Allowed

Anil Kumar Sharma v. Aditya Birla Finance Limited

DRT21 Feb 2026SA/420/2024

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal quashed the demand and sale notices issued under the SARFAESI Act for non-compliance with procedural mandates, specifically the failure to serve notices on a borrower in judicial custody and deficiencies in the sale notice details. Relief was granted to restore possession and return auction proceeds.

What did the court decide?

The demand and sale notices were set aside; the Financial Institution was directed to return auction proceeds with interest and restore physical possession of the property immediately.

Anil Kumar Sharma versus Aditya Birla Finance Limited — Banking and Recovery | DRT (2026)

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DRT-I, DELHI SA 420 of 2024 Debts Recovery Tribunal-I, Delhi 4th Floor, Jeevan Tara Building, Parliament Street, New Delhi PRESIDING OFFICER: SHRI GOVIND BALLABH SHARMA SA/420/2024
Sh.Anil Kumar Sharma s/o Late Sh.Jai Prakash Sharma R/o House No.212/1A, Gali No.4 Padam Nagar, Kishanganj, Delhi-110007 -Applicants Versus
1.Aditya Birla Finance Limited Through its Authorized Officer 1st Floor, Vijaya Building, 17, Barakhamba Road, New Delhi-110001
2. Unimarck Healthcare Limited Through its director Sh.Dharaminder Singh Bhatia S-49, Janta Market, Rajouri Garden New Delhi-110027 --Respondents
Present:
For the Applicant Mr. Vivek Singh, Ld. Counsel alongwith Mr. Anil Kumar Sharma,
For the Respondent No.1 : Ms.Ojaswi Sharma, Advocate.
For the Respondent No.2 : Mr.Khushboo Thakur, Advocate.
Date of reserved: 11.02.2026. Date of Pronouncement: 21.02.2026.

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FINAL ORDER

The present securitization application has been filed by the S. applicant praying therein to quash and set aside impugned possession notice dated 09.07.2024 u/s 13(4) and sale notice dated 13.09.2024 and steps taken u/s 13(4) of Securitization Act against the residential property No.233, Vivekananda Puri, Sarai Rohilla, Delhi-110007 (hereafter referred as property in question).

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It has been submitted on behalf of the applicant that S. applicant alongwith his wife Ms Anuradha Sharma purchased the property in question by way of registered Sale Deed dated 08.11.2007 and respondent FI granted loan to M/s Ashima Infrastructure Pvt. Ltd. on 19.11.2015 and applicant stood as a guarantor being share holder in the company. It has further been submitted that both stood as guarantor and applied for loan against property by creating equitable mortgage by way of deposit of original title deed for Rs.347.00 lacs to repaid in EMIs. It has further been submitted that regular EMIs were being regularly paid but due to pandemic Covid-1.9, moratorium period was extended and loan was restructured and was to be paid in EMIs of Rs.4.17 lacs p.m. It has further been submitted that FIR No.24/2023 under Section 420/467/468/471/120B was registered on 18.02.2023 at Police Station Central Sector17, Chandigarh and applicant was arrested as accused, surrendered and remained in judicial custody till 28.10.2024. It has further been submitted that the applicant being in custody,

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business standstill and facing financial crisis, wife of applicant made payment of Rs.30.85 lacs. It has further been submitted that without considering sympathetic and human view, the respondent FI issued impugned demand notice dated 16.04.2024 u/s 13 (2) of SARFAESI Act for Rs.3,69,39,036/-, but the same was never served upon the applicant and deprived of his legal right to represent u/s 13 (3A) of SARFAESI Act. It has further been submitted that respondent FI filed application u/s 14 on 05.07.2024 and Ld.CJM (Central) appointed Court Receiver Sh.Ashok Kumar Gupta to take possession of property by serving 15 days possession notice in advance and affixing on conspicuous part of property including applicant as per Section 2 (f) of SARFAESI Act 2002 as borrower. It has further been submitted that Court Receiver issued notice only to M/s Ashoka Infrastructure Pvt.Ltd. and M/s Shri Sai Nath Enterprises through its proprietor Ms Anuradha Sharma on 09.07.2024 for taking physical possession on 25.07.2024 but not to the applicant as apparent from the contents of impugned possession notice. It has further been submitted that physical possession of property was taken on 25.07.2024 while the applicant was in judicial custody. It has further been submitted impugned Sale Notice dated 13.09.2024 published on 14.09.2024 in Financial Express for auction and auctioned on 22.10.2024. It has further been

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submitted that the applicant was directed to be released on bail from judicial custody lodged since 23.03.2023 by Hon'ble Supreme Court of India in CrI.Appeal No.4408/2024 titled Anil Kumar Sharma Vs State of Union Territory of Chandigarh on 25.10.2024 in FIR No.24/2023 and was released on 28.10.2024. It has further been submitted that the applicant took all aforesaid impugned measure in utter defiance of the process established by law as notice u/s 13 (2) was served personally on applicant nor mandatory possession notice dated 09.07.2024 was ever addressed or served on applicant and even mandatory Sale Notice dated 13.09.2024 was not served as applicant was in judicial custody since 23.03.2023 and released on 28.10.2024, which is clear violation of mandate of law. It has further been submitted that since notice u/s 13 on the face of it are illegal and utter disregard and direction passed by Ld. CJM Delhi under Section 14 and subsequent measure are liable to be declared null and void and respondent FI is liable to be restrained for proceeding further in the matter as the case is a glaring example of violation of fundamental right of applicant guaranteed under Article 300A of Constitution of India. It has further been submitted that the applicant is lawful, absolute and legal owner of property in question and measures resorted by respondent FI are nullity in the eyes of law and is liable to be quashed and set aside. It has further been

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5 DRT-I, DELHI SA 420 of 2024 submitted that impugned notice u/s 13 (4) and Sale Notice is wholly illegal and unenforceable and respondent has adopted an approach of vengeance, irrespective of the fact whether any provisions of said act or rules made thereunder have been followed or not. It has further been submitted that respondent invoked in most discriminatory and unreasonable manner and same is absolutely arbitrary, illegal and liable to be quashed as applicant was in custody since 23.03.2023 to 28.10.2024 not given any opportunity to respond the impugned notices and measures resorted by respondent FI in provisions of Section 13(3A) and Section 14 of the Act. It has further been submitted that default in payment of EMIs cannot be termed as intentional or deliberate and applicant is not a director of M/s Ashima Infrastructure P.Ltd. nor a beneficiary of loan facility. It has further been submitted that property in question has been sold and confirmed in favour of defendant no.2 which is illegal on the face of it. It has further been submitted that it is settled position of law that fraud vitiates everything and respondent no.2 cannot claim to be bonafide purchaser of sale of property in question is illegal as measures under Section 13 (4) are illegal and in blatant violation of mandatory provision and rules framed under SARFAESI Act and sale is liable to be quashed. It has further been submitted that respondent FI malafidely tried to disposed of property in question at throw away price in order

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DRT-I, DELHI SA 420 of 2024 to illegally realize and recovery alleged amount as marked price of property is more than Rs.12 crores and auctioned for even less than 50% of market value. It has further been submitted that the entire actions of the respondent FI qua the property in question of sale be quashed and set aside alleged sale of property. Accordingly, it has been prayed for allowing the present securitization application. 3. On the other hand, Ld. counsel for respondent FI has vehemently opposed the submission of Ld. Counsel for the applicant and submitted that applicant along with M/s Ashima Infrastructure Pvt.Ltd., Shri Sai Nath Enterprises, Ms Anuradha Sharma, Mr.Sanjay Jain & Himanshu were sanctioned and disbursed loan facility of Rs.347.00 lacs on 19.11.2015 @ floating rate of interest and borrowers including applicant created equitable mortgage by depositing title deeds of property in question. It has further been submitted that creation of security interest was duly registered with CERSAI. It has further been submitted that after availing loan facilities, applicant/borrowers not adhere to financial commitments as per sanction terms and committed defaults and account were declared NPA on 14.04.2024 as per RBI Master Directions. It has further been submitted that demand notice under Section 13 (2) dated 16.042024 was issued read with Security Interest

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(Enforcement) Rules 2002 upon borrowers including applicant to discharge their liability of Rs.3,69,39,036/- due as on 15.04.2024 with interest but borrowers including applicant neither discharged their liabilities nor raised any objections u/s 13 (3A) of SARFAESI Act 2002. It has further been submitted that Respondent FI filed application u/s 14 of the Act and was allowed by Ld.CJM Central District vide order dated 05.07.2024 and Court Receiver in compliance of order dated 05.07.2024 took physical possession of secured asset on 25.07.2024. It has further been submitted that Respondent FI fixed the reserve price after obtaining valuation report as provided under Rule 8 (5) of Security Interest (Enforcement) Rules 2002 and put up for auction sale by publication of sale notice dated 13.09.2024 in two newspapers on 14.09.2024 by issuing pre-sale notice to borrowers including applicant and affixed on the conspicuous part of secured asset in compliance of Rule 9 of Security Interest (Enforcement) Rules 2002. It has further been submitted that respondent FI in exercise of power under Section 13 read with rules 8 & 9 of Security Interest (Enforcement) Rules 2002 sold the secured assets "As is where is", "As is what is" and "Whatever there is" basis in favour of respondent no.2 for sale consideration of Rs.577.88 lacs. It has further been submitted that respondent FI being prudent and law abiding respondent FI remitted the part of excess surplus cci

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8 DRT-I, DELHI SA 420 of 2024 of Rs.1,65,44,531.99 to Sh.Vijay Kumar Mittal in SB account in compliance of order dated 09.12.2024 and 20.03.2025 passed by Hon'ble Court of Special Court, G.B.Nagar, UP. Accordingly, it has been prayed for dismissal of the present securitization application.

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The respondent no.2 in his reply submitted that respondent no.1 issued the sale notice dated 13.09.2024 published in two newspapers for putting auction of property in question at reserve price of Rs.574.88 lacs to be held on 22.10.2024. It has further been submitted that the respondent no.2 declared highest bidder vide letter dated 22.10.2024 and deposited 25% of bid amount with respondent no.1 who issued sale confirmation letter dated 04.11.2024 in their favour duly registered with concerned Sub-Registrar, Delhi on 02.01.2025. It has further been submitted that the respondent no.2 being highest bidder deposited entire bid amount within stipulated time and respondent no.1 vide possession notice dated 05.11.2024 handed over physical possession of property in question. It has further been submitted that after completing all the formalities, respondent no.2 is in process of demolishing the building on the Plot No.233, Vivekananda Puri, Sarai Rohilla Delhi and demolished part of property for construction of new building but due to order of status quo with respect to property

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is quite prejudicial to the right and interest of highest bidder. It has further been submitted that no remedy under Section 17(1) can be taken by the borrower unless he loses the possession of secured assets. It is submitted that the orders passed by Ld. District Magistrate under Section 14 of Act cannot be constructed as notice u/s 6(1) and (2) of the Rules like in the matter of Hindon Forge (Supra), the Hon'ble Apex Court. Accordingly, it has been prayed for dismissal of the present securitization application. 5. The applicant in its rejoinder submitted that the notice u/s 13 (2) was not served as he was in judicial custody in connection with FIR no.24/2023 from 23.03.2023 till 29.10.2024 and there is no question of service of any such notices and giving reply or filing objections at all and not lie in the mouth of respondent no.1 to allege that statutory compliance were made. The valuation report is manipulated report created in collusion with officials of respondent no.1. It has further been submitted that deposit of alleged surplus amount was in violation of order dated 25.11.2024 of Hon'ble Allahabad High Court in Crl.Rev 6122/2024 titled Anil Kumar Sharma Vs State of UP and others directing "till the next date of listing, further proceedings in regards to attachment/auction of property of revisionist which is underway by order of trial sd-

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10 DRT-I, DELHI SA 420 of 2024
court and Assistant Collector Grade-1/SDM, Sub-Division Karol Bagh Delhi shall remain staved. It has further been submitted
that stay order copy of was duly served on 26.12.2024 in
person and way of Whatsapp of Respondent no.1. In view of the above, it is respectfully prayed to allow this application and pass order as deed just and proper.
6. Heard the rival contentions of both the parties and
perused the records thoroughly. IA no.338/2026. 7. The present application has been moved on behalf of the
applicant praying therein for summoning and for cross-
examination of the authors/signatory of the additional
documents i.e. Valuation Report dated 30.07.2024 issued by
the EEPAC (India) Pvt. Ltd. and Valuation report dated
29.07.2024 issued by Black Olive Ventures (P) Ltd.
8. It has stated in IA that there are several material
contradictions in both the additional valuation reports filed by
respondent no.1 and as such it is in the interest of justice that authors/signatories of said additional documents i.e. valuation
reports filed by respondent no.1 may kindly be allowed to be
cross-examined in order to enable this Tribunal to have a true
picture of valuation of applicant's property which has been Sd-

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auctioned at a throw away price in the clandestine manner. Accordingly, it has been requested to allow the present application.

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Apparently, the present application has been filed on behalf of the defendants seeking cross examination of the authors/signatory of the additional documents i.e. Valuation Report dated 30.07.2024 issued by the EEPAC (India) Pvt. Ltd. and Valuation report dated 29.07.2024 issued by Black Olive Ventures (P) Ltd. filed on behalf of the respondent FI, however, after going through the records of the case, this Tribunal is of the view that as per the judgment of Hon'ble Supreme Court of India in the case of "Union of India Vs. Delhi High Court Bar Association" BC 2004 II SC 33, evidence by way of affidavit can be taken by DRT and cross examination can only be allowed rarely because evidence is led by the bank are on the basis of printed documents only. The Hon'ble Supreme Court has also held that :-

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"Tribunal has Power to Require any Particular Fact to be Proved by Affidavit or Order that Affidavit of any Witness may be read at Hearing: It must Record sufficient Reasons for Passing Such Order.

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There should be no reason as to why a Tribunal, likewise, should not be able to decide the case merely on the basis of documents and affidavits before it. It is common knowledge that hardly any transaction with the Bank would be oral and without proper documentation, whether in the form of letters or formal agreements. In such an event the bonafide need for the oral examination of a witness should rarely arise. There has to be

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12 DRT-I, DELHI SA 420 of 2024 a vet)/ good reason to hold that affidavits, in such case, would not be sufficient':
10. Thus, in view of the above judgment, I find no reason to
allow the present application for cross examination of the
bank's valuers is without any cogent reason and in my
considered view this is only delaying tactics by the other side
who is delaying the matter since long, that too, when the
present matter is time bound case as per the direction of
Hon'ble DRAT, Delhi vide which the matter has to be decided
on or before 21.02.2026. Hence this IA for cross examination is hereby dismissed and disposed off accordingly. IA no.336/2026. 11.The present application has been moved on behalf of the
applicant praying therein to take on record additional
documents/evidence in rebuttal being filed on behalf of the applicant.
12. It is stated in IA that the applicant had already led his
evidence and even final arguments also advanced. It has also
been stated that on 15.10.2025, Ld. counsel for the respondent no.1/bank sought time to filing application for taking permission
of DRT-I to file additional documents. It has further been
submitted that on 25.09.2025, the respondent no.2 filed a Misc.
Application No. 1707/2025 EDRAT before the Hon'ble DRAT
praying that this Tribunal be directed to decide SA No.420 of

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13 DRT-I, DELHI SA 420 of 2024
2024 on 14.10.2025. It has also been stated that on
24.11.2025, the Hon'ble DRAT was pleased to dispose of said
Misc. Application No.1707 of 2025 and vide order dated
28.11.2025, this Tribunal, was pleased to allow the said
application permitting the respondent no.1 to place additional
documents on record at the stage of final arguments and
conclusion of stage of leading evidence. It has further been
stated that aggrieved of said order dated 28.11.2025, the
applicant preferred an Appeal under Section 18 of SARFESI Act,
2002, before the Hon'ble DRAT, Delhi, and same was disposed
of vide judgement/order dated 22.12.2025 wherein the Hon'ble
DRAT was pleased to hold that the order dated 28.11.2025 is upheld but the applicant is further allowed to file rebuttal before
the learned DRT within 2 weeks. It was further held that the
applicant should also provide copy of material to other side and
thereafter the learned DRT shall proceed to decide the pending
SA after affording an opportunity of hearing to the parties and
the appeal was accordingly disposed of at the admission stage.
It has further been stated that the petitioner has challenged the
said order dated 22/12/2025 passed by Hon'ble DRAT before
Hon'ble High Court of Delhi by filing CM (Main) No. 166 of 2026
and notice has been issued to respondents returnable for
03.03.2026. Accordingly, it has been requested to allow the
present application.

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By way of the present application, the present applicant wanted to take on record certain documents regarding aforesaid misc. application and the orders of DRAT and the order dated 21.01.2026 of Hon'ble High Court of Delhi. However, after going through these documents it appears that no prejudice would be caused to the respondent FI as well as auction purchaser if these documents are taken on record for consideration of this Tribunal and accordingly, these documents are taken on record. Further, on perusal of the aforesaid order of Hon'ble High Court, it appears that there is no stay qua the present proceedings, but this Tribunal has to decide the present matter in a time bound manner as per the order dated 24.11.2025 vide which this Tribunal has to decide the present matter on or before 21.02.2026.

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In the light of above discussion, these two applications in both the securitization applications are disposed of, accordingly.

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In the present matter, admittedly the borrower has availed the loan facilities from the respondent np.1 FI against the mortgage of the property in question. Apparently, there is default on the part of the borrower/mortgagor/guarantor in paying the dues of the respondent FI and after availing the loan facilities the borrower did not maintain the financial discipline

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15 DRT-I, DELHI SA 420 of 2024
and accordingly the account was declared as NPA on
14.04.2024. Thereafter, the respondent no.1 FI has issued the
demand notice under Section 13 (2) dated 16.04.2024 for
recovery of a sum of Rs.3,69,39,036/- due as on 15.04.2024,
however, it has been argued on behalf of the applicants that
the respondent bank has failed to serve the aforesaid demand
notices upon all the borrowers/guarantors/ mortgagors as per
the Security Interest (Enforcement) Rules, 2002 and the
respondent FI has also failed to give the details of bifurcation
of the outstanding amount in the demand notice as per the
judgement of Hon'ble High Court of Gujarat in the matter of
PNB vs Mithilanchal Industries (MANU/GJ/1069/2020) in the
aforesaid demand notices. On perusal of the records as well as
reply and documents filed by the respondent bank it appears
that the aforesaid demand notice has been served upon all the
borrowers/guarantors/mortgagors as per the postal receipts
and even the aforesaid demand notice was also served through
publication in the newspapers i.e. Financial Express and
Jansatta on 24.04.2024 and the said demand notice was also
affixed on the property in question on 23.04.2024 as per the
photographs annexed with reply (at page no.42 to 44 of reply).
However, record further reveals that the demand notice under
section 13 (2) of the SARFAESI Act, 2002 was issued on
16.04.2024, whereas as the present securitization applicant

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namely Mr. Anil Kumar Sharma was in judicial custody from 23.03.2023 till 28.10.2024 and accordingly, the said demand notice was required to be served upon the applicant through concerned superintendent of the jail, but the respondent FI has failed to do so and thus the respondent FI has failed to serve the aforesaid demand notice under section 13 (2) upon the applicant meaning thereby there is non-compliance of Rule 3 of the Security Interest (Enforcement) Rules, 2002 which is reproduced herein below:

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Rule: 3

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(1) The service of demand notice as referred to in subsection (2) of section 13 of the 2[Act] shall be made by delivering 5[including hand delivery] or transmitting at the place where the borrower or his agent, empowered to accept the notice or documents on behalf of the borrower, actually and voluntarily resides or carries on business or personally works for gain, by registered post with acknowledgement due, addressed to the borrower or his agent empowered to accept the service or by Speed Post or by courier or by any other means of transmission of documents like fax message or electronic mail service:

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Provided that where authorised officer has reason to believe that the borrower or his agent is avoiding the service of the notice or that for any other reason, the service can not be made as aforesaid, the service shall be effected by affixing a copy of the demand notice on the outer door or some other conspicuous part of the house or building in which the borrower or his agent ordinarily resides or carries on business or personally works for gain and also by publishing the contents of the demand notice in two leading newspapers, one in vernacular language, having sufficient circulation in that locality.

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(2) Where the borrower is a body corporate, the demand notice shall be served on the registered office or any of the branches of such body corporate as specified under sub-rule (1).

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(3) Any other notice in writing to be served on the borrower or his agent by authorised officer, shall be served in the same manner as provided in this rule.

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DRT-I, DELHI SA 420 of 2024 (4) Where there are more than one borrower, the demand notice shall be served on each borrower.

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1. Further on perusal of the aforesaid demand notice, it appears that in the demand notice dated 16.04.2024 the respondent FI has not given the complete details of bifurcation of the demanded amount i.e. amount disbursed, rate of interest, amount outstanding, schedule balance (principle), interest, principle, late charges, fee etc. and thus there is noncompliance on behalf of the respondent FT as per the judgement of Hon'ble High Court of Gujarat in the matter of PNB vs Mithilanchal Industries (MAN U/GJ/1069/2020). However, the respondent FT has given the complete details of bifurcation of the demanded amount vide letter dated 15.04.2024, but the same was required to be given in the aforesaid demand notice, but the respondent FI has failed to do so.

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Further, it has been argued on behalf of the applicants that the respondent FI has issued the sale notice dated sale notice dated 13.09.2024 (vide which the auction sale was fixed for 22.10.2024), but the respondent FI has failed to serve the said notices upon all the borrowers/guarantors/ mortgagor as per the Security Interest (Enforcement) Rules, 2002 and even the sale notice dated 13.09.2024 was published only in one newspaper. However, it has been argued on behalf of the

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18 DRT-I, DELHI SA 420 of 2024
respondent FI that the respondent FI has served the aforesaid
sale notices dated 13.09.2024 upon all the
borrowers/guarantors/mortgagor as per the Security Interest
(Enforcement) Rules, 2002. On perusal of the records as well
as reply of the respondent FI it appears that the respondent FI
has issued sale notice dated 13.09.2024 was dispatched on
19.09.2024, however, as per the postal tracking report filed by
the respondent FI the said sale notices were served to the
sender (respondent FI) meaning thereby the said sale notice
was not served upon all the borrower/guarantor/mortgagor and
thus the respondent FI has failed to serve the said notice by
post and thus there is non-compliance of the Rule 8 (1) and
Rule 8 (6) of the Security Interest (Enforcement) Rules, 2002
on the part of the respondent bank and the Rules 8 (1) and 8
(6) are reproduced herein below. Further, record reveals that
the sale notice was issued on 13.09.2024, whereas as the
present securitization applicant namely Mr. Anil Kumar Sharma
was in judicial custody from 23.03.2023 till 28.10.2024 and
accordingly, the said sale notice was required to be served upon
the applicant through concerned superintendent of the jail, but
the respondent FI has failed to do so and thus the respondent
FI has failed to serve the aforesaid sale notice upon the
applicant.

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Rule 8 (1):

Where the secured asset is an immovable property, the authorised officer shall take or cause to be taken possession, by delivering a possession notice prepared as nearly as possible in Appendix IV to these rules, to the borrower and by affixing the possession notice on the outer door or at such • conspicuous place of the property.

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Rule 8 (6):

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the authorized officer shall serve to the borrower a notice of thirty days for sale of the immovable secured assets, under sub-rule (5):

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[Provided that if the sale of such secured asset is being effected by either inviting tenders from the public or by holding public auction, the secured creditor shall cause a public notice in the Form given in Appendix IV-A to be published in two leading newspapers including one in vernacular language having wide circulation in the locality.].

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Further, on perusal of the records it appears that the sale notice dated 13.09.2024 was published in the newspapers i.e. Financial Express and Jansatta on 14.09.2024, but the said sale notice was dispatched by speed post on 19.09.2024. However, before the date of publication in the newspapers on 14.09.2024 the said sale notice was required to be dispatched before the date publication and thus the respondent FI has failed to give the right of redemption to the applicant/borrower under section 13 (8) of the SARFAESI Act, 2002, which is reproduced herein

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below:

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Section 13 (8) of the SARFAESI Act, 2002:

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Where the amount of dues of the secured creditor together with all costs, charges and expenses incurred by him is tendered to the secured creditor at any time before the date of publication of notice for public auction or inviting

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quotations or tender from public or private treaty for transfer by way of lease, assignment or sale of the secured assets

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Further, on perusal of the records as well as the valuation report dated 24.10.2015 of the valuers i.e. Protocol Valuers Pvt. Ltd. and valuation report dated 30.07.2024 of M/s EEPAC (India) Pvt. Ltd. filed by the respondent FI it appears that the property in question is consisting of ground floor, first floor and second floor, but the respondent FI has failed to give the details of floorwise in the sale notice dated 13.09.2024 and even the boundaries of the property in question have also not mentioned in the said sale notices, that too, when these details are available with respondent FI in their own valuation reports and further the details of boundaries are also given in the aforesaid valuation reports of the bank i.e. north: entry road 40 ft wide, south: service lane 15 ft wide, east: plot no.234 and west: plot no.234 and thus, there is non-compliance of Rule 8 (7a) of the Security Interest (Enforcement) Rules, 2002, which is reproduced herein below, and also against the judgement dated 20.09.2017 of Hon'ble High Court of Delhi in the case of Rajesh Gems and Jewels Pvt. Ltd. & ors. Vs India Overseas Bank [W.P.(C) 6653/2017 and CM APPL. 27673/2017] vide which the Hon'ble High Court has held as under:

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"....4. We are of the opinion that it is extremely desirable for all Banks/Financial Institutions to be as transparent as

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possible when putting immovable properties, mortgaged with them/attached by Court order to auction, by furnishing all the relevant details that can make it an attractive proposition for bidders to participate in the auctions conducted by them. This would also be in the larger public interest inasmuch as the best possible price for the properties could be fetched when put to auction. We deem it appropriate to direct the respondent/Bank in the present proceedings to ensure that henceforth, the public notices issued for auctioning all immovable properties under the SARFAESI Act, contain all the relevant details and state whether the same is freehold or leasehold, give its measurement, location etc., including other relevant details for it to attract as many bids as is possible.

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A copy of the present order shall be furnished by the respondent/Bank to the Indian Banking Institution for it in turn, to communicate the same to all the other Banks and Financial Institutions for information and compliance...."

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Rule 8 (7a):

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every notice of sale shall be affixed on the conspicuous part of the immovable property and the authorised officer shall upload the detailed terms and conditions of the sale, on the web- site of the secured creditor, which shall include;

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(a)the description of the immovable property to be sold, including the details of the encumbrances known to the secured creditor;

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Ld. counsel for the applicants has raised the objection that the officials of the respondent FI in connivance with the auction purchaser has sold the property in question at throw away price. Apparently, the respondent FI has auctioned the property in question for a sum of Rs.5.77 crores against the total outstanding amount of Rs.3.69 crores as per the aforesaid demand notice dated notice dated. 16.04.2024 and one or two floors of the property in question could have been put on auction sale to recover the entire dues of Rs.3.69 crores, but

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the respondent FI has sold the entire property in question for a sum of Rs.5.77 crores, which is bad in law as per Rule 8 (5) of the Security Interest (Enforcement) Rules, 2002 and the same is reproduced herein below, and also against law laid down by the Hon'ble Supreme Court in the matter of " Ram Kishun vs. State of U.P vide which the Hon'ble Supreme Court has held as under. Even otherwise, the respondent FI has failed to give the details of floorwise in the sale notice dated 13.09.2024 and by giving such details of floor-wise in the sale notice the respondent FI could have fetched more amount in the auction sale conducted on 22.10.2024. Further, the respondent FI is also relying upon the valuation report dated 24.10.2015 (annexed at page no.44 and exhibit as RW-1/2), which is more than ten years old valuation.

¶92

" 18. In Ambati Narasayya v. M. Subba Rao & Anr., AIR 1990 SC 119, this Court dealt with a case where in execution of a money decree for Rs.2,400/- the land was sold for Rs. 17,000/-. The Court set aside the sale observing that there is a duty cast upon the Court to sell only such property or a portion thereof as necessary to satisfy the decree. (See also: Takkaseela Pedda Subba Reddi v. Pujari Padmavathamma & Ors., AIR 1977 SC 1789; and S. Mariyappa (Dead) By LRs. & Ors. v. Siddappa & Anr., (2005) 10 SCC 235).

¶93

Thus, in view of the above, it is evident that law requires a proper valuation report, its acceptance by the authority concerned by application of mind and then fixing the reserve price accordingly and acceptance of the auction bid taking into consideration that there was no possibility of collusion of the bidders. The authority is duty bound to decide as to whether sale of part of the property would meet the outstanding demand. Valuation is a question of fact and valuation of the property is required to be determined fairly and reasonably....".

DRT-I, DELHI

SA 420 of 2024

Rule 8 (5):

Before effecting sale of the immovable property referred to in sub-rule (1) of rule 9, the authorized officer shall obtain valuation of the property from an approved valuer and in consultation with the secured creditor, fix the reserve price of the property and may sell thewhole or any part of such immovable secured assetby any of the following methods:- (a) by obtaining quotations from the persons dealing with similar secured assets or otherwise interested in buying the such assets; or.
21. Further, the Hon'ble Supreme Court of India in the
judgment of Rajiv Subramaniyam reported in [2014] 5 SCC
page 651 and referred para 14 of the judgment has held as under: ,„As noticed above, this Court in Mathew Varghees case also examined Rules 8 and 9 of the Rules, 2002. On a detailed analysis of Rules 8 and 9(1), it has been held that any sale effected without complying with the same would be unconstitutional and, therefore, null and void.'
22. In view of the above facts and circumstances and
SARFAESI Act and Rules, this Tribunal is of the affirmed view
that the respondent no. FI has not followed the mandatory
procedures as laid down under the SARFAESI Act and Rules,
while issuing the demand notice under section 13 (2) and
conducting the auction sale of the property in question,
therefore, the present SARFAESI Application is liable to be
allowed and the demand notice dated 16.04.2024 and the sale
notice dated 13.09.2024 (vide which the auction was fixed for
22.10.2024) and all the subsequent actions of the respondent
no.1 FI are liable to be set aside and quashed. Further, since sd-

¶99

24 DRT-I, DELHI SA 420 of 2024
the auction purchaser has invested the money by depositing the auction amount with the respondent FI and such money has
been retained by the respondent FI since the month of October,
2024, therefore, it would be appropriate to direct the
respondent no.1 FI to return the auction money alongwith
interest @ FDR from the date of deposit till the date of release of the payment and the respondent no.1 FI shall also restore
back the physical possession of the property in question to the securitization applicants immediately.
(ORDER)
The SARFAESI Application filed by the applicant is allowed
and the demand notice dated 16.04.2024 under section 13 (2) and the sale notice dated 13.09.2024 (vide which the auction was fixed for 22.10.2024) and all the subsequent actions of the respondent no.1 FI are hereby set aside and quashed. However,
the respondent no.1 FI is free to take afresh action under the
SARFAESI Act in accordance with law. The respondent no.1 FI
is hereby directed to return the auction money, so deposited by
the auction purchaser, to the auction purchaser within 30 days
from today alongwith interest @ FDR from the date of deposit
till the date of release of the payment and the respondent no.1 cd

¶100

¶101

DRT-I, DELHI SA 420 of 2024 FI shall also restore back the physical possession of the property in question to the securitization applicant immediately. Accordingly, the present securitization application alongwith pending applications, if any, stands disposed of. The present order be uploaded immediately on the website of this Tribunal. Final Order signed, sealed, dated and pronounced in the open court on this 21st February, 2026. Dictated & Corrected by me.

¶102

(GOVIND BALLABH SHARMA) PRESIDING OFFICER, DRT-I, Delhi

¶103

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Anil Kumar Sharma v. Aditya Birla Finance Limited

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Anil Kumar Sharma v. Aditya Birla Finance Limited

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