Dismissed

M S Sri Kalyana Chakravarthy Rice Mill v. State Bank of India

DRT20 Oct 2023SA/49/2023

Case brief

AI extract

What is this about?

The Recovery Tribunal dismissed a Security Application challenging a Sale Notice and auction of mortgage properties conducted by a bank. While noting prior proceedings were sub judice, the Tribunal held that proper valuation was done and the auction was procedurally valid, allowing the sale to stand.

What did the court decide?

Application dismissed; Sale Notice and auction proceedings of the 1st Respondent Bank affirmed.

M S Sri Kalyana Chakravarthy Rice Mill versus State Bank of… — Specific Performance | DRT (2023)

¶1

IN^'f I.{E D[:BTS RECOVERY TRIBUNAL - I AT HYDERABAD

¶2

l)z\ II.l) llllS.t ttt:.?_OIrrt)Ay OF OC'I_OBER, 2OZ3

¶3

PRESENT: GUMMADI GoPICHAND, PRESIDING oFFICER

¶4

sA.No.49/2C23

¶5

I. M/s. l{alyana C}rakravarthy Ricc Mill, (i,r I)artncrship lir:m, rcp. by its Managing [)ii rtn(]r: Sri l(ardiyilpr.r Vcnkatcswara Rao, S/o. Sri l(adi.yapu Govindr"r), Iithakota, Ravulitpalcnr(M), I,last. Godavari l)ist -53323g.

¶6

,), Sri I(adi,1,apu Vcn kal.cswara Rao, Slr.r. l:iri Iiacli.r,apur Govindu, agcd 72 yrs., Oc:r': Ilrrsir-rcss, l).No.2-250, Main Iloacl, lli,r, ulaltalcrn, Ilasl Godavari l)ist.-533238.

¶7

1 Sriti l)cli.t AtchuLha Sathyavani, Fcmale, W/o. Sri Il--ta Srinivas Rao, Occ: Ilousewife, l).No.6-8 961 I 1 , 4rn Larle , Adilakshmi Nagar, Rervu Ieipalcrn, Ilast. Godavari I)is1.-533238.

¶8

1. Sru( K:,idiyapu Lakshmi Mangayamma, Iremale, W/o. Sri Kadil,apu Vcnkatcswara Rao, z\gr:<1 irbor-rl 62 ycar, Occ: Ilouscholcl, I).No.2 250, Main Road, Ravulapalem, I,lirst Cl oclnvlrri l)ist-51]3238.

¶9

ti. [(iicl i1,;1111 r N4t.tr2li Gopal, Malc, S7 r.,. Sri Ir:trlivapu Vcnkatcswara Rao, AgciI attor.rt. 50 ycetr:s, Occ: I]usincss, I). No..2 ,2'.;O, N,larin [tond, Ravulapalem, liust^(loclavari I)ist 5l]3238.

¶10

6.
Srni [(a<liyapu Mrudula, lremale,
Wi,r. Sri Murali Gopal, aged 45 years, .-". ;:..,.-*-;:::;.*
Oc<:: Ilrrsincss, ll/o. I).Nrr.2-250, Main Road, d?ri.lj.!i €rii;. ,.,
I{avulirpalcm, Iiast GocJavari t)ist-53323g. lk6#. 4rr%
Versri.s 'i! r*, i:;'",i
ii,i N
l. Slrrrc ilirrrk ol'lrrdia, ii ii : ^ ? 2oL n u UU otl ,i?l "i),
Si.t'r:ss..il ;\ss.ts Managcmcnt Ilranch,
,\g
Scc:tt[rrlc|r.il;irr], I).No.S 9-'16, 2rcl liloor, iNd^ e .r|Y]
l, ;: I ii: I' .i:l;: t I 3,y,?,,:ji l*xtjjl l'i : K j ;t *iW
[(ir1;. ir.1, its Arrthrrrizcd Ol'liccr i.tnclcr Act. 51l2OOi.

¶11

SA.No.49/2023

¶12

¶13

Sri^(liincsula Rajiv Sairanr, Malc, Il/u, lrlett No.302, Sai Srir-rivas{lm, IllO"gg, 6ti, I)hasc, Kukatpally, i lvr{t'r'abad 5OO OT2. .). Vit't or"y Iklzilrs l)rivatc l,imitccl, ltcp. bv its Managing I)ircctor, Sri Kari Naga Salyanarayana Recldy, ORC Road, Ravulapalcm Mandal, Ilast Goclavari I)istrict .- 533238. /1 , Srnr [,al<slimi Sunitha Vantipally, W/o. I{rishna Rao, Itemalc, Il/ti. I).No, 1 15, Ramalayam Strcet, I{avulaltalcm, lfasl. Godavari l)ist.-53{}23g. Respondents. (lic.sTrorrrltrrrls rVo.2 to 4 rtre added as per ()rt!t.r (1t.. 8.0b..20)3 itr tA.No. t 4[;S;,/ 2023). C'r-stittsc:l lbr the Applicants Sri D. Raghauulu. Cour setl .fo r ll esponclent No. I Sri V. Ragtrhu. Cot.trtsel.f or l?esporulents No.2 to 4 Sn Gampa l?anglaiah.

¶14

-: _o__B_D_E-B:-

¶15

I. 'l''lri:; rLlrplic:rrrion js filcd by the Appricarrt u/s.17 of the *ARFAESI Act, 2uo.)., li,,r- clt'r:laring thc Salc Noticc c]t.0s.01.2023, issued by the 1st lft'spo.rlcrr []ank slali,g Lhe datc oI aucl.ion of the application st:lr,'clLtii' 1lt'oPortics ort 15.02.2023 ancl all thc measures initiated by tlrr' 1"1 lir:slrorrcli:nt llank unclcr the SARI.AIfsI Act are arbitrary and ilit';rirl rrncl to sr:l lrsiclc thc s€Lmo.

¶16

2..

¶17

'['lrt' nvt:nrc'r]ts madc in the application, in brief, are as under:_

¶18

i) 'l'hc Applicant No. I is a l)artnership firm engaged in the business 'c nrill. Applicants No.2 to 6 are guarantors and mortgagors t: rrpplir:artion schcdulc propcrties. Thc Applicanl. No.1 firm l.f availcd crcdir facilitics from sMIl Rajahmundry Branch of 20n rrrerrre sr llcspondcnt Ileink in thc ycar 2oo2, to the tune of ,00,000/ and samc ^'crc cnhanccd from time to time and st lrri:r'iiiling limits as on l3.or.2o1T arc to an ext.ent of

¶19

..lF
2 0 0tI 20n rrrerrre
:,

¶20

SA.No,49/2023

¶21

Ils. l l],20,00,000/ .. Thc r"r Respondent Bank has obtained sii4natrircs of Applicants on various blank prolorma forms. The /\1;1:lic--anl No. I l'irm wcnt in1,o financial crisis in the year 201g rrrcl tlr<r I "t Rcspondent llank wrongly classified the loan .i(]couilrs of the'Applicant No.l firm as NI)A and issued Demand i'Jr;irt:c <1t.02 .oq.'2o 19, u/s. r3(2) of the sARIrAFlsl Act, claiming an irnroLiirt of Ils.l2,93,2l,3B4l- u,ithout serving the notice to all the irrr.o*'crs ancl also issuccl l)osscssion Nol.ice d1_.14.06. 20lg u'iLhor-r t iollorn ing the provisions of the SARITAESI Act. olrallcnging thc said steps takcn by the I st l?espondent Bank uncicr thc SARITAI,)SI Act, thc Applicants filed SA.No.2gol2olg bclrlr. l)llr, Visakhapatnam and the said SA ended in dismissal orr 2l .O4.2022.

¶22

ii) '1'lit' l"t llcspondcnr I]ank has taken physical possession of the i:{l)r)}i()iil.ion sr;hc;r]r-rlc pr:opcrtics by gctting warrant lrom the chief .Ji.r<lit:iirl Miigistralc, Rajahmunriry. when the loan account of l\1.,plit:unt No. I lrras translcrrcd to thc lst Responclent Rank, the 1\6>1rii<:ar-rt No. I approachcd thc 1sr lRespondent liank seeking sc:l.tlcrncnt of r.hc loan account under ors by submitting letter 111.06. 12.'2022 for an amount of l?s.g,92,s2,r4s1- but the 1st l(csporrdr-'nt Ilank issucd lcttcr dt.1s. 12.2022 advising the r'\1;1,rlir:ar-rr- No.1 to improvc thc offcr.

¶23

iii) '1'lrc, l:ir Iicspondcrrt Ilank issuccl Salc Noticc dr_.05.0 r.2023 irrtirri^Lirg r.lrat thc auction ol t.hc schcclurc propcrties w.uld be ci:irclrrcLcd on 15,02.2023. Thc Ist Rcspondent ]3ank has not o[.;trrirrcci corrcct valuation of thc propcrl.ics as contemplatecl Lrrrtlcr ltr.rlc B(5) oI thc sccr:rity Intcrcst (ltrnforcement) Rules, ,:;^{.{]</sup> i.ttui, l)r-li-cr..r.!r'hcn .:!^a. \ia l.-nr .'-^{irrrrl lixcd} comparcd^{Lhc rcscrvc} to thc^{pricc of} cxisting market value^{thc propcrl.icsat} of^a the^vcry said^row pxrficr-ti\cs. Thc salc noticc was not affixed on the schedule *\i 2 S^{0[T ?0l])r'ol)(-r1l[s arrd nol publishcd in two newspapersas contemplatecl} Ilulcs, 2OO2. IIcncc t.hc SA.}

¶24

SA.No.49/2023

¶25

'l'lrt l-r llt:sPt>t.tdu-rl IJank lilcc] Rcply and Adclitional Reply Statements n,il I r lirliou,ing contcntior-rs:-

¶26

M/s. sri Kalyana chakravarthi Rice Mills, contractors, is not a party to l.lrc presr:nt sA and hence the prcsent sA is not rir:lintirinablc for non.joindcr o[ parl.ics. The present SA is filed r"rcrr rviLlrorrt implcr.lcling l.lrc owncrs/m<>rt.gagors of the pr-opt:rlics. Tlrc validity ol I)cmand Notice dt.o2.o4.2olg and the I)rsst-'ssion Nr>ticc dt.04.06.2019 was uphelcl by DRT, / i :;ir l< i'r aI:a rrui m vidc ordcr dl .2 1 .o4 .2022 in sA. No. 2go l 2ol 9 ancj tiii' \i l).No.,2ij(rii.1 ol' 2022 filr:d by thc Applicants was also riisririsscri b,,, tlrc IIon'bli: I{ig}r court and thc prescnt sA is birrrcd b-v thc principlc r>f res-jud.icata.

¶27

ii) '1'l-ro I'r l{cspr>ndcnt Ilank has dury complied with l?ule g(5) of the sci:trr"it.1' Intc:rcst (1,)nforccmcnt) llules, 2oo2, by obtaining ii'iir,latior-r rr:ports frorn thc pancl valucrs and fixed the reserve ;:ricc^{of thc schcdulc propcrtics} on the basis of the valuation r'(illorts . Thc salc noticc was duly servcd, affixed on the schedule propcr-lics an<1 publishccl in t.hc ncwspapers. The e-Auction i\i,iit:r' tir.u.>.oit.2.o2?, is propcr and valicl. 1'hc Applicants failed to iri';,ii rlr<: l:ent:f it of'ors offcr. r'hc lsr Rcspondcnt I]ank has filecl ()r.No.2.512o2o on Lhc lilc of I)R'r'-2, Ilydcrabad and same is 1;crrc'ling.^{Thc aucl.ion} of the schedule properties was conducted on 15.02 .2023 and in thc said auction, Responclents No.2 to 4 bccirrirc slrcc-'csslul biddcrs and altcr paymcnt of bicl amount, sale ,'iis oonfirnrccl and saic ccrtificatcs werc issuecl in their favour.

¶28

..:j]l :]',,.^{verlt-tittionrcportsrclicd} upon by the Applicants are brought.

¶29

trr "S#,l1l^{(rxislcr)cc onlv frrr ttrc pprposc of this case and they} do not ii'= fl ,lilt..,r llictLriri situation and thc said rcports clo not have any legal *ii

¶30

gtl ZU73^{,'lu{f ir',' Ilcroo,} thc prcscnr SA is liablc to bc dismissed. I :i

¶31

.:;., i

¶32

4' ','t,*',v"::f l'ir'sl)r)nrlt'r)t (aruction purchascr) lilcd his Rcply Statemenl -...: *?/ri

¶33

,^{jiii'i'!:.c(xrt't',iirlinrllhirt, hc is} thc succr:ssful bidder in the auct.iorr .!t7cIr'.' " 't t.'t^l:^...:" --- r:...- -'./

¶34

SA. No.49/2023

¶35

clt' l5't)2'2023 concluctccl by thc lst Respondent lSank in respect of Lot lrri;s.2 i,t' il oi trrc sch.crurc propcrtics [or Rs. r ,56,3 2,ooo l_ and Rs. 1,82,)-o,ooo/ rt--spcctivcry and that he cieposited 2soh of the bid iilloilrL arrcj tlrr: balanc:c TS(\t <tf thc bicl amount within the stipulate6 Iiirir: irr]rl tlri,rr rhc r"r licsp<lncJt--nt I]ank issr:cd salc ccrtificate tlt"2(;'t) i.'2023 in t't:spcct of thc saici pftlpcrtics in his favour ancl that trt; is Llic bor-raficlc purchascr of the said properties for a varuable corr siclcration.

¶36

li.

¶37

'['hc ':,rrl Ilt:s1:onclfirt (aur:tion purctraser) firecl his Repry Statement (:ortcriili,g thr,rt, hc is thc succcssful biddcr in the auction cit' lri'02 '20'23 concluctccl by ttrc l"t Rcsponclent Ilank in respect of Lot No. 1 ,l ttrc schcdulc propertics for Rs.6,99,13,000/- and that he rlu1.,r)sirCrl 12ii'|,, oI thc: bicl amounr and thc balan cc TS%o of the bicl .rrrt)irr[ \'/irlrirr thc st.ipulatccl r.imc and that thc l"t Rcspondent Bank is:;rrt:cj Sr,ilt; (jt:r-tjficatc dr.26,o4.2023 in rcspcct of thc said propcrty i. l.ris lirvc,r-rr a.d that hc is ttrc bonafidc purchaser of the said property Iirr a valuablc consicicration.

¶38

¶39

'['lrt' ']ri': IicspondcrrL (auction purchascr) fired her Repry Statement i-'oi*.rrtiirr'{ tr-rat, hc is thc succcssful bidder in the auction dt. I5.0:2.2023 concluctcd b1, thc lrr Rcsponclent Ilank in respect of Lot Nr>.'1 ot' rhc schr:clule propcrtics for lls.62,00,oool_ and that she rlr'1;ositc'cl 259t, <il'thc bicl amor-rnl and the balancc Tsoh of the bicl iirl,rii-lr* \r,itlrin tltr: stipurlaLccl limc and that thc lst Rcsponcient Bank issr"rccl sirlc (lr:rtir'icaLc dt..26.o4.2023 in rcspcct of thc said propcrty irr lir:r' la't.r,r rirrcl Lhi:r, shc is thc bonalidc purchascr of the said property for a r,;rlr-rablc considcration.

¶40

ru'[iLmrflrts oJ'thc I,d. counscls appearing for rcspective parties.

¶41

¶42

tlrait arisc Ibr consiclcral.ion arc,_

¶43

-: ?o^o Applicants havc cstablished any valid grounds for .i tl-rc S:rlc Nol.icc dl..0S.O 1.2023, issucd by r,he Irt

¶44

SA.No.49/202^j

¶45

ltt:spclr-:clcnr. Ilank lor conclucting auction of the schedule

¶46

pro;:i:rlic:s on lir,o2.2023 ancl ol,her measurcs initiated by the i"t Rcspondcnt llank unclcr thc SARITAF)SI Act ancl the Rules ini'tclc ttrcrcunder, irl rcspecr. of the said properties?

¶47

ii) 'l'o u,lrat rclir:l?

¶48

Puitit r;d.lili-

¶49

I-ti.r.rirri rirr' ('or1l'sc ilI argirnlcnts, Lcl. counscls frlr lhc Applicants and t irr' li,rs 1rt-rn< lc n t s rci tcra tccl Lhcir- rt:spcctivc vcrsion s as statcd supra.

¶50

l0' lrr tlrc pr"csont SA, thc Applicants havc challenged not only the auction t;l-tlrc schcdltlc prttpcrtics conrlucted by the .lst llespondent Ilank on l:i 02,').o?.3, pursuant 1:o Lhc Sarc Noticc crt.05.01.2023, but arso the l)c:n"I,rnci Noricc d1..02.o4.2or9, issucct u/s.r3(2) and thc possession Notier: clr. t'r .06.2o r9, issucd r.i/s. r3(a) of thc SARI,.AI,lsr Act, by the 1st llt's1"Ur.i<lt'r-tl IJarlk. l,d. Counscl frrr thc l"r llcsp<>nclcnt llank filed a ot)l).) ol' tlt<: ()rclcr clt.2l .04.2022 passcd in SA.No.2BOl2O1g on the file oi'lJ]t'i', Visr.il<har1:ntnam. As pcr thc said order, it is vcry clear ttrat the Ap1>licairrls llt:t'cirr {'ilcd thc said SA against. ttrc l"r Respondent Bank It<:r't:iu chali<:nging thc aloresaid I)emand Notice and possession Notice isslrccl to Ltrc Applicanr.s. After elaborate inquiry, the said SA.No,.)8ol?.o19 rvas clismisscd by I)RT, visakhapatnam. In the said S,/, 1,r1. l)r'i:sirlirrg ofliccr ol I)RT, visakhapatnam, gavc a finding to the cflcct t.hat I)cmancl Noticc clt.02.04.20lg ancl l)osse ssion Notice clt' 14.(J().:20 19, issucd by thc l"r llcsponclcnt llank arc in accordance u'itir tlrt' provisions ol lhc sARlrAltsl Act ancl thc Rules made Lli. i'..:LItiilt:t' iillcl lhc I'r llt:sponclcnt Ilank is cntitlccl to take recourse -:'.^., r i^{\ .:,i} .:.j ,^.... -"- ....,.,, i'(rr':i:q;Liu.y1'r its clircs ir-r accordancc with law. As pcr 1hc material -.t'-.1,r.',,,Tiih',t, rir,,.l b.y,r.hc r"t Rcspondcnt llank, it is also clear tha1, ,.r,,]},,,.',rqinE^{rhc sairi orcrcr dt.2r.04.2022, the Applicanl.shereinfiled} ';LI^(Mdru,, 5_1r,i;+^{ol- '2022 bcforc thc Ilon,ble Iligh courr} of Andhra ri,,ii'i; r-i 'i(l c u rit. n'ulras .: I' 1,;1ji'il i 1.: i ;icl tlr r: s a ici u, rir pctitio n 'uvas dismisscd I>y 1.hc thc I lI on, tble High i ".. .^, !tie^{,.Y1':" t..'} -!.1;rl-'i, "ri'^,';i ':..'^' '. ,ur;,{ ':-..,.1r' v Ly.^, -.,.

¶51

SA.No.49/2023

¶52

(jt)rtrt triclc orclt'r dt. 18.O8.2022, holcling that thc lrctitioncrs therein (i\1;1;llt::trtLs; l.ri:t"cin) havc all.crnativc and cfficacious remedy to file apPt:al [r<:[ort: Ap1:cllatc 'lribuntil uf s.]8 9f the SARIT^hISI Act. It is not th<: casc ol' thc Applicants herein that they filed any appeal before [[ort']:rlr: I)RnT, I(olkal,a, rv]rich is having jurisdiction over the Tribunal err Visal<lrapar.nam. So, thc ordcr dL.21.o4.2022 in SA.No.2go/201g on thr: fik: ol-l)llr, visakhapar.nam, became linal. so, when the Tribunal aL visal<harpatnam has catcgorically held that the Demand Notice dt,02 .o'+.2o r9 and thc r)osscssion Notice dt.14.06.20tg issued by the I't Rcspt)nclcut Ilar-rk in rcspcct of thc application scheclule properties elrL'ir'girl. r,aiicl and binding on rhc Applicanl.s, thc Applicants now citllli(,1 irgairt rt: clrallcngc Lhc validity of thc said notices issued by the I^.r lit:s1;orrdt:rrt lJarrk.

¶53

I I' So, sltlllcc i{'ttrc validity of thc Sale Notice dt.0s.ol.2o2s2 ancl the auctiotr of t.hc schcdulc propcrl.ics conducted by the l st Respondent Ilank o, r5.02.2023, is detcrmincd in the present sA.

¶54

12' As pcr l'hc matcrial document.s filecl by the I st Respondent- Bank, it is t'ct1' (:l<:iit' that l.hc salc noticc was issucd by the l"r Respondent 1lank to "hC^{z\1>plicitnts hcrcinancl Lhat Lhc said sale notice was duly} served ort all iilc Applicant"s cxccpt Applicant No.3. The sale notice sent to Applicar-rl Nrl.3 rcturncci un scrvcd with posl.al cndorsement as 'Atltirt:ssc<: Lclt rn'ithout instructions'. It is pcrl.incnt to no1e tha., Applit-itnl No.3 is no ol-hcr than thc ciaughter of Applicant No.2 ancl thr:.i' ;1pg rcsidcnts of samc village. I,cl. counsel for the l"t Respondent l]ilnk argucd tllal., Applicant No.3 is a partner of Applicant No.1 firm . atrcl tlrt: Alllllicant No' 1 and ot.hcr partners of the firm have duly ,f,cfc'ivc:cl^{thc sarlc notice} so, a noticc issued to the firm can be deemed "1" :'lvcr'siu'tPl], cottrrscl lbr thc lsr lrcspondent ilant has placed his r.- '. .- r' * ll z 0 0[T'ztll3""t ::ia^{jtrdgmcntof thc Ilon'bleMarlras Irigh court in} second 1, Apl;tri,tl tuQ.,irszz ol 199"/ "Anton Rauel and" others lzs. A. t?ajamani ,: "i.,'.u -+8€:' "{iW"'

¶55

SA.No.49/2023

¶56

and othc:t-s", dccidcd r>n 21.o9.2o1 r, whereunder in paragraph 10, it is ticrlrl as r rnclcr':

¶57

"T'irc fctcls cf,re not in rlispute in the case on hanci. The re:s1-tonclerzf Nos. l, 3 and 4 are .father and. sons and. the se':coir.1 respond.ent Jirm is an ururerlisterecl Jirm, in uthich tili't4 ere all pctrtner'.s. Il is the first responclent, who issued. rlit' iioiic:e requidng the qppellants to Jurnish the bank

¶58

(/('c'or./irt Jar r.lepositing tlrc rent. It is the first responrTent, t.L'ltt; lrts also lssued the rejoinder notice. /l ls a/so not in tlisptrte .f-t'om the legal notice as well as tLrc euidence uttctilobl<' on recorcl that the first responrlent was rnctnac.lirtg the a.ffairs of the Jirm. I{e has also not disputed tlrc re.ceiytt. ctf the notice issued. uncler Lix.A.2, of which he rrrcs crs/ced to quit cLnci hand ouer possession. 'fhe aboue srrirl /i:rcts ructuld- clearly clemonstrate that the responclents Jutur: rec:eiur:ci the nolice in compriance of the prouisions of Ijcc'lioi t 1 06 oJ'the 7'rans.fer of property Act.',

¶59

:13. So, iit ll-rc circumstanccs, it is clcar that all thc Applicants have duly rt-cr'itztrcl thc stllt: troticc issucd by thc 1*r Respondcnt llank. As per the (l(icr,.liil..'tlis l'ilcrl lt,, t.hc 1"r Ilr:sponcicnt Iiank, it is further clear that Lltt' szlic noticc was duly affixcd on the schcclule properties as tx iclcrrr-'c:c1 f}om thc photographs 1.akcn at thc timc of affixture of the siii,:[ rioticc and thc sajd noticc was also published in E)nglish and 'l'clr'rgt-i rlc\'spitpcrs. As pcr thc matcrial clocumcnl.s filcd by the 1st Ilt:splorrclcnl ]Jilnk, it is also vcry clcar: l-hat prior to proceeding for the salc oI thc schcdr-rlc propcrl.ics, l.hc lst llespondent l]ank has obtained vulttatlion of thc sctrcdulc propcrtics from the approved valuers ancl lrt,ising tltt thc rreiluation rcports givcn by thc said valuers, the reserve 1>i'i0r,^{r,,1'tlrr: st'hcclr.rlr: propcrtics} u,as Ilxccl by ttrc lst Rcspondent Ilank.

¶60

.".,'l--'= -.(,' ,-t -]tr" =;.'..t-.'.1'^{-''+.;1,1''"."rn;."r)} :^{Iii,-.Cqr,ttrscl} Li..':i{^{ilppr-ovccl lor thc Applicants valucrs} for cstablishing^{filcd various valuation} tha1. the valuation^reports issuedgiven ,i^';','-' ..'.. iT,f' Fi^{Llrc sitltll,i'alut-'rs} is much morc than the reserve pricc fixed by the I .'- ;i 'igfJcst;o,,Itrt llank in rcspect of the schedule propert-ies. I:]ut, the ?_ g 0[T' , Saicl r,ultrqL,gj r''-' i'i r.r'ho issucd such valuations, are not cmpanelled valuers '','. ,,1#,;i1a:.fl,u't,n" said valuation reports it is not clear whether they . ,''\hj'!..^-:1,.iCyOri:q,tgt.,irLit^{irrspccl.ion of thc localityand in such circumstancesit} -:;* *'':-|,.-.fu ::'-'

¶61

()

¶62

SA.No.49/2023

¶63

(:rurltor i"rc siritl tlrat tlrc ntalkcl Valuc of ttrc schcdulc properties is .rLit:l) .iol'(t titirrr ttrt: rr:sr;rrrc pricc fixccl l>y thc 1"t Rcspondent l,]ank.

¶64

In thc; aucl.i<ln of l.hc schcdule properties conclucteci by the lst Il<:slroncicnt llank on 1s.02.2023, the Respondents No.2 to 4 herein lrirrticiilittCti^and Lhc )rt<t Rcspondcnt. bccamc succcssful bidder in rcspcL)r ol'trYo propcrtics i.c., Lot Nos.2 & 3 of the scheclule properties lo. an,rrlour.rt .1' Rs.^{.l,s6,32,000/-} and |1s. 1,g2,20,0o0/- respectively; 'lrrl lQi'5;liorrclcnt bcc:ermc succcssful bidclcr in respect of T,ot No.1of the sc:iri:clurlc l)ropcrtics lor elr1 .rrnount of Rs.6>,99, I 3,000/- and 4th Ilcslror.rcicr.rr. ticr:anrc sLrcccssltrl bic]dcr in rcspcct of Lot No.4 of the sc:lrccluilc propcrr.ics for an amount. of Rs.62,00,oool- and they duly clcposilcd 25% of thc bid amount and the balance TSo/o of the bid arrollnt u'ilhin thc stipr.rlatcd timc ancl Sale Certificates were also issr-rccl irr thcir favorrr on 26.o4.2023 by the l"t Responclent Rank.

¶65

A pcnrsill ol'tfrc rccord indicates that, along with the present SA, the Applicarnls lilcd IA.No.25l 12023 sccking stay of auction of the sc'irc;cir-rlc l)r'()pcltics slntcc] on 1s.02.2023.'l'his Tribunal vide order cir. i 1.').)..).1)23, por-rnitt.ccl thc lsr Rcspondcnt Ilank to go ahead with t[-r(] arrcrion [;i-rt dinr<:tcd Lhr: l"t RcsponcJcnl. I]ank not to confirm the rluction in favotrr of Ltri: highcst bidder subject. to deposit of Rs.3.00 cr'orcs br, t.hc Applicants. Admittedly, the Applicants have not cornltlic<i r.r,itl'r th<: said orders and thcy did not deposit any amount in spitc ol cxtorsion of tirnc granl.cd by l,his 'lribunal. So, the 1st Itcs|-rolr(1crl1 llank conlirmcd thc salc and issued Sale Ccrtificates in rcspr:cl of ttrc schcdulc propcrtics in favour of highest bidders i.e., Rt:s1;oncicrrls No.2 to 4 hcrcin.

¶66

¶67

1a tt arll thc <;irt:umslilnccs, I trolcl that thc lsr Respondent *th,rk l-rahlh,r:ompticrl ivith thc proccclurc laid dorn,n in issuing the aucrion of the scheciule propert.ies and also J \l, r t,)Uf,,,icc,rt[.ir-rrlucting^r-ul..e , ''-f ;_d - <lt'lrrrsitrng . -i pl';bid ;t^j amr>unts by thc Ilespondents No.2 Lo 4 - auction rr{.rlfrtr'in ttrc stipulal.cd timc. I scc no grounds warranting

¶68

¶69

SA. No.49/2023

¶70

intcll'criltc<'ol this'l-ribunnl wil.h thc sale ol the scheclule properties con<lucl.t:ri [r.t, thr: l"r Rcspondcnt I3i:nk. The Applicanl.s ]rave miserably lrrilr:d Lo cstiiblish Hrlu grouncls for sctl.ing asidc the Sale Notice cit'0Ii'0 1..2023 anci the aucl.ion of the schedule properties conducted b1" 11," I'r Ilcsponclcnt Ilank pursua.t to thc said sale notice. so, in tltt: Cit'CLlr"llstilllt--cs, I holci that thc Applicants are not entitlerl to claim any rr:licl' in thc prescnt SA. Accordingly, this point is answered agr.iinst lhc Applicanl.s and in favour of the 1st Responclent Bank.

¶71

Poin t No.(ii):-

¶72

Irr thc: r-csr-rlt, ilrt: [)rcs(]nt Sccuritization Applical.ion is clismissed.

¶73

Corrscclri<:nLl.y, thc I,tcrlocut.ory Applications, pencling if any, shall sl.ancl clisposcd ol'. No ordcr as to costs.

¶74

19.^{(irrrirrrrr,ir:*tc} i;l cop., ol this orclcr to thc partics conccrncd.

¶75

(Dicttttecl lo llu' Priutfie 5,j,i,re,l!r!!! trun.scribed bg her, corected., siglned and pronounced bt1 nte in the open court on this tlrc 20," drtt.1 ttl'{)t1ottt,r )023)

¶76

sd/(c. coPrcHAND) PRESIDING OFFICER

¶77

'k
2 0 [l[I Zm ':,,:
.,Q *Tr,,
5,*6ffi''
SoviatY'

¶78

TR,UE COPY TjRT.I, HYDERAEAD: ,/ ^,"wi,

M S Sri Kalyana Chakravarthy Rice Mill v. State Bank of India

Case brief

What is this about?

What did the court decide?

M S Sri Kalyana Chakravarthy Rice Mill v. State Bank of India

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

Coram

Case details

All orders in this case

Similar cases

State Bank of India versus Sri Madishetty Suresh

Mr Thota Murali Krishna versus National Trust Housing Finance Ltd.

City Union Bank Ltd, versus M/S. Sri Venkateswara Motors

State Bank of India versus Sr. Kolluru Prem Kumar

State Bank of India versus Smt Dumpala Srilatha

Arcil versus M/S Slava Therapeutics Pvt. Ltd.