K. NAGESWARA RAO Vs. DEBTS RECOVERY APPELLATE TRIBUNAL

JUDGEMENT

(1.) Order dated 11.06.2009 passed by the Debts Recovery Tribunal, Visakhapatnam, in S.A. No. 82 of 2008 was confirmed by the Debts Recovery Appellate Tribunal, Kolkata, in Appeal No. 262 of 2013/43. Both the orders are subjected to challenge presently.

(2.) The State Bank of Hyderabad, Chirala Road, Chilakaluripeta, Guntur District, initiated proceedings under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 ('Sarfaesi Act'), in relation to the secured asset offered by Bhavanasi Subba Rao, the fourth respondent, for the loan facilities availed by him. After following the due procedure, the bank issued auction notice dated 15.10.2004, published in the newspaper on 17.10.2004, proposing to hold the auction sale on 15.11.2004. However, this sale did not materialize. The bank thereupon issued notice dated 007.2005, published in the newspaper on 04.07.2005, proposing to hold the auction on 15.07.2005. In the auction held on 15.07.2005, K. Nageswara Rao and his son, K.V. Pulla Rao, the writ petitioners, were declared the highest bidders. A sale certificate was issued to them on 207.2005. On 25.08.2005, Bhavanasi Subba Rao filed SA IR No.169 of 2005 under Sec. 17 of the SARFAESI Act, which came to be numbered as S.A.No.82 of 2008 on the file of the Debts Recovery Tribunal, Visakhapatnam. By order dated 11.06.2009, the Tribunal allowed the application, taking into consideration the fact that 30 days notice had not been given prior to conduct of the auction sale on 15.07.2005. The Tribunal also took note of the fact that Bhavanasi Subba Rao forwarded photocopies of demand drafts available with him to the bank in proof of his sincere efforts to redeem the secured asset. The Tribunal therefore granted 10 days time to Bhavanasi Subba Rao to deposit the money due to the bank and in the event he did so, the bank was directed to receive the same and restore possession of the secured asset to him.

(3.) Aggrieved thereby, K. Nageswara Rao and K.V. Pulla Rao, the auction purchasers, filed Appeal No. 262 of 2013/43 before the Debts Recovery Appellate Tribunal, Kolkata. By order dated 17.04.2017, the Appellate Tribunal upheld the order of the Debts Recovery Tribunal, Visakhapatnam, but granted liberty to the appellants to invoke appropriate remedies in accordance with law for the loss and harassment they were subjected to by the bank as they had paid the entire sale consideration and had secured a registered sale certificate as long back as on 22.07.2005. Aggrieved by the dismissal of their appeal, the auction purchasers are before this Court.