Debt Recovery Tribunal dismissed the applicants' special application seeking to quash auction proceedings initiated by the bank, holding that mandatorily provisions were complied with and res judicata barred prior challenges.
Sale proceedings and auction scheduled on 20-07-22 were upheld.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
F'l
IN THE DEBTS RECOVERY TRIBLTNAL LUCKNOW
Present: A. H. Khan, Presiding Officer
Date of order 16-08-2022
S.A. No.510 of 2022
Present:-
Counsel for the applicant Mr.Nikhil Shirvastava Counsel for the bank Mr.Vinay Shanker
l. Final arguments were heard on 02-08-2022 and case was reserved for pronouncement of orders.
2' The applicants have filed the present SA on 18-07-22 praying to quash the entire sale proceedings initiated by bank by which auction is scheduled on 20-07-22 pursuant to sale publication dtd.3 t-05-22 and to summon entire record perlaining to SAMAESI action alongwith loan agreement papers.
3' The case of the applicants, in brief, is that without informing the applicants and without issuing any notice bank has classified the account as NPA and have also failed to comply with Sec.25 of SARFAESI Act as they have not got the property mortgaged details update with the Central Registry. That without obtaining any valuation report bank had fixed the reserve price on a lower side. That no clear 30 days sale notice has been served on applicants and the said sale notice has also not been published in two newspapers and also not affixed on secured asset. That there are several illegalities in the action of the bank and mand atory provisions of SAMAESI Act have not been complied by the bank.
4' Bank had filed its reply wherein it is stated that earlier applicants have filed sA No.586/18 charlenging the issue of NpA, demand notice and possession and the said SA was dismissed by this Tribunal vide order dtd. 07-05-22' That the charge of bank over secured asset has been registered with central Registry and before putting the property to auction, bank had obtained valuation report from approved valuer on I I -05-22. That e-auction notice dtd.26-05-22 was sent to applicants through registered post on 3l-05-22 and auction was fixed on 20-07-22. The said sale notice was published in two newspapers and also affixed on secured asset. That property has been sold for an amount of Rs.1.42 Crore i.e. much higher than the reserve price in favour of highest bidder. That huge amount o more than l3 Crore is still due against the applicants and applicants have failed to show any irregularity in the action of the bank.
5' Duly considered submissions and perused the records. perusal of order dtd.07-05-22 passed by this Tribunal in SA NO.586/18 (Annex.CA-1) filed by bank alongwith reply reveals that applicants herein have filed the said SA
/-\
2
challenging classification of account as NPA and demand notice dtd.25-02-16 and possession notice dtd.0l-09-18 issued by the bank and after adjudicating all the issues with regard to NPA, demand notice andpossessionnotice the said SA was dismissed. Therefore, applicant is barred byprinciple ofRes Judicata to challange the issue of NPA again.
a
File be consignedto record room'
_- -i-__.
A ( .y. Khan) Presiding Officer
2 issues framed by the court
Whether the applicants are barred by Res Judicata from challenging the NPA classification and sale proceedings after a prior dismissal.
Whether procedural safeguards under SARFAESI Act including valuation report and sale notice were complied with.
3 provisions across 2 enactments
Applicants
Bank
A. H. Khan
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
