Allowed

Venu Akula v. Kotak Mahindra Bank Limited

DRT11 Mar 2025SA/395/2023

Case brief

AI extract

What is this about?

Applicants challenged SARFAESI proceedings initiated by Kotak Mahindra Bank. The Debt Recovery Tribunal held that selling the entire property worth 9 crores to recover a debt of 3.15 crores violated the principle in Ambati Narasayya. The sale was quashed, and possession restored to applicants.

What did the court decide?

Sale set aside; bid amounts refunded with 6% per annum interest; possession of secured assets restored to applicants.

Venu Akula versus Kotak Mahindra Bank Limited — Banking and Recovery | DRT (2025)

¶1

IN THE DEBTS RECOVERY TRIBUNAL - II AT HYDERABAD

¶2

DATED THIS THE 1lTH DAY OF^{MARCH, 2025}

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PRESENT: SH. RAMESHWAR KOTHE,^{B.Com., L.LB. (Hons.),M.A'} PRESIDING OFFICER

¶4

SECURITISATION APPLICATION^{No.395OF 2023}

¶5

Mr. Venu Akula

¶6

Age 44, Occ:Business R/o Flat No.618, Sundaram Building Rama Raja Nagar, Suchitra Ranga Reddy District-500067

¶7

Tunki Narender Rao S/o Late Bala Kistaiah Occ:Business, R/o H.No.5-64 Adarsh Nagar, Lingampally Serilingampally, Hyderabad Telangana

¶8

Tunki Raghavender Rao

¶9

S/o Narender Rao Occ:Business, R/o H.No.5-64 Adarsh Nagar, LingamPallY Serilingampally,^Hyderabad Telangana

¶10

Prathima Akula Plot No.107, Sundaram^Building Rama Raju Nagar Near Spencer SuPer^Market Suchitra Circle, QuthubullaPur Ranga Reddy-500055

¶11

Venagro Rep by its Partner Venu^Akula Sy.No.692 & 693,^Part-1 Devarayamzal, ShamirPet^Mandal Ranga Reddy District Telanqana-500019 ' / /Mn",-. ./A'-,2.^* (-/'rtE-

.. .... .Applicants.

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SA No.39sl2023

Versus

Kotak Mahindra Bank Limited Rep. by its Authorized Officer 3'd Floor, lewel Pawani Towers Raj Bhavan Road, Somajiguda Hydera bad - 500082

¶17

K. Rohit Reddy S/o Ramakrishna Reddy Aged Major, Occ:not known R/o Villa No.160, Palm Meadows Kompally, Hyderabad

¶18

. . . .Respondents.

¶19

Counsel for the Applicants : Mr. Abhinav Krishna Uppaluri Counsel for 7st Respondent Bank : Mrs. P.S. Sujatha Counsel for 2nd Respondent : Mr.Siddarth Pogula

¶20

-:ORDER:-

¶21

The Applicants filed the present Securitisation Application u/s.17 of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as "SARFAESI Act 2002") to set aside the possession notice dated 09.08.2023, sale notice dated 16.08.2023, e-auction sale held on 20,12.2023 pursuant to e-auction sale notice dated 18.11.2023 and consequential sale certification dated 23.0L2024 issued in favour of 2nd respondent and to restore possession of the secured asset to applicant.

¶22

The facts of the case, briefly, are that 5th applicant is the main borrower, 1st applicant is the co-borrower cum guarantor and applicants 2, 3 and 4 are guarantors for the loan availed from the respondent bank. The 5th applicant is an MSME proprietary concern

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engaged in business of popcorn. It was regularly^{paying EMIs till} December, 2022 however, due to competition and Covid-19 pandemic situation. Though it met the eligibility criteria under RBI Circulars 1.0 and 2.0^pertaining to^{restructuring} of^{Covid-19stress} related accounts without downgrading the asset classification,^the respondent bank failed to extend the benefit and^{dispose of the} appllcations dated 02.06.2027 and 30.09.2021 within^{30 days as} stipulated in the RBI Circular 2.0 dated 05.05.2021.^{The Overdraft} account has been renewed from time to time from^{2019 till date} despite business being hit by Covid- 19. RBI in^{its Resolution} Framework Circulars 1.0 and 2.0, vested discretion^{with the FIs in} deciding the framework for eligible IYSMEs but not to^{dismiss the} application of eligible entities without application of^{mind. The} respondent bank in its reply dated 01.08.2023^{to the objections} raised by the applicants to demand notice stated that^{the request to} restructure the account was suitably replied^vis SMS.^{This replywas} without application of mind and against the^{provisionsunder} Sec.13(34) of the Act, 2002.

¶26

The loan account has been illegally^{classifiedas NPA and} hence subsequent notices i.e., demand notice,^{possessionnotice,} prior to sale notice are null and void. Further, the notice^{prior to} sale u/r B(6) does not indicate date of^{auction. The e-auctionsale} notice dated 18.tt.2023^published on^{18.11.2023was not affixed} as per Rule B(7). Authorized Officer^{failed to obtain correctvaluation} and the reserve^price fixed is shabby^{and very low as compared to} the market value which is not in consonance^{with Rule B(5).The} outstanding amount as^per auction notice^is only^{around Rs.3.15} crores whereas the open^{plots which} were gll_ii]Ol"l^{were put for}

']"'-'

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SA No.39sl2023

sale together with a reserve^price of^{Rs.9 crores and the same is} illegal and against the^judgment of^{Hon'bleApex Court in Ambati} Narasayya vs. M. Subba Rao & anr [1990^{AIR rlgr. However, the} worth of^property is Rs.15 crores^{in the market.Hencethis SA to set} aside all the measures taken by the^{respondent bank against the} application schedule^properties.

¶31

The 1st respondent bank filed reply and^{additional reply} statements. The submissions, ,nfer alia, are^{that the applicant} availed OD facility of Rs.1 crore and^{Emergency CreditLine} Guarantee Scheme^(ECLGS) of Rs.19.94^{lakhs towards} comprehensive^package announced by the Central^{Governmentfor} MSMEs in view of the economic distress caused due to^Covid-19 pandemic. The loan facilities are secured by hypothecation of movable and mortgage of immovable^properties. The^borrower diverted the receivable to other accounts to default the bank.^Only in case both the borrower and the bank agreed for^resolution proposal, the same has to be communicated within 30 days so as to complete the restructure^process within 90 days. Since the^proposal of applicant was not in line with respondent bank's board^{policy, it} was rejected. The applicant was not entitled to restructuring schemes as per RBI Circulars. The rejection of restructuring was communicated by SMS.

¶32

Due to default in repayment, the account was classified as NPA as per RBI norms. The demand notice dated 25.10.2021 was issued as per RBI Master Circulars dated 07.04.202I and 01.10.2021. The^possession notice was issued under Sec.13(4) on 09.08.2023 and the same was affixed on secured^properties and 7Xtrra-.z._ 1?*'_

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SA No.395/2023

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published in 'Nava Telangana' and 'Business Line' Telugu and English dailies respectively on 10.08.2023.^Rule B(6)^{notice dated} 16.08.2023 was issued for redemption of^{mortgagedproperty'Mere} non-mentioning of sale date, the notice cannot become^invalid.

¶36

The sale notice dated 18.11.2023^{fixing auctionon} 20.12.2023 was issued which was^received by the^{applicant' The} auction sale notice was^published in'Nava^{Telangana'and Business} Line'Telugu and English newspapers on^{t8.71.2023besides} affixture on secured assets. This^{Tribunal directedthe respondent} bank not to confirm the sale subject to deposit^{of Rs.36.70 lakhs by} the applicant in three instalments,^{he failed to comply the sameand} hence as per liberty granted in the order dated^{20.12'2023,the} respondent bank^proceeded to confirm the sale^{and issuesale} certificate in favour of 2nd respondent-a^{uction purchaser. However,} the right of redemption extinguished with^{the publicationof sale} notice. Valuation report was obtained as^{per Rules' The schedule} property is indivisible and hence respondent bank was^{forced to put} the whole property for sale. The respondent^{bank has rightly} followed the due^procedure as contemplated^{under the provisions of} the Act and Rules of 2002. Hence^{the SA is liable to be dismissed.}

¶37

The 2nd respondent-auction^{purchaser filed reply statement} stating that the applicant lost the right of^{redemption available} under Sec. L3(B) of the Act,^Due to^{non-complianceof conditional} order, the 1't respondent bank^{confirmed the sale and lssuedthe} sale certificate in his favour. The bank^{has followed due procedure} of law. The applicant cannot be allowed^{to defeat the lawful claim of} the 1't respondent bank and financial^{loss to the 2nd respondent}

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being bonafide auction^purchaser. Hence SA is^liable to^be dism issed.

¶41

B. Heard learned counsel appearing for the applicants,^learned counsel for the 1st respondent bank and learned counsel^for the^2nd respondent. Perused the written arguments filed on behalf^of applicants as well as for respondents 1 and 2 and^{perused the} material brought on record.

¶42

It is contended by learned counsel for the applicants that the respondent bank has initiated the SARFAESI^proceedings without considering the application to restructure the loan account in view of Covid-19 pandemic and without deciding the obligations. He relied on the^judgement of Hon'ble Calcutta High Court in Olive Tree Retail Private Limited and Another vs. South Indian Bank Limited and Another 12023 SCC online Cal 1431 in support of his contention that the respondent bank should have considered the application for restructuring or waited for closure/settling the account before initiating proceedings under the Act, He would further contend that the possession notice was not affixed as claimed by the respondent bank. A comparison of the photographs filed as^proof of affixture of possession notice and photographs attached to valuation report would clearly establish the fact that the possession notice was affixed on some other property and not the secured asset.

¶43

He would also contend that the secured asset is a divisible property with separate Plot Nos.17, L8,21 and 22 demarcated by stones. Each plot is of 500 sq.yards and total value even as per respondent bank is Rs.9 crores. The 1st respondent bank could have

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sold a portion of the property to satisfy the outstanding dues instead of auctioning the entire property. Learned counsel relied on judgement of Hon'ble Supreme Court in:-

¶47

a. Ambati Narasayya vs. M. Subba Rao & Anr reported in 1990 AIR 719;

¶48

b. Chinnammal & 4 Ors. vs. P. Arumugham & An. Reported in 1990 AIR 1B2B; and

¶49

c. Bhikchand S/o Dhondiram Mutha (Deceased) Through LRs^vs. Shamabai Dhanraj Gugale (Deceased) through LRs in Civil Appeal No.5026 of 2023 decided on 14.05.2024.

¶50

Learned counsel referred to the relevant^paragraphs in the cited

¶51

judgements as hereunder:-

¶52

1't cited^judgment: "If the property is large and the decree to be satisfied is small, the Cuft must bring only^{suchpartition of} the property, the proceeds of which would be sufficient to satisfy the claim of the decree holder. It is immaterial^whether the property is one or several. Even if the^{property is} one,^{if a} separate portion could be sold without violating any^provision of law only such portion of the^property should be sold."

¶53

2"d cited^{judgement:"No} man should suffer^{becauseof the} mistake of the Court. No man should suffer a^{wrong by} technical^procedure of irregularities.^{Rules or proceduresare} the handmaids of^justice and not the mistress^{of the} iustice, Ex debito^justitiae, we must do^justice to him. If^{a man has} been wronged so long as it^lies within the^{human machineryof} administration of^justice that wrong^{must be remedied."}

¶54

3'd cited^judgment:

¶55

"23. In the matter of Balakrishnan vs. Malaiyandi^Konar this Court observed thus:

¶56

"9. The provision contains some significant^{words. They are} "necessary to satisfy the decree". Use of the^{said expression} clearly indicates the legislative^{intent that no sale can be} altowed beyond the decretal amount^{mentioned in the sale} proclamation. (See Takkaseela Pedda Subba Reddi v. Pujari Padmavathamma [(1977) 3 SCC 337:^{AIR 1977 SC 1789]') In} all execution^proceedings, the court^{has to first decidewhether} it is necessary to bring the entire^{property to sale or such} portion thereof as may seem necessary to satisfy the^decree. If the property is large and the decree to be^{satisfied is small} the court must bring only such^{portion of the property, the} proceeds of which would be sufficient to satisfy the claim of /Xry:,* l"/, L/ "tr')

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SA No.395/2023

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the decree-holder, It is immaterial whether the^property is one or several, Even if the property is one, if a separate^portion could be sold without violating any provision of law only such portion of the property should be sold. This is not just a discretion, but an obligation imposed on the court. The sale held without examining this aspect and not in conformity with this mandatory requirement would be illegal and without jurisdiction. (See Ambati Narasayya v. M. Subba Rao [1989 Supp (2) SCC 69i1.) The duty cast upon the court to sell only such property or portion thereof as is necessary to satisfy the decree is a mandate of the legislature which cannot be ignored, Similar view has been expressed in S, Mariyappa v, Siddappa [(200s) 10 sCC 23s].

¶60

t2. Learned counsel also contended that the authorized officer without application of mind brought the entire property for sale and sold for Rs.9.02 crores for recovery of Rs.3.2 crores which is against the law laid down in the above cited^judgments. The property was sold with enhancement of just Rs.2 lakhs which shows collusion of respondents L and 2. Collusion is further proved by the act of respondent bank in non-affixture of notices on the secured assets. With the above contentions, learned counsel sought to set aside the possession notice dated 09.08.2023 and consequent sale, sale confirmation and sale certificate and order restoration of schedule property to applicant.

¶61

On contrary, learned counsel for the 1st respondent bank while reiterating the version as in the reply and additional reply statements would submit that ECLGS loan was sanctioned due to Covid-19 pandemic only. The applicant failed to repay the first loan and also committed default in servicing the interest of second and therefore, loan account had to be declared as NpA on 30.04.2023 as per RBI guidelines. Restructuring of OD account could be done only by converting into term loan or short term loan only if the entity was in a position to run the business. It was

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entirely in the discretion of the financial institution to^consider restructuring of loan accounts. The RBI Circulars^were valid^only upto 31.12.2020 and 30.09.2021, However, the applicant^{was not} entitled for restructuring facility. There is no instructionⁱⁿ the^RBI Circular to intimate the borrower even if^{proposal is not in line} with Board's policy. On one hand the applicant admit^{that the} business was drastically hit by Covid-19^{pandemic and on the} other hand submit that they were regular in^paymenttill December, 2022. She would state that the^{judgementof Hon'ble} Calcutta High Court is not applicable to^{the caseof applicants.}

¶65

Learned counsel would further submit that the^possession notice dated 09.08.2023 was issued and^{published on} 10.08.2023. It was affixed on a tub^placed in the^securedasset which could have been moved subsequently^{being a movableitem} and thus it does mean that affixture^{was not done. Learned} counsel would submit that the right^{of redemptionto the applicant} extinguished on 17.11.2023 with the^{publicationof auction notice} as per amended^provision of Sec.13(B)^{of the Act. She would rely} on^judgement of Hon'ble Supreme^{Court in CELIR LLP vs. BAFNA} MOTORS (MUMBAI) PVT LIMITED &^{OTHERSin Civil Appeal} No.5542-5543 of 2O23 decided on^{27.O9.2o23 with specific} reference to^para f05(iii) which^{reads as hereunder:}

¶66

"iii) In accordance with the unamended^{Section13(8)of the} SARFAESI Act, the right of the borrower^{to redeem the secured} asset was available till the sale or^{transfer of suchsecured} asset. In other words, the borrower's^{rightof redemption did} not stand terminated on the date of the^{auction sale of the} secured asset itself and remained^{alive till the transferwas} completed in favour of the auction^{purchaser, by registrationof} the sale certificate and delivery of^{possession of thesecured} asset. However, the amended^{provisions of Section 13(8) of the} SARFAESI Act, make it clear that^{the right of the borrower to}

/M,,,b

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redeem the secured asset stands extinguished thereunder on the very date of publication of the notice for public auction under Rule 9(1) of the Rules of 2002. In effect, the right of redemption available to the borrower under the present statutory regime is drastically curtailed and would be available only till the date of publication of the notice under Rule 9(1) of the Rules of 2002 and not till the completion of the sale or transfer of the secured asset in favour of the auction purchaser. "

¶71

Learned counsel would also submit that the amendment petition pertaining to auction notice was not filed within 45 days and challenge against auction notice is liable to be rejected as time barred. The possession notice was issued on 09.08.2023 and auction notice on 18.11.2023. Despite ample time and opportunity without approaching the respondent bank with choosing to exercise right of redemption the applicant is attempting to shift the blame.

¶72

Learned counsel would also submit that the property is indivisible compelling the respondent bank to auction the entire property. Now, the third party rights have been created subsequent to the applicant's failure to comply the conditional order passed by this Tribunal. The respondent bank also filed seeking direction to applicant to provide account details for transferring the balance sale consideration. She said, at this belated stage, the applicants are estopped from objecting to the auction in the light of judgment of Hon'ble Supreme Court in Contempt Petition (C) Nos.758-759 of 2O24 decided on 73.72.2024 in Civil Appeal Nos.5542-5543 of 2023 between Celir LLP vs. Sumati Prasad Eafna with specific reference to para 218 of the cited judgment which reads as hereunder.^{i , \n} '..^. ' ' 'r'.'5D

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"218. Any sale by auction or other public^procurement methods once already confirmed or concluded ought not to be set-aside or interfered with lightly except on grounds that^go to the core of such sale^process, such as either being collusive, fraudulent or vitiated by inadequate pricing or underbidding. Mere irregularity or deviation from a rule which does not have any fundamental procedural error does not take away the foundation of authority for such^proceeding. In such cases, courts in particular should be mindful to refrain entertaining any ground for challenging an auction which either could^have been taken earlier before the sale was conducted^and confirmed or where no substantial injury has been^{caused on} account of such irreg u la rity.

¶76

Learned counsel for the respondent bank sought^For dismissal of the SA with costs stating that the respondent^bank has followed the due procedure contemplated in the Act,²⁰⁰² and Ru les thereunder.

¶77

Learned counsel for the 2nd respondent reiterated^the averments oF the reply statement and^{would contend that he is a} bonafide^purchaser of the SA schedule^{propertyin the auction} conducted by the respondent bank on 20.12.2023 for a^valuable sale consideration^pursuant to auction^{noticepublishedin} 'Business Line'and 'Nava Telangana'. Sale was confirmed in^his favour and sale certiFicate was also^{registered vide} Doc.No.965/2024 dated 23.01 .2024 and actual^{possesslonof the} property has also been handed over. Learned counsel also relied on judgement in CELfR LLP case^(supra) and^{judgements of} Hon'ble Supreme Court in Surinder Pal Singh^{vs. Viiaya Bank and} Others [2023 SCC OnLine SC 7402]; Sadashiv^{PrasadSingh vs.} Harendar Singh and others [(2015) 5^SCC 574]^{and Shakeena} and Another vs. Bank of India and^Others t(2O21)^{72 SCC7671} with regard to his contention that since the^{applicants failed to}

, . ., ","t

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exercise the right of redemption interference on the of equity not permissible and that applicants are not entitled to any relief particularly when sale was registered and actual possession was also registered. As per learned counsel, the SA is filed only to defraud the lawful claim of the respondent bank and cause financial loss to the auction purchaser. With these submissions, learned counsel sought for dismissal of the SA with exemplary costs.

¶82

Now the points that arise for adjudication are: -

¶83

i) Whether the Applicants made out any valid ground for quashing the measures initiated by the 1st respondent bank against the SA schedule property including the auction proceedings dated 20.12.2023 pursuant to auction sale notice dated 18.11.2023 under the provisions of Securitisation

¶84

Act?

¶85

ii) To what relief?

¶86

The primary contention of the applicants is that the respondent bank failed to implement RBI Circulars 1.0 and 2.0 pertaining to resolution frame work pertaining to Covid-19 stress related accounts. As per respondent bank, the applicants were sanctioned ECLGS of Rs.19.94 lakhs and that applicants' request for restructuring was rejected as not eligible. Vide letter dated 01.08.2023 towards reply to the objections raised by the applicants to demand notice, the respondent bank,s advocate clearly informed that the restructuring of loan was not considered as the borrower committed irregularity in repayment and default in churning the OD account and that the Resolution Framework

¶87

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SA No.395/2023

¶89

2.0 was not applicable to the OD accounts. The applicants are neither denying availment of ECLGS facility nor committing default. Under such circumstances, I do not find merit in the contention of applicants that the respondent bank did not consider their case for restructuring. Regarding communication of rejection, the applicants could not provide particular clause in the Circular about time fixed for communicating rejection of proposals. However, it is observed that the respondent bank got issued the reply to the objections within time stipulated under Sec.13(3A) of the Act, 2002.

¶90

The next contention of applicants is that the^possession notice was not affixed as per Rule B(1) of the Security Interest (Enforcement) Rules,2002. According to them, the proof is insufficient. After perusal of proof of affixture, I do find this contention as very trivial for the reason that the schedule properties are open lands and therefore the notice was pasted on a big tub lying in the plot. I do not want to see this issue in^a hyper-technical manner.

¶91

With regard to argument of learned counsel for respondent bank that the amendment^pertainlng e-auction sale notice is out of limitatlon, this Tribunal allowed the amendment^petition on the ground of continuous cause of action. It appears the said order has not been challenged. Hence the limitation cannot be^a :r''\1 . " question now. ^'.:''

¶92

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¶94

As far as contention on non-affixture of e-auction sale notice, the respondent bank placed proof of affixture and hence it is construed that Rule B(7) has been followed.

¶95

The respondent bank obtained a valuation report on 06.05.2023 and auction notice issued on 18.11.2023. There is a gap of six months. Be that as it may. It is manifest from the valuation report that each sq. yard rate is Rs.45,000/-, total extent of four plots is 2000 sq. yards and total market value of four flats assessed to be Rs.9 crores and the same was kept as reserve price. As per the e-auction sale notice is dated 18.17.2023, the outstanding amount is Rs.3,15,31,929l- in respect of four loan accounts i.e., OD and ECLGS accounts which are subject loans of this SA and SA 39412023 where secured assets are common. Thus, it is very clear that for recovery of around Rs.3.15 crores, the entire property worth of Rs.9 crores was put to sale. As per valuation report obtained by the bank itself, the property is divisible by metes and bounds as Plot Nos.17, 1B and 21 (Part) admeasuring 1215 sq, yards as one item and Plot Nos.21(Part) and 22 admeasuring 785 sq. yards as another item. Same description of property was also given in the e-auction sale notice. There is a feeble submission by the respondent bank that the property is not divisible and this submission is not acceptable in view of the facts borne out of the own record of the 1st respondent bank. The learned counsel for applicants vehemently relied on judgment in Ambati Narasayya (supra) supporting his contention that the respondent bank should have sold only part of the property. The Hon'ble Apex Court in the cited judgment held that:-^ll._.;I

¶96

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¶98

"It is of importance to note from this^provision that in all execution^proceedings, the Court^{has to} first decide whether it is necessary to bring the entire attached property to sale or such^partition thereof as may seem necessarY to satisfy^the decree. If the property is large and the decree^to be satisfied is small, the Curt must bring^{only such} partition of the property, the proceeds of which would be sufficient to satisfy the claim of the decree holder. It is immaterial whether the property is one or several, Even if the property is one, if a separate portion could be sold without violating any provision of law only such^portion of the property should be sold. This, in our^opinion,is not just a discretion, but an obligation imposed^on the Court. Care must be taken to Put only^such portion of the property to sale the consideration of which is sufficient to meet the claim^inthe execution petition. The sale held without examining this aspect and not in conformity with this requirement would be illegal and^without jurisdiction..,..,."

¶99

(emphasis supplied)

¶100

It is dlscernible fact that the action of the^{1st respondent} bank in auctioning the entire^property worth of^{Rs-9 crores for} recovery of around Rs.3.15 crores is not only against the^principle laid down in the^judgement but also against the^{Constitutional} Right to property and Principles of Natural lustice.^{Such sale,} conducted by the 1't respondent bank on^{20.t2.2023is,} therefore, liable to be set aside as^illegal.

¶101

As far as the argument of respondents^{1 and 2 on the point} of right oF redemption and interference^{oF court oncesale} proceedings were finalized, relying on^judgements of^BAFNA Motors and Contempt Petition in Sumati^{Prasad Bafna cases} (supra) is concerned, the Hon'ble Apex Court made it^{clear in} Contempt Petitions that:lt.^t, 'i.'1

¶102

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SA No.395/2023

¶104

"Any sale by auction or other public procurement methods once already confirmed or concluded ought not to be setaside or intertered with lightly except on grounds that go to the core of such sale process, such as either being collusive, fraudulent or vitiated by inadequate pricing or underbidding. Mere irregularity or deviation from a rule which does not have any fundamental procedural error does not take away the foundation of authority for such proceeding. In such cases, courts in particular should be mindful to refrain entertaining any ground for challenging an auction which either could have been taken earlier before the sale was conducted and confirmed or where no substantial injury has been caused on account of such irreg u la rity. (emphasis su pplied )

¶105

In the case on hand, as observed supra, there is arbitrariness on the part of the authorized officer and illegality in bringing entire property to sale though only a part would have been sufficient to satisfy the claim, and where collusiveness cannot also be ruled out, interference of this Tribunal is quite warranted even if the sale proceedings have been completed. As far as right of redemption is concerned, the issue of right of redemption is not raised by applicant.

¶106

In view of the above discussion, I have no hesitation to find that the applicants have made out valid grounds to quash the auction sale conducted on 20.12.2023 pursuant to e-auction sale notice dated 18.11.2023 in respect of the SA schedule properties and consequential sale confirmation and sale certificate issued in favour of the 2nd respondent and physical possession.

¶107

Point No.^(ii):

¶108

In the result, SA is allowed by quashing the auction sale conducted on 20.12.2023 pursuant to e-auction sale notice dated

¶109

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SA No.395/2023

¶111

18.11,2023 in respect of the SA schedule^{propertiesand} consequential sale confirmation and sale^{certificate dated} 23.01.2024 vide Doc.No.965/2024 issued in^favour of^the2nd respondent.

¶112

The 1st respondent bank is directed to^{refundthe bid amounts} deposited by the 2nd respondent^{with interest} @6%^{p.a. simple from} the respective of dates of deposits till^payment.

¶113

The applicant is entitled for the^{physicalpossessionof the SA} schedule^properties.

¶114

Consequently, Interlocutory^{Applications pendingif any, shall} stand closed.

¶115

JJ. No order as to costs.

¶116

34, Communicate a copy of this^{order to the parties concerned} and upload in the official website.

¶117

(Typed to my dictdtion by the P5, corrected, signed ond^{pronounced by me in theopen} court on this the 11th doy of Morch,2025).

¶118

ESHWAR KOTHE) PRESIDING OFFICER

Venu Akula v. Kotak Mahindra Bank Limited

Case brief

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Venu Akula v. Kotak Mahindra Bank Limited

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