N. Patherya, J. - (1.) BY this writ petition the petitioners seek to set aside the sale notice dated 22nd November, 2013, notice dated 10th August, 2014 and the actions taken thereunder against the properties of the petitioners.
(2.) THE case of the petitioners is that the petitioner No. 1 is the borrower of the respondent -Bank. For failure on his part to make payment, proceedings were initiated under the SARFAESI Act, 2002. Notice of sale was issued in November, 2013 initially and thereafter on 22nd March, 2014 and 26th March, 2014 in Sagar and Echo of India, two publications in the Islands as will appear from the affidavit filed by the respondent -Bank. Pursuant to the November notice no sale was held. Therefore, the sale notices in March, 2014 were issued. The sale notices of March, 2014 do not satisfy the mandatory provisions of 30 clear days. In fact, pursuant to the sale notices of March, 2014 no sale was effected and the sale notices lapsed. On 12th May, 2014 an offer was received by the Bank which offer is contrary to the requirements of Rule 8(6) of the 2002 Rules which mandates issuance of 30 clear days' notice. Clause 3 of the terms and conditions of the sale notice required that earnest money be deposited and in case no earnest money was deposited or the earnest money was not as required the offer would not be considered. In the instant case, the earnest money deposited is less than the amount mentioned in the sale notices; therefore, the authority could not have considered the offer of the purchaser. Two properties belonging to the petitioners were put up for sale. Property No. 1 was sold in June, 2014 and property No. 2 was sold on 21st July, 2014. As per the requirement of Rule 8(6) of the 2002 Rules the sale notice was served upon the borrower only on 27th March, 2014 and the sale was effected on 25th April, 2014. Therefore, no clear 30 days' notice was served on the petitioners. Under Section 14 of the 2002 Act the petitioners had been dispossessed on 9th September, 2013 and although an appeal had been filed from the order passed in proceedings filed under Section 13(2) the same has not been disposed of. The offer made by the purchaser is dated 12th May, 2014 i.e. beyond the time specified in the sale notice of March, 2014. Clear 30 days' notice is mandatory and in the absence of such notice the sale is void. In the event no sale for any reason could be held by the secured creditor as per the advertisement given issuance of a fresh notice is mandatory. In case no sale is held by public auction then Rule 8(8) of the 2002 becomes operative and private sale cannot be effected without the consent of the parties. The sale held is contrary to the original terms of payment and although Rule 9(4) of the 2002 Rules postulates payment within 15 days the secured creditor Bank has extended the time for payment without seeking consent of the petitioners. The authorised officer who conducts the sale is the Chief Manager. Instead it has been conducted by the Manager, PBD who is an officer below the rank of Chief Manager. Reliance has been placed on the decision reported in : (2014)5 SCC 610 wherein it has been specifically held by the Supreme Court of India that in the event no sale is held pursuant to the sale notice, the sale notice will be considered to have lapsed and the procedure prescribed will have to be followed afresh. Reliance has also been placed on, (2005) 12 SCC 364 for the proposition that the terms and conditions of sale cannot be altered. For the said reasons therefore as the procedure laid down by the statutory rules has not been followed by the respondent -Bank the sale be set aside and all steps taken thereafter be also set aside. In opposing the said application Counsel for the Bank submits that the petitioners are aggrieved by the sale effected and therefore should file an appeal under Section 17 of the 2002 Act. By letter dated 25th July, 2014 the petitioners have accepted the sale as it sought removal of the movables from the premises. Sale in respect of property 1 and property 2 was held in June, 2014 and 21st July, 2014 respectively. The first sale notice was issued in November, 2013 and as a fresh valuation was made therefore the second sale notice was issued. By 24th April, 2014 all offers were to be received and as no offer was received, as per Clause 11 of the Sale Notice, the sale was postponed to 15th May, 2014. Publication was made on 25th April, 2014 in the Echo of India. As the last date for submission of bid was not specified in the publication dated 25th April, 2014 a corrigendum was issued on 2nd May, 2014. The Bank was authorised to postpone or adjourn the sale pursuant to Clause 11 of the terms and conditions of sale. There is no requirement for issuance of a fresh sale notice. An application for mutation was filed on 4th August, 2014 and mutation effected on 20th August, 2014. Therefore, rights have accrued in favour of the purchaser. No possession of the properties, however, in view of the order dated 20th August, 2014 has been handed over to the purchaser. Section 17 of the 2002 Act is a bar to filing of writ petitions as held in : (2003) 3 SCC 524, (2004) 4 SCC 311, : (2010) 8 SCC 110, : (2009) 8 SCC 366 and (2011) 2 SCC 782. The Chief Manager of the Bank is the authorised officer who conducted the sale and Rule 9((4) of the 2002 Rules permits the Bank to extend the time to make payment. Therefore, this application merits no order and in view of : (2013) 10 SCC 83 be dismissed.
(3.) IN reply, Counsel for the petitioners submits that : (2013) 10 SCC 83 has been explained and distinguished in, (2014) 9 SCC 660. In view of the decision reported in : (1998) 8 SCC 1 the petitioners seek enforcement of their rights guaranteed under Article 300A of the Constitution of India and in view of violation of the principles of natural justice and the sale being conducted contrary to the rules the sale held is without jurisdiction, and alternative remedy is no bar to filing a writ as held in : (2014) 5 SCC 610.;