is not conducted in a proper legal manner.

According to Borrower, Market Value of the property is between

Rs.4.5 Crores to Rs.5 Crores, but it was sold for a meager sum of

Rs.1.51 Crores. Bank contended that Authorised Officer strictly

followed the provisions of SARFAESI Act and Rules made there

under, and there is no violation. Bank also contended that

Authorised Officer fixed upset price based on Valuation Report,

and therefore, objection of Borrower is not tenable. As Auction

Purchaser did not file any Counter, Tribunal below, after

examining material on record, held that the contentions of

Borrower that Authorised Officer has not followed Rule 9(4) of the

Rules, 2002, is not correct, and there is no substance in it,

therefore, rejected that contention. With regard to 2^nd ground,

Tribunal below recorded a finding that reserve price fixed by

Authorised Officer is unfair and not in conformity with the

RA (SA) 41/ 2017 & RA (SA) 154/2017

5

mandatory requirements of law, and therefore, the sale as held

cannot be allowed to sustain. Aggrieved by this finding, both

Bank and Auction Purchaser preferred these Appeals.

5. Written Arg