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Vimla Mishra & Others v/s State Bank of India (SARC), Zonal Office, The Mall, Kanpur, U.P. through Authorized Officer & Others

    Regular Appeal No. 85 of 2015

    Decided On, 17 March 2021

    At, Debts Recovery Appellate Tribunal at Allahabad


    For the Appellant: V.K. Shukla, Advocate. For the Respondents: S. K. Srivastava, Advocate.

Judgment Text


1. This appeal has been preferred under section 18 of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short “the SARFAESI Act”) against the order dated 06.07.2015 passed by the Presiding Officer, DRT, Allahabad, whereby the securitization application (S.A.) filed by the appellants was dismissed.

2. The respondent-Bank granted certain credit facilities to the respondent no. 3-M/s Sai International. The loan was secured by deposit of title deed of the property belonging to Smt. Sakuntala, wife of Shukhdev Prasad. After death of Smt. Sakuntala, Yogesh Kumar Mishra and Anand Mishra, both the sons of mortgagor executed the guarantee documents in the capacity of legal heirs. Since the loan was not repaid in terms of the agreement, therefore, the Bank issued demand notice dated 5.2.2011 under section 13(2) of the SARFAESI Act. Thereafter, the possession notice dated 12.10.2011 was issued under section 13(4) of the SARFAESI Act and the same was published on 16.10.2011. The SA-applicant-Yogesh Kumar Mishra filed a Civil Suit before the Civil Court, Kanpur, but did not challenge the demand notice and the possession notice before the DRT. The Bank issued the sale notice dated 27.11.2012 fixing the date of auction on 30.12.2012. The sale notice was published in the newspapers on 28.11.2012 and the copy of publication was also sent to the SA-applicant vide letter dated 4.12.2012. The property was auctioned in favour of the auction purchaser for Rs. 37.50 lacs on 30.12.2012. After deposit of sale price, the sale certificate has also been issued on 6.3.2013.

3. The SA-applicant challenged the proceedings of the Bank by filing the S.A. on 25.02.2013 inter-alia on the grounds that the possession notice was not served, a clear 30 days’ sale notice was also not given and the auction was held on Sunday, hence pleaded for setting aside the entire proceedings of the Bank. During the pendency of S.A., Yogesh Kumar Mishra expired, therefore, his legal heirs i.e. appellants pursued the S.A. The Tribunal below vide impugned order observed that the issue of demand notice and the possession notice were hopelessly barred by time and no reason for not challenging the sale notice within a period of 45 days has also been explained, therefore, dismissed the S.A. being barred by limitation and further observed that there was no irregularity in selling the property on Sunday. Being aggrieved by the said order, the present appeal has been filed by the appellants.

4. Learned counsel for the appellants submits that the possession notice was not challenged in time, because the S.A.-applicant filed a civil suit on the basis of ill-advice, therefore, the delay was liable to be condoned. Further, the sale notice was challenged only after a delay of about 1.5 months. Thus, the same ought to have been condoned by the Tribunal below. In any case the S.A. was filed on 25.02.2013 before issuance of sale certificate on 6.3.2013, therefore, the Tribunal below has erred in dismissing the S.A. on the ground of delay. The learned counsel also contends that a clear 30 days’ sale notice was not served and the same was sent on 4.12.2012. The auction was held on Sunday, which is not permissible and there is also likelihood that the auction purchaser had not deposited the amount in time, therefore, there is material substance to be adjudicated in the S.A. Hence, the matter be remanded back to the Tribunal below for fresh adjudication after condoning the delay.

5. On the contrary, the learned counsel for the Bank contends that no reason whatsoever has been explained before the DRT for not challenging the possession notice and the sale notice in time. The S.A.-applicant was required to explain day to day delay with cogent reason. Further, there is no prohibition in the SARFAESI Act to conduct the auction sale on Sunday. The sale notice dated 27.11.2012 was sent on the same day. However, the notice published on 28.11.2012 in the newspapers was again sent to the SA-applicant on 4.12.2012 giving him an information for publication and also an opportunity to deposit the amount before auction. Therefore, no irregularity was caused by the Bank in auction of the property.

6. Having heard the learned counsels for the parties and considering the material available on record, it is undisputed that the demand notice was issued on 5.2.2011 and the possession of the property was taken on 12.10.2011. The S.A.-applicant filed the Civil Suit challenging the proceedings before the DRT. The SA-applicant has not pleaded that he had not received the demand notice. With regard to the possession notice, he himself had challenged the same before the Civil Court and has also not specifically denied the service of the same. Thus, it is proved that the possession notice was duly served to him. Yet he has not challenged the same within 45 days and instead challenged it after one and half years. No explanation with regard to such inordinate delay has been given before the DRT nor any formal application for condonation of delay was filed. As such the relief qua the possession notice was hopelessly barred by time.

7. Similarly, challenge to sale notice was also made after limitation period of 45 days. The sale notice dated 27.11.2012 was required to be challenged upto 12.01.2013, but the S.A. was filed on 25.02.2013 with a clear delay of 43 days after excluding the limitation period of 45 days. However, no application for condonation of delay was filed nor any reason much less the sufficient one has been shown in the S.A. The S.A.- applicant has admitted the receipt of publication of sale notice dated 05.12.2012, but has not pleaded as to why the action of the Bank was not challenged in time. Thus, there was no occasion for the DRT to condone the delay without any prayer or without reasoning for such delay. Even no specific pleading has been taken in this appeal for condonation of delay nor any specific reason has been shown during course of the arguments. Thus, there are no sufficient grounds to condone the delay and the Tribunal below has rightly dismissed the S.A. being barred by limitation.

8. Since the learned counsel has also touched the merits of the case so as to make out prima facie case in favour of the appellant stating some irregularity in the auction, therefore, the same are also liable to be answered.

9. The S.A. applicant has not specifically pleaded that he has not received the sale notice dated 27.11.2012. The emphasis of the learned Advocate is that the sale notice was sent on 04.12.2012. The perusal of the letter dated 04.12.2012 issued by the Bank reveals that the copy of sale notice published in the newspapers on 28.11.2012 was sent with the letter dated 04.12.2012 and not the copy of the sale notice dated 27.11.2012. Thus, the period of sale notice cannot be reckoned from 04.12.2012 and rather it would be counted from 28.11.2012. As such a clear 30 days’ sale notice was given to the S.A.-applicant.

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10. The property was properly valued before auction. The reserve price was also fixed more than the realizable value of Rs. 31.78 lacs. After fixing the reserve price as Rs. 37.39 lacs, the property was auctioned for Rs. 37.50 lacs. Thus, it cannot be said that the Bank has auctioned the property in any throwaway price. There is no restrain in the SARFAESI Act and Rules made thereunder that the Bank cannot auction the property on any holyday. As such, apparently there appears to be no irregularity in auction of the property. 11. In view of the above, there is no substance in the appeal, hence, the same is dismissed with no order as to costs. 12. A copy of this judgment be sent to the parties as well as the DRT concerned and be also uploaded on the e-DRT portal.