Gujarat High Court
Varshaben Pareshkumar Patel vs The Authorized Officer, Union Bank Of ... on 3 April, 2024
NEUTRAL CITATION
C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 20368 of 2023
With
R/SPECIAL CIVIL APPLICATION NO. 20373 of 2023
With
R/SPECIAL CIVIL APPLICATION NO. 20374 of 2023
With
R/SPECIAL CIVIL APPLICATION NO. 20376 of 2023
With
R/SPECIAL CIVIL APPLICATION NO. 20377 of 2023
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE HEMANT M. PRACHCHHAK Sd/-
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1 Whether Reporters of Local Papers may be allowed Yes
to see the judgment ?
2 To be referred to the Reporter or not ? Yes
3 Whether their Lordships wish to see the fair copy No
of the judgment ?
4 Whether this case involves a substantial question No
of law as to the interpretation of the Constitution
of India or any order made thereunder ?
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VARSHABEN PARESHKUMAR PATEL
Versus
THE AUTHORIZED OFFICER, UNION BANK OF INDIA
================================================================
Appearance:
MR DIPEN DESAI(2481) for the Petitioner(s) No. 1
MR AS PANESAR(5390) for the Respondent(s) No. 1
================================================================
CORAM:HONOURABLE MR. JUSTICE HEMANT M. PRACHCHHAK
Date : 03/04/2024
ORAL JUDGMENT
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NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined
1. RULE. Mr. A.S. Panesar, learned Counsel waives service of notice of rule on behalf of the respondent-Bank.
With consent of the learned advocates appearing for the respective parties, present petitions are taken up for final disposal today. Since common issue is involved in all these petitions, they are being decided of by this common judgment.
2. Leave to correct the flat number in prayer clause in Special Civil Application No.20368 of 2023 and Special Civil Application No.20376 of 2023. Amendment to be carried out forthwith.
3. By way of present petitions under Articles 14, 19 and 226 of the Constitution of India, under the provisions of Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 ("SARFAESI"
for short") and under the Security Interest (Enforcement) Rules, 2002, the petitioners have challenged inaction on the part of the respondent authority.
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4. It is required to be noted herein that all the petitioners have prayed for similar relief in all the petitions, except Flat Numbers and therefore, Special Civil Application No.20368 of 2023 is treated as the lead petition wherein it is prayed, inter alia that:-
"12(A) A. This Hon'ble Court be pleased to admit and allow the petition filed by the Petitioner.
B. This Hon'ble Court be pleased to issue a writ of mandamus or any appropriate writ, order or directions and be pleased to direct Authorized Officer of Respondent Bank to issue Certificate of Sale forthwith (free from all encumbrances and reasonable doubts) in favour of petitioner as purchaser of Flat No.H-602 in the form given in Appendix-V to SARFAESI Rules and further be pleased to direct Authorized Officer of Respondent Bank to execute Registered Sale Deed forthwith in favour of petitioner for Flat No.H-602 and be pleased to direct Authorized Officer of Respondent Bank to handover actual, vacant and physical possession of Flat No.G-202 forthwith without any extension of time to the Respondent Bank.
C. Since petitioner is require to approach before this Hon'ble Court on account of failure of Authorized Officer of Respondent Bank in compliance of statutory and mandatory duty as envisaged under Rule-9 of SARFAESI Rules-2002 and since Authorized Officer of Respondent Bank had deprived the petitioner from enjoying property Flat No.H-602 from 22/6/2023 till date, heavy amount of exemplary cost be imposed upon Authorized Officer of Respondent Bank being public servant of public sector Page 3 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined bank in accordance with law.
D. This Hon'ble Court be pleased to pass any other just and proper relief may deem fit, be granted in the interest of justice."
5. It appears that the A.O. of the respondent bank had issued Sale Notice-E-Auction dated 07.03.2023 in Financial Express (English Editor) dated 11.3.2023 in respect of sale of properties as mentioned in the sale notice in respect of the scheme known as "Raj Labdhi Heritage" owned and belonging to M/s Rajlabdhi Infrastructure Pvt. Ltd. as stated in the description of the property part of the said auction sale notice dated 7.3.2023, which came to be published in local daily in English as per SARFAESI Rules.
5.1 The petitioners have participated in the said e-auction in group and out of that group, five petitioners have preferred present petitions. The relevant property shown in lot No.1 of the public notice dated 7.3.2023, reads as under:-
"LOT 1-(23 Flints & 20 Shops) All the piece and parcel of Block G, H, & 20 Shops of the Page 4 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined project situated at parcel of NA land bearing Block No 86 (Old Survey No. 86,38,97,99 & 74) admeasuring 14438 square meter and as per F P No. 147 of T.P. Scheme No 03 admeasuring 9385 sq. Mtrs., together with construction of residential units and commercial shops standing thereon situated and being at Mouje: Koba, Tal and Dist.: Gandhinagar, scheme known as "RAJ LABDHI HERITAGE" and owned by M/s Rajlabdhi Infrastructure Pvt. Ltd. (Excluding Blocks A,B,C,D,E,F & proportionate land share of these blocks in the scheme, since already sold in E-Auction) (List of such flats & Shops of Project is provided in Annexure) 5.2 In the said public notice, the bank has specifically mentioned pendency of three Securitisation Applications being S.A. No. 078 of 2023, S.A. No. 18 of 2022 and S.A. No. 202 of 2020 pending before the Debt Recovery Tribunal-I, Ahmedabad and one Letters Patent Appeal No.42288 of 2022 in R/SCA No. 22857 of 2022 before this Court. Subsequently the said Letters Patent Appeal came to be disposed of by this Court on the ground of non-
removal of the office objections.
5.3 Relevant Clause Nos. 4, 15, 19, 20 and 28 of the said public notice dated 7.3.2023 reads as under:-Page 5 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024
NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined "Clause 4.
The details of encumbrances, if any known to the Secured Creditor:-
SA No. 078/2023 in DRT-I, Ahmedabad S.A. No.18/2022 in DRT-I, Ahmedabad S.A. No.202/2020 in DRT-I, Ahmedabad & LPA No. 42288 of 2022 in R/SCA/22857/2022 before Hon'ble High Court of Gujarat.
Clause 15.
The Authorised Officer may, where the property sold is subject to any encumbrances, if he thinks fit, allow the purchaser to deposit with him the money required to discharge the encumbrances and any interest due thereon together with such additional amount that may be sufficient to meet the contingencies or further costs, expenses and interest as may be determined by him. On such deposit of money for discharge of encumbrances, the Authorised Officer may issue or cause the purchaser to issue the notices to the persons interested in or entitled to the money deposited with him and take steps to make the payment accordingly.
Clause 19.
The Authorised Officer will deliver the property on the basis of symbolic/physical possession taken on as is where is basis to the purchaser free from encumbrances known to the secured creditor on deposit of money by the purchaser towards the discharge of such encumbrances.
Clause 20.
The certificate of sale will be issued specifically mentioning whether the purchaser has purchased Page 6 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined the immovable/movable secured assets free from any encumbrances known to the secured creditor or not. No request for change of name in the sale certificate other than the person who submitted the bid/participated in the auction shall be entertained.
Clause 28.
28. To the best of information and knowledge of the Authorised Officer, there is no encumbrance on the property. However, the intending bidders should make their own independent enquiry regarding the encumbrances, title of the property put to auction and the claims /rights/ dues affecting the property, prior to submitting their bid. The E Auction advertisement does not constitute and will not be deemed to constitute any commitment or any representation of the Bank to sell the property.
The Authorised Officer/Secured Creditor shall not be responsible in any way for any third-party claims/rights/dues."
5.4 It appears that the petitioners amongst group of the intended purchaser, who have participated in E-Auction through one of the member, who lead to all the group of persons. Even on page 49 in the affidavit, it was clarified that while registration under group of individuals' category on MSTC portal, some technical error/glitch is prompting up, and thus not allowing to register the ID under group of 35 individuals.
Page 7 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined 5.5 Before accepting the offer of the petitioners, the bank was very much aware this fact and after considering all relevant facts, the bank has accepted the offer of the petitioners and in response thereto all the petitioners have paid total amount of the offer made to the bank.
Thereafter, the petitioners have approached the bank to execute the sale deed in the name of individual person and also for issuance of sale certificate in favour of the group of the petitioners whose offer have been accepted by the bank. Since the respondent bank has not paid any heed therefore, the petitioners have preferred present petitions.
6. I have heard Mr. Dipen Desai, learned Counsel appearing for the petitioners in all the petitions and Mr. A.S. Panesar, learned Counsel appearing for the respondent bank in all the petitions.
7. Mr. Desai, learned Counsel for the petitioners has submitted that the petitioners are successful borrowers and they are purchasers and they are not aggrieved by Page 8 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined action of the bank and therefore, they cannot file any proceedings under Section 17 of the SARFAESI Act, before the Debt Recovery Tribunal. Mr. Desai, learned Counsel for the petitioners has submitted that the respondent bank has intentionally withheld the process of issuance of certificate of sale, execution of registered sale deed for the subject secured asset and handing over of actual, physical and vacant possession of the flat to the petitioners for the reason best known to the respondent bank.
7.1 Mr. Desai, learned Counsel for the petitioners has referred to and relied upon Section 17 of the SARFAESI Act read with rules 8 and 9 of the Security Interest (Enforcement) Rules, 2002 which are as follow:-
"17.[Application against measures to recover secured debts].-- (1) Any person (including borrower), aggrieved by any of the measures referred to in sub- section(4)of section 13 taken by the secured creditor or his authorised officer under this Chapter,2[may make an application along with such fee, as may be prescribed,] to the Debts Recovery Tribunal having jurisdiction in the matter within forty five days from the date on which such measure had been taken:Page 9 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024
NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined [Provided that different fees may be prescribed for making the application by the borrower and the person other than the borrower.] [Explanation.--For the removal of doubts, it is hereby declared that the communication of the reasons to the borrower by the secured creditor for not having accepted his representation or objection or the likely action of the secured creditor at the stage of communication of reasons to the borrower shall not entitle the person (including borrower) to make an application to the Debts Recovery Tribunal under this sub-section.] [(1A) An application under sub-section(1)shall be filed before the Debts Recovery Tribunal within the local limits of whose jurisdiction--
(a) the cause of action, wholly or in part, arises;
(b) where the secured asset is located; or
(c) the branch or any other office of a bank or financial institution is maintaining an account in which debt claimed is outstanding for the time being.] [(2) The Debts Recovery Tribunal shall consider whether any of the measures referred to in sub-section(4)of section 13 taken by the secured creditor for enforcement of security are in accordance with the provisions of this Act and the rules made thereunder.
[(3) If, the Debts Recovery Tribunal, after examining the facts and circumstances of the case and evidence produced by the parties, comes to the conclusion that any of the measures referred to in sub-section(4)of section 13, taken by the secured creditor are not in Page 10 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined accordance with the provisions of this Act and the rules made thereunder, and require restoration of the management or restoration of possession, of the secured assets to the borrower or other aggrieved person, it may, by order,--
(a) declare the recourse to any one or more measures referred to in sub-section(4)of section 13 taken by the secured creditor as invalid; and
(b) restore the possession of secured assets or management of secured assets to the borrower or such other aggrieved person, who has made an application under sub-section(1), as the case may be; and
(c) pass such other direction as it may consider appropriate and necessary in relation to any of the recourse taken by the secured creditor under sub-
section(4)of section 13.] (4) If, the Debts Recovery Tribunal declares the recourse taken by a secured creditor under sub-section(4)of section 13, is in accordance with the provisions of this Act and the rules made thereunder, then, notwithstanding anything contained in any other law for the time being in force, the secured creditor shall be entitled to take recourse to one or more of the measures specified under sub-section(4)of section 13 to recover his secured debt.
[(4A) Where--
(i) any person, in an application under sub-section(1), claims any tenancy or leasehold rights upon the secured asset, the Debt Recovery Tribunal, after examining the Page 11 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined facts of the case and evidence produced by the parties in relation to such claims shall, for the purposes of enforcement of security interest, have the jurisdiction to examine whether lease or tenancy,--
(a) has expired or stood determined; or
(b) is contrary to section 65A of the Transfer of Property Act, 1882 (4 of 1882); or
(c) is contrary to terms of mortgage; or
(d) is created after the issuance of notice of default and demand by the Bank under subsection(2)of section 13 of the Act; and
(ii) the Debt Recovery Tribunal is satisfied that tenancy right or leasehold rights claimed in secured asset falls under the sub-clause (a) or sub-clause(b) or sub- clause(c) or sub-clause(d) of clause(i), then notwithstanding anything to the contrary contained in any other law for the time being in force, the Debt Recovery Tribunal may pass such order as it deems fit in accordance with the provisions of this Act.] (5) Any application made under sub-section(1)shall be dealt with by the Debts Recovery Tribunal as expeditiously as possible and disposed of within sixty days from the date of such application:
Provided that the Debts Recovery Tribunal may, from time to time, extend the said period for reasons to be recorded in writing, so, however, that the total period of pendency of the application with the Debts Recovery Tribunal, shall not exceed four months from the date of Page 12 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined making of such application made under sub-section(1).
(6) If the application is not disposed of by the Debts Recovery Tribunal within the period of four months as specified in sub-section(5), any part to the application may make an application, in such form as may be prescribed, to the Appellate Tribunal for directing the Debts Recovery Tribunal for expeditious disposal of the application pending before the Debts Recovery Tribunal and the Appellate Tribunal may, on such application, make an order for expeditious disposal of the pending application by the Debts Recovery Tribunal.
(7) Save as otherwise provided in this Act, the Debts Recovery Tribunal shall, as far as may be, dispose of the application in accordance with the provisions of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (51 of 1993) and the rules made thereunder.]"
8.Sale of immovable secured assets.
(1)Where the secured asset is an immovable property, the authorized officer shall take or cause to be taken possession, by delivering a possession notice prepared as nearly as possible in Appendix IV to these rules, to the borrower and by affixing the possession notice on the outer door or at such conspicuous place of the property.
(2)The possession notice as referred to in sub-rule (1) shall also be published in two leading newspaper, one in vernacular language having sufficient circulation in that locality, by the authorized officer.
(2A)[ All notices under these rules may also be served upon the borrower through electronic mode of service, in addition to the modes prescribed under sub-rule (1) Page 13 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined and sub-rule (2) of rule 8.][Inserted by Notification No. G.S.R. 1046 (E), dated 3.11.2016 (w.e.f. 20.9.2002).] (3)In the event of possession of immovable property is actually taken by the authorized officer, such property shall be kept in his own custody or in the custody of any person authorized or appointed by him, who shall take as much care of the property in his custody as a owner of ordinary prudence would, under the similar circumstances, take of such property. (4)The authorized officer shall take steps for preservation and protection of secured assets and insure them, if necessary, till they are sold or otherwise disposed of.
(5)Before effecting sale of the immovable property referred to in sub-rule (1) of rule 9, the authorized officer shall obtain valuation of the property from an approved valuer and in consultation with the secured creditor, fix the reserve price of the property and may sell the whole or any part of such immovable secured asset by any of the following methods:-(a)by obtaining quotations from the persons dealing with similar secured assets or otherwise interested in buying the such assets; or
(b)by inviting tenders from the public;
(c)[ by holding public auction including through e- auction mode; or][Substituted by Notification No. G.S.R. 1046 (E), dated 3.11.2016 (w.e.f. 20.9.2002).]
(d)by private treaty.
(6)the authorized officer shall serve to the borrower a notice of thirty days for sale of the immovable secured assets, under sub-rule (5):[Provided that if the sale of such secured asset is being effected by either inviting Page 14 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined tenders from the public or by holding public auction, the secured creditor shall cause a public notice in the Form given in Appendix IV-A to be published in two leading newspapers including one in vernacular language having wide circulation in the locality.][Substituted by Notification No. G.S.R. 1040(E), dated 17.10.2018 (w.e.f. 20.9.2002).] (7)[ every notice of sale shall be affixed on the conspicuous part of the immovable property and the authorised officer shall upload the detailed terms and conditions of the sale, on the web- site of the secured creditor, which shall include;(a)the description of the immovable property to be sold, including the details of the encumbrances known to the secured creditor;
(b)the secured debt for recovery of which the property is to be sold;
(c)reserve price of the immovable secured assets below which the property may not be sold;
(d)time and place of public auction or the time after which sale by any other mode shall be completed;
(e)deposit of earnest money as may be stipulated by the secured creditor;
(f)any other terms and conditions, which the authorized officer considers it necessary for a purchaser to know the nature and value of the property.] (8)Sale by any methods other than public auction or public tender, shall be on such terms as may be settled [between the secured creditors and the proposed purchaser in writing][Substituted 'between the parties in writing' by Notification No. G.S.R. 1046 (E), dated Page 15 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined 3.11.2016 (w.e.f. 20.9.2002).].
9.Time of sale, issue of sale certificate and delivery of possession, etc. [(1) No sale of immovable property under these rules, in first instance shall take place before the expiry of thirty days from the date on which the public notice of sale is published in newspapers as referred to in the proviso to sub-rule (6) of rule 8 or notice of sale has been served to the borrower:Provided further that if sale of immovable property by any one of the methods specified by sub rule (5) of rule 8 fails and sale is required to be conducted again, the authorized officer shall serve, affix and publish notice of sale of not less than fifteen days to the borrower, for any subsequent sale.][Substituted by Notification No. G.S.R. 1046 (E), dated 3.11.2016 (w.e.f. 20.9.2002).] (2)The sale shall be confirmed in favour of the purchaser who has offered the highest sale price in his bid or tender or quotation or offer to the authorized officer and shall be subject to confirmation by the secured creditor:Provided that no sale under this rule shall be confirmed, if the amount offered by sale price is less than the reserve price, specified under sub-rule (5) of [rule 8][Substituted by Notification No. G.S.R. 1046 (E), dated 3.11.2016 (w.e.f. 20.9.2002).]:Provided further that if the authorized officer fails to obtain a price higher than the reserve price, he may, with the consent of the borrower and the secured creditor effect the sale at such price.
(3)[ On every sale of immovable property, the purchaser shall immediately, i.e. on the same day or not later than next working day, as the case may be, pay a deposit of twenty five per cent. of the amount of the sale price, Page 16 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined which is inclusive of earnest money deposited, if any, to the authorized officer conducting the sale and in default of such deposit, the property shall be sold again;] [Substituted by Notification No. G.S.R. 1046 (E), dated 3.11.2016 (w.e.f. 20.9.2002).] (4)The balance amount of purchase price payable shall be paid by the purchaser to the authorized officer on or before the fifteenth day of confirmation of sale of the immovable property or such extended period [as may be agreed upon in writing between the purchaser and the secured creditor, in any case not exceeding three months][Substituted by Notification No. G.S.R. 1046 (E), dated 3.11.2016 (w.e.f. 20.9.2002).]. (5)In default of payment within the period mentioned in sub-rule (4), the deposit shall be forfeited [to the secured creditor][Inserted by Notification No. G.S.R. 1046 (E), dated 3.11.2016 (w.e.f. 20.9.2002).]and the property shall be resold and the defaulting purchaser shall forfeit all claim to the property or to any part of the sum for which it may be subsequently sold. (6)On confirmation of sale by the secured creditor and if the terms of payment have been complied with, the authorized officer exercising the power of sale shall issue a certificate of sale of the immovable property in favour of the purchaser in the Form given in Appendix V to these rules.
(7)Where the immovable property sold is subject to any encumbrances, the authorized officer may, if he thinks fit, allow the purchaser to deposit with him the money required to discharge the encumbrances and any interest due thereon together with such additional amount that may be sufficient to meet the contingencies or further cost, expenses and interest as may be determined by him.
Page 17 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined (8)On such deposit of money for discharge of the encumbrances, the authorized officer may issue or cause the purchaser to issue notices to the persons interested in or entitled to the money deposited with him and take steps to make the payment accordingly. (9)The authorized officer shall deliver the property to the purchaser free from encumbrances known to the secured creditor on deposit of money as specified in sub- rule (7) above.
(10)The certificate of sale issued under sub-rule (6) shall specifically mention that whether the purchaser has purchased the immovable secured asset free from any encumbrances known to the secured creditor or not."
7.2 In support of his submissions, Mr. Desai, learned Counsel for the petitioners has relied upon the decision of High Court of Jammu and Kashmir in case of S.K. Bakshi vs. Punjab National Bank and others reported in 2022 SCC OnLine J&K 1075 wherein High Court of Jammu and Kashmir has observed in paragraph Nos. 9, 11, 17, 18 and 19 as under:-
"09. The procedure under which the secured creditors can enforce the liability discharged by the borrower is provided under Section 13(4)of the SARFAESI Act. If the borrower fails to discharge his liability after issuance of notice under Section 13(2), the secured creditor can take possession of the secured asset of the borrower and has a right to transfer the same by way of lease Page 18 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined agreement or sale. Section 13(4)of the Act being relevant reads as under:
"(4) In case the borrower fails to discharge his liability in full within the period specified in sub-section (2), the secured creditor may take recourse to one or more of the following measures to recover his secured debt, namely:--
(a) take possession of the secured assets of the borrower including the right to transfer by way of lease, assignment or sale for realizing the secured asset;
[(b) take over the management of the business of the borrower including the right to transfer by way of lease, assignment or sale for realising the secured asset:
Provided that the right to transfer by way of lease, assignment or sale shall be exercised only where the substantial part of the business of the borrower is held as security for the debt:
Provided further that where the management of whole of the business or part of the business is severable, the secured creditor shall take over the management of such business of the borrower which is relatable to the security for the debt;]
(c) appoint any person (hereafter referred to as the manager), to manage the secured assets the possession of which has been taken over by the secured creditor;
(d) require at any time by notice in writing, any person who has acquired any of the secured assets from the borrower and from whom any money is due or may become due to the borrower, to pay the secured creditor, so much of the money as is sufficient to pay the secured debt."Page 19 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024
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11. As per Section 13(4)of the SARFAESI Act read with Clause 9 & 10 of Rule 9 of the Security Interest (Enforcement) Rules, 2002, it was incumbent upon the authorized officer/respondent No. 1 to deliver the property to the purchaser free from all encumbrances on deposit of money in the Bank. Rule 9 Clause 9 & 10 are to be read with Section 13(4)of the Act which reads as under:
"(9) Time of sale, Issue of sale certificate and delivery of possession, etc. -
(9) The authorized officer shall deliver the property to the purchaser free from encumbrances known to the secured creditor on deposit of money as specified in sub-
rule (7) above.
(10) The certificate of sale issued under sub-rule (6) shall specifically mention that whether the purchaser has purchased the immovable secured asset free from any encumbrances known to the secured creditor or not."
17. It is also submitted by respondent Nos. 6 and 7 that this petition is not maintainable as the only remedy is available to the petitioner is underSection 17of the SARFAESI Act. Reliance is placed on the judgment of the Hon'ble Supreme Court, in case titled„Agarwal Tracom Pvt. Ltd. vs. Punjab National Bank and others' dated 27.11.2017. This, however, is opposed by learned counsel for the petitioner by submitting that by not delivering the possession of the property to the petitioner by the Bank is not one of the measures specified under Section 13(4)of the SARFAESI Act, therefore, provisions of Section 17of the SARFAESI Act are not attracted, as such, this action of the respondents cannot be challenged underSection 17of the said Act.
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18. Thus, in terms of this Act, an application under Section 17can be made to DRT by "any person"
including borrower to challenge any of the measures referred to in Section 13(4)once taken by the secured creditor. But, in this case, the petitioner who is the auction purchaser of the property and has been promised by the Bank that the delivery of the property is free from all encumbrances cannot proceed under Section 17as it does not envisages any of the grounds enumerated in Section 13(4). Thus, the judgment relied upon is not applicable to the facts of this case.
(emphasis supplied)
19. The third party, who comes forward to purchase the secured asset, must have a confidence that he would get the title to the property at the earliest. If the transferring of the property by way of title is going to be delayed endlessly, then the object of the Act which is meant for speedy recovery would be defeated as a whole. The duty is on the respondent No. 1 to hand over the possession of the property."
7.3 Mr. Desai, learned Counsel for the petitioners has also referred to and relied upon the decision of this Court in Letters Patent Appeal No.597 of 2018 decided on 18.12.2020. Mr. Desai, learned Counsel for the petitioners has emphasized on paragraph Nos. 21 to 23 which read as under:-
"21. As regards the judgment of the learned Single Judge, the learned Single Judge had principally dismissed the writ petition on the ground of availability Page 21 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined of an alternative remedy under Section 17 of the SARFAESI Act, which is reproduced herein below:
Section 17 Right to appeal.--
"(1) Any person (including borrower), aggrieved by any of the measures referred to in sub-section (4) of section 13 taken by the secured creditor or his authorised officer under this Chapter, 1[may make an application along with such fee, as may be prescribed] to the Debts Recovery Tribunal having jurisdiction in the matter within forty-five days from the date on which such measures had been taken:--(1) Any person (including borrower), aggrieved by any of the measures referred to in sub-section (4) of section 13 taken by the secured creditor or his authorised officer under this Chapter, 1[may make an application along with such fee, as may be prescribed] to the Debts Recovery Tribunal having jurisdiction in the matter within forty-five days from the date on which such measures had been taken\:"
2[Provided that different fees may be prescribed for making the application by the borrower and the person other than the borrower.] 3[Explanation. --For the removal of doubts it is hereby declared that the communication of the reasons to the borrower by the secured creditor for not having accepted his representation or objection or the likely action of the secured creditor at the stage of communication of reasons to the borrower shall not entitle the person (including borrower) to make an application to the Debts Recovery Tribunal under sub-section (1) of section
17.]3[Explanation.--For the removal of doubts it is hereby declared that the communication of the reasons to the borrower by the secured creditor for not having accepted his representation or objection or the likely action of the secured creditor at the stage of communication of reasons to the borrower shall not entitle the person (including borrower) to make an application to the Debts Recovery Tribunal under sub- section (1) of section 17.]" 4[(2) The Debts Recovery Tribunal shall consider whether any of the measures referred to in sub-section (4) of section 13 taken by the secured creditor for enforcement of security are in accordance with the provisions of this Act and the rules Page 22 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined made thereunder.
(3) If, the Debts Recovery Tribunal, after examining the facts and circumstances of the case and evidence produced by the parties, comes to the conclusion that any of the measures referred to in sub-section (4) of section 13, taken by the secured creditor are not in accordance with the provisions of this Act and the rules made thereunder, and require restoration of the management of the secured assets to the borrower or restoration of possession of the secured assets to the borrower, it may by order, declare the recourse to any one or more measures referred to in-sub-section (4) of section 13 taken by the secured assets as invalid and restore the possession of the secured assets to the borrower or restore the management of the secured assets to the borrower, as the case may be, and pass such order as it may consider appropriate and necessary in relation to any of the recourse taken by the secured creditor under sub-section (4) of section 13.
4) If, the Debts Recovery Tribunal declares the recourse taken by a secured creditor under sub-section (4) of section 13, is in accordance with the provisions of this Act and the rules made thereunder, then, notwithstanding anything contained in any other law for the time being in force, the secured creditor shall be entitled to take recourse to one or more of the measures specified under sub-section (4) of section l3 to recover his secured debt.
(5) Any application made under sub-section (1) shall be dealt with by the Debts Recovery Tribunal as expeditiously as possible and disposed of within sixty days from the date of such application: Provided that the Debts Recovery Tribunal may, from time to time, extend the said period for reasons to be recorded in writing, so, however, that the total period of pendency of the application with the Debts Recovery Tribunal, shall not exceed four months from the date of making of such application made under sub-section (1). (6) If the application is not disposed of by the Debts Recovery Tribunal within the period of four months as specified in sub-section (5), any party to the application Page 23 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined may make an application, in such form as may be prescribed, to the Appellate Tribunal for directing the Debts Recovery Tribunal for expeditious disposal of the application pending before the Debts Recovery Tribunal and the Appellate Tribunal may, on such application, make an order for expeditious disposal of the pending application by the Debts Recovery Tribunal. (7) Save as otherwise provided in this Act, the Debts Recovery Tribunal shall, as far as may be, dispose of application in accordance with the provisions of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (51 of 1993) and the rules made thereunder.]
22. Plain reading of Section 17 makes it clear that the Debts Recovery Tribunal can be approached by any person including a borrower, who is aggrieved by any measures referred in Sub-section (4) of Section 13 take by the secured creditor or its Authorized Officer. Now the question would be as to whether the action of the respondent bank in not issuing the No Due Certificate inspite of having received entire amount due to it from loan accounts of the respondent bank was in any manner covered under Section 13(4) of the Act. We therefore, deem it appropriate to refer Section 13(4) of the Act, which reads as under: Section 13(4) "(4) In case the borrower fails to discharge his liability in full within the period specified in sub- section (2), the secured creditor may take recourse to one or more of the following measures to recover his secured debt, namely:-
(a) take possession of the secured assets of the borrower including the right to transfer by way of lease, assignment or sale for realising the secured asset;
(b) take over the management of the secured assets of the borrower including the right to transfer by way of lease, assignment or sale and realise the secured asset;
(c) appoint any person (hereafter referred to as the manager), to manage the secured assets the possession of which has been taken over by the secured creditor;
(d) require at any time by notice in writing, any person Page 24 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined who has acquired any of the secured assets from the borrower and from whom any money is due or may become due to the borrower, to pay the secured creditor, so much of the money as is sufficient to pay the secured debt."
23. Plain reading of Sub-section 4 of Section 13 makes it abundantly clear that the action of the respondent Dena Bank in not issuing No Due Certificate to the appellant - petitioner and not taking appropriate steps to release its charge over the property inspite of entire loan being paid up by the appellant - petitioner by availing loan from Kotak Mahindra Bank Ltd., would not fall under the scope and ambit of the said Sub-section. Said Sub- section states about recourse to which a secured creditor may take, in case a borrower fails to discharge his liability in full. It is not the case of the respondent Bank that non-issuance of No Due Certificate and non- release of charge was on account of the appellant - petitioner not discharging its liability towards the respondent Bank. On the contrary, the appellant - Petitioner has discharged its liability to the respondent Bank in full. But the respondent Bank has taken the collateral security given by the appellant - petitioner in lieu of the loans availed by it, as cross guarantee to loan availed by M/s. Ramdev Cotton & Ginning. Under such circumstances, we are of the considered opinion that the action of the bank in not releasing No Due Certificate and not taking steps to release its charge upon the collateral security, cannot be termed to be an action taken under Section 13(4) of the SARFAESI Act, which would entitle the appellant - petitioner to invoke remedy under Section 17 of the SARFAESI Act. Thus, we hold that the remedy under Section 17 of the SARFAESI Act was neither an alternative remedy nor an efficacious remedy for cause of action raised in the present petition."
7.4 In view of the above facts, Mr. Dipen Desai, learned Counsel for the petitioners urge before the Court that Page 25 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined present petition may be allowed and the prayer made in present petition may be granted.
8. On the other hand, Mr. Panesar, learned Counsel for the respondent bank has objected present petitions by way of filing an affidavit-in-reply. Mr. Panesar, learned Counsel for the respondent bank has submitted that since the petitioners have participated in the e-auction in a group and therefore, the bank will not execute individual sale deed in favour of the petitioners.
8.1 Mr. Panesar, learned Counsel for the respondent bank has submitted that the petitioners have an alternate efficacious and statutory remedy of approaching the Debts Recovery Tribunal under Section 17 of the SARFAESI Act, however, the petitioners have instead of exhausting the said statutory remedy straightway approached this Court by filing present petitions which is legally impermissible.
8.2 Mr. Panesar, learned Counsel for the respondent bank Page 26 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined has further submitted that the petitioners have participated in the e-auction after accepting all the terms and condition of tender/contract and with full knowledge of the litigation over the property and therefore, the claim of the petitioners to seek issuance of sale certificate free from all encumbrances is also completely beyond the terms of tender/contract accepted by the petitioners. He has further submitted that petitioners along with 34 persons together as a group gave their bid for the entire Lot No.1 and the said group of 35 persons was being led by one Mr. Ravi Amrutbhai Patel, hence the petitioner along with 34 other persons gave composite bid for Lot No.1, however, the MSTC portal was not accepting the details of more than 5 persons for a bid. He has further submitted that the said Mr. Ravi Patel has also submitted an affidavit dated 29.3.2023 which is not disputed by the petitioners. He has further submitted that since the bid has been given by 35 persons together for common Lot No.1, the respondent bank will have to issue common sale certificate in favour of 35 successful bidders for the entire Page 27 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined lot only and cannot issue individual sale certificate as prayed by the petitioners.
8.3 In support of his submissions, Mr. Panesar, learned Counsel for the respondent bank has relied upon the decisions of the Hon'ble Apex Court in the case of Agarwal Tracom Private Limited vs. Punjab National Bank and others reported in (2018) 1 SCC 626. He has relied upon paragraph No.18 wherein Hon'ble Apex Court has discussed about Section 13(4) and Section 17 of the SARFAESI Act as well as Rule 8 and 9 of the Security Interest (Enforcement) Rules, 2002. He has further relied upon paragraph No.22 of the said decision which reads as under:-
"22. So far as Section 17is concerned, it provides a remedy to a person who is aggrieved by the measures taken by the secured creditor or his authorized officer under Section 13(4)in relation to secured assets of the borrower. It says that "any person (including borrower)"
may make an application to the DRT within 45 days from the date of measures taken under Section 13(4). Sub- section (2) of Section 17was added by way of amendment w.e.f. 11.11.2004. It provides that the Tribunal, on such application being made under Section 17(1), shall consider whether the measures referred to Page 28 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined and taken under Section 13(4)by the secured creditor are in accordance with the "provisions of this Act and the Rules made thereunder". Similarly, sub- sections (3), (4) and (7) of Section 17which deal with the power of the DRT also use the expression "in accordance with provisions of the Act and the Rules made thereunder".
8.4 In view of the above facts, Mr. Panesar, learned Counsel for the respondent bank urges before the Court that present petition may not be entertained and the same may be dismissed.
9. I have considered submissions made by both the learned advocates for the respective parties. I have also gone through the records of the petitions as well as relevant material.
10. It appears that in first instance, the respondent bank has objected the admission of the petitions by way of filing affidavit-in-reply, more particularly, paragraph Nos.
2 and 3, only on the ground of an alternative remedy and not stated about the fact that the respondent bank is not going to execute sale deed individually and instead of that respondent bank is going to execute the sale deed in Page 29 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined favour of the group of the petitioners and the respondent bank is going to issue the sale certificate in the name of group of petitioners and not individual.
11. Thereafter, in second further affidavit, the respondent bank has completely changed its version by raising contentions in paragraph Nos. 2 to 4 which reads as under:-
"2. The present Respondent vide auction sale notice dated 7/3/2023 (produced at page No. 17 to 26 of the Petition) put various properties of the Borrower to public auction on 28/3/2023. It is submitted in the lot No.1 of the said auction sale notice, the Respondent had put to sale 23 Flats and 20 Shops of Raj Labdhi Heritage to auction in one single combined lot. Hence, there was no individual properties which were put to auction sale by the Respondent and who soever was to bid was to get all the said properties in one lot. The Petitioner along with 34 other persons together as group gave their bid for the entire lot No.1. The said group of 35 persons was being led by one Mr. Ravi Amrutbhai Patel. Hence, the Petitioner along with 34 other persons gave composite bid for Lot No.1 consisting of 23 Flats and 20 shops. In this connection, as the MSTC Portal was not accepting the details of more than 5 persons for a bid, the said Mr. Ravi Patel had also submitted an Affidavit dated 29/03/2023 which is also not disputed by the Petitioner. True copy of the Affidavit dated 29/03/2023 given by Mr. Ravi Patel is attached herewith and is marked as ANNEXURE-R/1.Page 30 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024
NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined
3.It is submitted that even the initial sale confirmation which is immediately issued after confirmation of sale by the authorized through email was issued in favor of only those 5 persons whose registration was accepted by the website that too for Lot No.1 as a combined lot. True copy of email dated 28/03/2023 sent by the Respondent to the successful bides for confirmation of sale is attached herewith and is marked as ANNEXURE-R/2.
4. Hence, the above facts shows that, the Respondent Bank has put entire 23 flat and 20 shops in one lot to auction sale for which the petitioner along with 34 other people have gave their common bid. Hence, the group of 35 persons in combine were the successful bidder for entire 23 flats and 20 shops without any segregation. Since the bid has been given by 35 persons together for common lot of 23 flats and 20 shops, the Respondent will have to issue common sale certificate in favor of 35 successful bidders for the entire lot only and cannot issue individual sale certificates as sought for by the Petitioner in the present Petition. Hence, the present Petition lacks total merit and deserves dismissal. It is submitted if internally the said bidders have some understanding about the division of the properties than the same can be done at their end individually as to such an agreement the Respondent was never a party. It is submitted that if the Respondent would not venture into execution of individual sale certificates and sale deeds, the same will not only be against the auction sale notice issued by the Respondent, but would also amount to evasion of stamp duty which the petitioners and their other co-bidders will be liable to pay on the documents which may be executed in between them. It is submitted that in this connection, the petitioner and the other co- bidders have also entered into an unregistered Page 31 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined Memorandum of Understanding on 15/04/2023 which has not been produced by the Petitioner along with the Petition which also shows that petitioner along with other co-bidders gave their common bid for entire lot No.1 and not individual flats. It is submitted that letter dated 18/04/2023 issued by the Respondent was issued at the request of the Bidders, however, the same does not change the fact Petitioner had made combined bid for a combined Lot No.1 and therefore, the Respondent cannot issue a separate or individual sale certificate. Copy of the said Memorandum of Understanding executed between the petitioner and the other co- bidders on 15.4.2023 is attached herewith and is marked as ANNEXURE-R/3"
12. Thereafter, the petitioners have filed their affidavit-in- rejoinder and pointed out all the facts and empathized upon the provision of law, more particularity Section 17 of the SARFAESI Act and submitted that the petitioners are not the aggrieved persons as mentioned in Section 17 of the SARFAESI Act as they are the successful bidders and purchased the properties from e-auction held by the respondent bank and therefore, they would not fall under the provision of Section 17 of the SARFAESI Act and therefore, so far as the contention raised by the respondent bank with regard to alternate remedy is concerned, they are not aggrieved party and therefore, Page 32 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined they have no remedy except preferring present petition.
13. Relevant part of the affidavit-in-rejoinder dated 19.2.2024 of the petitioner reads as under:-
"14. Further, the contention of the Bank that the Bank cannot issue individual sale letter is completely false. The Bank itself has issued individual sale certificates in favour of another flat being flat no.C- 501 on 03.06.2023. Copy of Sale Certificate dated 03.06.2023 is annexed hereto and marked as ANNEXURE-RJ-1.
15. It is submitted that the auction notice dated 07.03.2023 also includes the property being Flat no.C- 501 for which individual sale certificate has been issued. Therefore, the Bank having already issued individual sale certificate to other party cannot now state that it will not issue individual sale certificate to the petitioner. The said assertion is completely false and dishonest and the Bank is clearly trying to help the principal borrower and is trying to delay the handing over of possession to the petitioners and other successful bidders.
16. The contentions of the Bank that the entire 23 flats and 20 shops have been sold in one lot is completely false and the Bank is intentionally making false statements for which strictest action may be taken against the Bank.
17. The petitioners crave leave to rely upon the Letter dated 18.04.2023 (Annexure-B Page no.27) which is issued by the Bank in favour of the petitioner wherein the Bank has specifically stated that the petitioner has been declared as highest bidder for "the said property"
meaning thereby Flat no.602. Therefore, even as per the Page 33 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined Bank, separate auctions have been conducted and separate individual letters have been issued to the highest bidder including the petitioner and now the Bank is trying to change its stand for the benefit of borrower."
14. It is surprised to note herein that though in public notice for e-auction, the bank has specifically shown the pendency of the three Securitization Applications pending before the DRT-I Ahmedabad, except these, no other details were furnished in the notice for e-auction by the respondent bank. Subsequently, in further affidavit-in- reply the respondent bank has come out with a case that other litigations except these three Securitization Applications were filed by the interested persons including the borrower and the third party but the said details were not mentioned by the bank in the affidavit-in- reply filed by the respondent bank.
15. From the perusal of the record and averments made in the petitions, it is very much clear that the petitioners have participated in e-auction held by the respondent bank with an open eyes that they were aware the fact that there were three Securitization Applications pending Page 34 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined before the DRT-I, Ahmedabad and with that understanding the petitioners amongst group of persons have participated in the e-auction. Subject to final outcome of the said proceedings, the petitioners are ready to accept the conditions mentioned in the public notice and after considering all these facts, the bank has accepted the bid of the petitioners including other participants who were represented through one of the members.
16. It is also further abundantly clear that all these properties are subject to encumbrance which is shown in the proceedings and after considering all these facts petitioners have participated in e-auction and accepted all the conditions mentioned in the public notice. The bid was accepted by the bank and the bank has also further accepted that the petitioners are member of the group of the persons, who are represented by one of the members.
Even in written communication, the bank has responded to the request of the petitioners, wherein they have specifically mentioned that the members of group was Page 35 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined being led by one Mr. Ravi Patel meaning thereby the bank is also aware that the petitioners are the members of group and all the individual members have jointly participated in e-auction. It is also further clarified from the record that group of 35 persons have participated in the e-auction representing through one of the members and after considering all these, the bank has accepted the offer of the petitioners. It is also not the case of the bank that after accepting the offer of the petitioners, the petitioners have backed out from the bid. It is also not the case of the bank that the petitioners have not fulfilled the conditions mentioned in the e-auction. Therefore, the request made by the petitioners cannot be denied by the bank on the ground that the bank is ready to execute the sale deed in the name of group and not in individual.
17. In view of the above, the action of the respondent bank deserves to be deprecated, as the bank has taken completely two different stands in two affidavit-in-reply filed by the bank. In first affidavit it has been mentioned that alternative remedy is available to the petitioners to Page 36 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined approach DRT by preferring Appeal under Section 17 of SARFAESI Act wherein the bank has not mentioned anything with regard to other litigation filed by other persons. Then in second further affidavit-in-reply the bank has taken completely different stand.
18. Therefore, it is clear that after accepting the bid of the petitioners, somehow the bank is not ready and willing to execute sale deed in favour of the individual petitioner.
19. At this stage, it is appropriate to refer to the decision of the High Court of Jammu & Kashmir in case of S.K. Bakshi (supra), while dealing with the judgment which is referred to and relied upon by the respondent in case of Agarwal Tracom (supra), the High Court of Jammu & Kashmir has held as under:-
18.......an application under Section 17 can be made to DRT by "any person" including borrower to challenge any of the measures referred to in Section 13(4) once taken by the secure creditor. But in this case, the petitioner who is auction purchaser of the property and has been promised by the bank that the delivery of the property is free from all encumbrances cannot proceed under Section 17 as it does not envisages any of the grounds enumerated in Section 13(4). Thus, the Page 37 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined judgment relied upon is not applicable to the facts of this case."
20. In view of the above, it is abundantly clear that the petitioners are successful bidders who have participated in e-auction and their bids have been accepted by the bank with clear understanding that because of glitch in the site, the petitioners individually could not participate in e-auction and instead of all 35 persons group, one of the representative has participated on behalf of the group. Subsequent to that the bank has accepted this fact and considered that the petitioners are individual member of the group represented by one Mr. Ravi Patel.
Therefore, the stand which is taken by the respondent bank before this Court is not tenable in the eye of law and same deserve to be deprecated.
21. In view of the above, the petitions are allowed. Rule is made absolute. The respondent bank is hereby directed to execute sale deed in favour of the individual petitioners within period of 8 weeks from the date of receipt of copy of the order with an encumbrance which is shown in Page 38 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024 NEUTRAL CITATION C/SCA/20368/2023 JUDGMENT DATED: 03/04/2024 undefined clause 4 and clause 15 of the public notice, failing which the respondent bank has to refund the amount to all petitioners with 18% running interest.
Direct service is permitted.
Sd/-
(HEMANT M. PRACHCHHAK,J) SURESH SOLANKI Page 39 of 39 Downloaded on : Fri Apr 05 21:54:48 IST 2024