Decided on August 26,2014



Ranjit Singh, J. (Chairperson) - (1.) THE appellants had filed an S.A. before the Tribunal below praying for quashing/setting aside the sale notice dated 8th January, 2010. This S.A. had been dismissed by the Tribunal below on 19th March, 2012. The appellants had accordingly filed the present appeal to impugn the said order. Appellants would not only challenge this order on merit, but would plead that the Tribunal below had heard arguments on two pending interim applications (I.A. No. 422/2011 and 781/2011) on 7th March, 2012 and had kept the case for pronouncement of order on 19th March, 2012. Grievance is that while deciding these two I.As., the Tribunal has also dismissed the S.A. without hearing any submission in the S.A.
(2.) THE facts noticed in brief in this case are that the appellants had obtained certain credit facilities from respondent No. 1 Bank. Property bearing No. C -134 -D, Surya Nagar, District Ghaziabad, U.P. was mortgaged in favour of the Bank to secure the said credit facilities. When the appellants could not maintain financial discipline, the Bank issued a notice dated 8th January, 2010, which was published in the newspaper on 12th January, 2010 making a demand of Rs. 3,13,80,466/ -. The notice under Section 13(4) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short the SARFAESI Act) was also followed the notice under Section 13(2) of the Act. The appellants on their part questioned both the notices by filing an application (S.A.) under the SARFAESI Act pleading that the said notices were issued in violation of the relevant provisions of the rules. The Tribunal, however, stopped further recourse to any of the action by the Bank vide its order dated 12th February, 2010 when it found that notices had not been issued to one of the applicants, namely, Mr. Rajender Kumar Sadhu (respondent No. 3). The Bank, however, was given liberty to issue fresh notice rectifying the defect. The Bank, accordingly, issued a fresh notice under Section 13(2) of the SARFAESI Act on 25th February, 2010. This was -replied to by the applicants through their Counsel on 21st April, 2010. Thereafter, notice under Section 13(4) of the Act was issued on 6th September, 2010. In terms of the order dated 15th October, 2010, the possession was handed over to the Receiver appointed by the Court and sale notice was published fixing the reserve price at Rs. 240 lacs. It is stated that the Bank received a bid for Rs. 245 lacs. It appears that at this juncture the applicants brought four intending buyers who had offered better price and the Tribunal, vide its order dated 13th April, 2011, directed inter se bidding amongst the said four intending buyers to be held under the supervision of Recovery Officer (R.O.) on 19th April, 2011. The Tribunal had issued direction to the R.O. to follow the rules under the Security Interest (Enforcement) Rules (for short, the Rules) so far as the deposit of sale consideration is concerned.
(3.) THE sale accordingly was conducted on 19th April, 2011 at about 3 p.m. The matter was adjourned to 21st April, 2011 and GCG Enterprises Private Ltd. was declared as successful buyer for Rs. 311 lacs. The authorised officer directed the purchaser to complete the process of sale in accordance with the provisions of the SARFAESI Act and the rules. It is alleged that the sale was conducted in violation of Rules 9(3) and 9(4) of the Rules and hence is challenged by the appellants. In this regard, the appellants filed I.A. No. 422/2011 pleading that the highest bidder and the authorized officer had violated the order dated 21st April, 2011 of the Tribunal below alleging that Rules 9(3), 9(4), and 9(5) of the Rules stood violated. The plea was that the payments were not made within the time stipulated either as per the order of the Tribunal or as regulated under the Rules. The plea accordingly was for directing resale of the property and forfeiture of the amount deposited by the highest bidder.;

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