Ms Nuray Realtech Private Limited v. Punjab and Sind Bank

DRT9 Jan 2026SA/527/2023

Case brief

AI extract

What is this about?

This court dismissed writ applications challenging enforcement proceedings under the SARFAESI Act. It held that land mortgaged for a non-agricultural development purpose does not qualify for exemption under Section 31(1) despite revenue record classification. The court found the bank complied with statutory notice requirements and rejected claims that CIRP approval barred arbitration against guara

What did the court decide?

Applications challenging demand notice, possession notice, and sale notice under the SARFAESI Act are dismissed. Sale in favor of auction purchaser is confirmed.

Ms Nuray Realtech Private Limited versus Punjab and Sind Bank — Banking and Recovery | DRT (2026)

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DEBTS RECOVERY TRIBUNAL-I, DELHI JEEWAN TARA BUILDING, PARLIAMENT STREET NEW DELHI

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PRESIDING OFFICER: Shri Govind Ballabh Sharma

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SA No.527 OF 2023
M/s Nuray Rea !tech Private Limited Registered office: B-165, Shukra Bazar, Main Road, New Ashok Nagar, East Delhi, Delhi-110096 Versus	Applicant
1. Punjab and Sind Bank Through its Authorized Officer 21, Rajendra Palace, New Delhi-110008.
2. Authorized Officer, Punjab and Sind Bank 21, Rajendra Place, New Delhi-110008
3. M/s Era Infra Engineering Limited Through its Resolution Professional, Office: 370-371/2, Sahi Hospital Road, Jangpura, Bhogal, New Delhi-110014.
Also at: B-292, Chandra Kanta Complex Shop No.2 & 3, Near Metro Pillar NO.161, New Ashok Nagar, New Delhi-110096
Sh.Hem Singh Bharana -146, First Floor, arvodaya Enclave, alviya Nagar, New Delhi-110017.
M/s Vayuu Propmart Pvt. Ltd., 55, S/F, Ramnagar, ahadara, elhi-110051. Respondents

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SA no.527/2023 & SA no.528/2023 SA No.528 OF 2023
M/s UBA Realtech Pvt. Ltd.,
Registered Office:
B-165, Shukra Bazar, Main Road, New Ashok Nagar,
East Delhi,
Delhi-110096 Applicant Versus
1. Punjab and Sind Bank Through its Authorized Officer 21, Rajendra Palace, New Delhi-110008.
2. Authorized Officer, Punjab and Sind Bank 21, Rajendra Place, New Delhi-110008
3. M/s Era Infra Engineering Limited Through its Resolution Professional, Office: 370-371/21Sahi Hospital Road, Jangpura, Bhogal, New Delhi-110014.
Also at: B-292, Chandra Kanta Complex Shop No.2 & 3, Near Metro Pillar NO.161, New Ashok Nagar, New Delhi-110096
Sh.Hem Singh Bharana -146, First Floor, arvodaya Enclave, Malviya Nagar, New Delhi-110017.
M/s Vayuu Propmart Pvt. Ltd., 155, S/F, Ramnagar,
•ahadara,
elhi-110051. Respondents
resent:
r. Siddharth Yadav, Ld. Senior Advocate alongwith Mr. Pallav -axena, Ld. Counsel and Mr. Apoory Aggarwal, Ld. Counsel for he securitization applicants.

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SA no.527/2023 & SA no.528/2023

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Mr. Sanjiv Kakra, Ld. Senior Advocate alongwith Mr. R. Wali, Ld. Counsel for the respondent bank. Mr. Anil Airi, Ld. Senior Advocate alongwith Mr. Abhisek Batra, Ld. Counsel for the auction purchasers.

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Date of reserve: 07.01.2026. Date of Pronouncement: 09.01.2026. (FINAL ORDER)

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The Hon'ble DRAT, Delhi vide order dated 24.11.2025 passed in Misc. Appeal no.282/2023 and Misc. Appeal no.283/2023 directed this Tribunal to deliver the judgement in these two connected matters within a period of 15 days positively after concluding the arguments. That these two connected securitization applications are clubbed together and hence the same are being decided together with this single final order/judgement.

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SA No.527 2023.

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The present securitization has been moved on behalf of he applicant praying therein to stay the operation of the impugned sale notice dated 07.092023, in relation to the properties in question, as claimed to be issued by the respondent bank under Rule 8 (6) of Security Interest Enforcement) Rules, 2002; stay the operation of the impugned Demand Notice dated 05.02.2014 issued by the respondent sank under Section 13(2) of the SARFAESI Act, 2002; Stay the •peration of the impugned possession notice dated 09.05.2014 s claimed to be issued by the respondent bank under Section 3(4) of the SARFAESI Act 2002; restrain the respondent bank,

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SA no.527/2023 & SA no.528/2023 its servants, agents, employees, and persons associated with the same from taking physical possession of the subject land and/or from handing over the same to a third party or its servants, employees, attorneys, and agents in any manner whatsoever; restrain the respondent no.2 from selling, creating any third-party interest on the subject land and to maintain status quo on the subject land arising out of the sale certificate dated 10.10.2023. 2. It has been submitted on behalf of the securitization applicant that the applicant is a Private Limited Company registered under the provisions of Companies Act, 1956. It has further been submitted that M/s. Era Infra Engineering Limited (borrower/respondent no.2) is an EPC company and as per the respondent bank, the borrower approached the respondent bank in and around January 2013 to seek "Term Loan Facility" to the tune of Rs.30 Crores for strengthening the Net Working Capital and to overcome liquidity mismatch faced by the borrower. It has also been submitted that the respondent bank anctioned a term loan of Rs.30 Crore in favour of the borrower o meet long term working capital requirement and for general orporate purpose vide sanction letter dated 13.12.2012. It has lso been submitted that the respondent bank contends that ertain lands owned by the applicant were mortgaged to the espondent bank against this loan. It has further been

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SA no.527/2023 & SA no.528/2023

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submitted that the of subject lands are as follows: Land admeasuring 2.86 acres (22 kanal, 17 marla) in the name of M/s Nuray Realtech Ltd. (group company) situated at khewat no.381, khata no. 499, mustil no. 51, killa nos.2/2(3-15), 9/1(5-0), 12/2(6-0), 13/1 (7/2) and 2/1 (1-0) in village Daulatabad, Tehsil & District Gurgaon (hereinafter as 'property in question). It has further been submitted that Corporate Insolvency Resolution Process (herein-after to be referred as "CIRP") has been initiated against the borrower i.e., respondent no. 2 vide company petition bearing no. CP No. (IB) 190 of 2017, under section 7 of the Insolvency and Bankruptcy Code, 2016 and the Ld. National Company Law Tribunal, Principal Bench, New Delhi vide its order dated 8th May 2018 allowed the application under Section 7 for initiation of the Corporate Insolvency Resolution Process of the Borrower. It has further been submitted that a claim of the respondent bank including the outstanding of the loan as mentioned above, has been admitted in the CIRP of the borrower and is reflected in he updated list, uploaded on the website of the borrower. It has further been submitted that the resolution plan of the •orrower has been approved by the CoC with the requisite ajority and the claims of the Respondent Bank have been ealt with as per the terms of the resolution plan and now the esolution plan is pending before NCLT for approval and in view 4-

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SA no.527/2023 & SA no.528/2023

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of this, any claim dealt with and discharged in the CIRP process can in any event not be enforced against the applicant. It has further been submitted that the respondent bank has filed multiple petitions before multiple forums against the same loan facility granted to the borrower and the respondent bank herein issued a demand notice dated 05.02.2014 for payment of an amount to the tune of Rs.32,17,65,461.23/- (Rupees thirty-two crores seventeen lacs sixty-five thousand four hundred and sixty-one and paise twenty-three only) to the borrower. It has further been submitted that the impugned demand notice is in variance to the charge filed by the respondent bank with the MCA having SRN No. B66528852 with charge ID 10399165. It has further been submitted that the provisions of the SARFAESI Act, 2002 mandates the secured creditor to mention the details of the amount payable by the borrower and the respondent bank herein has failed to mention the details of interest, penalty interest and other harges levied by it and has merely stated only the outstanding mount in the impugned demand notice dated 05.02.2014 ssued by the respondent bank proper and thus complete nformation including the breakup of the outstanding amount n terms of principal, interest and penal interest as mandated nder Section 13(3) of the SARFAESI Act, 2002 has not been rovided by the respondent bank in the said demand notice.

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SA no.527/2023 & SA no.528/2023 3. It has further been submitted on behalf of the applicants that the respondent bank is, without application of mind, in an arbitrary manner, demanding exorbitant amount from the applicant which is evident from the impugned notices as in the impugned demand notice the respondent bank is claiming Rs.32.17 crores as outstanding amount and in the sale notice dated 06.02.2023 (which became infructuous as the stay was granted by the DRT-1 vide order dated 23.02.2023 and also that no bid was received), the respondent bank had claimed Rs.126.20 Cr. as outstanding amount and in sale notice dated 24.03.2023 (which was also became infructuous as the stay was granted by the DRT-1 vide order dated 10.04.2023), the respondent bank had claimed Rs.127.67 Cr as the outstanding amount and now in the impugned sale notice dated 07.09.2023, which was published in the newspaper (ie., Financial Express) the respondent bank is claiming Rs.137.78 Cr as the outstanding amount. It has also been submitted that the respondent bank, in the garb of banking company is trying to illegally extort hard earned money of the applicant by pressuring the applicant by threatening to put the applicant's gricultural lands to auction, which is evident from the fact that he said borrower availed a term loan facility to the tune of s.30 Crores however, the respondent bank, without giving ny reasoning, or any back up of the calculations arbitrarily

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SA no.527/2023 & SA no.528/2023 claimed its outstanding dues to the tune of Rs.126.20 Cr. 06.02.2023 and Rs.127.67 Cr. in the sale notice dated 24.03.2023 and now the respondent bank is claiming its outstanding dues to the tune of Rs.137.78 Cr. in the impugned sale notice dated 07.09.2023. It has further been submitted that the from 10.04.2023 till 04.09.2023 a stay was in operation and even assuming that the respondent bank has not stopped the interest calculation for the period of the stay this amounts to an interest of Rs.1.65 Cr. per month on a principal outstanding of 30 Cr. which translates to annual interest rate of about 66% of the principal outstanding being charged as interest by the respondent bank. It has further been submitted that exorbitant interest charged by the respondent bank and that too with great variance in the impugned notices is as i). Impugned demand notice dated 05.02.2014 (disputed) amount claimed as outstanding is Rs.32,17,65,461.23/-, ii). Impugned ale notice dated 06.02.2023 (disputed) amount claimed as utstanding Rs.126.20 crores, iii). Impugned sale notice dated 4.03.2023 (disputed) amount claimed as outstanding is s.127.67 Cr. iv). Impugned sale notice dated 07.09.2023 disputed) amount claimed as outstanding is Rs.137.78 Cr. It as further been submitted that without prejudice, it is once gain reiterated that the above mention table shows that the espondent bank is charging an interest of Rs.1.65 Cr. per 5d-

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SA no.527/2023 & SA no.528/2023 month on a principal outstanding of Rs.30 Cr. which translates to annual interest rate of 66% being charged by the respondent bank, against the interest rate fixed by the respondent bank in the sanction letter i.e., BR +3.50 per annum on monthly rests. It has further been submitted that the outstanding amount as claimed by the respondent bank is wrong, illegal and arbitrary as there is no practical calculation provided for the same, which is evident from the impugned notices that the respondent bank had arbitrarily charged excessive interest and penal interest without disclosing the details of the same to the applicant, in complete contravention of fair practice code issued by the Reserve Bank of India. It has further been submitted that the respondent bank maintained deafening silence for years and issued the impugned notices for sale of subject lands after an inexplicable delay of more than 9 years from the alleged date of declaration ,of the borrower's account as NPA i.e., from 31.12.2013, which is nothing but the tactics of the respondent bank to extort money rom the applicant herein in the form of extortionate interest. t has further been submitted that as per Rule 9(1) of the ecurity Interest Rules, 2002, no sale of immovable property nder these rules, in first instance shall take place before the xpiry of thirty days from the date on which the public notice f sale is published in newspapers however, the respondent

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S I—

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SA no.527/2023 & SA no.528/2023 bank has issued the impugned sale notice on 07.09.2023 wherein the sale of subject land is fixed for 29.09.2023 which is less than 30 days, against the period of 30 days as provided under Rule 9(1) of the Security Interest Rules, 2002. It has further been submitted that the notice for less than 30 days is given when the sale of immovable property fails, however, in the present matter, the sale of subject lands did not fail, it was merely stayed by the order of this Tribunal, hence, the respondent bank is clearly liable to give 30 days prior notice to the applicant for which the applicant has relied upon the Rule 8 of Security Interest (Enforcement) Rules 2002 and Rule 9 time of sale, issue of sale certificate and delivery of possession etc., hence, for the stated reasons, the impugned sale notice dated 07.09.2023 is liable to be quashed and any subsequent action/ measure taken by the respondent bank under the SARFAESI Act, 2002 is also liable to be quashed as the impugned sale notice dated 07.09.2023 is bad in law. It • has further been submitted that the subject lands on which the Ileged security has been created are agricultural lands and

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hence, are exempt from the provisions of the SARFAESI Act, 002 by virtue of Section 31 (1) of the SARFAESI Act. It has

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urther been submitted that the respondent bank failed to erve a copy of the impugned possession notice to the pplicant and the impugned possession notice was in complete sd-

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SA no.527/2023 & SA no.528/2023 violation of the Rule 8(2) of the Security Interest (Enforcement) Rules, 2002, as the respondent bank failed to pub-lish the impugned possession notice in a vernacular language newspaper having wide circulation in the locality where subject lands are located. It has further been submitted that the subject lands are situated in Gurgaon, Haryana, however, the respondent bank published the Possession notice only in the New Delhi edition of English newspaper. 4. It has further been submitted on behalf of the applicants the respondent bank issued an illegal sale notice dated 07.09.2023 for sale of the subject lands through e-auction in complete violation of provisions of the SARFAESI Act, 2002 and Security Interest (Enforcement) Rules, 2002. It has further been submitted that the subject lands are not demarcated and hence, the subject lands are part of a parcel of a larger land parcel and the same cannot be identified and as per rule 8(1) and Rule 8(7) of the Security Interest (Enforcement) Rules, 2002, the respondent bank is mandated to deliver possession notice and sale notice by affixing the possession notice on the uter door or at conspicuous place of the subject lands which bviously could not have been done in this instance as the ubject lands by the admission of the respondent bank in the mpugned sale notice dated 07.09.2023 are not demarcated nd hence obviously not identifiable. It has further been

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sct

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SA no.527/2023 & SA no.528/2023

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submitted that the subject land are agricultural land and outside the purview of the SARFAESI Act of 2002 in terms of section 31(1) of the Securitization Act 2002. It has further been submitted that the applicant is the owner of the subject lands which are agricultural as referred to and admitted by • the respondent bank/respondent bank in the impugned notice. It has further been submitted that the documents and title including the respective sale deeds lying in the power and possession of the respondent bank itself reflect that at the time the said lands were purchased by the applicant. It has further been submitted that in the title deed of equitable mortgaged dated 20.12.2012, which was duly signed by the authorized officer of the respondent bank, the description of the subject Land as specifically mentioned in the sale deeds deposited with the respondent bank the said sale deeds describe the subject lands as 'Chahi' which means "irrigated from well", which shows that at the time of creation of interest on the subject land, the respondent bank knew that the subject lands are .gricultural lands. It has further been submitted that at the ime of sanctioning of credit facility by the respondent bank, he applicant had deposited original sale deeds of the subject ands with the respondent bank and it is evident from the •escription of subject lands as stated in the sale deeds that the .ubject lands were agricultural lands and from the sale deeds

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SA no.527/2023 & SA no.528/2023 that the respondent bank was well aware of the nature of the subject lands and had executed the mortgage with complete knowledge that the subject lands were agricultural in nature. It has further been submitted that the records maintained by the concerned authorities including the statutory revenue records clearly reveal and substantiate the fact that the subject lands have always been agricultural land and only used as such including by previous owners and also by the applicant. It has further been submitted that there has been no change of use nor has the nature of the subject lands been altered and the subject lands were not demarcated and there was/is no permission or license issued or granted by the concerned competent authorities changing the permitted use of the subject lands from agricultural use to any other use whether residential, institutional, or commercial. It has further been submitted that the above is the conclusive proof of the agriculture land with cultivation and as such complete debars he respondents from proceedings under Securitization Act 2002. It has further been submitted that without demarcation d necessary permissions and licenses being issued by the ompetent authorities, the subject lands are incapable of being •ut to any other use, other than for agricultural purposes, urthermore, the revenue records relating to the subject lands ncluding but not limited to the Khasra Girdawari clearly reflect

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SA no.527/2023 & SA no.528/2023 that the Subject Lands have continuously been used and still being used only for agricultural purposes, therefore, it is also a conclusive proof of the agriculture land with cultivation and as such complete debars the respondents from proceedings under Securitisation Act 2002 and even today there are standing crops of wheat in the area of subject land. It has further been submitted that the aforementioned details and particulars of the subject lands are also mentioned by respondent bank in the notices including the notice under Section 13(2) and the impugned possession notice and it is evident from the details and particulars of the subject lands and the awareness of the respondent bank that the subject lands continue to be in the nature of agricultural lands. It has further been submitted that as elaborated hereinafter, the subject lands being agricultural lands are exempted from the provisions of the SARFAESI Act, 2002 by virtue of Section 31(1) and any alleged security interest claimed to have been created with respect to the subject lands cannot be enforced by the recourse to the provisions of the SARFAESI Act, 2002. It has further been submitted that as per Section 31(1) of the SARFAESI Act, 2002, he provisions of the said Act shall not be applicable if any ecurity interest is created in agricultural land. It has further een submitted that as per Section 31(1) of the SARFAESI Act, 002, the respondent bank cannot enforce a charge over the

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SA no.527/2023 & SA no.528/2023 Agricultural lands by invoking the provisions of SARFAESI Act
2002 and issuing the demand notice as issued by respondent
bank and the respondent bank has no right to take any steps
for taking over the possession of the subject lands under the
SARFAESI Act, 2002, any such steps taken by respondent bank
are illegal and void abinitio, therefore, the respondent bank is
hereby liable to withdraw the present impugned sale notice as
the subject lands depicted in the demand notice and impugned
possession notice of the respondent bank are agricultural
lands. It has further been submitted that the respondent bank
knowingly and with their eyes open had created security
interest over agricultural lands whose change of land use was
not approved/ sanctioned by the competent authorities and
reliance is placed on the judgment of K Sreedhar vs Raus
Constructions Private Limited, Civil Appeal No. 7402 of 2022. It
has further been submitted that the Hon'ble Supreme Court in
State of Karnataka Vs Shankara Textile (1995) 1 SCC 295, has
held that no agricultural land can be used or treated as non-
agricultural land without obtaining prior permission of the
concerned authorities and it is clear from the available records
that the concerned authorities never issued any license
allowing change in usage of these subject lands. It has further
been submitted that the Financial Commissioner and Principal
Secretary to Government Haryana, Town, and Country

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SA no.527/2023 & SA no.528/2023 Planning Department issued a letter dated 19.12.2006 under the provisions of the Urban Areas Act to the Director, Town, and Country Planning Department with the Subject "POLICY FOR GRANT OF LICENSE AND CHANGE OF LAND USE CASE". It has further been submitted that the subsequent to the aforementioned letter dated 19.12.2006, a notification dated 05.02.2007 was issued by the Haryana Government, Town, and Country Planning under the provisions of the Punjab Controlled Areas Act outlining a plan to develop the different zones in the area of Gurgaon-Manesar Urban Complex. It has further been submitted that various sections of the notification dated 05.02.2007 including Sections VII, IX, XI and XVII lay down the prerequisites of the approval by the government authority for the CLU and nowhere the law in the said notification says that merely notification of an area wherein the land is situated as controlled area or a mere application for conversion of land use will automatically convert the nature of land to non-agricultural. It has further been submitted that in absence of a license from the Government, the nature of the subject lands will remain agricultural. It has further been submitted that the Section 3 of the Haryana Development and Regulation of Urban Areas Act, 1975 (hereinafter referred to as "Urban Areas Act"), lays down the law that any owner desiring to convert his agricultural land into a colony shall make an

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SA no.527/2023 & SA no.528/2023

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application to Director of Town & Country Planning Department, Haryana to request for granting a license to develop a colony in the prescribed form. It has further been submitted that it is evident from plain reading of Section 3 of the Urban Areas Act that conversion of any land in Haryana would be subject to approval and grant of license by the concerned authority. It has further been submitted that the Director, Town & Country Planning Department, Haryana has never granted any license to the applicant allowing for the conversion of land use and this has been admitted by . the respondent bank in it is impugned sale notice. It has further been submitted that as per Section 7 of the Punjab Scheduled Roads and Controlled Areas Restriction of Unregulated Development Act, 1963 (hereinafter to be referred to as "Punjab Controlled Areas Act"), any land in the State of Haryana cannot be used for any purpose other than those for which it was used on the date of publication and the applicant to establish its case is relied upon the provision of the Punjab Controlled Area Act. It has further been submitted that above provisions that the subject lands do not change its nature by he virtue of falling under the controlled area as the intention •f the legislature is evident, by the simple reading of Sections (5) and 4 Punjab Controlled Areas Act which describes a ontrolled area to be any area that in the opinion of the

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SA no.527/2023 & SA no.528/2023
government has the "potential" for building activities,
therefore, the controlled area only identifies the potentiality of
the part of the land to be used for a purpose as stated in a
Development Plan/Master Plan. It has further been submitted
that the word "Potential" is defined in Black's Law Dictionary as
"Existing in possibility but not in act, naturally and probably
expected to come into existence at some future time, though
not now existing, for example, the future product of grain or
trees already planted, or the successive future instalments or
payments on a contract or engagement already made. Thus,
as per the definition of the word "potential" means existing in
possibility and not existing in real, therefore the declaration of
an area as controlled area only marks its future possibility of
getting converted into a non-agricultural land, that possibility
may or may not occur in the future and there is probability that
the land under a controlled area continues to be used as an
agricultural land forever for any number of reasons including
the reason that the lands may not qualify to be licensed for any
other use. It has further been submitted that in such case the
land though lying within the controlled area loses the
"potential" of being used for non-agricultural purpose, hence,
the notification of the subject lands under provisions of the
Punjab Con-trolled Areas Act, 1963 do not change the nature
•f the subject lands. It has further been submitted that the

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SA no.527/2023 & SA no.528/2023 Sections 6 of the Punjab Controlled Area Act, clearly lays out the intent of the legislature that the nature of the land, even if it is notified as a controlled area does not automatically change its purpose/nature until and unless express per-mission is procured from the competent authority allowing the said land to be used for any purpose other than the purpose which it was being used on the date of publication of the notification identifying it as a controlled area. It has further been submitted that the legislative intent of the Punjab Controlled Area Act as laid out in Section 7 is clear that the nature of the lands falling under the controlled area is mandated to remain as it was on the date of the notification unless express approval is procured from the competent authority for alternate use, thus, land which was being used for agriculture on the date of the notification would by law continue to remain solely in the nature of agricultural land till a license is procured on the said land allowing for any other use i.e. residential/commercial etc., hence, the nature of the land cannot be assumed to have changed just on account of the notification identifying it as a controlled area and the applicant is relied upon the judgment •f Hon'ble High Court of Punjab and Haryana at Chandigarh itled Trishul Industries Versus The State of Haryana and nother, CWP No. 3596 of 1998 (Trishul Industries Case")

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.uccinctly lays out the stance of the state with regards to lands

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SA no.527/2023 & SA no.528/2023 situated in controlled areas. It has further been submitted that the facts of the current matter is that the Subject Lands fall
under the controlled area as notified under the Punjab
Controlled Area Act vide a notification dated 05.02.2007 and on that date, the Subject Lands were being used for agriculture
purpose and thus the Subject Lands by law can be used only
for the purposes of agriculture till an approval/licence to use
the land for any other purpose is pro-cured as per the
provisions laid out in the Urban Areas Act, 1975. It has further
been submitted that the Urban Areas Act was promulgated to
regulate the use of land in order to "prevent ill-planned and
haphazard urbanization in or around towns and for the
development of the infrastructure sector and infrastructure
projects for the benefit of the State of Haryana and for matters
connected therewith and incidental thereto." It has further
been submitted that the definition of "Colony" under Section 2
(c) of the Urban Areas Act specifically excludes the land being
used for the purpose of agriculture and Section 7 of the Urban
Areas Act, 1975 prohibits "erect or re-erect" any building other
than for the purpose of agriculture on the land sub-divided for
agriculture as defined in clause (aa) of Section 2 of the Urban
Areas Act, 1975. It has further been submitted that this
ascertains that even if the land is classified for a particular zone, the nature of the land still remains the same as Clause

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SA no.527/2023 & SA no.528/2023

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(iii) of Section 7 prohibits any construction over land for nonagricultural purpose if the land is being used for agricultural purpose. It has further been submitted that Section 7A of the Urban Areas Act, protects all agricultural land in urban areas from being misused, as it makes it mandatory to obtain a No Objection Certificate issued by the Director of. D'TCP before registration of transfer by way of sale or lease of "any agricultural land" and the said provision of the requirement to seek an NOC was challenged before the Hon'ble Punjab and Haryana High Court in Suresh Kumar Juneja v. State of Haryana & Ors., CWP No. 14402 of 2006 wherein the vires of the said NOC and the provision of Section 7A of the Urban Areas Act were challenged and the Hon'ble High Court held that the said provision of NOC was valid and must be complied with. It has further been submitted that it is important to bring to the notice of this Tribunal that an Application was filed by Uba Realtech Private Limited on behalf of the Applicant herein for a grant of license for Group Housing on the Subject Lands situated at Daulatabad, Gurgaon on 28.01.2011 under Section 3 of the Urban Areas Act, 1975 before the Town & Country Planning Department, Haryana. It has further been submitted that the Directorate of Town & Country Planning, Harayan rejected the request for grant of license for setting up of residential project on the subject lands vide letter dated

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r -

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SA no.527/2023 & SA no.528/2023 05.01.2016 and subsequent to the rejection of the application for conversion of the Subject Lands by the Director, Town and Country Planning Department, Haryana the usage and nature of Subject Lands continued as agricultural land moreover the Subject Lands also lost the potentiality of being converted for any other use and till date the Subject Lands are being used for agricultural purposes. It has further been submitted that on a previous occasion, the Hon'ble Punjab and Haryana High Court in Subir Kaur Dey and Ors. vs State of Haryana And Ors. (2007) 146 PLR 746 held that on non-production of relevant documents, the land would remain agricultural in nature and the said land cannot be used for any other purposes. It has further been submitted that District Town Planner (HQ), for Director General, Town, and Country Planning Haryana, Chandigarh vide order dated 23.06.2015 laid down "Instructions for making grant/issue of NOC for the purpose of Section 7A of Act of 1975 transparent." ("said instructions"). It has further been submitted that the said instructions contain a format of an affidavit which is to be accompanied by an application for grant of NOC under Section 7-A of the Urban Areas Act 1975 and the language of the affidavit itself recognizes the basic nature of land in an urban area to be agricultural and for any change in the nature of the land, a license is required to be procured as per the terms of the Urban _5c11—_

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SA no.527/2023 & SA no.528/2023 Areas Act. It has further been submitted that this intent of the legislature with regard to the nature of the land within a controlled area is also evident from the stamp duty rates notified for controlled areas covering the villages of Daulatabad and Mohammad Heri (the location where the Subject Lands are located). It has further been submitted that the notified rate charts provide for different collector rates in the same locality for agricultural land and for lands wherein change in land use has been allowed and the lands have been licensed to be developed for residential/commercial purposes. It has further been submitted that it is evident from the above that the conversion of land in Haryana would be subject to approval and grant of license by the concerned authority and as the Director, Town & Country Planning Department, Haryana has never granted license to the applicant and therefore, the subject lands continue agricultural in nature and a fact which has been admitted by the Respondent Bank in the impugned sale notice. It has further been submitted that ICICI Bank has proceeded with the sale of such lands to ZES Realty Private Limited (Purchaser) under the provisions of the SARFAESI Act, 2002.

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It has further been submitted on behalf of the applicants the sale deed dated 24.08.2023 which was executed between the authorized officer of ICICI Bank and ZES Realty Private Limited, specifically states that the lands were conveyed as are

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SA no.527/2023 & SA no.528/2023

¶67

"Krishi Chahi", which means that those lands are agricultural lands. It has further been submitted that in the same instance even while entering an entry in the Intekal register of the revenue authorities put on record that lands are agricultural lands. It has further been submitted that the type of land for the lands is mentioned as "Chahi"/ "Majrua" in the Intekal register and as per the translation of vernacular words as mentioned on the official website of the Haryana Land Records, "Chabi" means "irrigated from well. It has further been submitted that if the lands are irrigated from well, it is implied that the lands are agricultural lands in nature. It has further been submitted that as the applicant herein has filed the application under Section 340 of Cr. PC bearing M.A No. 28 of 2023, titled as 'Nuray Realtech Pvt. Ltd. vs. ICICI Bank, against the ICICI Bank for illegal sale of mortgaged land of the applicant herein held by the ICICI Bank as the ICICI Bank while proceedings always stated that the mortgaged lands are not agricultural land however, while executing sale of mortgaged land, the ICICI Bank specifically states that the lands were conveyed as are "Krishi Chahi", which means that those lands are agricultural lands. It has further been submitted that Ld. DRT-III has issued the notice in the said 340 Application vide Order dated 06.09.2023. It has further been submitted that in a similar matter being Securitization Application No. 14 of 2023,

¶68

¶69

SA no.527/2023 & SA no.528/2023

¶70

titled as Dore Realtors Pvt Ltd. vs. Canara Bank and Ors.', pending before this Tribunal, this Tribunal was pleased to grant an interim order dated 11.09.2023 in favour of the mortgagors. It has further been submitted that it is evident from the facts and documents annexed herein that the respondent bank is clearly aware of the fact that the Subject Lands are agricultural land and despite being exempted under Section 31(i) of the SARFAESI Act, 2002, the respondent bank has erred in initiating action for enforcement of security interest in the subject lands and issuing the demand notice dated 05.02.2014 and the impugned possession notice dated 09.05.2014 and the rea-sons stated herein above, the demand notice dated 05.02.2014 and the impugned possession notice dated 09.05.2014 and the impugned sale notice dated 07.09.2023 are bad in law and are liable to be set aside. It has further been submitted that the demand notice dated 05.02.2014 issued under Section 13(2) of SARFAESI Act, 2002, possession notice dated 09.05.2024 under Section 13(4) of SARFAESI Act, 2002 and sale notice dated 07.09.2023 being void ab initio relating thereto. It has further been submitted that the respondent bank issued a demand notice dated 05.02.2014 to the borrower for claiming an outstanding amount of Rs. 32,17,65,461.23/from the borrower. It has further been submitted that the respondent bank has failed to serve the Demand Notice dated

¶71

¶72

SA no.527/2023 & SA no.528/2023 05.02.2014 to the Applicant herein in complete violation of the
Rule 3 of the Security Interest (Enforcement) Rules, 2002.
6. It has further been submitted on behalf of the applicants
the Respondent Bank in the Demand Notice dated 05.02.2014
that, as on 31.12.2013, an amount of Rs.32,17,65,461.23/-is
allegedly outstanding and payable by the said Borrower, i.e.
the Respondent No.3 as also inter alia the other mortgagor and
without prejudice to what has been stated above, a bare
perusal of the Impugned Demand Notice dated 05.02.2014
would show that breakup of the outstanding amount in terms
of principal amount, interest and penal interest charged are nowhere stated in Demand Notice dated 05.02.2014 which is
in complete violation of the provision of Section 13 (3) of the
SARFAESI Act, 2002. It has further been submitted that the
impugned Demand Notice dated 05.02.2014 merely discloses
the sum total of the alleged outstanding amount without giving
any necessary particulars, which renders the Demand Notice dated 05.02.2014 violative of the provisions of the SARFAESI
Act, 2002. It has further been submitted that as per Rule 3 of
the Security Interest Rules, 2002, if for any reason, the service
cannot be made to the borrower and mortgagors, the service
has to effected in two manners: (1) firstly, by affixing a copy
of such demand notice on the outer door or some other
conspicuous part of the Subject Lands, and also by (ii)

¶73

¶74

SA no.527/2023 & SA no.528/2023

¶75

Secondly, by publishing the contents of the demand notice in two leading newspapers, one in vernacular language, having sufficient circulation in that locality. It has further been submitted that the impugned Demand Notice dated 05.02.2014 was never served and/or received by the Applicant herein and the same was taken by the Applicant from the Respondent No.3 herein and the case here is that when the service could not be effected, the Respondent Bank failed to undertake the substitute method of service as mandated by law and the law mandates that if the demand notice could not be serviced for any reasons, whatsoever, the demand notice has to be serviced by two alternative methods, both of which are mandatory to be complied with as the words used in the Security Interest Rules, 2002 are "and also by" and it is evident that the Respondent Bank has failed to comply with the mandatory provision of the Security Interest Rules, 2002 and has failed to serve the Demand Notice dated 05.02.2014 by affixing a copy of it on the outer door or some other conspicuous part of the Subject Lands and further, the Respondent Bank also failed to publish the contents of the Demand Notice dated 05.02.2014 in two leading newspapers and accordingly, the said demand notice is bad in law.

¶76

It has further been submitted on behalf of the applicants the Respondent Bank had published the impugned Possession

¶77

¶78

SA no.527/2023 & SA no.528/2023 Notice dated 09.05.2014, without the knowledge of the Applicant herein in a newspaper published and circulated in New Delhi, just for the sake of creating armor to safeguard themselves from the lack of compliance on the part of the Respondent Bank and the the Respondent Bank failed to serve a copy of the Impugned Possession Notice to the Applicant herein. It has further been submitted that the Subject Lands are situated in Gurgaon, Haryana, however, the Respondent Bank has published the impugned Possession Notice in New Delhi edition of newspaper (which does not have circulation in Gurugram) and as per the mandate of Security Interest (Enforcement) Rules, 2002, the Respondent Bank is under obligation to serve possession notice to each and every person against whose property the debt is being claimed and the Respondent Bank deliberately avoided the service of Impugned Possession Notice upon the Applicant, to illegally take the possession of the Subject Lands and thus, the Impugned Possession Notice dated 09.05.2014 issued by the Respondent Bank is liable to be set aside as there is clear violation of Security Interest (Enforcement) Rules, 2002 and principle of natural justice. It has further been submitted that the Respondent bank has failed to comply with the provision of Rule 8 (1) of the Security Interest Rules before issuing the Impugned Notice for Symbolic Possession under Section 13(4)

¶79

¶80

SA no.527/2023 & SA no.528/2023 of the SARFAESI Act, 2002 and thus, the impugned Symbolic Possession Notice dated 09.05.2014 is liable to be set aside on the ground of non-compliance as the Respondent Bank has acted arbitrarily by not serving the Impugned. Possession Notice to the Applicant. It has further been submitted that the Respondent Bank has not complied with the mandate of the Rule 8 (6) of the Security Interest (Enforcement) Rules, 2002 of publishing the Impugned E-Auction Notice in two leading news-papers, one being in vernacular language, having sufficient circulation in the locality setting out the terms of sale and the impugned E-Auction Notice was published by the Respondent Bank only in New Delhi edition of newspapers having circulation in Delhi whereas the Subject Lands are situated in Gurugram, Haryana and the Financial Express is a specialized business/financial news focused newspaper whose circulation is minuscule as compared to the other well-known and leading English daily newspapers and the said newspapers, ie. Financial Express is neither a leading newspaper nor has wide or sufficient circulation in Delhi, NCR or even in Gurugram. It has further been submitted that in the Impugned Possession Notice dated 09.05.2014, the Respondent Bank had mentioned that the physical possession is taken of the Subject Land as on 09.05.2014 however, in the Impugned Sale Notice dated 07.09.2023, the Respondent Bank mentions that the Symbolic

¶81

¶82

SA no.527/2023 & SA no.528/2023

¶83

possession is taken of the Subject Land as on 09.05.2014. It has further been submitted that the Respondent Bank is making contradictory statement with respect to a critical element which is possession of the Subject Land, which shows the negligent and arbitrary approach of the Respondent Bank towards the Applicant and the whole process of law. It has further been submitted that the physical possession of the Subject Land could not have been taken by the Respondent Bank, as the Subject Land by the admission of the Respondent Bank is not demarcated. It has further been submitted that the Subject Lands are agricultural land and hence, no security interest can be enforced against the Subject Lands in light of Section 31(1) of the SARFAESI Act, 2002 wherein agricultural lands are clearly and explicitly exempted from the provisions of the SARFAESI Act, 2002. It has further been submitted that the Respondent Bank, in the garb of banking company is trying to illegally extort hard earned money of the Applicant by pressuring the Applicant by threatening to put the Applicant's agricultural lands to auction, which is evident from the fact that the said Borrower took the term loan facility to the tune of Rs.30.00 Crores, however, the Respondent Bank, without giving any reasoning, arbitrarily claimed its outstanding dues to the tune of Rs.32,17,65,461.23/-in the Impugned Demand Notice and to the utter shock and surprise, respondent bank

¶84

¶85

SA no.527/2023 & SA n0.528/2023 claimed its outstanding dues to the four/five times of the actual principal amount in the subsequent Impugned Sale Notices (i.e. to the tune of Rs.126.20 Cr. in the sale Notice dated 06.02.2023 and Rs.127.67 Cr. in the sale Notice dated 24.03.2023 and now the Respondent Bank is claiming its outstanding dues to the tune of Rs.137.78 Cr. in the Impugned Sale Notice dated 07.09.2023) and it is pertinent to mention that, this amounts to an interest of Rs.1.65 Cr. per month on a principal outstanding of Rs.30.00 crores which translates to annual interest rate of 66% being charged by the Respondent Bank. It has further been submitted that the Impugned sale notice issued by the Respondent Bank is wrong as the Respondent Bank, in the Impugned Sale notice (Published on the website of the Respondent Bank) had mentioned that "physical/Symbolic Possession bas been taken by authorized officer" because in the Impugned Possession Notice dated 09.05.2014, the Respondent Bank had mentioned that the physical possession is taken of the Subject Land as on 09.05.2014, however, in the Impugned Sale Notice dated 07.09.2023, the Respondent Bank mentioned that the Symbolic possession is taken of the Subject Land as on 09.05.2014 and on the Impugned Sale Notice available on the website of the Respondent Bank, the Respondent Bank has mentioned that physical/Symbolic Possession has been taken and it is pertinent

¶86

¶87

SA no.527/2023 & SA no.528/2023

¶88

to pointed out that the Respondent Bank cannot take physical and symbolic possession both on the subject Lands. It has further been submitted that the Respondent Bank is making contradictory statement with respect to a critical element which is possession of the Subject Land, which shows the negligent and arbitrary approach of the Respondent Bank to-wards the Applicant and the whole process of law and moreover, the physical possession of the Subject Land could not have been taken by the Respondent Bank, as the Subject Land by the admission of the Respondent Bank is not demarcated and with respect to the Respondent Bank's different statement regarding taking possession in Impugned Notices and on the website of the Respondent Bank, reflects the hastiness on the part of Respondent Bank in order to grab the Subject Lands of the Applicant herein. It has further been submitted that in the Impugned Sale Notice, the Respondent Bank has mentioned that "No encumbrance known to the Bank" and also, in the terms and conditions laid down by the Respondent Bank for the E-auction of the Subject Lands, the Respondent Bank has mentioned that "intending bidder should make their own independent inquiries regarding encumbrance" and it is the duty of the Respondent Bank to disclose all the encumbrance on the immovable property. It has further been submitted that the Bank cannot escape or shift their responsibility on the

¶89

¶90

SA no.527/2023 & SA no.528/2023 shoulders of the intended bidder like in the instant case, by mentioning that the intending bidder should make their own independent inquiries regarding encumbrance, the Respondent Bank is trying to shift the burden on the intending bidder, which is completely wrong and against the norms of the auction. 8. It has further been submitted that after impugned e- auction of the subject lands, the Respondent Bank issued a sale certificate dated 10.10.2023, in favor of M/s Vayuu Propmart Pvt. Ltd., despite knowing the status of the Subject Lands, the Respondent Bank concluded the e-auction of the Subject Land for Rs.26,86,00,000 and declared the sole bidder, Le. M/s Vayuu Propmart Pvt. Ltd. as the successful bidder of the Subject Lands which was well pre-existed plan of the officers of the bank to usurp the property in question to favour the respondent No.5 under the garb of recovery of the public money. It has further been submitted that the Respondent Bank has colluded with other consortium of banks and is collectively with other banks selling the mortgaged properties to one setup buyer and the same is evident from the fact that in each instance of sale, there is only one bidder participating in the e-auction and in the instant case as well, there was only one bidder participating in the e-auction, implying that the successful auction purchaser, ie. the Respondent No. 5 is a setup buyer by the Respondent Bank wherein the Respondent

¶91

¶92

SA no.527/2023 & SA no.528/2023 No.5 by bidding the minimum/reserve price got in its favour, which is malafide and bad in law. It has further been submitted that the Respondent Bank in a calculated manner, conspired with the Respondent No.5 and played fraud before this Tribunal and put a bid for the Subject Lands at the Reserve Price on 29.09.2023 by hurriedly issuing the publication notice in newspaper on 07.09.2023 under Rule 9(1) of Rules 2002 before the expiry of clear thirty days as envisaged and mandatory under Rule 8(6) of the Rules 2002. It has further been submitted that the Subject Lands are located at prime location, and hence, by the reasonable man theory, there ought to be more than merely a sole bidder for the auction of the Subject Lands and therefore, it is evident that the Respondent Bank has colluded with the Respondent No.5 to auction the Subject Lands at a minimal price and the Subject Lands had been auctioned at the reserve price, which is much lower than the fair market value and therefore, the Subject Lands have been auctioned at an undervalued price, putting the Applicant in worse position and this is because, firstly, the auction of the Subject Lands is illegal and secondly, despite the auction of the subject Lands taking place, the Lands have been sold at a much less price, which still leaves the Applicant with an exorbitant Debt which is owed to the Respondent Bank. It has further been submitted that it is trite position of law that

¶93

¶94

SA no.527/2023 & SA no.528/2023 "what could not be done directly cannot be allowed to be done
indirectly" and the Respondent Bank has gained illegally and
abused the process of law by fraudulently executed the sale
certificate of the Subject Land which is an agricultural and
undemarcated land under Securitization Act 2002 and thus, in
order to favour the auction purchaser, who claims to be sole
bidder, in fact, the entire stage of illegally giving these
properties in question was set up by the Respondent Bank
and/or its officer so that there is no other bidder and the wide
publication was not made at the place/locality of the Subject
Lands, with clear intention that none comes up for bidding and
the Respondent No.2 was declared the successful bidder for
the Subject Lands at the reserve price and from the conduct of
the Respondent Bank and its officers, it is apparent that the
Respondent Bank has abused the process of law and this
Tribunal has power, authority and jurisdiction to see the strict compliance of its order and also pass necessary orders and/or
directions to secure the ends of justice, as prayed in this
reply/application to the other prayers sought by the bank. It
has further been submitted that a bare reading of the definition
of "security interest" read with Section 31 (i) of the SARFEASI
Act, 2002 contemplates that 'security interest' can certainly be
created on agricultural lands by way of mortgage and/or
charge, however, notwithstanding creation of and existence of

¶95

5d-

¶96

¶97

SA no.527/2023 & SA no.528/2023 such 'security interest' upon Agricultural Lands, Section 31 (1) of the Act by its plain reading exempts enforcement of such security interest created upon "agricultural lands" by recourse to the provisions of the SARFEASI Act, 2002. It has further been submitted that the exemptions as set forth in Section 31 (i) of the SARFEASI Act, 2002 are attracted to a particular stated species of properties though mortgage/hypothecation/ security interest may have been created upon such property(s) mentioned therein and the species or nature of property exempted by Section 31 (I) is "agricultural land" even though 'security interest 'over such 'agricultural land 'had been created and subsists and it is only the enforcement of the already created and existing security interest by recourse to the provisions of the SARFEASI Act, 2002 which is bared and exempted by virtue of Section 31 (i) of the SARFAESI Act, 2002. It has further been submitted that in the absence of creation of security interest over any species of property, in any event the SARFEASI Act, 2002 would have no applicability over any property of any description, nature or species. It is to be noted that the legislature sought to correct itself in Section 31 (1) by excluding and omitting clause (e) from Section 31 and thus, the said Clause (e) of Section 31 when inserted at the time of promulgation of the Act was meaningless or rather an error because indisputably the provisions of the SARE-FASI Act, 2002

¶98

¶99

SA no.527/2023 & SA no.528/2023 are only attracted to properties over which 'security interest' has been created and subsisting and not over properties and assets over which no security interest have been created and thus, the same would equally apply to lands though the same are agricultural lands and are cultivated as agricultural lands over which security interest by way of mortgage/Charge has or has not been created. It has further been submitted that all properties including all nature of lands can be attached and sold in execution of a Decree of a civil court or a Recovery certificate issued under Section 19 (22) of the DRT Act 1993, however, the exemptions from attachment and sale in execution of a decree and/or Recovery Certificate are provided only to those properties finding mention in (a) to (p) of Section 60(1) CPC. It has further been submitted that it is important to note that the legislature has not limited the exemption of Section 31(i) of the SARFEASI Act, 2002 to any particularly type or usage of "Agricultural Lands" or qualified that such exemption will only apply to Agricultural Lands owned or belonging to an Agriculturist or only with respect to lands belonging to an agriculturist who cultivates land personally and who depends for his livelihood mainly on the income from agricultural land, whether as owner, tenant, partner or agricultural labourer and lands used for pisciculture, floriculture, orchids or even horticulture or a combination of

¶100

¶101

SA no.527/2023 & SA no.528/2023 either or all will always be treated as Agricultural Lands. It has further been submitted that so long as Lands are by their very nature and user are agricultural lands and the character and user of such lands has not been altered or changed by acts of the Owner-Mortgagor by raising constructions or buildings unrelated to the agricultural activities, or by any other such like acts altering the predominant character and user of such lands, the exemption of Section 31(1) would be attracted. It has further been submitted that as a mere illustration, say with or in absence of permission of the concerned authorities, a commercial building or industrial building or the like has been constructed and erected on such agricultural lands permanently altering the character, nature, and predominant user of such lands from agricultural lands then surely the exemption provided under Section 31 of the SARFEASI Act, 2002 would not be attracted and even, mere grant of permission by any competent concerned State or local authority to erect or construct upon agricultural lands without the act of carrying out such constructions or in doing other acts altering the very nature and character of agriculture lands and continuously using the lands only as agricultural lands, the same will not remove the applicability of the exemption of Section 31(1) to such lands. It has further been submitted that unless specific permission has been granted by the competent

¶102

¶103

SA no.527/2023 & SA no.528/2023 authorities permitting change of existing user (CLU) of such
agricultural lands and such permission has been acted upon by changing the very nature and character of the said Lands from
Agricultural lands and usage to any other unrelated character
or usage, the exemption under Section 31 (i) will be still
attracted to such Lands. It has further been submitted that the
nature, character and user of the subject lands from either
prior to their respective purchase by the SA Applicant and till
date has not been altered or changed and will remain
agricultural lands uninterruptedly by their very character and
user till dare and there is no contrary documentary evidence
filed by the respondent bank till date. It has further been
submitted that no Change of Land User (CLU) has been granted by the competent authority and any license to use the subject
lands for any other purpose has been granted by the
competent authority including The Department of Town and
Country Planning, Haryana. (DTCP) and a report was sought
from the Tehsildar, Gurgaon in relation to the confirm the
nature and user of the subject lands and vide report dated
11.09.2023, the Tehsildar confirmed that the nature and user
of the subject lands in the records maintained by them is
agricultural lands." It has further been submitted that after of
amendment of the provisions of SARFAESI Act in 2016, it is
evident from joint reading of amended Section 13 (8) of the

¶104

¶105

SA no.527/2023 & SA no.528/2023 SARFAESI Act, 2002 and Rule 8(6) and Rule 9 (1) of the Rules
of 2002, the borrowers are entitled to receive a thirty day'
notice period for enabling the borrower to redeem the security
interest as envisaged under Section 13 (8) of the SARFAESI Act and only after expiry of notice period of thirty days under Rule
8 (6) can the secured creditor issue publication of sale notice
under Rule 9 (1), and on publication of such notice, the right
of the borrower to redeem the property stands extinguished. It
has further been submitted that the Respondent Bank did not
comply with the mandate of Rule 8(6) of the Rules of 2002 as
the thirty days 'notice was never given to the Borrower in order
to enable him to exercise his right to redemption as envisaged
under Section 13 (8) of the SARFAESI Act, which makes every
action taken by the Respondent Bank pursuant to these illegal
E-auction Sale Notices, null and void because as per Section 13
(8) of the SARFAESI Act, a secured creditor is bound to afford
to the borrower a clear thirty day notice period under Rule 8
(6) so that the borrower can exercise his right of redemption, which was not afforded in the instant matter. However, without
prejudice to the above, for the sake of arguments, 15 days'
notice under Rule 9 (1) is taken to be correct being fourth
auction, even then, the same 15 days 'notice could not have
been issued before the expiry of 30 days mandatory notice
under Rule 8(6) of Rules 2002. It has further been submitted

¶106

¶107

SA no.527/2023 & SA no.528/2023 that the Respondent Bank was under obligation to serve a notice of thirty days before publication of E-auction Sale Notice in newspaper, failing which the E-auction sale Notice would be infructuous and in the case at hand, the Respondent Bank did not comply with the man date of Rule 8(6) of SARFAESI Interest Rules, 2002, therefore, the Impugned E-auction held by the Respondent Bank and the sale executed by the Respondent Bank in favor of successful auction purchaser was also infructuous and hence, liable to be set aside. Accordingly, it has been prayed for setting aside the entire actions of the respondent bank initiated under the SARFAESI Act, 2002 qua the properties in question. 9. On the other hand, Ld. Counsel for the Respondent Bank has vehemently opposed the submission of the applicants and submitted that applicant has not approached this Hon'ble Tribunal with clean hands and are guilty of suppression of material facts. It has further been submitted that applicant has not disputed the mortgage over the subject property for securing the loan facility and Respondent Bank is well within its rights to take measure for recovering lawful dues as per Law. It has further been submitted that Respondent Bank has taken all the measures as per provisions of 13(4) as well as Rule 8 and 9 of SARFAESI Act Rules, 2002. It has further been submitted that Respondent Bank duly served the notice under

¶108

¶109

SA no.527/2023 & SA no.528/2023 Section 13(2), Notice under Section 13(4) duly served, affixed
and published in two newspapers as well as auction notice
dated 07.09.2023 including compliance of provision of Rule 3
as well as Rule 8(5), (6) and 9(1) etc. & there is no illegality.
It has further been submitted that pursuant to issuance of
possession notice by Respondent Bank for sale of property by
public auction dated 18.7.2014, applicant filed securitization
application no.149/2014 under Section 17 before DRT,
Chandigarh which was dismissed as withdrawn vide order
dated 05.05.2017. It has further been submitted that the
auction scheduled on 27.02.2023 has become infructuous due to no bid received for the said auction by the Respondent bank.
It has further been submitted that Respondent Bank after classifying the account as NPA on 31.12.2013 issued demand notice on 5.2.2014 duly served upon all the borrowers and on
failure of discharge of liability by the borrowers, issued
possession notice on 9.5.2014 duly served on all available
addresses, affixed and published in two newspapers i.e. The
Statesman and Veer Arjun. It has further been submitted that
defendant no.3 and 4 are under CIRP before NCLT and no
action is taken against them and CIRP proceedings do not
restrict the Respondent from initiating action under SARFAESI
Act against applicants as mortgagors. It has further been
submitted that Respondent Bank got the valuations on

¶110

¶111

SA no.527/2023 & SA no.528/2023 17.01.2023 and 18.01.2023 and in consultant with secured
creditor, fixed the reserve price for sale of the property. It has
further been submitted that sale notice dated 07.09.2023 has
been sent to borrowers by post and affixed and published in
four leading newspapers having vide circulation. It has further been submitted that present application is not maintainable as
the secured assets is not exempted from enforcement
measures under section 31 (i) and when the mortgage of
secured property was created vide sanction letter dated
13.12.2012, property was stood classified as residential zone.
It has further been submitted that mortgagors had themselves
applied on 28.1.2011 for grant of license for setting up of
residential plotted colony and valuation report filed by
Respondent Bank clearly prove that subject properties are
neither the agricultural lands or are they being used for
agricultural purposes and borrowers never intended to be used
for agricultural purposes as held by the Hon'ble Apex Court. It
has further been submitted that answering respondent place
reliance on the judgement of Apex Court in the case of "ITSC
Limited Vs Blue Coast Hotels Limited (2018) 15 SCC 99. It has
further been submitted that mere entries in Revenue records
are not the conclusive evidence of the properties being
agricultural land being used for agriculture and has placed
recent judgement of Hon'ble Apex Court in the case of

¶112

¶113

SA no.527/2023 & SA no.528/2023 K.Sreedharvs M/s Raus Construction Pvt.Ltd. — Civil Appeal
No.7402/2022. It has further been submitted that the present securitization application is not maintainable and is liable to be
dismissed as Respondent Bank has to recover a huge amount of Rs.58.90 crores beside a claim of Rs.119.14 crores has been
filed with liquidator in NCLT under CIRP proceedings. It has
further been submitted that CIRP proceedings against
Corporate Debtors bearing CP (IB) no.190 of 2017 under
Section 7 of IBC 2016 does not affect the liability of applicant
and measures of Respondent Bank to enforce the security
interest in the secured asset. It has further been submitted that
the Petition NO.C.P.(IB) No.190(PB)/2017 titled as "Union Bank
of India Vs Era Engineering Limited" filed under Section 7 of
IBC 2016 before NCLT Delhi and appointment of IRP and / or
approval of resolution plan by COC does not affect the liability
of applicant for recovery of their further dues. It has further
been submitted that measures are taken strictly in accordance
with the Act and Rules and all documents are being placed on
record to demonstrate the compliance of their action and
contents infirmities stated in application are vehemently denied
being baseless. It has further been submitted that properties
put to sale after obtaining valuation from two different valuers
and published in two leading newspapers. Accordingly, it has

¶114

¶115

SA no.527/2023 & SA no.528/2023
been prayed for dismissal of the present securitization
application. IA no. 4028/2023 10.The present application has been moved on behalf of the applicant seeking permission of this Tribunal to place on record
the additional documents in the present securitization
application.
11. It has been submitted on behalf of the applicant that the
applicant seeks the permission of this Tribunal to place on
record additional documents in the present securitization
application, due to subsequent development in the in the
present matter for proper adjudication of the present matter.
It has further been submitted that the applicant had sent a
settlement proposal to the respondent bank on 16.09.2023
offering an amount of Rs.32,17,65,000/- (hereinafter referred
to as "offer amount"), for release of the 4.98 acres of
agricultural lands owned by the applicant alongwith other
companies, which was put as mortgage to secure the said Term Loan. It has also been submitted that the settlement proposal
dated 16.09.2023 was rejected by the respondent bank vide
letter dated 22.09.2023 and sought payment of an amount of
Rs.44.80 crores by 27.09.2023 for release of agricultural lands
owned by the applicant herein, however, it is noteworthy to

¶116

¶117

SA no.527/2023 & SA no.528/2023 mention here that the hard copy of said letter was received by the applicant only on 30.09.2023 and upon receiving such letter, the applicant thoroughly checked their mail account as well but the mail was not in their inbox. It has also been submitted that it was only on 03.10.2023, the applicant had searched the spam folder of the mail account and discovered that the rejection of the settlement proposal dated 16.09.2023 was mailed to them, however, due to the reasons cited above, the applicant could not reply to such rejection to the settlement proposal in the given time-period, thus, the applicant became aware of such rejection of the proposal only on 30.09.2023 and the said rejection letter was filed by the respondent bank vide an application for additional documents which was serviced to the counsel of the applicant at 8:17 PM on 26.09.2023, therefore, no sufficient time was given to the applicant to act on the rejection letter dated 22.09.2023. It has further been submitted that vide order dated 29.09.2023, this Tribunal had passed an order directing the parties to maintain status quo w.r.t. such agricultural lands, therefore, in view of this interim relief, the applicant could not send any settlement proposal to the respondent bank during this time, thereafter, the status quo granted by this Tribunal was vacated vide order dated 07.10.2023, therefore, upon such vacation of the status quo granted by this Tribunal the applicant has sent a revised

¶118

¶119

SA no.527/2023 & SA no.528/2023 settlement proposal to the respondent bank on 09.10.2023
accepting the terms of the respondent bank to release the
mortgaged properties if the applicant deposits a sum of
Rs.44.80 crores with the respondent bank, which is the fair market value of the mortgaged properties. It has further been submitted that the relevant terms of the revised settlement plan are a. The applicant shall deposit 10% as upfront payment
by way of demand draft/cheque along with the settlement proposal. Upon deposit of 10% of the offer value, the bank shall suspend all steps towards the conclusion of the auction
process, (b) b. Balance amount of 90% of the payment shall
be made by the Applicant within 15 days from the date of
acceptance of the Revised Settlement Proposal dated
09.10.2023, (c). If the settlement is not accepted by the bank,
10% of the offer amount deposited shall be remitted back to
the bank account.
12. It has further been submitted hat in furtherance of the
terms of the Revised Settlement Offer, the applicant had
approached investors for paying the banks back and releasing
mortgaged lands from the charge of the respondent bank. It
has also been submitted that the investor namely, Nunlet
Projects Private Limited had duly deposited 10% of the offer
value with the respondent bank and the same was conveyed
to the respondent bank vide an email dated 10.10.2023, cd

¶120

¶121

SA no.527/2023 & SA no.528/2023 however, without considering the revised settlement proposal, which was higher than the actual bid amount received by the respondent bank, the respondent bank rejected the revised settlement proposal of the applicant vide an email dated 10.10.2023, creating doubt on the bonafide of the respondent bank. Accordingly, it has been requested to allow the present application and take on record additional document filed by the applicant. 13. It has been objected on behalf of the respondent bank and submitted that during the pendency of the securitization application and while the property had been put to sale by public auction, the applicant through its authorized represented submitted a settlement proposal dated 16.09.2023 which was received on 18.09.2023 and the proposal was considered by the respondent bank. It has further been submitted that the respondent bank vide its letter dated 22.09.2023 rejected the offer made by the applicant as not found acceptable to the respondent and it was conveyed that the mortgaged property was put to auction on minimum reserve price based on realizable value of Rs.44.80 crores. It has further been submitted that the applicant was informed that in case the applicant wishes to get the mortgaged properties released, they may deposit the said minimum reserve price amount before 27.09.2023 for release of properties and the said letter

¶122

¶123

SA n0.527/2023 & SA no.528/2023

¶124

dated 22.09.2023 was sent to the applicant by mail and also by post, however, the applicant did not avail such opportunity and did not deposit any amount with the respondent bank in terms of letter dated 22.09.2023. It has further been submitted that copy of letter dated 22.09.2023 issued by the respondent in response to the settlement proposal dated 16.09.2023 has been placed on record by the respondent among other documents on 26.09.2023 with advance copy served upon the counsel for the applicant, thus, the applicant had due information and knowledge of the rejection letter dated 22.09.2023 well in time. It has also been submitted that the contention of the applicant that the hard copy of the letter dated 22.09.2023 was received only on 30.09.2023, is ill founded and baseless. It has been denied that upon receiving the letter, the applicant checked their mail account and found the rejection letter on 03.10.2023 in their spam and the said facts are concocted, though it is admitted that advance copy of the letter was received by the counsel on 26.09.2023 while the same was placed on record. It has also been submitted that after hearing the matter this Tribunal on 27.09.2023, 28.09.2023 and 29.09.2023, the order was reserved with interim order as directed, however, admittedly, the applicant has not responded to the letter dated 22.09.2023 in terms thereof. It has further been submitted that pursuant to the 5d-

¶125

¶126

SA no.527/2023 & SA no.528/2023 order dated 07.10.2023 passed by this Tribunal, the sale has
been confirmed in favour of the auction purchaser and the sale
certificate issued in their favour after receipt of the entire sale
consideration within the stipulated period of time. It has further
been submitted that the revised proposal is an attempt to
hamper the sale already conducted in accordance with law and
the proposal dated 09.10.2023 is denied and without any
acceptance of the said purported proposal dated 09.10.2023,
an amount to the value of 10% was sent to the respondents
account through electronic means, which was immediately
returned to the senders account and the respondent denies the
e-mail dated 10.10.2023. It has further been submitted that it
is an admitted case of the applicant that the purported revised
proposal has already been rejected by the respondent. It has
further been submitted that the documents sought to be placed
by way of the application under reply has no connection with
the lis-pending before this Tribunal and these documents have
no relevance with the issue under consideration of this Tribunal
and as regards the offer of settlement, as contended, the
respondent has already taken a decision and conveyed to the
applicant. It has also been submitted that no purpose will be
achieved in taking the documents under reference on record
and on contrary, the application has been filed to complicate

¶127

¶128

SA no.527/2023 & SA no.528/2023 the issue and derail the final adjudication. Accordingly, it has
been requested to dismiss the present application. IA no.4145/2023. 14.The present application has been moved on behalf of the applicant seeking permission of this Tribunal to place on record
the additional documents in the present securitization
application. 15. It has been submitted on behalf of the applicant that the
applicant seeks the permission of this Tribunal to place on
record additional documents in the present securitization
application, due to subsequent development in the in the
present matter for proper adjudication of the present matter.
It has further been submitted that the applicant had sent a
settlement proposal to the respondent bank on 16.09.2023
offering an amount of INR.32,17,65,000/- in lieu of the
corporate term loan amounting to INR 30,00,00,000/- availed
by M/s Era Infra Engineering Limited, for release of the 4.98
acres of agricultural lands owned by the applicant alongwith
other companies, which was put as mortgage to secure the
said Term Loan. It has also been submitted that the settlement
proposal dated 16.09.2023 was rejected by the respondent
bank vide letter dated 22.09.2023 and vide order dated
29.09.2023, this Tribunal had passed an order granting interim

¶129

¶130

SA no.527/2023 & SA no.528/2023 relief to the applicants and stated that even though the respondent bank can proceed with their auction-sale, however, the sale shall not be confirmed until the order on interim relief is pronounced by this Tribunal, thus maintaining a status quo w.r.t, such agricultural land, therefore, in view of this interim relief, the applicant could not send any settlement proposal to the respondent bank during this time. It has further been submitted that this interim relief granted by this Tribunal was vacated vide order dated 07.10.2023, wherein the respondent bank was directed to proceed with the proposed auction sale, therefore, upon such vacation of the interim relief granted by this Tribunal, the applicant has sent a revised settlement proposal to the respondent bank on 09.10.2023 accepting the terms of the respondent bank to release the mortgaged properties if the applicant deposits a sum of INR 44.80 crores with the respondent bank, which is the fair market value of the mortgaged properties, in fact, during the course of the arguments before this Tribunal, when this Tribunal advised the parties to settle the matter amicably, the senior counsel appearing for the applicant on instructions enhanced the original offer of Rs.32,17,65,000 to Rs.39.5 crores for release of the subject lands from the respondent bank which was rejected by senior counsel appearing for the respondent bank and the respondent bank was not inclined to settle the matter cd—

¶131

¶132

SA no.527/2023 & SA no.528/2023

¶133

and was ardent on payment of INR.44.80 crores. It has further been submitted that the applicant on 16.10.2023, in order to preserve his agricultural lands was forced to bow down to the illegal demands of the respondent bank and in furtherance of the same has drawn two cheques to safeguard his agricultural lands. i.e. i) one cheque issued in favour of PSB HO SAMVERT bearing no. "005209" for INR 24,80,00,000 (Rupees twentyfour crore eighty lac) and; (ii) another cheque issued in favour of PSB HO SAMVERT bearing no. "005214" for INR 20,00,00,000 (Rupees twenty crore). It has further been submitted that it is imperative to take the above-mentioned documents on record considering the principles of natural justice and to properly adjudicate upon the issue pending before this Tribunal in the present securitization application. Accordingly, it has been requested to allow the present application and take on record the additional documents filed by the applicant.

¶134

It has been objected on behalf of the respondent bank and submitted that during the pendency of the present securitization application and while the property had been put to sale by public auction, the applicant through its authorized represented submitted a settlement proposal dated 16.09.2023 which was received on 18.09.2023 and admittedly rejected by the respondent bank. It has further been submitted that after

¶135

¶136

SA no.527/2023 & SA no.528/2023 hearing the matter this Tribunal on 27.09.2023, 28.09.2023
and 29.09.2023, the order was reserved with interim order as
directed. It has also been submitted that the applicants
knowing fully well that the offer has been considered and
rejected, yet, again sent anther proposal after the sale was
confirmed in favour of the auction purchaser. It has further
been submitted that the applicant first awaited the outcome of
the order reserved on 29.09.2023, and thereafter, sent the
offer to scuttle the sale, which speaks volumes about the
conduct and intention of the applicants. It has further been submitted that it is an admitted case of the applicants that even during the course of hearing all that they offered was Rs.39.5 crores as contended knowing fully well that they were given an
opportunity to deposit the amount of Rs.44.80 crores till
27.09.2023, which they failed to avail. It has further been
submitted that the cheques referred are admittedly dated
16.10.2023 and were never offered to the respondent except
the copies of cheques placed on record, evenotherwise, as
submitted the offer had already been rejected by the
respondents and the copies of cheques referred therein are
denied. It has also been submitted that the documents sought
to be placed on record by way of the present application under
reply have no connection with the lis-pending before this
Tribunal and these documents have no relevance with the issue sd-

¶137

¶138

SA no.527/2023 & SA no.528/2023 under consideration of this Tribunal. It has further been
submitted that as regards the offer of settlement, as
contended, the respondent has already taken a decision and
conveyed to the applicant. It has further been submitted that
no purpose 'will be achieved in taking the documents under
reference on record and on the contrary, the application has
been filed to complicate the issue and derail the final
adjudication. It has further been submitted that the contents
of the application under reply are denied both specifically and
individually, save to the extent what is specifically admitted
herein and/or a matter of record. Accordingly, it has been
requested dismiss the present application.
IA no. 4907/ 2023. 17.The present application has been moved on behalf of the applicant seeking permission of this Tribunal to place on record
the additional documents i.e. a Cheque issued in favour of
respondent bank by the applicant alongwith the other SA
Applicant in SA no.528 of 2023 i.e., UBA Realtech Pvt. Ltd.
18. It has been submitted on behalf of the applicants that on
19.10.2023 vide diary no.4145 of 2023, the applicant filed an
application for placing additional documents on records
wherein, the applicant filed two cheques which were issued in
favour of the respondent bank, in order to offer a settlement

¶139

¶140

SA no.527/2023 & SA no.528/2023 of present matter to the respondent bank and the present application be read in part and parcel of the aforesaid application and the details of the said cheques are (i) one cheque issued in favour of PSB HO SAMVERT bearing no. "005209" for Rs.24,80,00,000/-, (ii) another cheque issued in favour of PSB HO SAMVERT bearing no."005214" for Rs.20,00,00,000 (Rupees twenty crore). It has further been submitted that the in order to settle the matter amicably and to offer better price of the subject land, the applicant herein is ready to offer Rs.50,00,000/- (Rupees Fifty Lakhs Only), in addition to the aforesaid cheques, vide cheque no.005226, drawn in favour of the respondent bank on 25.10.2023. It has further been submitted that the applicant came to know that during the e-auction of the subject land, only one bidder participated in the auction which was scheduled on 29.09.2023, who bid the minimum price/reserve price of the subject lands, thus, in order to ensure maximum recovery of the bank and to protect the interest of the applicant in the agricultural lands, the applicant alongwith the other SA applicant in SA NO. 528 of 2023 i.e., UBA Realtech Pvt. Ltd. is offering a sum of Rs.50,00,000/- in addition to 44.80 crores. It has also been submitted that it is imperative to take the above-mentioned facts and documents on record considering the Principles and Natural Justice and properly adjudicate upon the issue pending _Cc(

¶141

¶142

SA no.527/2023 & SA no.528/2023 before this Tribunal in the present securitization application.
Accordingly, it has been requested to allow the present
application and take on the record the additional document.
19. On the other hand, it has been objected on behalf of the respondent bank and submitted that a similar application has
been filed by the applicant vide diary no.4145/2023 to which
the respondent bank has filed the reply which also be treated as part and parcel of the present reply. It has further been submitted that during the pendency of the present SA and while the property had been put to sale by public auction, the applicant through its authorized representative submitted a settlement proposal dated 16.09.2023 which was received on
18.09.2023 and the proposal was considered by the
respondent and rejected vide its letter dated 22.09.2023 as not
found acceptable to the respondent. It has further been
submitted that it was conveyed to the applicant that mortgaged property was put to auction on minimum reserve price based
on Realizable value of Rs.44.80 crores and accordingly, the
applicant was informed that in case the applicant wishes to get
the mortgaged properties released, they may deposit the said
minimum reserve price amount before 27.09.2023 for release
of properties and the said letter dated 22.09.2023 was sent to
the applicant by mail and also by post, however, the applicant did not avail such opportunity and did not deposit any amount

¶143

¶144

SA no.527/2023 & SA no.528/2023 with the respondent in terms of letter dated 22.09.2023. It has
further been submitted that the copy of letter dated
22.09.2023 issued by the respondent in response to the
settlement proposal dated 16.09.2023 has been placed on
record by the respondent among other documents on
26.09.2023 with advance copy served upon the counsel for the
applicant, thus, the applicant had due information and
knowledge of the rejection letter dated 22.09.2023 well in time. It has also been submitted that the contention of the applicant that they had prepared two cheques to match the reserve price
in order to amicably settle the matter is ill founded inter-alia
the reason that the offer was available only till 27.09.2023
which the applicant did not avail, thereafter, pursuant to
passing of the order by this Tribunal on 07.10.2023 the
respondents confirmed the sale in favour of the highest bidder
in accordance with law after receipt of the entire sale
consideration within the stipulated period of time. It has also
been submitted that the contention of the applicant expressing
its purported readiness to offer Rs.50,00,000/- more is again
misconceived to create hurdles in completing the sale
transaction undertaken in accordance with law and purported
cheque only copy of the which is placed on record is dated
25.10.2023 i.e. much after the sale in favour of the auction
purchaser had conclude and the offer of the applicant had

¶145

¶146

SA no.527/2023 & SA n0.528/2023
already been considered and declined. It has further been
submitted that the additional documents sought to be placed
on record by way of the present application under reply has not connection with the lis-pending before this Tribunal and
these documents have no relevance with the issue under
consideration of this Tribunal and as regards the offer of
settlement, as contended, the respondent has already taken a
decision and conveyed to the applicant. Accordingly, it has
been requested to dismiss the present application. IA no. 4746/ 2023. 20.The present application has been moved on behalf of the applicant seeking permission of this Tribunal to place on record
the additional documents in the present securitization
application.
21.It has been submitted on behalf of the applicant that the
applicant seeks the permission of this Tribunal to place on
record additional documents i.e. True copy of Section 9 petition
filed before the Hon'ble Delhi High Court being O.M.P (I)
(COMM.) 293/2023 and the order dated 12.09.2023 passed by
the Hon'ble Delhi High Court wherein the Hon'ble High Court
was pleased to grant an interim relief of maintaining status quo
against the respondent therein, True copy of the deed of revocation of General Power of Attorney dated 08.02.2023 and

¶147

¶148

SA no.527/2023 & SA no.528/2023 True copy of the Deed of Cancellation of Development Agreement dated 08.02.2023. It has further been submitted that the entire reply filed by the respondent bank is based on a Development Agreement dated 08.02.2023 (hereinafter 'Development Agreement'). It has further been submitted that the respondent sought to rely upon Section 13[13] SARFAESI Act, 2002, which assertion was baseless as no alienation was contemplated or consummated by Development Agreement and the respondent bank is trying to portray a picture that the applicant entered into said Development Agreement with a commercial intent to develop the agricultural land into residential projects to earn profit, further, the respondent bank has alleged that the applicant concealed the Development Agreement with malafide intention to defraud the banks, however, the fact is that the applicant entered into the said Development Agreement with the developer, with a bonafide intent to arrange finance so that the lender bank's debts can be paid off. It has further been submitted that the said Development Agreement & GPA was entered into in furtherance of a Memorandum of Understanding dated 25.01.2023 (hereinafter ‘MoU") and clause 14.11 of the said Development Agreement clearly stated that the said Development Agreement is in furtherance of an MoU, hence, the Development Agreement cannot be read in isolation and

¶149

¶150

SA no.527/2023 & SA no.528/2023 has to be read with the MoU dated 25.01.2023. It has also been submitted that the combined reading of the said Development Agreement and MoU dated 25.01.2023, makes it very clear that
the applicant was compelled to enter into such arrangement
only to pay the banks their dues back, which shows the
bonafide intentions of the applicant to pay the dues of banks,
however, MoU and Development Agreement could not be
proceeded because as per the terms of the MoU, it was agreed
that the Developer will provide the financial assistance to the
applicant in order to get its lands free from the consortium of
banks. It has further been submitted that since the said
developers failed to arrange the requisite funds towards
payments of such debts so the MoU and Development
Agreement was terminated by the applicant as the as the
Developer failed to perform its obligations, thereafter, a
petition under Section 9 of the Arbitration and Conciliation Act,
1996 was filed by the applicant before the Hon'ble Delhi High
Court seeking directions to restrain the Developers under the
MoU dated 25.01.2023 and Development Agreement dated
08.02.2023 from claiming any right, title or interest in the
Subject Lands vide O.M.P. (I) (COMM.) 293/2023. It has
further been submitted that the Hon'ble Delhi High Court was
pleased to grant an interim relief of maintaining status quo
against the Respondents therein vide an order dated

¶151

¶152

SA no.527/2023 & SA no.528/2023

¶153

12.09.2023. It has further been submitted that the Development Agreement dated 08.02.2023 and General Power of Attorney dated 08.02.2023 has been revoked by the parties vide Deed of Revocation of General Power of Attorney dated 29.11.2023 and Deed of Cancellation of Development Agreement dated 29.11.2023. It has further been submitted that in the light of aforesaid revocation of the Development Agreement dated 08.02.2023 and General Power of Attorney dated 08.02.2023, the aforesaid documents become null and void and it is reiterated that intent behind entering into such Development Agreement dated 08.02.2023, General Power of Attorney dated 08.02.2023 and Memorandum of Understanding dated 25.01.2023 was only to arrange financial assistance in order to pay off the debts of the banks and nothing more. It has further been submitted that the aforesaid additional documents are crucial for effectually adjudicating upon the issue at which the parties are at variance. Accordingly, it has been requested to allow the present application and take on record the additional documents filed by the applicant.

¶154

It has been objected on behalf of the respondent bank and submitted that during the pendency of the securitization application, the SA applicant has deliberately concealed the material fact before this Tribunal that they had malafidely sd-

¶155

¶156

SA no.527/2023 & SA n0.528/2023

¶157

executed a Development Agreement to defraud to secured creditor and in order to develop the land into a residential project for their wrongful gains. It has further been submitted that the Development Agreement was executed in the teeth of Section 13(13) of the SARFAESI Act after issuance of statutory demand notice under Section 13(2) of the Act dated 22.02.2019. It has further been submitted that the SA applicant post service of statutory demand notice have executed a Development Agreement dated 08.02.2023 and also a General Power of Attorney dated 08.02.2023 and the said documents were placed on record by the respondent bank to show the conduct and intention of the SA applicant, which was deliberately concealed to seek an equitable relief from this Tribunal. It has further been submitted that the SA applicant has not approached this Tribunal with clean hands and is therefore, not entitled to any indulgence by this Tribunal and in order to cover their lapses, the SA applicant has now filed an application to place on record the purported Deed of revocation of General Power of Attorney and cancellation of Development Agreement both dated 29.11.2023 and these documents have been purportedly executed as an afterthought after their intent and conduct was exposed. It has further been submitted that the SA applicants chose not to disclose the execution of Development Agreement and General Power of

¶158

¶159

SA no.527/2023 & SA no.528/2023 Attorney in their SA cannot be now permitted to place the
documents on record which are sought to be filed by way of
application under reply. It has further been submitted that the
SA applicant had filed a similar application before the co- ordinate bench of this Tribunal in a similarly situated matter
and the bench has not permitted the documents to be placed
on record vide order dated 08.01.2024 passed in SA no.14 of 2023. It has been denied that the Development Agreement was
entered into with the Developer with a bonafide intent to
arrange finance to pay off the lender bank's as alleged and as it is evident from the record, all purported acts including filing of Section 9 petition and Revocation/Cancellation of GPA and Development Agreement are belated and an afterthought to cover up the concealment of facts which were pointed out the
respondent. Accordingly, it has been requested to dismiss the
present application.
SA No.528 2023.
23. The present securitization has been moved on behalf of
the applicant praying therein to stay the operation of the
impugned sale notice dated 07.09.2023, in relation to the
properties in question, as claimed to be issued by the
respondent bank under Rule 8 (6) of Security Interest
(Enforcement) Rules, 2002; stay the operation of the impugned sce

¶160

¶161

SA no.527/2023 & SA n0.528/2023 Demand Notice dated 05.02.2014 issued by the respondent
bank under Section 13(2) of the SARFAESI Act, 2002; Stay the operation of the impugned possession notice dated 09.05.2014
as claimed to be issued by the respondent bank under Section 13(4) of the SARFAESI Act 2002; restrain the respondent bank,
its servants, agents, employees, and persons associated with
the same from taking physical possession of the subject land
and/or from handing over the same to a third party or its
servants, employees, attorneys, and agents in any manner
whatsoever; restrain the respondent no.2 from selling, creating
any third-party interest on the subject land and to maintain status quo on the subject land arising out of the sale certificate dated 10.102023.
24. It has been submitted on behalf of the securitization
applicant that the applicant is a Private Limited Company
registered under the provisions of Companies Act, 1956. It has
further been submitted that M/s. Era Infra Engineering Limited
(borrower/respondent no.2) is an EPC company and as per the
respondent bank, the borrower approached the respondent
bank in and around January 2013 to seek "Term Loan Facility"
to the tune of Rs.30 Crores for strengthening the Net Working
Capital and to overcome liquidity mismatch faced by the
borrower. It has also been submitted that the respondent bank sanctioned a term loan of Rs.30 Crore in favour of the borrower

¶162

¶163

SA no.527/2023 & SA no.528/2023 to meet long term working capital requirement and for general corporate purpose vide sanction letter dated 13.12.2012. It has also been submitted that the respondent bank contends that certain lands owned by the applicant were mortgaged to the respondent bank against this loan. It has further been submitted that the subject lands are as follows: land admeasuring 2.128 acres (17 kanal 5 marla) in the name of M/s UBA Realtech Ltd, comprising of Khewat no. 341 min, 344 rectangle No.41, Killa No. 13/2 (2-13), 18/1 (7-11), 19/1 (6-8) and half share of rectangle No. 41, Killa No. 18/2 (0-9) and 19/2 (0-8) situated at Vill Daulatabad, tehsil & Dist- Gurgaon (hereinafter as 'property in question). It has further been submitted that Corporate Insolvency Resolution Process (herein-after to be referred as "CIRP") has been initiated against the borrower i.e., respondent no. 2 vide company petition bearing no. CP No. (IB) 190 of 2017, under section 7 of the Insolvency and Bankruptcy Code, 2016 and the Ld. National Company Law Tribunal, Principal Bench, New Delhi vide its order dated 8th May 2018 allowed the application under Section 7 for initiation of the Corporate Insolvency Resolution Process of the Borrower. It has further been submitted that a claim of the respondent bank including the outstanding of the loan as mentioned above, has been admitted in the CIRP of the borrower and is reflected in the updated list, uploaded on the Sd-

¶164

¶165

SA no.527/2023 & SA no.528/2023 website of the borrower. It has further been submitted that the resolution plan of the borrower has been approved by the CoC with the requisite majority and the claims of the Respondent Bank have been dealt with as per the terms of the resolution plan and now the resolution plan is pending before NCLT for approval and in view of this, any claim dealt with and discharged in the CIRP process can in any event not be enforced against the applicant. It has further been submitted that the respondent bank has filed multiple petitions before multiple forums against the same loan facility granted to the borrower and the respondent bank herein issued a demand notice dated 05.02.2014 for payment of an amount to the tune of Rs.32,17,65,461.23/- (Rupees thirty-two crores seventeen lacs sixty-five thousand four hundred and sixty-one and paise twenty-three only) to the borrower. It has further been submitted that the impugned demand notice is in variance to the charge filed by the respondent bank with the MCA having SRN No. B66528852 with charge ID 10399165. It has further been submitted that the provisions of the SARFAESI Act, 2002 mandates the secured creditor to mention the details of the amount payable by the borrower and the respondent bank herein has failed to mention the details of interest, penalty interest and other charges levied by it and has merely stated only the outstanding amount in the impugned demand notice

¶166

¶167

SA no.527/2023 & SA no.528/2023 dated 05.022014 issued by the respondent bank proper and thus complete information including the breakup of the outstanding amount in terms of principal, interest and penal interest as mandated under Section 13(3) of the SARFAESI Act, 2002 has not been provided by the respondent bank in the said demand notice. It has further been submitted that the respondent bank is, without application of mind, in an arbitrary manner, demanding exorbitant amount from the applicant which is evident from the impugned notices as in the impugned demand notice the respondent bank is claiming Rs.32.17 crores as outstanding amount and in the sale notice dated 06.02.2023 (which became infructuous as the stay was granted by the DRT-1 vide order dated 23.02.2023 and also that no bid was received), the respondent bank had claimed Rs.126.20 Cr. as outstanding amount and in sale notice dated 24.03.2023 (which was also became infructuous as the stay was granted by the DRT-1 vide order dated 10.04.2023), the respondent bank had claimed Rs.127.67 Cr as the outstanding amount and now in the impugned sale notice dated 07.09.2023, which was published in the newspaper (ie., Financial Express) the respondent bank is claiming Rs.137.78 Cr as the outstanding amount. It has also been submitted that the respondent bank, in the garb of banking company is trying to illegally extort hard earned money of the applicant by pressuring the applicant by

¶168

¶169

SA no.527/2023 & SA no.528/2023 threatening to put the applicant's agricultural lands to auction,
which is evident from the fact that the said borrower availed a
term loan facility to the tune of Rs.30 Crores however, the
respondent bank, without giving any reasoning, or any back up
of the calculations arbitrarily claimed its outstanding dues to
the tune of Rs.126.20 Cr. 06.02.2023 and Rs.127.67 Cr. in the
sale notice dated 24.03.2023 and now the respondent bank is
claiming its outstanding dues to the tune of Rs.137.78 Cr. in
the impugned sale notice dated 07.09.2023. It has further been
submitted that the from 10.04.2023 till 04.09.2023 a stay was
in operation and even assuming that the respondent bank has
not stopped the interest calculation for the period of the stay
this amounts to an interest of Rs.1.65 Cr. per month on a
principal outstanding of 30 Cr. which translates to annual
interest rate of about 66% of the principal outstanding being
charged as interest by the respondent bank. It has further been
submitted that exorbitant interest charged by the respondent
bank and that too with great variance in the impugned notices
is as i). Impugned demand notice dated 05.02.2014 (disputed)
amount claimed as outstanding is Rs.32,17,65,461.23/-, ii).
Impugned sale notice dated 06.02.2023 (disputed) amount
claimed as outstanding Rs.126.20 crores, iii). Impugned sale
notice dated 24.03.2023 (disputed) amount claimed as
outstanding is Rs.127.67 Cr. iv). Impugned sale notice dated

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¶171

SA no.527/2023 & SA no.528/2023 07.09.2023 (disputed) amount claimed as outstanding is Rs.137.78 Cr. It has further been submitted that without prejudice, it is once again reiterated that the above mention table shows that the respondent bank is charging an interest of Rs.1.65 Cr. per month on a principal outstanding of Rs.30 Cr. which translates to annual interest rate of 66% being charged by the respondent bank, against the interest rate fixed by the respondent bank in the sanction letter i.e., BR +3.50 per annum on monthly rests. It has further been submitted that the outstanding amount as claimed by the respondent bank is wrong, illegal and arbitrary as there is no practical calculation provided for the same, which is evident from the impugned notices that the respondent bank had arbitrarily charged excessive interest and penal interest without disclosing the details of the same to the applicant, in complete contravention of fair practice code issued by the Reserve Bank of India.

¶172

It has further been submitted on behalf of the applicants the respondent bank maintained deafening silence for years and issued the impugned notices for sale of subject lands after an inexplicable delay of more than 9 years from the alleged date of declaration of the borrower's account as NPA i.e., from 31.12.2013, which is nothing but the tactics of the respondent bank to extort money from the applicant herein in the form of

¶173

extortionate interest. It has further been submitted that as per

¶174

¶175

SA no.527/2023 & SA no.528/2023 Rule 9(1) of the Security Interest Rules, 2002, no sale of immovable property under these rules, in first instance shall take place before the expiry of thirty days from the date on which the public notice of sale is published in newspapers however, the respondent bank has issued the impugned sale notice on 07.09.2023 wherein the sale of subject land is fixed for 29.09.2023 which is less than 30 days, against the period of 30 days as provided under Rule 9(1) of the Security Interest Rules, 2002. It has further been submitted that the notice for less than 30 days is given when the sale of immovable property fails, however, in the present matter, the sale of subject lands did not fail, it was merely stayed by the order of this Tribunal, hence, the respondent bank is clearly liable to give 30 days prior notice to the applicant for which the applicant has relied upon the Rule 8 of Security Interest (Enforcement) Rules 2002 and Rule 9 time of sale, issue of sale certificate and delivery of possession etc., hence, for the stated reasons, the impugned sale notice dated 07.09.2023 is liable to be quashed and any subsequent action/ measure taken by the respondent bank under the SARFAESI Act, 2002 is also liable to be quashed as the impugned sale notice dated 07.09.2023 is bad in law. It has further been submitted that the subject lands on which the alleged security has been created are agricultural lands and hence, are exempt from the provisions of the SARFAESI Act,

¶176

¶177

SA no.527/2023 & SA no.528/2023

¶178

2002 by virtue of Section 31 (1) of the SARFAESI Act. It has further been submitted that the respondent bank failed to serve a copy of the impugned possession notice to the applicant and the impugned possession notice was in complete violation of the Rule 8(2) of the Security Interest (Enforcement) Rules, 2002, as the respondent bank failed to pub-lish the impugned possession notice in a vernacular language newspaper having wide circulation in the locality where subject lands are located. It has further been submitted that the subject lands are situated in Gurgaon, Haryana, however, the respondent bank published the Possession notice only in the New Delhi edition of English newspaper. It has further been submitted that the respondent bank issued an illegal sale notice dated 07.09.2023 for sale of the subject lands through e- auction in complete violation of provisions of the SARFAESI Act, 2002 and Security Interest (Enforcement) Rules, 2002.

¶179

It has further been submitted on behalf of the applicants the subject lands are not demarcated and hence, the subject lands are part of a parcel of a larger land parcel and the same cannot be identified and as per rule 8(1) and Rule 8(7) of the Security Interest (Enforcement) Rules, 2002, the respondent bank is mandated to deliver possession notice and sale notice by affixing the possession notice on the outer door or at conspicuous place of the subject lands which obviously could

¶180

¶181

SA no.527/2023 & SA no.528/2023

¶182

not have been done in this instance as the subject lands by the admission of the respondent bank in the impugned sale notice dated 07.09.2023 are not demarcated and hence obviously not identifiable. It has further been submitted that the subject land are agricultural land and out-side the purview of the SARFAESI Act of 2002 in terms of section 31(1) of the Securitization Act 2002. It has further been submitted that the applicant is the owner of the subject lands which are agricultural as referred to and admitted by the respondent bank/respondent bank in the impugned notice. It has further been submitted that the documents and title including the respective sale deeds lying in the power and possession of the respondent bank itself reflect that at the time the said lands were purchased by the applicant. It has further been submitted that in the title deed of equitable mortgaged dated 20.12.2012, which was duly signed by the authorized officer of the respondent bank, the description of the subject Land as specifically mentioned in the sale deeds deposited with the respondent bank the said sale deeds describe the subject lands as 'Chahi' which means "irri-gated from well", which shows that at the time of creation of interest on the subject land, the respondent bank knew that the subject lands are agricultural lands. It has further been submitted that at the time of sanctioning of credit facility by the respondent bank, the applicant had deposited original sale deeds of the sd-

¶183

¶184

SA no.527/2023 & SA no.528/2023 subject lands with the respondent bank and it is evident from the description of subject lands as stated in the sale deeds that the subject lands were agricultural lands and from the sale deeds that the respondent bank was well aware of the nature of the subject lands and had executed the mortgage with complete knowledge that the subject lands were agricultural in nature. It has further been submitted that the records maintained by the concerned authorities including the statutory revenue records clearly reveal and substantiate the fact that the subject lands have always been agricultural land and only used as such including by previous owners and also by the applicant. It has further been submitted that there has been no change of use nor has the nature of the subject lands been altered and the subject lands were not demarcated and there was/is no permission or license issued or granted by the concerned competent authorities changing the permitted use of the subject lands from agricultural use to any other use whether residential, institutional, or commercial. It has further been submitted that the above is the conclusive proof of the agriculture land with cultivation and as such complete debars the respondents from proceedings under Securitization Act 2002. It has further been submitted that without demarcation and necessary permissions and licenses being issued by the competent authorities, the subject lands are incapable of being

¶185

¶186

SA no.527/2023 & SA no.528/2023 put to any other use, other than for agricultural purposes, furthermore, the revenue records relating to the subject lands including but not limited to the Khasra Girdawari clearly reflect that the Subject Lands have continuously been used and still being used only for agricultural purposes, therefore, it is also a conclusive proof of the agriculture land with cultivation and as such complete debars the respondents from proceedings under SARFAESI Act 2002 and even today there are standing crops of wheat in the area of subject land. It has further been submitted that the aforementioned details and particulars of the subject lands are also mentioned by respondent bank in the notices including the notice under Section 13(2) and the impugned possession notice and it is evident from the details and particulars of the subject lands and the awareness of the respondent bank that the subject lands continue to be in the nature of agricultural lands. It has further been submitted that as elaborated hereinafter, the subject lands being agricultural lands are exempted from the provisions of the SARFAESI Act, 2002 by virtue of Section 31(1) and any alleged security interest claimed to have been created with respect to the subject lands cannot be enforced by the recourse to the provisions of the SARFAESI Act, 2002. It has further been submitted that as per Section 31(1) of the SARFAESI Act, 2002, the provisions of the said Act shall not be applicable if any

¶187

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SA no.527/2023 & SA no.528/2023 security interest is created in agricultural land. It has further been submitted that as per Section 31(1) of the SARFAESI Act, 2002, the respondent bank cannot enforce a charge over the Agricultural lands by invoking the provisions of SARFAESI Act 2002 and issuing the demand notice as issued by respondent bank and the respondent bank has no right to take any steps for taking over the possession of the subject lands under the SARFAESI Act, 2002, any such steps taken by respondent bank are illegal and void abinitio, therefore, the respondent bank is hereby liable to withdraw the present impugned sale notice as the subject lands depicted in the demand notice and impugned possession notice of the respondent bank are agricultural lands. It has further been submitted that the respondent bank knowingly and with their eyes open had created security interest over agricultural lands whose change of land use was not approved/ sanctioned by the competent authorities and reliance is placed on the judgment of K Sreedhar vs Raus Constructions Private Limited, Civil Appeal No. 7402 of 2022. It has further been submitted that the Hon'ble Supreme Court in State of Karnataka Vs Shankara Textile (1995) 1 SCC 295, has held that no agricultural land can be used or treated as nonagricultural land without obtaining prior permission of the concerned authorities and it is clear from the available records that the concerned authorities never issued any license

¶189

¶190

SA no.527/2023 & SA no.528/2023 allowing change in usage of these subject lands. It has further been submitted that the Financial Commissioner and Principal Secretary to Government Haryana, Town, and Country Planning Department issued a letter dated 19.12.2006 under the provisions of the Urban Areas Act to the Director, Town, and Country Planning Department with the Subject "POLICY FOR GRANT OF LICENSE AND CHANGE OF LAND USE CASE" . It has further been submitted that the subsequent to the aforementioned letter dated 19.12.2006, a notification dated 05.02.2007 was issued by the Haryana Government, Town, and Country Planning under the provisions of the Punjab Controlled Areas Act outlining a plan to develop the different zones in the area of Gurgaon-Manesar Urban Complex. It has further been submitted that various sections of the notification dated 05.02.2007 including Sections VII, IX, XI and XVII lay down the prerequisites of the approval by the government authority for the CLU and nowhere the law in the said notification says that merely notification of an area wherein the land is situated as controlled area or a mere application for conversion of land use will automatically convert the nature of land to non-agricultural. It has further been submitted that in absence of a license from the Government, the nature of the subject lands will remain agricultural. It has further been submitted that the Section 3 of the Haryana Development and

¶191

¶192

SA no.527/2023 & SA no.528/2023 Regulation of Urban Areas Act, 1975 (hereinafter referred to as "Urban Areas Act"), lays down the law that any owner desiring to convert his agricultural land into a colony shall make an application to Director of Town & Country Planning Department, Haryana to request for granting a license to develop a colony in the prescribed form. It has further been submitted that it is evident from plain reading of Section 3 of the Urban Areas Act that conversion of any land in Haryana would be subject to approval and grant of license by the concerned authority. It has further been submitted that the Director, Town & Country Planning Department, Haryana has never granted any license to the applicant allowing for the conversion of land use and this has been admitted by the respondent bank in it is impugned sale notice. It has further been submitted that as per Section 7 of the Punjab Scheduled Roads and Controlled Areas Restriction of Unregulated Development Act, 1963 (hereinafter to be referred to as "Punjab Controlled Areas Act"), any land in the State of Haryana cannot be used for any purpose other than those for which it was used on the date of publication and the applicant to establish its case is relied upon the provision of the Punjab Controlled Area Act. It has further been submitted that above provisions that the subject lands do not change its nature by the virtue of falling under the controlled area as the intention

¶193

¶194

SA no.527/2023 & SA no.528/2023

¶195

of the legislature is evident, by the simple reading of Sections 2 (5) and 4 Punjab Controlled Areas Act which describes a controlled area to be any area that in the opinion of the government has the "potential" for building activities, therefore, the controlled area only identifies the potentiality of the part of the land to be used for a purpose as stated in a Development Plan/Master Plan. It has further been submitted that the word "Potential" is defined in Black's Law Dictionary as "Existing in possibility but not in act, naturally and probably expected to come into existence at some future time, though not now existing, for example, the future product of grain or trees already planted, or the successive future instalments or payments on a contract or engagement already made. Thus, as per the definition of the word "potential" means existing in possibility and not existing in real, therefore the declaration of an area as controlled area only marks its future possibility of getting converted into a non-agricultural land, that possibility may or may not occur in the future and there is probability that the land under a controlled area continues to be used as an agricultural land for-ever. for any number of reasons including the reason that the lands may not qualify to be licensed for any other use. It has further been submitted that in such case the land though lying within the controlled area loses the "potential" of being used for non-agricultural purpose, hence,

¶196

¶197

SA no.527/2023 & SA no.528/2023 the notification of the subject lands under provisions of the Punjab Con-trolled Areas Act, 1963 do not change the nature of the subject lands. It has further been submitted that the Sections 6 of the Punjab Controlled Area Act, clearly lays out the intent of the legislature that the nature of the land, even if it is notified as a controlled area does not automatically change its purpose/nature until and unless express per-mission is procured from the competent authority allowing the said land to be used for any purpose other than the purpose which it was being used on the date of publication of the notification identifying it as a controlled area. It has further been submitted that the legislative intent of the Punjab Controlled Area Act as laid out in Section 7 is clear that the nature of the lands falling under the controlled area is mandated to remain as it was on the date of the notification unless express approval is procured from the competent authority for alternate use, thus, land which was being used for agriculture on the date of the notification would by law continue to remain solely in the nature of agricultural land till a license is procured on the said land allowing for any other use i.e. residential/commercial etc, hence, the nature of the land cannot be assumed to have changed just on account of the notification identifying it as a controlled area and the applicant is relied upon the judgment of Hon'ble High Court of Punjab and Haryana at Chandigarh

¶198

¶199

SA no.527/2023 & SA no.528/2023 titled Trishul Industries Versus The State of Haryana and
Another, CWP No. 3596 of 1998 (Trishul Industries Case")
succinctly lays out the stance of the state with regards to lands situated in controlled areas. It has further been submitted that
the facts of the current matter is that the Subject Lands fall
under the controlled area as notified under the Punjab
Controlled Area Act vide a notification dated 05.02.2007 and on that date, the Subject Lands were being used for agriculture
purpose and thus the Subject Lands by law can be used only
for the purposes of agriculture till an approval/licence to use
the land for any other purpose is pro-cured as per the
provisions laid out in the Urban Areas Act, 1975. It has further
been submitted that the Urban Areas Act was promulgated to
regulate the use of land in order to "prevent ill-planned and
haphazard urbanization in or around towns and for the
development of the infrastructure sector and infrastructure
projects for the benefit of the State of Haryana and for matters
connected therewith and incidental thereto." It has further
been submitted that the definition of "Colony" under Section 2
(c) of the Urban Areas Act specifically excludes the land being
used for the purpose of agriculture and Section 7 of the Urban
Areas Act, 1975 prohibits "erect or re-erect" any building other
than for the purpose of agriculture on the land sub-divided for
agriculture as defined in clause (aa) of Section 2 of the Urban

¶200

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SA no.527/2023 & SA no.528/2023 Areas Act, 1975. It has further been submitted that this ascertains that even if the land is classified for a particular zone, the nature of the land still remains the same as Clause (iii) of Section 7 prohibits any construction over land for nonagricultural purpose if the land is being used for agricultural purpose. It has further been submitted that Section 7A of the Urban Areas Act, protects all agricultural land in urban areas from being misused, as it makes it mandatory to obtain a No Objection Certificate issued by the Director of D'TCP before registration of transfer by way of sale or lease of "any agricultural land" and the said provision of the requirement to seek an NOC was challenged before the Hon'ble Punjab and Haryana High Court in Suresh Kumar Juneja v. State of Haryana & Ors., CWP No. 14402 of 2006 wherein the vires of the said NOC and the provision of Section 7A of the Urban Areas Act were challenged and the Hon'ble High Court held that the said provision of NOC was valid and must be complied with. It has further been submitted that it is important to bring to the notice of this Tribunal that an Application was filed by Uba Realtech Private Limited on behalf of the Applicant herein for a grant of license for Group Housing on the Subject Lands situated at Daulatabad, Gurgaon on 28.01.2011 under Section 3 of the Urban Areas Act, 1975 before the Town & Country Planning Department, Haryana. It has further been submitted

¶202

¶203

SA no.527/2023 & SA no.528/2023 that the Directorate of Town & Country Planning, Haryana rejected the request for grant of license for setting up of residential project on the subject lands vide letter dated 05.01.2016 and subsequent to the rejection of the application for conversion of the Subject Lands by the Director, Town and Country Planning Department, Haryana the usage and nature of Subject Lands continued as agricultural land moreover the Subject Lands also lost the potentiality of being converted for any other use and till date the Subject Lands are being used for agricultural purposes. It has further been submitted that on a previous occasion, the Hon'ble Punjab and Haryana High Court in Subir Kaur Dey and Ors. vs State of Haryana And Ors. (2007) 146 PLR 746 held that on non-production of relevant documents, the land would remain agricultural in nature and the said land cannot be used for any other purposes. It has further been submitted that District Town Planner (HQ), for Director General, Town, and Country Planning Haryana, Chandigarh vide order dated 23.06.2015 laid down "Instructions for making grant/issue of NOC for the purpose of Section 7A of Act of 1975 transparent." ("said instructions"). It has further been submitted that the said instructions contain a ormat of an affidavit which is to be accompanied by an pplication for grant of NOC under Section 7-A of the Urban reas Act 1975 and the language of the affidavit itself 5d-

¶204

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SA no.527/2023 & SA no.528/2023

¶206

recognizes the basic nature of land in an urban area to be agricultural and for any change in the nature of the land, a license is required to be procured as per the terms of the Urban Areas Act. It has further been submitted that this intent of the legislature with regard to the nature of the land within a controlled area is also evident from the stamp duty rates notified for controlled areas covering the villages of Daulatabad and Mohammad Heri (the location where the Subject Lands are located). It has further been submitted that the notified rate charts provide for different collector rates in the same locality for agricultural land and for lands wherein change in land use has been allowed and the lands have been licensed to be developed for residential/commercial purposes. It has further been submitted that it is evident from the above that the conversion of land in Haryana would be subject to approval and grant of license by the concerned authority and as the Director, Town & Country Planning Department, Haryana has never granted license to the applicant and therefore, the subject lands continue agricultural in nature and a fact which has been admitted by the Respondent Bank in the impugned sale notice. It has further been submitted that ICICI Bank has proceeded with the sale of such lands to ZES Realty Private Limited (Purchaser) under the provisions of the SARFAESI Act, 2002. It

¶207

has further been submitted that the sale deed dated

¶208

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SA no.527/2023 & SA no.528/2023 24.08.2023 which was executed between the authorized officer of ICICI Bank and ZES Realty Private Limited, specifically states that the lands were conveyed as are "Krishi Chahi", which means that those lands are agricultural lands. It has further been submitted that in the same instance even while entering an entry in the Intekal register of the revenue authorities put on record that lands are agricultural lands. It has further been submitted that the type of land for the lands is mentioned as "Chahi"/ "Majrua" in the Intekal register and as per the translation of vernacular words as mentioned on the official website of the Haryana Land Records, "Chabi" means "irrigated from well. It has further been submitted that if the lands are irrigated from well, it is implied that the lands are agricultural lands in nature. It has further been submitted that as the applicant herein has filed the application under Section 340 of Cr. PC bearing M.A No. 28 of 2023, titled as 'Nuray Realtech Pvt. Ltd. vs. ICICI Bank, against the ICICI Bank for illegal sale of mortgaged land of the applicant herein held by the ICICI Bank as the ICICI Bank while proceedings always stated that the mortgaged lands are not agricultural land however, while executing sale of mortgaged land, the ICICI Bank specifically tates that the lands were conveyed as are "Krishi Chahi", hich means that those lands are agricultural lands. It has urther been submitted that Ld. DRT-III has issued the notice

¶210

¶211

SA no.527/2023 & SA no.528/2023 in the said 340 Application vide Order dated 06.09.2023. It has further been submitted that in a similar matter being Securitization Application No. 14 of 2023, titled as 'Dore Realtors Pvt Ltd. vs. Canara Bank and Ors.', pending before this Tribunal, this Tribunal was pleased to grant an interim order dated 11.09.2023 in favour of the mortgagors. It has further been submitted that it is evident from the facts and documents annexed herein that the respondent bank is clearly aware of the fact that the Subject Lands are agricultural land and despite being exempted under Section 31(i) of the SARFAESI Act, 2002, the respondent bank has erred in initiating action for enforcement of security interest in the subject lands and issuing the demand notice dated 05.02.2014 and the impugned possession notice dated 09.05.2014 and the rea-sons stated herein above, the demand notice dated 05.02.2014 and the impugned possession notice dated 09.05.2014 and the impugned sale notice dated 07.09.2023 are bad in law and are liable to be set aside. It has further been submitted that the demand notice dated 05.02.2014 issued under Section 13(2) of SARFAESI Act, 2002, possession notice dated 09.05.2024 under Section 13(4) of SARFAESI Act, 2002 and sale notice dated 07.09.2023 being void ab initio relating thereto. It has urther been submitted that the respondent bank issued a •emand notice dated 05.02.2014 to the borrower for claiming

¶212

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SA no.527/2023 & SA no.528/2023 an outstanding amount of Rs.32,17,65,461.23/- from the borrower. It has further been submitted that the respondent bank has failed to serve the Demand Notice dated 05.02.2014 to the Applicant herein in complete violation of the Rule 3 of the Security Interest (Enforcement) Rules, 2002. 27. It has further been submitted that the Respondent Bank in the Demand Notice dated 05.02.2014 that, as on 31.12.2013, an amount of Rs.32,17,65,461.23/-is allegedly outstanding and payable by the said Borrower, i.e. the Respondent No.3 as also inter alia the other mortgagor and without prejudice to what has been stated above, a bare perusal of the Impugned Demand Notice dated 05.02.2014 would show that breakup of the outstanding amount in terms of principal amount, interest and penal interest charged are nowhere stated in Demand Notice dated 05.02.2014 which is in complete violation of the provision of Section 13 (3) of the SARFAESI Act, 2002. It has further been submitted that the impugned Demand Notice dated 05.02.2014 merely discloses the sum total of the alleged outstanding amount without giving any necessary particulars, which renders the Demand Notice dated 05.02.2014 violative of the provisions of the SARFAESI ct 2002. It has further been submitted that as per Rule 3 of he Security Interest Rules, 2002, if for any reason, the service annot be made to the borrower and mortgagors, the service 5d-

¶214

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SA no.527/2023 & SA no.528/2023 has to effected in two manners: (1) firstly, by affixing a copy of such demand notice on the outer door or some other conspicuous part of the Subject Lands, and also by (ii) Secondly, by publishing the contents of the demand notice in two leading newspapers, one in vernacular language, having sufficient circulation in that locality. It has further been submitted that the impugned Demand Notice dated 05.02.2014 was never served and/or received by the Applicant herein and the same was taken by the Applicant from the Respondent No.3 herein and the case here is that when the service could not be effected, the Respondent Bank failed to undertake the substitute method of service as mandated by law and the law mandates that if the demand notice could not be serviced for any reasons, whatsoever, the demand notice has to be serviced by two alternative methods, both of which are mandatory to be complied with as the words used in the Security Interest Rules, 2002 are "and also by" and it is evident that the Respondent Bank has failed to comply with the mandatory provision of the Security Interest Rules, 2002 and has failed to serve the Demand Notice dated 05.02.2014 by affixing a copy of it on the outer door or some other conspicuous part of the Subject Lands and further, the Respondent Bank also failed to publish the contents of the Demand Notice dated 05.02.2014

¶216

¶217

SA no.527/2023 & SA no.528/2023 in two leading newspapers and accordingly, the said demand notice is bad in law.
28. It has further been submitted that the Respondent Bank
had published the impugned Possession Notice dated
09.05.2014, without the knowledge of the Applicant herein in a newspaper published and circulated in New Delhi, just for the sake of creating armor to safeguard themselves from the lack of compliance on the part of the Respondent Bank and the the
Respondent Bank failed to serve a copy of the Impugned
Possession Notice to the Applicant herein. It has further been
submitted that the Subject Lands are situated in Gurgaon,
Haryana, however, the Respondent Bank has published the
impugned Possession Notice in New Delhi edition of newspaper
(which does not have circulation in Gurugram) and as per the
mandate of Security Interest (Enforcement) Rules, 2002, the
Respondent Bank is under obligation to serve possession notice
to each and every person against whose property the debt is
being claimed and the Respondent Bank deliberately avoided
the service of Impugned Possession Notice upon the Applicant,
o illegally take the possession of the Subject Lands and thus,
he Impugned Possession Notice dated 09.05.2014 issued by
he Respondent Bank is liable to be set aside as there is clear
iolation of Security Interest (Enforcement) Rules, 2002 and
•rinciple of natural justice. It has further been submitted that

¶218

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SA no.527/2023 & SA no.528/2023 the Respondent bank has failed to comply with the provision of Rule 8 (1) of the Security Interest Rules before issuing the Impugned Notice for Symbolic Possession under Section 13(4) of the SARFAESI Act, 2002 and thus, the impugned Symbolic Possession Notice dated 09.05.2014 is liable to be set aside on the ground of non-compliance as the Respondent Bank has acted arbitrarily by not serving the Impugned Possession Notice to the Applicant. It has further been submitted that the Respondent Bank has not complied with the mandate of the Rule 8 (6) of the Security Interest (Enforcement) Rules, 2002 of publishing the Impugned E-Auction Notice in two leading news-papers, one being in vernacular language, having sufficient circulation in the locality setting out the terms of sale and the impugned E-Auction Notice was published by the Respondent Bank only in New Delhi edition of newspapers having circulation in Delhi whereas the Subject Lands are situated in Gurugram, Haryana and the Financial Express is a specialized business/financial news focused newspaper whose circulation is minuscule as compared to the other well-known nd leading English daily newspapers and the said newspapers, ie. Financial Express is neither a leading newspaper nor has ide or sufficient circulation in Delhi, NCR or even in Gurugram. t has further been submitted that in the Impugned Possession otice dated 09.05.2014, the Respondent Bank had mentioned sd-

¶220

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SA no.527/2023 & SA no.528/2023

¶222

that the physical possession is taken of the Subject Land as on 09.05.2014 however, in the Impugned Sale Notice dated 07.09.2023, the Respondent Bank mentions that the Symbolic possession is taken of the Subject Land as on 09.05.2014. It has further been submitted that the Respondent Bank is making contradictory statement with respect to a critical element which is possession of the Subject Land, which shows the negligent and arbitrary approach of the Respondent Bank towards the Applicant and the whole process of law. It has further been submitted that the physical possession of the Subject Land could not have been taken by the Respondent Bank, as the Subject Land by the admission of the Respondent Bank is not demarcated. It has further been submitted that the Subject Lands are agricultural land and hence, no security interest can be enforced against the Subject Lands in light of Section 31(1) of the SARFAESI Act, 2002 wherein agricultural lands are clearly and explicitly exempted from the provisions of the SARFAESI Act, 2002. It has further been submitted that the Respondent Bank, in the garb of banking company is trying to illegally extort hard earned money of the Applicant by pressuring the Applicant by threatening to put the Applicant's .gricultural lands to auction, which is evident from the fact that he said Borrower took the term loan facility to the tune of s.30.00 Crores, however, the Respondent Bank, without

¶223

¶224

SA no.527/2023 & SA no.528/2023 giving any reasoning, arbitrarily claimed its outstanding dues to the tune of Rs.32,17,65,461.23/-in the Impugned Demand Notice and to the utter shock and surprise, respondent bank claimed its outstanding dues to the four/five times of the actual principal amount in the subsequent Impugned Sale Notices (i.e. to the tune of Rs.126.20 Cr. in the sale Notice dated 06.02.2023 and Rs. 127.67 Cr. in the sale Notice dated 24.03.2023 and now the Respondent Bank is claiming its outstanding dues to the tune of Rs.137.78 Cr. in the Impugned Sale Notice dated 07.09.2023) and it is pertinent to mention that, this amounts to an interest of Rs.1.65 Cr. per month on a principal outstanding of Rs.30.00 crores which translates to annual interest rate of 66% being charged by the Respondent Bank. It has further been submitted that the Impugned sale notice issued by the Respondent Bank is wrong as the Respondent Bank, in the Impugned Sale notice (Published on the website of the Respondent Bank) had mentioned that "physical/Symbolic Possession bas been taken by authorized officer" because in the Impugned Possession Notice dated 09.05.2014, the Respondent Bank had mentioned that the physical possession is taken of the Subject Land as on 09.05.2014, however, in the Impugned Sale Notice dated 07.09.2023, the Respondent Bank mentioned that the Symbolic possession is taken of the Subject Land as on 09.05.2014 and sc-

¶225

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SA no.527/2023 & SA no.528/2023

¶227

on the Impugned Sale Notice available on the website of the Respondent Bank, the Respondent Bank has mentioned that physical/Symbolic Possession has been taken and it is pertinent to pointed out that the Respondent Bank cannot take physical and symbolic possession both on the subject Lands. It has further been submitted that the Respondent Bank is making contradictory statement with respect to a critical element which is possession of the Subject Land, which shows the negligent and arbitrary approach of the Respondent Bank to-wards the Applicant and the whole process of law and moreover, the physical possession of the Subject Land could not have been taken by the Respondent Bank, as the Subject Land by the admission of the Respondent Bank is not demarcated and with respect to the Respondent Bank's different statement regarding taking possession in Impugned Notices and on the website of the Respondent Bank, reflects the hastiness on the part of Respondent Bank in order to grab the Subject Lands of the Applicant herein. It has further been submitted that in the Impugned Sale Notice, the Respondent Bank has mentioned that "No encumbrance known to the Bank" and also, in the terms and conditions laid down by the Respondent Bank for the E-auction of the Subject Lands, the Respondent Bank has mentioned that "intending bidder should make their own independent inquiries regarding encumbrance" and it is the

¶228

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SA no.527/2023 & SA no.528/2023

¶230

duty of the Respondent Bank to disclose all the encumbrance on the immovable property. It has further been submitted that the Bank cannot escape or shift their responsibility on the shoulders of the intended bidder like in the instant case, by mentioning that the intending bidder should make their own independent inquiries regarding encumbrance, the Respondent Bank is trying to shift the burden on the intending bidder, which is completely wrong and against the norms of the auction.

¶231

It has further been submitted that after Impugned e- auction of the subject lands, the Respondent Bank issued a sale certificate dated 10.10.2023, in favor of M/s Vayuu Propmart Pvt. Ltd., despite knowing the status of the Subject Lands, the Respondent Bank concluded the e-auction of the Subject Land for Rs.26,86,00,000 and declared the sole bidder, Le. M/s Vayuu Propmart Pvt. Ltd. as the successful bidder of the Subject Lands which was well pre-existed plan of the officers of the bank to usurp the property in question to favour the respondent No.5 under the garb of recovery of the public money. It has further been submits d that the Respondent Bank has colluded with other consortium of banks and is collectively with other banks selling the mortgaged properties to one setup buyer and the same is evident from the fact that in each instance of sale, there is only one bidder participating in the e-auction and in the instant case as well, there was only

¶232

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SA no.527/2023 & SA no.528/2023

¶234

one bidder participating in the e-auction, implying that the successful auction purchaser, ie. the Respondent No. 5 is a setup buyer by the Respondent Bank wherein the Respondent No.5 by bidding the minimum/reserve price got in its favour, which is malafide and bad in law. It has further been submitted that the Respondent Bank in a calculated manner, conspired with the Respondent No.5 and played fraud before this Tribunal and put a bid for the Subject Lands at the Reserve Price on 29.09.2023 by hurriedly issuing the publication notice in newspaper on 07.09.2023 under Rule 9(1) of Rules 2002 before the expiry of clear thirty days as envisaged and mandatory under Rule 8(6) of the Rules 2002. It has further been submitted that the Subject Lands are located at prime location, and hence, by the reasonable man theory, there ought to be more than merely a sole bidder for the auction of the Subject Lands and therefore, it is evident that the Respondent Bank has colluded with the Respondent No.5 to auction the Subject Lands at a minimal price and the Subject Lands had been auctioned at the reserve price, which is much lower than the fair market value and therefore, the Subject Lands have been auctioned at an undervalued price, putting he Applicant in worse position and this is because, firstly, the uction of the Subject Lands is illegal and secondly, despite the uction of the subject Lands taking place, the Lands have been

¶235

¶236

SA no.527/2023 & SA no.528/2023

¶237

sold at a much less price, which still leaves the Applicant with an exorbitant Debt which is owed to the Respondent Bank. It has further been submitted that it is trite position of law that "what could not be done directly cannot be allowed to be done indirectly" and the Respondent Bank has gained illegally and abused the process of law by fraudulently executed the sale certificate of the Subject Land which is an agricultural and undemarcated land under Securitization Act 2002 and thus, in order to favour the auction purchaser, who claims to be sole bidder, in fact, the entire stage of illegally giving these properties in question was set up by the Respondent Bank and/or its officer so that there is no other bidder and the wide publication was not made at the place/locality of the Subject Lands, with clear intention that none comes up for bidding and the Respondent No.2 was declared the successful bidder for the Subject Lands at the reserve price and from the conduct of the Respondent Bank and its officers, it is apparent that the Respondent Bank has abused the process of law and this Tribunal has power, authority and jurisdiction to see the strict compliance of its order and also pass necessary orders and/or directions to secure the ends of justice, as prayed in this reply/application to the other prayers sought by the bank. It has further been submitted that a bare reading of the definition of "security interest" read with Section 31 (i) of the SARFEASI 5d-

¶238

¶239

SA no.527/2023 & SA no.528/2023 Act, 2002 contemplates that 'security interest' can certainly be
created on agricultural lands by way of mortgage and/or
charge, however, notwithstanding creation of and existence of
such 'security interest' upon Agricultural Lands, Section 31 (1)
of the Act by its plain reading exempts enforcement of such
security interest created upon "agricultural lands" by recourse
to the provisions of the SARFEASI Act, 2002. It has further
been submitted that the exemptions as set forth in Section 31
(i) of the SARFEASI Act, 2002 are attracted to a particular
stated species of properties though
mortgage/hypothecation/security interest may have been
created upon such property(s) mentioned therein and the
species or nature of property exempted by Section 31 (i) is
"agricultural land" even though 'security interest 'over such
'agricultural land 'had been created and subsists and it is only
the enforcement of the already created and existing security
interest by recourse to the provisions of the SARFEASI Act,
002 which is bared and exempted by virtue of Section 31 (i)
•f the SARFAESI Act, 2002. It has further been submitted that
n the absence of creation of security interest over any species
•f property, in any event the SARFEASI Act, 2002 would have
o applicability over any property of any description, nature or
pecies. It is to be noted that the legislature sought to correct
tself in Section 31 (1) by excluding and omitting clause (e)

¶240

¶241

SA no.527/2023 & SA no.528/2023 from Section 31 and thus, the said Clause (e) of Section 31 when inserted at the time of promulgation of the Act was meaningless or rather an error because indisputably the provisions of the SARE-FASI Act, 2002 are only attracted to properties over which 'security interest' has been created and subsisting and not over properties and assets over which no security interest have been created and thus, the same would equally apply to lands though the same are agricultural lands and are cultivated as agricultural lands over which security interest by way of mortgage/Charge has or has not been created. It has further been submitted that all properties including all nature of lands can be attached and sold in execution of a Decree of a civil court or a Recovery certificate issued under Section 19 (22) of the DRT Act 1993, however, the exemptions from attachment and sale in execution of a decree and/or Recovery Certificate are provided only to those properties finding mention in (a) to (p) of Section 60(1) CPC. It has further been submitted that it is important to note that the legislature has not limited the exemption of Section 31(i) of the SARFEASI Act, 2002 to any particularly type or usage of "Agricultural Lands" or qualified that such exemption will only pply to Agricultural Lands owned or belonging to an griculturist or only with respect to lands belonging to an griculturist who cultivates land personally and who depends

¶242

¶243

SA no.527/2023 & SA no.528/2023

¶244

for his livelihood mainly on the income from agricultural land, whether as owner, tenant, partner or agricultural labourer and lands used for pisciculture, floriculture, orchids or even horticulture or a combination of either or all will always be treated as Agricultural Lands. It has further been submitted that so long as Lands are by their very nature and user are agricultural lands and the character and user of such lands has not been altered or changed by acts of the Owner-Mortgagor by raising constructions or buildings unrelated to the agricultural activities, or by any other such like acts altering the predominant character and user of such lands, the exemption of Section 31(1) would be attracted. It has further been submitted that as a mere illustration, say with or in absence of permission of the concerned authorities, a commercial building or industrial building or the like has been constructed and erected on such agricultural lands permanently altering the character, nature, and predominant user of such lands from agricultural lands then surely the exemption provided under Section 31 of the SARFEASI Act, 2002 would not be attracted and even, mere grant of permission by any competent concerned State or local authority to erect or construct upon agricultural lands without the act of carrying out such constructions or in doing other acts altering the very nature and character of agriculture lands and continuously using the

¶245

100

¶246

SA no.527/2023 & SA no.528/2023

¶247

lands only as agricultural lands, the same will not remove the applicability of the exemption of Section 31(1) to such lands. It has further been submitted that unless specific permission has been granted by the competent authorities permitting change of existing user (CLU) of such agricultural lands and such permission has been acted upon by changing the very nature and character of the said Lands from Agricultural lands and usage to any other unrelated character or usage, the exemption under Section 31 (i) will be still attracted to such Lands. It has further been submitted that the nature, character and user of the subject lands from either prior to their respective purchase by the SA Applicant and till date has not been altered or changed and will remain agricultural lands uninterruptedly by their very character and user till dare and there is no contrary documentary evidence filed by the respondent bank till date. It has further been submitted that no Change of Land User (CLU) has been granted by the competent authority and any license to use the subject lands for any other purpose has been granted by the competent authority including The Department of Town and Country Planning, Haryana. (DTCP) and a report was sought from the Tehsildar, Gurgaon in relation to the confirm the nature and user of the subject lands and vide report dated 11.09.2023, the Tehsildar confirmed that the nature and user of the subject

¶248

101

¶249

SA no.527/2023 & SA no.528/2023

¶250

lands in the records maintained by them is agricultural lands." It has further been submitted that after of amendment of the provisions of SARFAESI Act in 2016, it is evident from joint reading of amended Section 13 (8) of the SARFAESI Act, 2002 and Rule 8(6) and Rule 9 (1) of the Rules of 2002, the borrowers are entitled to receive a thirty day' notice period for enabling the borrower to redeem the security interest as envisaged under Section 13 (8) of the SARFAESI Act and only after expiry of notice period of thirty days under Rule 8 (6) can the secured creditor issue publication of sale notice under Rule 9 (1), and on publication of such notice, the right of the borrower to redeem the property stands extinguished. It has further been submitted that the Respondent Bank did not comply with the mandate of Rule 8(6) of the Rules of 2002 as the thirty days 'notice was never given to the Borrower in order to enable him to exercise his right to redemption as envisaged under Section 13 (8) of the SARFAESI Act, which makes every action taken by the Respondent Bank pursuant to these illegal E-auction Sale Notices, null and void because as per Section 13 (8) of the SARFAESI Act, a secured creditor is bound to afford to the borrower a clear thirty day notice period under Rule 8 (6) so that the borrower can exercise his right of redemption, which was not afforded in the instant matter. However, without prejudice to the above, for the sake of arguments, 15 days'

¶251

102

¶252

SA no.527/2023 & SA no.528/2023

¶253

notice under Rule 9 (1) is taken to be correct being fourth auction, even then, the same 15 days 'notice could not have been issued before the expiry of 30 days mandatory notice under Rule 8(6) of Rules 2002. It has further been submitted that the Respondent Bank was under obligation to serve a notice of thirty days before publication of E-auction Sale Notice in newspaper, failing which the E-auction sale Notice would be infructuous and in the case at hand, the Respondent Bank did not comply with the man date of Rule 8(6) of SARFAESI Interest Rules, 2002, therefore, the Impugned E-auction held by the Respondent Bank and the sale executed by the Respondent Bank in favor of successful auction purchaser was also infructuous and hence, liable to be set aside. Accordingly, it has been prayed for setting aside the entire actions of the respondent bank initiated under the SARFAESI Act, 2002 qua the properties in question.

¶254

On the other hand, Ld. Counsel for the Respondent Bank has vehemently opposed the submission of the applicants and submitted that applicant has not approached this Hon'ble Tribunal with clean hands, not disclose any cause of action and are guilty of suppression of material facts. It has further been submitted that applicant has not disputed the mortgage over the subject property for securing the loan facility by admitting his liability towards dues and Respondent Bank is well within Sd--

¶255

103

¶256

SA no.527/2023 & SA no.528/2023

¶257

its rights to take measure for recovering lawful dues as per Law. It has further been submitted that Respondent Bank has taken all the measures as per provisions of 13(4) as well as Rule 8 and 9 of SARFAESI Rules. It has further been submitted that Respondent Bank duly served the notice under Section 13(2), Notice under Section 13(4) duly served, affixed and published in two newspapers as well as auction notice dated 07.09.2023 including compliance of provision of Rule 3 as well as Rule 8 (5), (6) and 9(1) etc. & there is no illegality. It has further been submitted that pursuant to issuance of possession notice by Respondent Bank for sale of property by public auction dated 18.7.2014, applicant filed securitization application no.149/2014 under Section 17 before DRT, Chandigarh which was dismissed as withdrawn vide order dated 05.05.2017. It has further been submitted that the auction scheduled on 27.02.2023 has become infructuous due to no bid received for the said auction by the Respondent bank. It has further been submitted that Respondent Bank after classifying the account as NPA on 31.12.2013 issued demand notice on 5.2.2014 duly served upon all the borrowers and on failure of discharge of liability by the borrowers, issued demand notice on 05.02.2014, possession notice on 9.5.2014 duly served on all available addresses, affixed and published in two newspapers i.e. The Statesman and Veer Arjun. It has further Sat-

¶258

104

¶259

SA no.527/2023 & SA no.528/2023

¶260

been submitted that defendant no.3 and 4 are under CIRP before NCLT and no action is taken against them and CIRP proceedings do not restrict the Respondent from initiating action under SARFAESI Act against applicants as mortgagors. It has further been submitted that Respondent Bank got the valuations on 17.01.2023 and 18.01.2023 and in consultant with secured creditor, fixed the reserve price for sale of the property. It has further been submitted that sale notice dated 07.09.2023 has been sent to borrowers by post on the last available address provided and affixed and published in four leading newspapers having vide circulation. It has further been submitted that present securitization application is not maintainable as the secured assets is not exempted from enforcement measures under section 31 (i) of the Act and when the mortgage of secured property was created vide sanction letter dated 13.12.2012, property was stood classified as residential zone. It has further been submitted that mortgagors had themselves applied on 28.1.2011 for grant of license for setting up of residential plotted colony and valuation report filed by Respondent Bank clearly prove that subject properties are neither the agricultural lands or are they being used for agricultural purposes and borrowers never intended to be used for agricultural purposes as held by the Hon'ble Apex Court. It has further been submitted that answering

¶261

105

¶262

SA no.527/2023 & SA no.528/2023

¶263

respondent place reliance on the judgement of Apex Court in the case of "ITSC Limited Vs Blue Coast Hotels Limited (2018) 15 SCC 99. It has further been submitted that mere entries in Revenue records are not the conclusive evidence of the properties being agricultural land being used for agriculture and has placed recent judgement of Hon'ble Apex Court in the case of K.Sreedharvs M/s Raus Construction Pvt.Ltd. — Civil Appeal No.7402/2022. It has further been submitted that the present securitization application is not maintainable and is liable to be dismissed as Respondent Bank has to recover a huge amount of Rs.58.90 crores beside a claim of Rs.119.14 crores has been filed with liquidator in NCLT under CIRP proceedings. It has further been submitted that CIRP proceedings against Corporate Debtors bearing CP (IB) no.190 of 2017 under Section 7 of IBC 2016 does not affect the liability of applicant and measures of Respondent Bank to enforce the security interest in the secured asset. It has further been submitted that the Petition No.C.P.(IB) No.190(PB)/2017 titled as "Union Bank of India Vs Era Engineering Limited" filed under Section 7 of IBC 2016 before NCLT Delhi and appointment of IRP and / or approval of resolution plan by COC does not affect he liability of applicant for recovery of their further dues. It has further been submitted that measures are taken strictly in . ccordance with the Act and Rules and all documents are being 5d-

¶264

106

¶265

SA no.527/2023 & SA no.528/2023

¶266

placed on record to demonstrate the compliance of their action and contents infirmities stated in application are vehemently denied being baseless. It has further been submitted that properties put to sale after obtaining valuation from two different valuers and published in two leading newspapers. Accordingly, it has been prayed for dismissal of the present securitization application.

¶267

IA no. 4029/2023.

¶268

The present application has been moved on behalf of the applicant seeking permission of this Tribunal to place on record the additional documents in the present securitization application.

¶269

It has been submitted on behalf of the applicant that the applicant seeks the permission of this Tribunal to place on record additional documents in the present securitization application, due to subsequent development in the in the present matter for proper adjudication of the present matter. It has further been submitted that the applicant had sent a settlement proposal to the respondent bank on 16.09.2023 offering an amount of Rs.32,17,65,000/- for release of the 4.98 acres of agricultural lands owned by the applicant alongwith other companies, which was put as mortgage to secure the said Term Loan. It has also been submitted that the settlement

¶270

107

¶271

SA no.527/2023 & SA no.528/2023

¶272

proposal dated 16.09.2023 was rejected by the respondent bank vide letter dated 22.09.2023 and sought payment of an amount of Rs.44.80 crores by 27.09.2023 for release of agricultural lands owned by the applicant herein, however, it is noteworthy to mention here that the hard copy of said letter was received by the applicant only on 30.09.2023 and upon receiving such letter, the applicant thoroughly checked their mail account as well but the mail was not in their inbox. It has also been submitted that it was only on 03.10.2023, the applicant had searched the spam folder of the mail account and discovered that the rejection of the settlement proposal dated 16.09.2023 was mailed to them, however, due to the reasons cited above, the applicant could not reply to such rejection to the settlement proposal in the given time-period, thus, the applicant became aware of such rejection of the proposal only on 30.09.2023 and the said rejection letter was filed by the respondent bank vide an application for additional documents which was serviced to the counsel of the applicant at 8:17 PM on 26.09.2023, therefore, no sufficient time was given to the applicant to act on the rejection letter dated 22.09.2023. It has further been submitted that vide order dated 29.09.2023, this Tribunal had passed an order directing the parties to maintain status quo w.r.t. such agricultural lands, therefore, in view of this interim relief, the applicant could not send any settlement

¶273

108

¶274

SA no.527/2023 & SA no.528/2023

¶275

proposal to the respondent bank during this time thereafter, the status quo granted by this Tribunal was vacated vide order dated 07.10.2023, therefore, upon such vacation of the status quo granted by this Tribunal the applicant has sent a revised settlement proposal to the respondent bank on 09.10.2023 accepting the terms of the respondent bank to release the mortgaged properties if the applicant deposits a sum of Rs.44.80 crores with the respondent bank, which is the fair market value of the mortgaged properties. It has further been submitted that the relevant terms of the revised settlement plan are (a). The applicant shall deposit 10% as upfront payment by way of demand draft/ cheque along with the settlement proposal. Upon deposit of 10% of the offer value, the bank shall suspend all steps towards the conclusion of the auction process, (b) Balance amount of 90% of the payment shall be made by the Applicant within 15 days from the date of acceptance of the Revised Settlement Proposal dated 09.10.2023, (c). If the settlement is not accepted by the bank, 10% of the offer amount deposited shall be remitted back to the bank account. It has further been submitted that in furtherance of the terms of the Revised Settlement Offer, the applicant had approached investors for paying the banks back and releasing mortgaged lands from the charge of the respondent bank. It has also been submitted that the investor $d-

¶276

109

¶277

SA no.527/2023 & SA no.528/2023

¶278

namely, Nunlet Projects Private Limited had duly deposited 10% of the offer value with the respondent bank and the same was conveyed to the respondent bank vide an email dated 10.10.2023, however, without considering the revised settlement proposal, which was higher than the actual bid amount received by the respondent bank, the respondent bank rejected the revised settlement proposal of the applicant vide an email dated 10.10.2023, creating doubt on the bonafide of the respondent bank. Accordingly, it has been requested to allow the present application and take on record additional document filed by the applicant.

¶279

It has been objected on behalf of the respondent bank and submitted that during the pendency of the securitization application and while the property had been put to sale by public auction, the applicant through its authorized represented submitted a settlement proposal dated 16.09.2023 which was received on 18.09.2023 and the proposal was considered by the respondent bank. It has further been submitted that the respondent bank vide its letter dated 22.092023 rejected the offer made by the applicant as not found acceptable to the respondent and it was conveyed that the mortgaged property was put to auction on minimum reserve price based on realizable value of Rs.44.80 crores. It has further been submitted that the applicant was informed that in case the

¶280

110

¶281

SA no.527/2023 & SA no.528/2023

¶282

applicant wishes to get the mortgaged properties released, they may deposit the said minimum reserve price amount before 27.09.2023 for release of properties and the said letter dated 22.09.2023 was sent to the applicant by mail and also by post, however, the applicant did not avail such opportunity and did not deposit any amount with the respondent bank in terms of letter dated 22.09.2023. It has further been submitted that copy of letter dated 22.09.2023 issued by the respondent bank in response to the settlement proposal dated 16.09.2023 has been placed on record by the respondent bank among other documents on 26.09.2023 with advance copy served upon the counsel for the applicant, thus, the applicant had due information and knowledge of the rejection letter dated 22.09.2023 well in time. It has also been submitted that the contention of the applicant that the hard copy of the letter dated 22.09.2023 was received only on 30.09.2023, is ill founded and baseless. It has been denied that upon receiving the letter, the applicant checked their mail account and found the rejection letter on 03.10.2023 in their spam and the said facts are concocted, though it is admitted that advance copy of the letter was received by the counsel on 26.09.2023 while the same was placed on record. It has also been submitted that after hearing the matter this Tribunal on 27.09.2023, 28.09.2023 and 29.09.2023, the order was reserved with

¶283

111

¶284

SA no.527/2023 & SA no.528/2023 interim order as directed, however, admittedly, the applicant has not responded to the letter dated 22.09.2023 in terms thereof. It has further been submitted that pursuant to the order dated 07.10.2023 passed by this Tribunal, the sale has been confirmed in favour of the auction purchaser and the sale certificate issued in their favour after receipt of the entire sale consideration within the stipulated period of time. It has further been submitted that the revised proposal is an attempt to hamper the sale already conducted in accordance with law and the proposal dated 09.10.2023 is denied and without any acceptance of the said purported proposal dated 09.10.2023, an amount to the value of 10% was sent to the respondents account through electronic means, which was immediately returned to the senders account and the respondent denies the e-mail dated 10.10.2023. It has further been submitted that it is an admitted case of the applicant that the purported revised proposal has already been rejected by the respondent. It has further been submitted that the documents sought to be placed by way of the application under reply has no connection with the lis-pending before this Tribunal and these documents have no relevance with the issue under consideration of this Tribunal and as regards the offer of settlement, as contended, the respondent has already taken a decision and conveyed to the applicant. It has also been submitted that no purpose will be

¶285

112

¶286

SA no.527/2023 & SA no.528/2023 achieved in taking the documents under reference on record and on contrary, the application has been filed to complicate the issue and derail the final adjudication. Accordingly, it has been requested to dismiss the present application. IA no.4146/ 2023. 34. The present application has been moved on behalf of the applicant seeking permission of this Tribunal to place on record the additional documents in the present securitization application.

¶287

It has been submitted on behalf of the applicant that the applicant seeks the permission of this Tribunal to place on record additional documents in the present securitization application, due to subsequent development in the in the present matter for proper adjudication of the present matter. It has further been submitted that the applicant had sent a settlement proposal to the respondent bank on 16.09.2023 offering an amount of Rs.32,17,65,000/- in lieu of the corporate term loan amounting to Rs.30,00,00,000/- availed by M/s Era Infra Engineering Limited, for release of the 4.98 acres of agricultural lands owned by the applicant alongwith other companies, which was put as mortgage to secure the said Term Loan. It has also been submitted that the settlement proposal dated 16.09.2023 was rejected by the respondent bank vide

¶288

113

¶289

SA no.527/2023 & SA no.528/2023 letter dated 22.09.2023 and vide order dated 29.09.2023, this Tribunal had passed an order granting interim relief to the applicants and stated that even though the respondent bank can proceed with their auction-sale, however, the sale shall not be confirmed until the order on interim relief is pronounced by this Tribunal, thus maintaining a status quo w.r.t, such agricultural land, therefore, in view of this interim relief, the applicant could not send any settlement proposal to the respondent bank during this time. It has further been submitted that this interim relief granted by this Tribunal was vacated vide order dated 07.10.2023, wherein the respondent bank was directed to proceed with the proposed auction sale, therefore, upon such vacation of the interim relief granted by this Tribunal, the applicant has sent a revised settlement proposal to the respondent bank on 09.10.2023 accepting the terms of the respondent bank to release the mortgaged properties if the applicant deposits a sum of Rs.44.80 crores with the respondent bank, which is the fair market value of the mortgaged properties, in fact, during the course of the arguments before this Tribunal, when this Tribunal advised the parties to settle the matter amicably, the senior counsel appearing for the applicant on instructions enhanced the original offer of Rs.32,17,65,000 to Rs.39.5 crores for release

¶290

of the subject lands from the respondent bank which was

¶291

114

¶292

SA no.527/2023 & SA no.528/2023

¶293

rejected by senior counsel appearing for the respondent bank and the respondent bank was not inclined to settle the matter and was ardent on payment of Rs.44.80 crores. It has further been submitted that the applicant on 16.10.2023, in order to preserve his agricultural lands was forced to bow down to the illegal demands of the respondent bank and in furtherance of the same has drawn two cheques to safeguard his agricultural lands. i.e. i) one cheque issued in favour of PSB HO SAMVERT bearing no. "005209" for Rs.24,80,00,000.00 (Rupees twentyfour crore eighty lac) and; (ii) another cheque issued in favour of PSB HO SAMVERT bearing no. "005214" for Rs.20,00,00,000.00 (Rupees twenty crore). It has further been submitted that it is imperative to take the above-mentioned documents on record considering the principles of natural justice and to properly adjudicate upon the issue pending before this Tribunal in the present securitization application. Accordingly, it has been requested to allow the present application and take on record the additional documents filed by the applicant.

¶294

It has been objected on behalf of the respondent bank and submitted that during the pendency of the present securitization application and while the property had been put to sale by public auction, the applicant through its authorized represented submitted a settlement proposal dated 16.09.2023

¶295

115

¶296

SA no.527/2023 & SA no.528/2023

¶297

which was received on 18.09.2023 and admittedly rejected by the respondent bank. It has further been submitted that after hearing the matter this Tribunal on 27.09.2023, 28.09.2023 and 29.09.2023, the order was reserved with interim order as directed. It has also been submitted that the applicants knowing fully well that the offer has been considered and rejected, yet, again sent anther proposal after the sale was confirmed in favour of the auction purchaser. It has further been submitted that the applicant first awaited the outcome of the order reserved on 29.09.2023, and thereafter, sent the offer to scuttle the sale, which speaks volumes about the conduct and intention of the applicants. It has further been submitted that it is an admitted case of the applicants that even during the course of hearing all that they offered was Rs.39.5 crores as contended knowing fully well that they were given an opportunity to deposit the amount of Rs.44.80 crores till 27.09.2023, which they failed to avail. It has further been submitted that the cheques referred are admittedly dated 16.10.2023 and were never offered to the respondent except the copies of cheques placed on record, even otherwise, as submitted the offer had already been rejected by the respondents and the copies of cheques referred therein are denied. It has also been submitted that the documents sought to be placed on record by way of the present application under

¶298

sc/-

¶299

116

¶300

SA no.527/2023 & SA no.528/2023

¶301

reply have no connection with the lis-pending before this Tribunal and these documents have no relevance with the issue under consideration of this Tribunal. It has further been submitted that as regards the offer of settlement, as contended, the respondent has already taken a decision and conveyed to the applicant. It has further been submitted that no purpose will be achieved in taking the documents under reference on record and on the contrary, the application has been filed to complicate the issue and derail the final adjudication. It has further been submitted that the contents of the application under reply are denied both specifically and individually, save to the extent what is specifically admitted herein and/or a matter of record. Accordingly, it has been requested dismiss the present application.

¶302

IA no.4203/2023.

¶303

The present application has been moved on behalf of the applicant seeking permission of this Tribunal to place on record the additional documents i.e. a Cheque issued in favour of respondent bank by the applicant alongwith the other SA Applicant in SA no.527 of 2023 i.e., Nuray Realtech Pvt. Ltd.

¶304

It has been submitted on behalf of the applicant that on 19.10.2023 vide diary no.4029 of 2023, the applicant filed an application for placing additional documents on records

¶305

117

¶306

SA no.527/2023 & SA no.528/2023

¶307

wherein, the applicant filed two cheques which were issued in favour of the respondent bank, in order to offer a settlement of present matter to the respondent bank and the present application be read in part and parcel of the aforesaid application and the details of the said cheques are as (i) one cheque issued in favour of PSB HO SAMVERT bearing no. "005209" for INR 24,80,00,000 (Rupees twenty-four crore eighty lac) and (ii) another cheque issued in favour of PSB HO SAMVERT bearing no. "005214" for INR 20,00,00,000 (Rupees twenty crore). It has further been submitted that the in order to settle the matter amicably and to offer better price of the subject land, the applicant herein is ready to offer Rs.50,00,000/- (Rupees Fifty Lakhs Only), in addition to the aforesaid cheques, vide cheque no.005226, drawn in favour of the respondent bank on 25.10.2023. It has further been submitted that the applicant came to know that during the e- auction of the subject land, only one bidder participated in the auction which was scheduled on 29.09.2023, who bid the minimum price/reserve price of the subject lands, thus, in order to ensure maximum recovery of the bank and to protect the interest of the applicant in the agricultural lands, the applicant alongwith the other SA applicant in SA No. 527 of 2023 i.e., Nuray Realtech Pvt. Ltd. is offering a sum of Rs.50,00,000/- in addition to Rs.44.80 crores. It has also been submitted that it cd

¶308

118

¶309

SA no.527/2023 & SA no.528/2023

¶310

is imperative to take the above-mentioned facts and documents on record considering the Principles and Natural Justice and properly adjudicate upon the issue pending before this Tribunal in the present securitization application. Accordingly, it has been requested to allow the present application and take on the record the additional document.

¶311

On the other hand, it has been objected on behalf of the respondent bank and submitted that a similar application has been filed by the applicant vide diary no.4029/2023 to which the respondent bank has filed the reply which also be treated as part and parcel of the present reply. It has further been submitted that during the pendency of the present SA and while the property had been put to sale by public auction, the applicant through its authorized representative submitted a settlement proposal dated 16.09.2023 which was received on 18.09.2023 and the proposal was considered by the respondent and rejected vide its letter dated 22.09.2023 as not found acceptable to the respondent. It has further been submitted that it was conveyed to the applicant that mortgaged property was put to auction on minimum reserve price based on Realizable value of Rs.44.80 crores and accordingly, the applicant was informed that in case the applicant wishes to get the mortgaged properties released, they may deposit the said minimum reserve price amount before 27.09.2023 for release

¶312

119

¶313

SA no.527/2023 & SA no.528/2023

¶314

of properties and the said letter dated 22.09.2023 was sent to the applicant by mail and also by post, however, the applicant did not avail such opportunity and did not deposit any amount with the respondent in terms of letter dated 22.09.2023. It has further been submitted that the copy of letter dated 22.09.2023 issued by the respondent in response to the settlement proposal dated 16.09.2023 has been placed on record by the respondent among other documents on 26.09.2023 with advance copy served upon the counsel for the applicant, thus, the applicant had due information and knowledge of the rejection letter dated 22.09.2023 well in time. It has also been submitted that the contention of the applicant that they had prepared two cheques to match the reserve price in order to amicably settle the matter is ill founded inter-alia the reason that the offer was available only till 27.09.2023 which the applicant did not avail, thereafter, pursuant to passing of the order by this Tribunal on 07.10.2023 the respondents confirmed the sale in favour of the highest bidder in accordance with law after receipt of the entire sale consideration within the stipulated period of time. It has also been submitted that the contention of the applicant expressing its purported readiness to offer Rs.50,00,000/- more is again misconceived to create hurdles in completing the sale transaction undertaken in accordance with law and purported cheque only copy of the

¶315

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¶317

which is placed on record is dated 25.10.2023 i.e. much after

¶318

the sale in favour of the auction purchaser had conclude and the offer of the applicant had already been considered and declined. It has further been submitted that the additional documents sought to be placed on record by way of the present application under reply has not connection with the lis-pending before this Tribunal and these documents have no relevance with the issue under consideration of this Tribunal and as regards the offer of settlement, as contended, the respondent has already taken a decision and conveyed to the applicant. Accordingly, it has been requested to dismiss the present application.

¶319

IA no.4750/2023

¶320

The present application has been moved on behalf of the applicant seeking permission of this Tribunal to place on record the additional documents in the present securitization application.

¶321

It has been submitted on behalf of the applicant that the applicant seeks the permission of this Tribunal to place on record additional documents i.e. True copy of Section 9 petition filed before the Hon'ble Delhi High Court being O.M.P (I) (COMM.) 293/2023 and the order dated 12.09.2023 passed by the Hon'ble Delhi High Court wherein the Hon'ble High Court

¶322

_scik"_

¶323

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was pleased to grant an interim relief of maintaining status quo against the respondent therein, True copy of the deed of revocation of General Power of Attorney dated 08.02.2023 and True copy of the Deed of Cancellation of Development Agreement dated 08.02.2023. It has further been submitted that the entire reply filed by the respondent bank is based on a Development Agreement dated 08.02.2023 (hereinafter 'Development Agreement'). It has further been submitted that the respondent sought to rely upon Section 13[13] SARFAESI Act, 2002, which assertion was baseless as no alienation was contemplated or consummated by Development Agreement and the respondent bank is trying to portray a picture that the applicant entered into said Development Agreement with a commercial intent to develop the agricultural land into residential projects to earn profit, further, the respondent bank has alleged that the applicant concealed the Development Agreement with malafide intention to defraud the banks, however, the fact is that the applicant entered into the said Development Agreement with the developer, with a bonafide intent to arrange finance so that the lender bank's debts can be paid off. It has further been submitted that the said Development Agreement & GPA was entered into in furtherance of a Memorandum of Understanding dated 25.01.2023 (hereinafter 'Mon and clause 14.11 of the said

¶326

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¶328

Development Agreement clearly stated that the said Development Agreement is in furtherance of an MoU, hence, the Development Agreement cannot be read in isolation and has to be read with the MoU dated 25.01.2023. It has also been submitted that the combined reading of the said Development Agreement and MoU dated 25.01.2023, makes it very clear that the applicant was compelled to enter into such arrangement only to pay the banks their dues back, which shows the bonafide intentions of the applicant to pay the dues of banks, however, MoU and Development Agreement could not be proceeded because as per the terms of the MoU, it was agreed that the Developer will provide the financial assistance to the applicant in order to get its lands free from the consortium of banks. It has further been submitted that since the said developers failed to arrange the requisite funds towards payments of such debts so the MoU and Development Agreement was terminated by the applicant as the as the Developer failed to perform its obligations, thereafter, a petition under Section 9 of the Arbitration and Conciliation Act, 1996 was filed by the applicant before the Hon'ble Delhi High Court seeking directions to restrain the Developers under the MoU dated 25.01.2023 and Development Agreement dated 08.02.2023 from claiming any right, title or interest in the Subject Lands vide O.M.P. (I) (COMM.) 293/2023. It has

¶329

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¶331

further been submitted that the Hon'ble Delhi High Court was pleased to grant an interim relief of maintaining status quo against the Respondents therein vide an order dated 12.09.2023. It has further been submitted that the Development Agreement dated 08.02.2023 and General Power of Attorney dated 08.02.2023 has been revoked by the parties vide Deed of Revocation of General Power of Attorney dated 29.11.2023 and Deed of Cancellation of Development Agreement dated 29.11.2023. It has further been submitted that in the light of aforesaid revocation of the Development Agreement dated 08.02.2023 and General Power of Attorney dated 08.02.2023, the aforesaid documents become null and void and it is reiterated that intent behind entering into such Development Agreement dated 08.02.2023, General Power of Attorney dated 08.02.2023 and Memorandum of Understanding dated 25.01.2023 was only to arrange financial assistance in order to pay off the debts of the banks and nothing more. It has further been submitted that the aforesaid additional documents are crucial for effectually adjudicating upon the issue at which the parties are at variance. Accordingly, it has been requested to allow the present application and take on record the additional documents filed by the applicant.

¶332

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¶334

It has been objected on behalf of the respondent bank and submitted that during the pendency of the securitization application, the SA applicant has deliberately concealed the material fact before this Tribunal that they had malafidely executed a Development Agreement to defraud to secured creditor and in order to develop the land into a residential project for their wrongful gains. It has further been submitted that the Development Agreement was executed in the teeth of Section 13 (13) of the SARFAESI Act after issuance of statutory demand notice under Section 13(2) of the Act dated 22.02.2019. It has further been submitted that the SA applicant post service of statutory demand notice have executed a Development Agreement dated 08.02.2023 and also a General Power of Attorney dated 08.02.2023 and the said documents were placed on record by the respondent bank to show the conduct and intention of the SA applicant, which was deliberately concealed to seek an equitable relief from this Tribunal. It has further been submitted that the SA applicant has not approached this Tribunal with clean hands and is therefore, not entitled to any indulgence by this Tribunal and in order to cover their lapses, the SA applicant has now filed an application to place on record the purported Deed of revocation of General Power of Attorney and cancellation of Development Agreement both dated 29.11.2023 and these

¶335

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¶337

documents have been purportedly executed as an afterthought after their intent and conduct was exposed. It has further been submitted that the SA applicants chose not to disclose the execution of Development Agreement and General Power of Attorney in their SA cannot be now permitted to place the documents on record which are sought to be filed by way of application under reply. It has further been submitted that the SA applicant had filed a similar application before the coordinate bench of this Tribunal in a similarly situated matter and the bench has not permitted the documents to be placed on record vide order dated 08.01.2024 passed in SA no.14 of 2023. It has been denied that the Development Agreement was entered into with the Developer with a bonafide intent to arrange finance to pay off the lender bank's as alleged and as it is evident from the record, all purported acts including filing of Section 9 petition and Revocation/Cancellation of GPA and Development Agreement are belated and an afterthought to cover up the concealment of facts which were pointed out the respondent. Accordingly, it has been requested to dismiss the present application.

¶338

Heard the rival contentions of both the parties and perused the records thoroughly.

¶339

126

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¶341

In the present matters, during the pendency of these two securitization applications, the applicants had also filed four applications/IAs each in both the securitization applications. By way of these four applications, the applicants wanted to place on record certain documents/facts such as (i) that the settlement proposal dated 16.09.2023 of the applicants was rejected by the respondent bank vide letter dated 22.09.2023 and sought payment of an amount of Rs.44.80 crores by 27.09.2023 for release of agricultural lands owned by the applicant herein and hard copy of said letter was received by the applicant only on 30.09.2023 and upon receiving such letter, the applicant thoroughly checked their mail account as well but the mail was not in their inbox, (ii) that on instructions the applicants enhanced the original offer of Rs.32,17,65,000/to Rs.39.5 crores for release of the subject lands from the respondent bank which was rejected by senior counsel appearing for the respondent bank and the respondent bank was not inclined to settle the matter and on 16.10.2023, in order to preserve his agricultural lands was forced to bow down to the illegal demands of the respondent bank and the same has drawn two cheques to safeguard his agricultural lands (a) one cheque issued in favour of PSB HO SAMVERT bearing no. "005209" for Rs.24,80,00,000.00 and; (b) another cheque issued in favour of PSB HO SAMVERT bearing no. "005214" for

¶342

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¶344

Rs.20,00,00,000.00 (Rupees twenty crore), (iii) in order to ensure maximum recovery of the bank and to protect the interest of the applicant in the agricultural lands, the applicant alongwith the other SA applicant in SA No.527 of 2023 i.e., Nuray Realtech Pvt. Ltd. is offering a sum of Rs.50,00,000/- in addition to Rs.44.80 crores and (iv) to place on record additional documents i.e. True copy of Section 9 petition filed before the Hon'ble Delhi High Court being O.M.P (I) (COMM.) 293/2023 and the order dated 12.09.2023 passed by the Hon'ble Delhi High Court wherein the Hon'ble High Court was pleased to grant an interim relief of maintaining status quo against the respondent therein, True copy of the deed of revocation of General Power of Attorney dated 08.02.2023 and True copy of the Deed of Cancellation of Development Agreement dated 08.02.2023.

¶345

By way of these four applications, the present applicants wanted to take on record certain documents regarding settlement proposal dated 16.09.2023 of the applicants, certain copies of cheques and additional documents such as copy of Section 9 petition filed before the Hon'ble Delhi High Court being O.M.P (I) (COMM.) 293/2023 and the order dated 12.09.2023 passed by the Hon'ble Delhi High Court, copy of the deed of revocation of General Power of Attorney dated 08.02.2023 and copy of the Deed of Cancellation of Development Agreement dated 08.02.2023. However, after oing through these documents it appears that no prejudice ould be caused to the respondent bank as well as auction

¶346

sd-

¶347

128

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¶349

purchaser if these documents are taken on record for consideration of this Tribunal and accordingly, these documents are taken on record.

¶350

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

¶351

In the present matters, admittedly the applicants have availed the loan facilities from the respondent bank against the mortgage of the properties in question. Apparently, there is default on the part of the borrower/mortgagor in paying the dues of the respondent bank and notices under Section 13(2) and 13(4) of SARFAESI Act have been duly issued and served upon the borrower/mortgagor after declaring the account as NPA as per RBI guidelines and the borrower has not cleared the dues of the respondent bank. It has been argued on behalf of the securitization applicants that the credit facility of Rs.30.00 Crores was allegedly sanctioned in favor of M/s Era Infra Engineering Limited vide Sanction Letter dated 13.12.2012 and against the said credit facility availed by the Borrower, the Applicant had mortgaged its agricultural lands in favour of the Respondent Bank. It has further been argued that the Respondent Bank issued a Demand Notice dated 05.02.2014 under Section 13 (2) of the SARFAESI Act, 2002 for payment of Rs.32,17,65,461.23/- and the Respondent Bank sd

¶352

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¶354

issued Possession Notice dated 09.05.2014 under Section 13 (4) of the SARFAESI Act, 2002 and after inexplicable delay of 9 years, the Respondent Bank issued the Sale Notices dated 07.09.2023 claiming therein disputed amount claimed as outstanding Rs.126.20 crores, however, the said notice became infructuous in light of the stay order granted by this Tribunal vide its Order dated 23.02.2023 in SA 98 of 2023 and also no bid was received. It has further been argued that impugned Sale Notice dated 07.09.2023 also claiming therein disputed amount claimed as outstanding Rs.137.78 crores and the said sale was published in Financial Express and the said sale notice was in violation of provisions of SARFAESI Act including but not limited to violation of Section 13 (8) read with Rule 8 (6) and 9 (1) of the Rules. It has further been argued that the Respondent Bank conspired with the Auction Purchaser (Vayuu Propmart Pvt. Ltd) i.e. Respondent No. 5 herein and conducted the auction of the subject land on 29.09.2023 and thereafter the Respondent Bank illegally executed the sale certificate in favor of the Respondent No.5 on 10.10.2023, wherein the description of the subject land is as agricultural and undemarcated and vide Order dated 14.11.2023, this Tribunal directed that the sale certificate issued by the Respondent Bank in favour of the Auction Purchaser qua the property in question should not be

¶355

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¶357

registered with the Sub/Joint Registrar of the concerned authority, till the final disposal of the Securitisation Applications. It has further been argued that vide order dated 11.06.2024, the Ld. NCLT has approved the Resolution Plan of M/s Era Infra Engineering Limited, Respondent No.3 and it is most relevant to mention here that the Respondent Bank filed its claim with the Resolution Professional of the Borrower, and a claim to the extent of Rs.119.15 Cr. was admitted and dealt in the CIRP of the Borrower and by virtue of passing of Resolution Plan of the Borrower, the entire liability (including the instant outstanding claim of the Respondent Bank) of. the Borrower has been restructured under Resolution Plan and hence, the instant SARFAESI measures taken by the Respondent Bank are liable to be set aside. It has further been argued that the subject Lands are AGRICULTURAL LANDS and are thus, exempt from the provisions of the SARFAESI Act, 2002 and the title deed of equitable mortgage dated 20.12.2012, which was duly signed by the Respondent Bank, the description of the subject land as "Chahi" which means "irrigated from well", meaning thereby that at the time of creation of interest of the subject land, the Respondent Bank was aware of the nature of the same as Agriculture Land. It has further been argued that the classification of the subject lands in all revenue records including but not limited to. the

¶358

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Khasra Girdawari clearly reflect the Subject Lands as Agriculture Lands which have been continuously and uninterruptedly used for agriculture purposes and even today there are standing crops of wheat in the Subject Lands and reliance is placed on K Sreedhar vs. Raus Constructions Pvt. Ltd., Civil Appeal No. 7402 of 2022. It has further been argued that in the sale certificate dated 10.10.2023, issued by the Respondent Bank in favour of Auction Purchaser, it is mentioned that the subject land is undemarcated which means that the subject land is agricultural land and moreover, the requirement of affixation of possession notice and sale notice on the subject land [as per the mandate of Rule 8 (1) and 8 (7) of the SARFAESI Rules] could not be complied with by the Respondent Bank. It has further been argued that the Respondent Bank has failed to issue the Demand Notice dated 05.02.2014 to the Applicant herein in complete violation of the Rule 3 of the Security Interest (Enforcement) Rules, 2002 and even no breakup of the outstanding debt claimed is stated in the notice, which is in complete violation of Section 13(3) of SARFAESI Act, 2002 and the description of the subject land is inaccurate and the reliance is placed on Rajesh Gems ,and Jewels Private Limited vs Indian Overseas Bank, 2017 SCConline Del 1067 and Punjab National Bank vs Mithilanchal Industries Private Limited, 2020 SCConline Guj 3441.

¶361

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¶363

It has further been argued on behalf of the applicants that the Respondent Bank published the impugned possession notice without the knowledge of the Applicant herein, as the Respondent Bank failed to serve the said notice to the Applicant and further, the subject land is in Gurgaon and the Respondent Bank published the impugned possession notice in New Delhi edition of newspaper which do not have the circulation in Gurgaon. It has further been argued that the subject land is undemarcted and hence, the Respondent bank could not have prepared the possession notice as nearly as possible in Appendix IV to the SARFAESI Rules, and could not have affixed the possession notice on the conspicuous place of the subject land as the subject land is an undemarcated part of big chunk of land so identifying the land of the Applicant is not possible and there is a clear violation of Rule 8 (1) of the Security Interest (Enforcement) Rules, 2002 and therefore, the impugned Possession Notice is liable to be set aside and reliance is placed on Bharat Post Graduate College vs. IndiaBulls Housing Finance Limited & Ors., MANU/TN/5586/ 2018 and Fyro Foods Private Limited & Ors. vs. The Authorised Officer, Oriental Bank of Commerce & Ors., MANU/DR/0781/ 2019. It has further been argued that the Respondent Bank cted in violation of Rule 8 (6) Security Interest (Enforcement) Rules, 2002 as it published the impugned sale notice in only Sd—

¶364

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¶366

New Delhi edition of newspapers having circulation in Delhi, whereas the subject lands are situated in Gurgaon and also, the said newspaper i.e. Financial Express is neither a leading newspaper nor has wide or sufficient circulation in Delhi, NCR or even in Gurgaon. It has further been argued that there was violation of Rule 8 (7) as the land is not demarcated hence, the Respondent Bank failed to affix the sale notice on the conspicuous place of the subject land as the subject land. It has further been argued that the Respondent Bank has also failed to serve a impugned sale notice to the Applicant. It has further been argued on behalf of the applicant that the Respondent Bank without application of mind has been demanding exorbitant amount, as initially claimed its outstanding dues as Rs.32 17165,461.231 however, in subsequent sale notices, this amount was arbitrarily escalated to Rs.126.20 crores and then to Rs.127.67 Crores in the notice and now, the Respondent Bank has claimed dues of Rs.137.78 crores in the, impugned sale notice dated 07.09.2023 and this pattern indicates an imposition of interest 'amounting to pproximately Rs.1.65 crores per month on the principal

¶367

•utstanding amount, effectively translating to an annual nterest rate of 66% and the Respondent Bank issued illegal e- uction sale notices in complete contravention of the amended ection 13(8) of SARFAESI Act, 2002.

¶368

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¶370

It has further been argued on behalf of the applicant that the Title Deed of equitable mortgaged dated .20.12.2012 and sale deed showing that at the time of creation of mortgage on the subject land, the Respondent Bank knew that the subject lands are agricultural land and the certificate from Tehsildar report dated 11.09.2023, clearly certifies that the Subject Lands are agricultural lands and further Khasra Girdawari and Jamabandi of the subject Lands clearly state that the said Lands are agricultural lands and even photographs reflecting the current use of land. It has further been argued that no agricultural land can be used or treated as non-agricultural land without obtaining prior permission of the concerned authorities and a joint application was filed for conversion of land use of Subject Lands along with other lands by a company named Uba Realtech Private Limited, but the application was withdrawn by the said company as the Applicant did not want to pursue the same. It has further been argued that mere notification of an area as controlled area/application for conversion of land does not automatically convert the nature of land to agricultural land in light of Section 3, Haryana Development and Regulation of Urban Areas Act, 1975, Section 7, Punjab Scheduled Roads and Controlled Areas Restriction of Unregulated Development Act, 1963, Sections 2 (5) and 4, Punjab Scheduled Roads and Controlled Areas Restriction of Unregulated Development Act, sd-

¶371

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1963 and Section 6, Punjab Scheduled Roads and Controlled Areas Restriction of Unregulated Development Act, 1963 and on reading of the said provisions, the intent of the legislature is clear that even if the land is notified as a controlled area, it does not automatically change the nature of the land, until an express permission is procured from the competent authority. It has further been argued that the Sale deed dated 24.08.2023 between ICICI Bank and ZES Reality Private Limited, specifically states that the lands were conveyed as are "Krishi Chahi", which means that those lands are agricultural land and Intekal register dated 31.07.2023 and list of translation of vernacular words mentioned in official website of the Haryana Land Records, wherein the similarly situated lands are described as Krishi Chahi.

¶374

It has further been argued that the Ld. NCLT in CP (IB) No.190 of 2017, vide order dated 11.06.2024 has approved the Resolution Plan of M/s Era Infra Engineering Limited, Respondent No.3 and it is most relevant to mention here that the Respondent Bank filed its claim with the Resolution rofessional of the Borrower and a claim to the extent of s.119.15 crores was admitted in the CIRP of the Borrower and n light of the same, the said resolution plan clearly states that n amount of Rs.534.96 Crores shall be paid by the SRA for the esolution of the Borrower and furthermore, the entire

¶375

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admitted financial debt of the Borrower stands restructured and converted into equity of the Borrower pursuant to deduction of the amount proposed to be paid as upfront and committed amounts as provided in the Resolution Plan. It has further been argued that since the entire debt of the Borrower towards the Respondent Bank herein has been dealt with entirety in the Resolution Plan, as on the present date, there is no liability of the Applicant towards the Respondent Bank herein and furthermore, it is crucial to mention here that under Clause 13.2.9 as per the Resolution Plan of the Borrower, the account(s) of the Borrower have been regularized and the first and foremost requirement of initiating proceedings under Section 13 (2) of the SARFAESI Act is that the account of the Borrower must be declared NPA, which in the present case, has been regularized and therefore, all the actions initiated by the Respondent Bank are bad in law, and with the Resolution Plan of the Borrower being approved by the Ld. NCLT, there remains no liability of the Applicant towards the Respondent Bank, and hence, the actions initiated by the Respondent Bank against the Applicant are liable to be quashed. It has further been argued that Resolution Plan for the Borrower was submitted by A Infrastructure which was approved by the CoC with a ubstantial majority of 87.08% votes on 25.01.2023 in the 2nd meeting of the CoC of the Borrower and the Bank was

¶378

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¶380

the member of the CoC and has voted in favour of the resolution plan and in consequence thereof, the Respondent Bank has agreed to be bound by the provisions of the Resolution Plan. It has further been argued that under the Resolution Plan the entire liability is restructured and hence, there is nothing left to recover from the Applicant herein therefore the SARFAESI measures are liable to be set aside and otherwise, it would amount to double recovery of the same debt by the Respondent Bank, which is against the principle of natural justice and fairness. Accordingly, it has been prayed for setting aside the entire actions of the respondent bank initiated under the SARFAESI Act, 2002 qua the properties in question.

¶381

Ld. Senior Advocates and Ld. Counsels for the applicants have relied upon the judgement J. Rajiv Subramaniyan and Another vs. Pandiyas and Others, Civil Appeal No. 3865 of 2014 Citation: (2014) 5 Supreme Court Cases 651, Bhupinder Singh vs. State Bank of India, C.W.P. No. 6306 of 2007 Citation: 2008 SCC online P&H 473 and Swastik Agency and Others vs. State Bank of India, Bhubaneswar and Others, W.P.(C) No. 7361 of 2008 Citation: 2009 SCC online Ori 3, Oasis Dealcom Private Limited vs. Khazana Dealcomm Private Limited, Civil Appeal No. 10676-77 of 2016 (Before Hon'ble Supreme Court of India) (2016) 10 Supreme Court Cases 214, Kanika Swami vs. State

¶382

138

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¶384

of U.P, Writ-C No. 46425 of 2017 (Before Hon'ble Allahabad High Court) 2017 SCC online all 2299, Vishnu Steels vs. Union Bank of India, Civil Writ Petition No. 12496 of 2016 (Before Hon'ble Punjab & Haryana High Court) 2016 SCC online, Federal Motors Pvt. Ltd. Vs. Atma Ram Properties Pvt. Ltd., CM(M) No. 4/2014 (Before Hon'ble Delhi High Court) ILR (2014) III DELHI 1810, Kundanmal Dabriwala vs. Haryana Financial Corporation and Anr., Civil Writ Petition No.2713 of 2009 (Before Hon'ble Punjab & Haryana High Court) 2011 SCC online, United Bank of India vs. Satyawati Tondon and Ors., Civil Appeal No. 5990 of 2010 (Before Hon'ble Supreme Court of India) (2010) 8 SCC 110, Union Bank of India vs. Injamuri Arun Vilasini, Misc. Appeal No. 06 of 2023 (Before Hon'ble DRAT, Kolkata Bench), Union Bank of India vs. Dilshad Elahi, Misc. Appeal No. 34 of 2023 (Before Hon'ble DRAT, Kolkata Bench) and Bank of Baroda vs. Nirupama Devi, Appeal No. 102 of 2024 (Before Hon'ble DRAT, Kolkata Bench), Sri Sai Annadhatha Polymers vs The Canara Bank rep. by its Manager, Mandapalle 2018 SCC Online Hyd 178 (Hon'ble Telangana High Court), K.V.V. Prasad Rao Gupta vs State Bank of India 2021 SCC Online TS 328 (Hon'ble Telangana High Court), Celir LLP vs Bafna Motors (Mumbai) Private Limited (2024) 2 SCC 1 (Hon'ble Supreme Court of India), VST Constructions vs Canara Bank & Ors., Appeal No. 09 of 2024 (Hon'ble Debt Recovery

¶385

139

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¶387

Appellate Tribunal, Kolkata), Smt. Alluri Vijaya Lakshmi vs Union Bank of India, Appeal No. 107 of 2023 (Hon'ble Debt Recovery Appellate Tribunal, Kolkata), Chaudhry Ventures Pvt. Ltd. & Ors. vs Indiabulls Housing Finance Ltd., Appeal No. 387/2023 (Hon'ble Debt Recovery Appellate Tribunal, Delhi), Punjab National Bank Versus M/S Mithilanchal Industries Pvt. Ltd. C/LPA/159/2020 High Court of Gujarat at Ahmedabad and M/s Abaj Foods Private Limited Versus The Authorized Officer, Punjab National Bank C/SCA/2676/2023 High Court Of Gujarat at Ahmedabad, Prashant Shashi Ruia Vs. State Bank of India [2022]170SCL293(Guj), State Bank of India Vs. Prashant S. Ruia OA/648/2018 (DRT-1, AHMEDABAD), State of Assam Vs Barak Upatyaka D.U. Karmachari Sanstha (2009) 5 SCC 694, Prem Kishore & Ors Vs. Brahm Prakash & Ors Civil Appeal No.1948 of 2013, Amruddin Ansari (Dead) through LRs & Ors Vs Afajal Ali & Ors. 2025 INSC 566, Prathyasa Mental Health Counselling Forum Vs State of Kerala & Ors 2020 SCC Online Ker 2314, Alka Gupta Vs Narender Kumar Gupta (2010) 10 SCC 141, ARCE Polymers Private Limited Vs M/s Alphine Pharmaceuticals Private Limited and ORs, Civil Appeal No.7372 of 2022 and M/s Alphine Pharmaceuticals Pvt. Ltd, Another Vs. Andhra Bank, Writ Petition no.13936 of 2019, Sunshine India Private Limited Vs Manjit Singh & Ors. CS (OS) 2501/2011 and Rajesh Kumar Aggarwal & Ors. Vs. K.K. Modi & Ors. Civil Appeal 5d-

¶388

140

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¶390

Nos.5350-5351 of 2022, Judgement passed in the matter of

¶391

"E.K. Rajan Vs. The Authorized Officer, Vs Canara Bank" WP (C) no.27485 of 2021, Judgement passed in the matter of "Kanika Swami Vs State Bank of U.P. and Ors MANU/UP/2703/2017, Judgement dated 15.11.2022 passed in the matter of "Eicore Technologies Pvt. Ltd. & Ors. Vs Eexpedise Technologies Pvt. Ltd. & Ors" 296 (2023) DLT, Padam Singhee and Anr Vs M/s SVOGL Oil, Gas and Energy Ltd & Ors. (W.P. (C) 9616/2018), Maya Prints & Ors. VS. Canara Bank (Appeal No.111 of 2002- decided on 04.06.2004), Antikeros Shipping Corporation Vs. Adani Enterprises Limited (Appeal No. 533 Of 2019 In Notice of Motion No. 1015 Of 2019), Kapra Mazdoor Ekta Union Vs. Management of Birla Cotton Spinning And Weaving Mills Ltd. And Ors. (Civil Appeal No. 3475 Of 2003), Liang Miao Sheng and Ors. Vs. The State of West Bengal And Ors. (A.P.O. no. 542 Of 2017 And W.P. No. 518 Of 2016), Lokesh Dhawan Vs. Union of India (UOI) And Ors. (CW No. 2855/2003), Nazir Ahmed Vs. King Emperor 1936 SCC Online Pc 41, Raghunath Rai Bareja and Anr Vs. Punjab National Bank and Others, (2007) 2 Supreme Court Cases 230, M/S. Pragati Builders & Promoters and Ors. Vs. M/S Ram Murty Pyara Lal & Ors (WP (C) No.4441 Of 2011), Ram Kishun and Others Vs. State of Uttar Pradesh and Others (2012) Supreme Court Cases 511, MS Morning Maidens Pvt. Ltd. Vs. HDFC Bank sd

¶392

141

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¶394

SA 23 Of 2023, HDFC Bank Vs. Ms Morning Maidens Pvt. Ltd Misc. Appeal 63 Of 2023 and Rajesh Gems and Jewels Pvt. Ltd. Vs. Overseas Bank India (2017 SCC Online Del 10679).

¶395

It has been argued on behalf of the respondent bank that pursuant to classification of loan accounts as NPA, the Respondent bank as secured creditor took measures under the provisions of SARFAESI Act and issued a Notice under section 13 (2) of the Act calling upon the Borrowers to discharge their liability in full and on their failure to meet the demand, the Respondent bank took further measures and issued a notice under section 13 (4) of the Act, which was challenged before the Debts Recovery Tribunal, Chandigarh by way of SA No. 149/2014 and subsequently the Applicants withdrew their SA, recorded in order dated 05.05.2017, thereby giving up their hallenge to the aforesaid notices issued by the Respondents. t has further been argued that the SA Applicant filed another ► ecuritization Application against the Sale Notice issued by the espondent on 06.02.2023 being SA No.98/2023 and after ompletion of pleadings and evidence filed by the parties, this ribunal after providing a detailed hearing to the parties, • ecided the aforesaid SA which has been dismissed vide udgement dated 04.09.2023 by a well-reasoned speaking order and the Applicant has not assailed the said judgement in I ppeal as provided under law, but filed a Review Application sd-

¶396

142

¶397

SA no.527/2023 & SA no.528/2023

¶398

and the issues raised in the present SA under reply are the same which were raised in SA No.98/2023, having been heard by this Tribunal and decided finally and conclusively on merits. It has further been argued that the present Securitization Applications are not maintainable and liable to be dismissed in as much as the same does not disclose any fresh challenge on the issues already having been considered and the only subsequent act is the issuance of fresh Sale Notice dated 07.09.2023. It has further been argued that the present Securitization Applications are not maintainable and liable to be dismissed inasmuch as the entire measures of the Respondent Bank are strictly in accordance with the provisions of Section 13 (4) of the SARFAESI Act, 2022 as well as Rules 8 and 9 of the Security Interest (Enforcement) Rules, 2002 and other applicable provisions and the answering Respondent bank has already placed on record in the earlier SA No.149/2014, the proof of service of Statutory Demand Notice dated 05.02.2014 issued under Section 13 (2) of the Act, Notice under Section 13(4) of the Act dated 09.05.2014 i.e. symbolic possession, • uly served, affixed and published in two newspapers and so ar as the fresh measures are concerned, the sale notice dated 7.09.2023 has been issued to the borrowers on all addresses nd the sale notice has been duly sent through mail on 7.09.2023, affixed and published in two leading newspapers, 5d -

¶399

143

¶400

SA no.527/2023 & SA no.528/2023

¶401

one in vernacular language. It has further been argued that the sale notice dated 07.09.2023 and the postal receipts, service by mail, Company Master Data providing the mailing address to the Respondent, photographs showing service of notice by affixation and citations showing publication of Sale notice on 08.09.2023 are annexed herewith as Annexure R-2 (Colly). It has further been argued that the Respondent being a secured creditor has obtained a fresh valuation dated 26.08.2023 before putting the property again on sale and thus the reserve price has been fixed in terms with the value assessed by the valuer and thus there is no infirmity in the subsequent measures taken by the Respondent; hence the SA is liable to be dismissed. It has further been argued that the Applicant has entered into a Development Agreement with a Developer in respect of the property in question claiming the property to be free from encumbrances and have represented to the developer to provide him the license land capable of being used for development of residential project and the Respondent has come across the said Document being Development Agreement executed on 08.02.2023. It has further been argued that the Respondent bank has also come across a Public Notice issued

¶402

n behalf of the SA Applicant though their Counsel published in Times Nation dated 23.09.2023, claiming to have entered into an Agreement in respect of the property of which the sd-

¶403

144

¶404

SA no.527/2023 & SA no.528/2023

¶405

property being subject matter of the present SA and the secured asset of the Respondent, is also a part. It has further been argued that pursuant to the issuance of the sale notice dated 07.09.2023 and while assailing the said action of the Answering Respondent, the SA was heard in detail on the interim relief by this Tribunal on 26.09.2023, 27.09.2023 and 29.09.2023 as the auction was scheduled to take place on 29.09.2023 and the Answering Respondent bank was permitted to go ahead with the sale and the confirmation was stayed till the pronouncement of orders on the interim relief. It has further been argued that this Tribunal vide order dated 07.10.2023 rejected the interim relief prayer for by the Applicant by a detailed and reasoned order and as a consequence thereof the Answering Respondent has issued the sale certificate to the auction purchaser on 10.10.2023 after having received the entire sale consideration and the sale certificate has been issued as a consequence of successful sale by public auction and receipt of entire sale consideration and the Possession has been handed over to the Respondent No.5 i.e. auction purchaser on 11.10.2023. It has further been argued that pursuant to the issuance of Sale Notice, the pplicant submitted a One-time settlement proposal dated 16.09.2023 to seek release of the mortgaged property, which as considered and rejected vide letter dated 22.09.2023 and sd-

¶406

145

¶407

SA no.527/2023 & SA no.528/2023

¶408

during the pendency of the present proceedings, the Applicant filed an Application for discovery which has been appropriately responded to by the Respondent and all relevant documents have been placed on record along with the reply dated 26.10.2023. It has further been argued that the Respondent Bank has initiated all measures strictly in accordance with the Provisions of the Act and Rules framed there under and pursuant to classification of loan account as NPA on 31.12.2013, the Respondent Bank admittedly issued a demand notice under Section 13 (2) of the Act dated 05.02.2014, duly served upon all the borrowers and on failure of discharge of liability by the borrowers, the Respondent took further measures and issued a possession notice dated 09.05.2014 under section 13 (4) of the SARFAESI Act, 2002 to the borrowers which has been duly served on all available addresses, affixed and also published in two newspapers i.e. the Statesman and Veer Arjun.

¶409

It has further been argued that though the property was earlier put to sale on four occasions in the year 2014, which

¶410

id not fetch any bid and so far as the borrower i.e. M/s Era nfra Engineering Ltd. and Mr. Hem Singh Bharana are oncerned, they are before NCLT under CIRP and no action is aken against them and the said CIRP proceedings do s not estrict the answering Respondent from initiating action under sa

¶411

146

¶412

SA no.527/2023 & SA no.528/2023

¶413

SARFAESI Act against the Applicants as mortgagors. It . has further been argued that the Respondent bank has to recover an amount of Rs.137.76 crores as on 31.082023 and the claim admitted under CIRP as against the dues of the Borrower Company are only Rs.62.58 crores, out of the admitted claim of Rs.119.14 claims, which is still not received the approval of adjudicating authority and no amount paid to the Respondent. It has further been argued that the Respondent bank in any case has to recover the amounts much more than the admitted claims and the Respondent is entitled to take measures against the Applicant as the provisions of section 14 (1) of the Code, do not apply to a Surety in a contract of guarantee to a Corporate Debtor as provided under sub-section 3(b). It has further been argued that the Respondents are claiming the recoverable dues strictly according to contractual stipulations and the interest at the rate agreed upon and admittedly, the Borrower has agreed to the interest @ BPLR+3.50% and the interest has been charged strictly as applicable from time to time as per contractual stipulations and the Respondent has charged interest varying between 13.25% to 13.75% p.a. on monthly rests.

¶414

It has further been argued that the present Securitization Applications are not maintainable and liable to be dismissed inasmuch as the secured asset is not exempted from the 5d

¶415

147

¶416

SA no.527/2023 & SA no.528/2023

¶417

enforcement measures under Section 31 (i) of the Act and when the mortgage of the secured property was created pursuant to sanction of loan to the borrowers vide sanction letter dated 13.12.2012, the same stood classified as residential zone. It has further been argued that the mortgagers had themselves applied to the Town & Country Planning Department, Haryana Government, on 28.01.2011 i.e. much prior to creation of mortgage for grant of license for setting up of residential plotted colony. It has further been argued that other documents including the valuation report filed by Respondent Bank clearly prove that the subject properties are neither the agricultural lands nor are they being used for agricultural purposes and the fact that the property stood mortgaged with the Respondent Bank clearly proves that the subject properties were never intended to be used for agricultural purposes, as has been held by the Hon'ble Apex Court and in the case of "ITC Limited versus Blue Coast Hotels Limited, (2018) 15 SCC 99". It has further been argued that he present Securitization Application is not maintainable and s liable to be dismissed inasmuch as the reliance of the pplicants on the revenue records as filed with the SA is ompletely misplaced and it is no longer res-Integra that mere -ntries in the revenue records are not the conclusive evidence

¶418

•f the properties being an agricultural land or being used for 5d-

¶419

148

¶420

SA no.527/2023 & SA no.528/2023

¶421

the agricultural purposes and for this purpose the Respondent bank places reliance on the relevant paragraphs of a recent judgement of the Hon'ble Apex Court in the case of K. Sreedhar vs M/s Raus Construction Pvt. Ltd- Civil Appeal No.7402/2022. It has further been argued that the present Securitization Application is not maintainable and is liable to be dismissed inasmuch as the Respondent bank has to recover a huge amount of Rs.75.18 crores besides a claim of Rs.119.14 crores (out of which Rs. 62.58 pertain to the Borrower Company in connection with the present loan) filed with the Liquidator in NCLT under CIRP proceedings and the Respondents have to recover huge public money, which cannot be allowed to be derailed because of this baseless SA. It has further been argued that the respondent bank has taken the measures under the SARFAESI Act, 2002 as per law and accordingly, it has been prayed for dismissal of the present securitization applications. Ld. Senior for the respondent bank has relied upon the various judgements i.e. Meghmala & Ors. V/S. G. Narasimha Reddy & Ors. (2010) 8 SCC 383, United India Insurance Co. Ltd. V/S. Rajendra Singh and Ors. & Ors. (2000) 3 SCC 581 And A.V. Papayya Sastry and Ors. V/S. Government of A.P. And Ors. (2007) 4 SCC 221, Anathula Sudhakar versus P. Buchi Reddy (2008) 4 sec 594 and the order dated 15.04.2023 passed in S.A. No. 386 of 2023, order dated 04.09.2023 in S.A.No. 98 5d -

¶422

149

¶423

SA no.527/2023 & SA no.528/2023

¶424

Of 2023 and S.A. No. 99 Of 2023 passed by this Tribunal, order dated 07.10.2023 in S.A. no. 98 of 2023 and S.A. No. 99 Of 2023 passed by this Tribunal, order dated 07.10.2023 in S.A. No. 527 Of 2023 and S.A. No. 528 Of 2023 passed by this Tribunal, Sarguja Transport Service V. S.T.A.T. (1987) 1 SCC 5, Celir Llp Versus Sumati Prasad Bafna And Ors. 2024 SCC Online SC 3727, M. Nagabhushana Versus State of Karnataka & Others (2011) 3 SCC 408, State of Orissa and Another Versus Laxmi Narayan Das (Dead) Thr. Lrs and Others 2023 SCC Online SC 825, ITC Ltd. V. Blue Coast Hotels Ltd. (2018) 15 SCC 99, Indian Bank V. K. Pappireddiyar, (2018) 18 SCC 252, K. Sreedhar Versus Raus Constructions Pvt. Ltd. And Ors. 2023 SCC Online 13, Celir Lip Versus Bafna Motors (Mumbai) Pvt. Ltd. And Ors. 2023 SCC Online SC 1209, M. Rajendran Versus KPK Oils and Protiens India Pvt. Ltd. 2025 SCC Online SC 2036, Order Dated 11.06.2024 Passed by The Ld. National Company Law Tribunal In C.P.(IB) No. 190 Of 2017, SBI V. V. Ramakrishnan (2018) 17 Scc 394, Sbi V. V. Ramakrishnan (2018) 17 SCC 394 And Sanjay Sarin Versus Authorised Officer, Canara Bank And Ors. (2022) 29 Dlt 641.

¶425

It has been argued on behalf of the auction purchaser that they have adopted the arguments of the respondent bank, but it has further been argued on behalf of the auction

¶426

150

¶427

SA no.527/2023 & SA no.528/2023

¶428

purchaser that there was default in repayment of the loan led to the classification of account of Respondent No.3 as NPA w.e.f. 31.12.2012 and thereafter Demand Notice under Section 13 (2) SARFAESI Act, 2002 dated 05.02.2014 was issued by the Respondent No.1 Bank claiming an outstanding amount of Rs.32,17,65,461.23/- and symbolic possession Notice dated 09.05.2014 under. Section 13 (4) of the SARFAESI Act, 2002 also issued by the Respondent No. I Bank. It has further been argued that the respondent bank issued first auction notice dated 18.07.2014 thereby putting the subject property on auction, which was failed. Thereafter, the second auction notice dated 06.02.2023 was issued by the respondent bank, but no bid was received by the respondent bank and accordingly, the respondent bank issued third auction notice dated 24.03.2023, but the same was also not successful. It has further been argued that the Respondent No.1 Bank issued 4th Auction Notice in terms of the SARFAESI Act, 2002 thereby putting the subject lands on auction at a reserve price of Rs.26.71 crores (M/s Nuray Realtech Pvt. Ltd.) and Rs.18.09 crores (M/s UBA Realtech Pvt. Ltd.) and pursuant to the order dated 07.10.2023 of this Tribunal the Respondent No.1 Bank, vide its letter dated 09.10.2023 was pleased to issue a sale/bid confirmation advice declaring the Respondent No.5 as the successful auction purchaser and calling upon it to deposit the

¶429

151

¶430

SA no.527/2023 & SA no.528/2023

¶431

•

¶432

75% balance sale consideration on or before the 15th day of confirmation of the sale/bid and in terms of the Letter dated 09.10.2023, the Respondent No.5 deposited the balance 75% sale consideration and the Respondent No.1 Bank was pleased to issue Sale Certificate dated 10.10.2023 and the Respondent No.5 has also purchased stamp papers worth Rs.1.88 crores and Rs.1.27 crores for the purpose of registration. It has further been argued that at the time of sanctioning of credit facility by the Respondent Bank, the Applicant had deposited original sale deeds of the Subject Lands with the Respondent Bank. It is evident from the description of the Subject Lands as stated in the sale deeds that the Subject Lands were agricultural lands and it is evident from the sale deeds that the Respondent Bank was well aware of the nature of the Subject Lands and had executed the mortgage with complete knowledge that the Subject Lands were agricultural in 'nature. It has further been argued that the SA Applicant also admits the due execution of the memorandum of equitable mortgage dated 20.12.2012 and thus, since the subject land had dmittedly been mortgaged by the SA Applicant with the Respondent No.1 Bank, it goes to show that the SA Applicant never treated the subject land as agricultural land and the creation of security interest in the subject land is itself indicative of the fact that the SA Applicant did not treat the

¶433

152

¶434

SA no.527/2023 & SA no.528/2023 subject land as agricultural land. It has further been submitted that the SA Applicant is seeking exemption under Section 31 (i) of the SARFAESI Act, 2002 and has relied upon an alleged Report of the Tehsildar dated 11.09.2023, Khasra Girdhawari and Jamabandi and Intekal Register, however, classification of land in the revenue records as agricultural is not dispositive or conclusive of the question whether the SARFAESI Act does or does not apply and whether a parcel of land is agricultural must be deduced as a matter of fact from the use to which it was being put on the date of creation of security interest and. the purpose for which it was set apart. It has further been submitted that admittedly, the subject land was not being used for agricultural purposes at the time of creation of mortgage and moreover, the security interest on the subject land could not have been created in case the land was being used for agricultural purpose. It has further been submitted that what is relevant in determination of exemption under Section 31 (i) of the SARFAESI Act, 2002 is the nature and use of the subject land to which it was being put on the date of creation of mortgage and the onus to prove that the subject land was being for agricultural purpose was upon the SA Applicants which they have failed to discharged since, no evidence, documentary or otherwise, has been placed on record show that the SA Applicant was engaged in agricultural activities sck

¶435

153

¶436

SA no.527/2023 & SA no.528/2023

¶437

ant/or had put the subject lands to agricultural use at the time of creation of mortgage. It has further been submitted that in order to show use of the land as agricultural, the SA Applicant has placed on record certain alleged photographs of the subject land and a perusal, of the photographs does not in any manner show that the subject land is being used for agricultural purposes and the photographs appear to have been taken from specific angles in order to distort the entire image of the subject land. It has further been submitted that merely show some bushes/shrubs and an area where water is collected and as such the said photographs in no manner whatsoever show that the subject land is and/or was being used for agricultural purpose by the SA Applicant and it is pertinent to note that the photographs are without any date stamp and the pleadings of the SA Applicant are also silent in said respect. It has further been submitted that the photographs, without any date stamp cannot be relied upon and moreover, in order to render the images admissible, they ought to have been supported by a valid certificate under Section 65B Indian Evidence Act by the person in lawful control of the computer from which the photographs have been printed, who could have certified as to the condition of the computer and in the instant case, the same has not been done and as such, the said photographs are inadmissible in evidence. It has further been argued that the

¶438

154

¶439

SA no.527/2023 & SA no.528/2023

¶440

contention of the SA Applicant that conversion of any land in Haryana would be subject to approval and grant of license by the Director, Town and Country Planning Department, Haryana and since the said authority has not granted any such license, the subject land allegedly being agricultural in nature is exempted from the purview of SARFAESI Act, 2002. It has further been argued that the nature of the land would not be a conclusive factor in determining the applicability of exemption under Section 31 (i) of the Act and what would be relevant would be the use it was put to by the SA Applicant and since the subject land was never used by the SA Applicant for agricultural purpose, the exemption would not apply. It has further been argued that insofar as lack of license from the Town and Country Planning Department, Haryana is oncerned, it is pertinent to note that the SA Applicant through UBA Realtech Pvt. Ltd. had applied for grant of license for etting up of residential plotted colony vide Application dated 8.01.2011 and the said fact is conclusive proof that the SA pplicant is neither an agriculturist nor its livelihood is • ependent on agricultural activities and nor the subject land ad ever been used for the said purpose and moreover, the .aid license was rejected vide Letter dated 03.01.2016 only on account of deficiencies such as deficit of license fee etc. It has urther been argued that the allegations of the SA Applicant

¶441

155

¶442

SA no.527/2023 & SA no.528/2023

¶443

that it was entitled to receive a thirty-day notice for enabling to redeem the security interest in view of the amended provision of Section 13 (8) of the Act read with Rule 8 (6) of the Security Interest (Enforcement) Rules, 2002 is bereft of any merit. It has further been argued that the SA Applicant by virtue of the own conduct in order to compromise with the Respondent No.1 Bank had time and again issued letters including letter dated 16.09.2023 before filing of the present Securitization Application and it is pertinent to note that the aforesaid letter dated 16.09.2023 specifically referred to the Sale Notie published on 08.09.2023. It has further been argued that even the SA Applicant even after filing of the present Securitization Application, sent a revised settlement proposal dated 09.10.2023 to the Respondent No.1 Bank in an attempt to compromise which is sought to be placed on record and similarly, the SA Applicant, vide I.A. No.4145 of 2023 and I.A. No.4904 of 2023 seeks to place on record copies of cheques which were issued to make the said settlement offers more lucrative and the said settlement proposal of the applicant has already been rejected by the respondent bank. It has further been argued that it is an admitted fact on record that the auction notice was issued in 2014 against which the SA applicant filed SA No.149 of 2014 which was withdrawn on 05.05.2017 and the SA applicant at no point of time even sd-

¶444

156

¶445

SA no.527/2023 & SA no.528/2023

¶446

during the said period paid any dues of the bank or made any endeavour to redeem the mortgage. It has further been argued that even after the withdrawal of the said SA and till the publication of said notice which are the subject matter of challenge in the present Application, the SA applicant never approached the bank to redeem the said mortgage and it is only when the present auction notice was issued and the applicant could not redeem its mortgage the present applications were filed and the conduct of the SA applicant clearly shows the malafide which is writ large as since 31.12.2012 when the account of the Respondent No. 3 was classified as NPA and thereafter since 05.02.2014 when the notice under 13 (2) of the SARFAESI Act and 09.05.20214 when the notice under 13(4) of the SARFAESI Act was issued he applicant has failed to pay any dues whatsoever and has nly been filing various proceedings before this Tribunal. ccordingly, it has been prayed for dismissal of these ecuritization applications. Ld. Senior Advocate for the auction urchaser has relied upon the various judgements i.e. S.P hengalvaraya Naidu Vs Jagannath (1994) 1 SCC 1, K.D. harma Versus Steel Authority of India Ltd. And Ors. (2008) 12 CC 481, Dalip Singh Versus State of U.P. (2010) 2 SCC 114, amjas Foundation and Anr. Versus Union of India (2010) 14 CC 38, Order dated 03.10.2024 Passed in Misc Appeal No. 98 sd-

¶447

157

¶448

SA no.527/2023 & SA no.528/2023

¶449

Of 2023 Titled "Kiaan Propmart Pvt. Ltd. Versus Alvita Realtors Pvt. Ltd. and Ors." by the Hon'ble Debts Recovery Appellate Tribunal, New Delhi, Order Dated 03.10.2024 Passed in Misc Appeal No. 98 Of 2023 titled "Kiaan Propmart Pvt. Ltd. Versus Alvita Realtors Pvt. Ltd. And Ors." by the Hon'ble Debts Recovery Appellate Tribunal, New Delhi, Indian Bank V. K. Pappireddiyar, (2018) 18 SCC 252, K. Sreedhar Versus Raus Constructions Pvt. Ltd. And Ors. 2023 SCC Online 13, Celir Lip Versus Bafna Motors (Mumbai) Pvt. Ltd. And Ors. 2023 SCC Online SC 1209, Arce Polymer Pvt Limited Versus Alphine Pharmaceuticals and Ors (2022) 2 SCC 221, Valji Khimji and Company V. Official Liquidator of Hindustan Nitro Product (Gujarat) Ltd., (2008) 9 SCC 299, Celir LIp Versus Sumati Prasad Bafna and Ors. 2024 SCC Online SC 3727, M. Rajendran and Ors. Versus KPK Oils and Protiens India Pvt. Ltd. 2025 SCC

¶450

nline SC 2036, M. Rajendran and Ors. Versus KPK Oils and Protiens India Pvt. Ltd. 2025 SCC Online Sc 2036, Order Dated 07.10.2023 Passed in S.A. No. 98 Of 2023 And S.A. No. 99 Of 023, Order Dated 07.10.2023 Passed in S.A. No. 527 Of 2023 nd 528 Of 2023, Order Dated 22.02.2024 Passed In S.A. No. 8 Of 2023 And S.A. No. 99 Of 2023, Sarguja Transport Service . S.T.A.T. (1987) 1 SCC 5, Order Dated 11.06.2024 Passed by he Ld. National Company Law Tribunal In C.P.(Ib) no. 190 Of 017, Lalit Kumar Jain Versus Union Of India And Ors. (2021) Sd

¶451

. 158

¶452

SA no.527/2023 & SA no.528/2023

¶453

9 Scc 321, Sanjay Sarin Versus Authorised Officer, Canara Bank and Ors. (2022) 29 Dlt 641, Esjaypee Impex Pvt. Ltd. Versus Assistant General Manager and Authorised Officer, Canara Bank (2021) 11 SCC 537, Anathula Sudhakar Versus P. Buchi Reddy (2008) 4 SCC 594.

¶454

In rejoinder, it has been argued on behalf of the applicants that the present securitization applications are filed on the basis of demand notice issued under Section 13 (2) of the SARFARESI Act dated 05.02.2014 which was issued in the year 2014, thereafter, today after almost 11 years' respondent bank is still taking actions and the respondent bank is required to issue a fresh notice under Section 13 (2) of the SARFAESI.

¶455

It has further been argued that the in the year 2014 the amount as per 13 (2) notice was only Rs.32.17 crores and on date the amount, which is recoverable by the respondent bank is almost Rs.137 crores. It has further been argued that no fresh calculated 13 (2) notice has ever been issued after the Oar of 2014. It has also been submitted that in the year 2014 pplicant has filed a securitization application vide SA no.149 oaf 2014, thereafter in year 2023 SA no.98 of 2023 and hereafter SA no. 99 of 2023 but all the aforesaid files have • nly filed against the notice issued under Section 13 (2) of the •ARFAESI Act dated 05.02.2014 and all the SAs were only ithdrawn by the applicant, however, no consideration of this 5d

¶456

159

¶457

SA no.527/2023 & SA no.528/2023

¶458

Tribunal has been ever given by this Tribunal. Ld. counsel for the applicant has also relied upon Section 36 of the SARFAESI Act which mandates that secured creditors must enforce their claims within the time limits prescribed by the Limitation Act, 1963, meaning actions under SARFAESI (like those under Section 13) must be initiated before the original debt or mortgage right prescribes (often 12 years for mortgages) for the remedy to be valid; it ensures banks can't use SARFAESI to revive time-barred debts but rather provides an accelerated path for timely claims, requiring compliance with standard limitation periods. It has also been argued that if the notice issued under Section 13 (2) of the SARAESI is not correct then he entire the action initiated by the respondent bank will be bad in law and the Section 13 (6) of the SARFAESI Act deals

¶459

ith the statutory transfer of rights in a secured asset after it as been possessed and sold by . a secured creditor and this •rovision operates within the framework of general limitation laws, and while the Limitation Act, 1963 does apply to roceedings under the SARFAESI Act, Article 137 is not directly elevant to Section 13 (6) itself. It has further been argued that s Directorate of Town and Country Planning, Haryana dated 3.01.2016 applicant has made a request for grant of license, owever, the same has been rejected by the competent uthority, which was applied in the year of 2012 before availing 5d-

¶460

160

¶461

SA no.527/2023 & SA no.528/2023

¶462

the loan facility and it shows the bonafide intention of the applicant. It has further been argued that as per reply filed by the respondent bank at page no.63 the valuation reports issued by Mr. Abhishek Kumar Sharma, clearly shows that the said property was undemarcated and from the evidences filed by the applicant it clearly shows that property in question is only agricultural land and till date there is no demarcation of the property in question, so the notices issued by the respondent bank are bad in law. It has also been argued that from the evidence filed by the applicant it cannot be determine that whether the property falls under Delhi or Punjab or Haryana and as per proof of affixation of sale notice it cannot be concluded that on which wall the affixation notice has pasted. It has further been argued that respondent bank served the 13(2) notice in the year 2014 but till date respondent bank has pot approached any competent authority for identification of he property in question and the respondent bank is only taking ction against the property in question without doing its complete homework. It has also been argued that the evelopment Agreement dated 08.02.2023 and General Power f Attorney dated 08.02.2023 has been revoked by the parties vide Deed of Revocation of General Power of Attorney dated 9.11.2023 and Deed of Cancellation of Development

¶463

5d-

¶464

161

¶465

SA no.527/2023 & SA no.528/2023

¶466

Agreement dated 29.11.2023 and hit by principles of resjudicata.

¶467

Apparently, the demand notice dated 05.02.2014 was issued under Section 13 (2) of the SARFAESI Act was issued by the respondent bank and as per the proof of service filed by the respondent bank the aforesaid demand notice was duly served upon all the borrowers/guarantors/mortgagors as per the Security Interest (Enforcement) Rules, 2002. The applicants have also raised the objection that Ld. NCLT in CP (IB) No.190 of 2017, vide order dated 11.06.2024 has approved the Resolution Plan of M/s Era Infra Engineering Limited, Respondent No.3 and the Respondent Bank also filed its claim with the Resolution Professional of the Borrower and the entire admitted financial debt of the Borrower stands restructured and since the entire debt of the Borrower towards the Respondent Bank herein has been dealt with entirety in the Resolution Plan, as on the present date, there is no liability of the Applicant towards the Respondent Bank. However, it has been argued on behalf of the respondent bank that the property was earlier put to sale on four occasions since the year 2014, which did not fetch any bid and so far as the orrower i.e. M/s Era Infra Engineering Ltd. and Mr. Hem Singh harana are concerned, they are before NCLT under CIRP and no action is taken against them and the said CIRP proceedings

¶468

162

¶469

SA no.527/2023 & SA no.528/2023

¶470

do not restrict the answering Respondent bank from initiating action under SARFAESI Act against the Applicants as mortgagors and the Respondent bank has to recover an amount of Rs.137.76 crores as on 31.08.2023 and as per the respondent bank, the claim admitted under CIRP as against the dues of the Borrower Company were only Rs.62.58 crores, out of the admitted claim of Rs.119.14 claims, which is still not received the approval of adjudicating authority and no amount paid to the Respondent bank. It has further been argued that the Respondent bank in any case has to recover the amounts much more than the admitted claims and the Respondent is entitled to take measures against the Applicant as the provisions of section 14 (1) of the Code, do not apply to a Surety in a contract of guarantee to a Corporate Debtor as provided under sub-section 3(b). Apparently, the liability of a guarantor is co-extensive with that of the principal debtor, as zlefined under Section 128 of the Indian Contract Act, 1872, Which means the respondent bank can pursue the guarantor or the full amount of the debt, and is not required to exhaust r all remedies against the principal borrower first. Further, the moratorium under Section 14 of the IBC prohibits actions against the corporate debtor and its assets once the Corporate insolvency Resolution Process (CIRP) starts, but the same oes not apply to the personal/corporate guarantor and the T

¶471

163

¶472

SA no.527/2023 & SA no.528/2023

¶473

respondent bank has the right to initiate separate, simultaneous actions against the principal borrower (under IBC in NCLT) and the corporate guarantor (under SARFAESI Act, or a separate IBC proceeding). Even otherwise, if a resolution plan is approved by the NCLT for the principal borrower under Section 31 of the IBC, it does not automatically discharge the guarantor's liability and the guarantor remains bound by their independent contract of guarantee. Thus, the NCLT proceedings against the borrower do not place any legal fetters on the bank from initiating or continuing proceedings against the guarantor under the SARFAESI Act to recover its ues. Accordingly, the said objection of the applicant stands ismissed.

¶474

The securitization applicants have raised the objection hat the demand notice was issued under Section 13 (2) of the ARFAESI Act on 05.02.2014 which was issued in the year R014, thereafter, today after almost 11 years' respondent bank is still taking actions and the respondent bank is required to issue a fresh notice under Section 13 (2) of the SARFAESI as per the Section 36 of the SARFAESI Act, 2002 entire actions of he respondent bank are barred by limitation. Before deciding he said issue, we may go through the Section 36 of the ARFAESI Act, 2002, which is reproduced herein below:

¶475

164

¶476

SA no.527/2023 & SA no.528/2023

¶477

No secured creditor shall be entitled to take all or any of the measures under sub-section (4) of section 13, unless his claim in respect of the financial asset is made within the period of limitation prescribed under the Limitation Act, 1963 (36 of 1963).

¶478

Apparently, after availing the loan facilities the borrower did not maintain the financial discipline and accordingly, the account was declared as NPA on 31.12.2012 and thereafter the respondent bank has taken the measures under the SARFAESI Act, 2002 by issuing the demand notice dated 05.02.2014 under section 13 (2) and the symbolic possession notice dated 09.05.2014 under section 13 (4) and thereafter the first auction sale notice was issued on 18.07.2014 and the subsequent auction notices in the year 2023. That as per the section 36 of the SARFAESI Act, 2002 the secured shall take all or any of the measures under sub-section (4) of Section 13 within the period f limitation and in the present matters, after declaring the account as NPA on 31.12.2012 the respondent bank has issued the demand notice on 05.02.2014 and the symbolic possession notice on 09.05.2014 under section 13 (4) meaning thereby he action of the respondent bank is well within limitation as per section 36 of the Act, 2002 and even otherwise the cause of action is still continue by issuing the first auction sale notice on 18.07.2014 and subsequent auction notices in the year 023. Thus, the said plea of the applicants is not maintainable nd accordingly, the same stands rejected. S,_

¶479

165

¶480

SA no.527/2023 & SA no.528/2023

¶481

That the present securitization applicants wanted to get release the mortgaged properties for which they have given a settlement proposal dated 16.09.2023, but as per the applicants the said settlement proposal was rejected by the respondent bank vide letter dated 22.09.2023 and the respondent bank sought payment of an amount of Rs.44.80 crores by 27.09.2023 for release of the properties, but the copy the said letter dated 22.09.2023 was handed over to the applicant only on 30.09.2023. However, as per the submission of the respondent bank that since the applicants had failed to deposit the said amount by 27.09.2023, therefore, the said settlement proposal was rejected and further said letter dated 22.09.2023 was sent to the applicants by post as well as email

¶482

and even the same was also placed on record by the respondent bank alongwith other documents on 26.09.2023 with advance copy served upon the counsel for the applicants. Thus, the applicants have failed to avail the said opportunity by depositing the said amount on or before 27.09.2023, that too, when the applicants were aware about the said letter dated 22.09.2023. Further, the applicants were ready to deposit Rs.50.00 lakhs more amount in addition to Rs.44.80 crores, but before that the auction sale (auction sale notice dated 07.09.2023) process was already initiated by the respondent bank. Even otherwise, as per section 13 (8) of the sd-

¶483

166

¶484

SA no.527/2023 & SA no.528/2023

¶485

SARFAESI Act, 2002 the applicants have lost their right to redeem the properties in question after the publication of the sale notice dated 07.09.2023 as the applicants have given the said settlement proposal only on 16.09.2023 and further the aforesaid cheques were of 16.10.2023 and the same were never offered to the respondent except the copies of cheques placed on record. Further, the applicants are also relying upon the copy of deed of revocation of General Power of Attorney dated 08.02.2023 and copy of the Deed of Cancellation of Development Agreement dated 08.02.2023, but these documents were executed qua the properties in question Without the prior permission of the secured creditor i.e.. the respondent bank herein. However, when the applicants have failed to pay the dues of the respondent bank, the respondent bank has proceeded further under the SARFAESI Act, 2002 by issuing the demand notice dated 05.02.2014 and the sale iotice dated 07.09.2023, but the applicants have now got cancelled the said development agreement by executing deed 6f revocation of General Power of Attorney dated 08.02.2023

¶486

the Deed of Cancellation of Development Agreement dated 08.02.2023 just to create hurdle in the recovery of the public money, that too, when the respondent bank has already nitiated the recovery proceedings by issuing the sale notices and such conduct of the applicants are highly deprecated by sa

¶487

167

¶488

SA no.527/2023 & SA no.528/2023

¶489

this Tribunal. Even otherwise, after availing more than nine years from the date of issuance of the demand notice dated 05.02.2014 under section 13 (2) the applicants have not paid the dues of the respondent bank, which is public money. Further, the applicants have also relied upon the order dated 12.09.2023 passed by the Hon'ble High Court of. Delhi in O.M.P (I) (COMM.) 293/2023 regarding the aforesaid development agreement. However, on perusal of the aforesaid order it appears that the said interim order dated 12.09.2023 was not passed against the respondent bank. Even otherwise, the aforesaid petition being O.M.P (I) (COMM.) 293/2023 was dismissed as withdrawn by the Honble High Court of Delhi vide order dated 22.02.2024.

¶490

Further, the applicants have raised the objections that the respondent bank has failed to give the details of bifurcation of the demanded amount in the aforesaid demand notice dated 05.02.2014 and in this regard, the applicants have relied upon the judgements of Rajesh Gems and Jewels Private Limited vs Indian Overseas Bank, 2017 SCC online Del 1067 and Punjab National Bank vs Mithilanchal Industries Private Limited, 2020 SCConline Guj 3441. On perusal of the records, it appears that the aforesaid demand notice dated 05.02.2014 was issued by the respondent bank under section 13 (2) of the SARFAESI Act, p002 thereby demanded an amount of Rs.32,17,65,461.23 cd

¶491

168

¶492

SA no.527/2023 & SA no.528/2023

¶493

alongwith future interest, however, there, is no illegality or irregularity in the said demanded amount and even the applicants have also failed to point out any single entry to prove that the respondent bank has charged the exorbitant rate of interest etc. However, the applicants have relied upon the aforesaid judgments Rajesh Gems and Jewels Private Limited vs Indian Overseas Bank, 2017 SCC online Del 1067 and Punjab National Bank vs Mithilanchal Industries Private Limited, 2020 SCConline Guj 3441, but it is a matter of fact that the aforesaid judgements were passed in the year 2017 and 2020, whereas the aforesaid demand notice was issued in the year 2014, therefore, the said judgments are not helpful to the present applicants and thus, the said arguments are not sustainable.

¶494

Further, the respondent bank has issued the symbolic possession notice dated 09.05.2014 under section 13 (4) of the SARFAESI Act, 2002 and as per the respondent bank the said symbolic possession notice was served upon all the borrowers/guarantors/mortgagors as per the Rules 8 (1) and 8 (2) of the Security Interest (Enforcement) Rules, 2002, which re reproduced herein below:

¶495

Rule 8 (1) of the Security Interest (Enforcement) Rules, 2002:

¶496

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.

¶497

169

¶498

SA no.527/2023 & SA no.528/2023

¶499

Rule 8 (2) of the Security Interest (Enforcement) Rules, 2002:

¶500

The possession notice as referred to in sub-rule (1) shall also be published in two leading newspapers, one in vernacular language having sufficient circulation in that locality, by the _ authorized officer.

¶501

On perusal of the records, it appears that the aforesaid symbolic possession notice dated 09.05.2014 under section 13 (4) of the SARFAESI Act, 2002 was served by post/delivery, ffixation (as per the photographs annexed) and through publications in two newspapers i.e. Statesman (English) and eer Arjun (Hindi) and thus the said symbolic possession notice ated 09.05.2014 has been served as per the Security Interest Enforcement) Rules, 2002 and these newspapers are having ide circulations in the said area.

¶502

Further, the securitization applicants have raised the bjections that the respondent bank has failed to serve the 30

¶503

ays' sale notice dated 07.09.2023 upon all the orrowers/guarantors/mortgages as per the Security Interest Enforcement) Rules, 2002. However, it has been argued on ehalf of the respondent bank that the respondent bank has ssued the sale notice dated 07.09.2023 as per the Rule 9 (1)

¶504

f the Security Interest (Enforcement) Rules, which is re-

¶505

roduced as under:

¶506

170

¶507

SA no.527/2023 & SA no.528/2023

¶508

Rule 9 (1)

¶509

No sale of immovable property under these rules, in first instance shall take place before the expiry of thirty days from the date on which the public notice of sale is published in newspapers as referred to in the proviso to sub-rule (6) of rule 8 or notice of sale has been served to the borrower:

¶510

Provided further that if sale of immovable property by any . one of the methods specified by sub rule (5) of rule 8 fails and sale is required to be conducted again, the authorized officer shall serve, affix and publish notice of sale of not less than fifteen days to the borrower, for any subsequent sale.

¶511

On perusal of the records, it appears that the respondent bank has issued the sale notice dated 07.09.2023 thereby fixing the date of auction on 29.09.2023 and admittedly, the present auction was the subsequent auction because the earlier three auctions have already been failed and thereafter the auction sale notice dated 07.09.2023 was issued thereby fixing the auction on 29.09.2023 meaning thereby the respondent bank has given the clear cut 15 days' sale notice as per the Rule 9 (1) of the Security Interest (Enforcement) Rules, 2002. Further, on perusal of the records, it appears that the respondent bank has served the aforesaid sale notice dated 07.09.2023 upon all the borrowers/ guarantors/mortgagors by post/delivery, affixation (as per the photographs annexed) and through publications in two newspapers i.e. Statesman (English) and Veer Arjun (Hindi) and thus the said sale notice dated 07.09.2023 has been served as per the Security Interest (Enforcement) Rules, 2002 and these newspapers are also having wide circulations in the said area.

¶512

¶513

171

¶514

SA no.527/2023 & SA no.528/2023

¶515

Further, it has been argued on behalf of the applicants that the respondent bank has failed to serve the aforesaid symbolic possession notice dated 09.05.2014 and sale notice dated 07.09.2023 through affixation as per the Rule 8 (1) of the Security Interest (Enforcement) Rules, 2002. However, it has been argued on behalf of the respondent bank that the aforesaid symbolic possession notice and sale notice have been served through affixation and since there is no boundary wall •f the property in question, therefore, the said notices were • isplayed on the site and photographed was taken by the uthorized officer of the respondent bank. Apparently, the property in question is a piece of land/vacant land which, otably, is devoid of any permanent physical boundary .tructures, such as walls, fences, or existing buildings and since he literal compliance was physically impossible in this instance, herefore, in order to ensure the due compliance with statutory equirements for the service and public display of the notices nder the provisions related to Security Interest (Enforcement) ules, 2002, the aforesaid notices were prominently displayed

¶516

• n the site and to verify its presence at the correct location the

¶517

• hotographs were taken by the authorized officer of the espondent bank and thus the said method should be deemed .ufficient service through affixation as per the Rule 8 (1) of the ecurity Interest (Enforcement) Rules, 2002. That such action

¶518

S i r

¶519

172

¶520

SA no.527/2023 & SA no.528/2023

¶521

of the respondent bank legally constitutes a valid affixation of the notices to the property, ensuring the said notices are brought to the attention of the public and the relevant parties, thereby fulfilling the requirement for service by pasting/affixing (affixation) on the secured asset, notwithstanding the absence of pre-existing permanent structures. Thus, this Tribunal is of the affirmed view that since properties in question are vacant land, which often lacks walls or doors, the aforesaid method of affixing the notices to it is to be considered the legally valid method to prove that the respondent bank has taken the required measure of serving the public notice on the property itself and such act of fixing the notice on the said land is done o ensure strict compliance with the legal requirement of .ffixation on a conspicuous part of the property, accordingly, it is proved that the respondent bank has served the aforesaid .ymbolic possession notice dated 09.05.2014 and sale notice sated 07.09.2023 through affixation as per the Rule 8 (1) of he Security Interest (Enforcement) Rules, 2002.

¶522

•7. Further, the aforesaid sale notice dated 07.09.2023 was

¶523

uly served upon the borrower/guarantor/ mortgagor by post, ffixation and publication in two newspapers, one in vernacular anguage i.e. Financial Express (English edition) and Jansatta Hindi edition) and since this is not the first auction, therefore, 5 days' sale notice was served upon the borrower/ mortgagor/ 54-

¶524

173

¶525

SA no.527/2023 & SA no.528/2023

¶526

guarantor. Though, the applicants have raised the objection that these newspapers are not having wide circulation in the area. However, after going through websites of these newspapers it appears that the newspaper Financial Express is one of the oldest newspapers of this country, which was originally started in the year 1961 and published simultaneously from different states including Delhi NCR etc. and it has wide circulation in the area of Delhi NCR, whereas

¶527

he newspaper Jansatta, which was originally started in the ear 1983 and published simultaneously from different states including Delhi NCR etc. and it has also wide circulation in the rea of Delhi NCR, meaning thereby it cannot be said that these newspapers are not having wide circulation in the said area. part that, the applicants were well aware about the actions/ easures taken by the respondent bank under the SARFAESI ct qua the properties in question and it cannot be said that he applicants were not aware about the actions/ measures of he respondent bank.

¶528

Further, the applicants have raised the objection that ince the property in question is an agricultural land, therefore, he respondent bank has illegally auctioned the property in uestion as per Section 31 (i) of the Security Interest Enforcement) Rules, 2002. On perusal of the records, it ppears that the borrower had availed the loan facilities from

¶529

174

¶530

SA no.527/2023 & SA no.528/2023

¶531

the respondent bank against the mortgage of the properties in question for the development of the group housing society and in this regard the borrower had applied for license, though, the said license was not granted by the Town & Country Department of Govt. of Haryana. Apparently, the applicants had acquired the large chunk of lands from the local farmers and at the time of acquiring the land the properties were in nature of agricultural and accordingly, the title documents were -xecuted showing the agricultural land and as per the revenue records the said land is agricultural, but that doesn't mean that erely the title documents were executed qua the agricultural and and as per revenue record, the lands are being used for ultivation purposes and in view of the Section 31 (i) of the •ARFAESI Act, 2002 the respondent bank cannot proceed nder the said Act. Even otherwise, the aforesaid loan facilities ere availed for the development of the group housing ocieties, which were to be built on the properties in question. urther, when the mortgage over the secured property was reated on 13.12.2012, the same already stood classified as esidential zone, which is apparent from the Notification dated 5.02.2007 of the Haryana Government, Town & Country Manning Department, even otherwise, the debtor had created security interest was indicative of the position that the parties id not treat the land as agricultural land. Further, the Hon'ble

¶532

175

¶533

SA no.527/2023 & SA no.528/2023

¶534

Supreme Court in various cases has specifically observed and held after considering the object and purpose of Section 31(i) of the SARFAESI Act that merely because in the revenue records the secured properties are shown as agricultural land is not sufficient to attract Section 31(i) of the SARFAESI Act.

¶535

Further, the key factor in determining the applicability of Section 31 (i) is not merely the classification of the land in the revenue records but its actual use at the time of the security interest (mortgage) was created, and the intention of the arties. The Hon'ble Supreme Court of India and various on'ble High Courts have held that the exemption under ection 31 (i) is not automatic, even, if the land is recorded as gricultural in government records and the focus on the hysical and factual nature and use of the land and only when he secured property is actually put to use as agricultural land he exemption under Section 31 (i) be attracted. That mere ntention of the borrower to develop the land for building, oupled with the fact that the loan was availed for a nongricultural purpose (like building development, as opposed to crop loan or agricultural machinery loan), strongly proved hat the land was not being used for agricultural purposes at he time of creation of mortgage. Further, the loan was xplicitly sanctioned for development or building construction a non-agricultural purpose), and the land was mortgaged to

¶536

176

¶537

SA no.527/2023 & SA no.528/2023

¶538

secure this loan, which indicates that both the borrower and the respondent bank did not treat the property as agricultural land for the purpose of the transaction. The burden of proof to show that the land is "agricultural land" and is therefore exempt under Section 31 (i) rests heavily on the borrower/mortgagor who is claiming the exemption and the borrower/mortgagor must produce concrete evidence that agricultural activity was actually taking place on the land when the mortgage was created, not just that it could be used for agriculture or that the revenue records states it is agricultural land if the land was not being actually used for agricultural purposes but was intended for building development, it will likely not qualify for the Section 31 (i) exemption. Further, the

¶539

on-agricultural purpose of the loan (developing the land as a • uilding) supports the bank's case that the land was not treated s agricultural security. Thus, the argument that the land .hould be exempt under SARFAESI is weakened because the •orrower had availed the loan knowing and intending to use the land for non-agricultural activities and the applicants were equire to produce concrete evidence that agricultural activity was actually taking place on the land when the mortgage was reated, not just that it could be used for agriculture or that the revenue records state it is agricultural. Though, in the valuation report the property is described as agricultural land, sd-

¶540

177

¶541

SA no.527/2023 & SA no.528/2023

¶542

but that doesn't mean that the loan facilities were availed for agricultural activities, therefore, it cannot be said that the said land is exempted under section 31 (i) of the SARFAESI Act, 2002. Further, the Hon'ble Supreme Court in the case of K. Sreedharvs M/s Raus Construction Pvt.Ltd. — Civil Appeal

¶543

No.7402/2022 has held as under:

¶544

57. ...having regard to the character of the land the purpose for which it is set apart, we are of the view that the land in question is not an agricultural /and. The High Court misdirected itself in holding that the land was an agricultural land merely because it stood as such in the revenue entries, even though the application made for such conversation lies pending till date."

¶545

9. The classification of land in the revenue records as agricultural is not dispositive or conclusive of the question whether the SARFAESI Act does or does not apply. Whether a parcel of land is agricultural must be deduced as a matter of fact from the nature of the land, the use to which it was being put on the date of the creation of the security interest and the purpose for which it was set apart "7.1 The purpose of enacting Section 31(i) of the SARFAESI Act has been considered by this Court in the case of Blue Coast Hotels Ltd. (Supra) in paragraph 36, which reads as under:

¶546

"36. The purpose of enacting Section 31(i) and the meaning of the term "agricultural land" assume significance. This provision, like many others is intended to protect agricultural land held for agricultural purposes by agriculturists from the extraordinary provisions of this Act, which provides for enforcement of security interest without intervention of the Court. The plain intention of the provision is to exempt agricultural land froM the provisions of the Act. In other words, the creditor cannot enforce any security interest created in his favour without intervention of the court or tribunal, if such security interest is in respect of agricultural land. The exemption thus protects agriculturists from losing their source of livelihood and income i.e. the agricultural land, under the drastic provision of the Act. It is also intended to deter the creation of security interest over agricultural land as defined in Section 2(1)(z035. Thus, security interest cannot be created in respect of property specified in Section 31." 7.2 Thus, as per the law laid down by this Court in the aforesaid two decisions, only in a case where the secured property is actually put to use as agricultural land and solely on the basis of the revenue records / Pattadar and once the secured property is put as a security by way of mortgage etc. meaning thereby the same was not treated as agricultural land, such properties cannot be said to be exempted from the provisions of the SARFAESI Act under Section 31(i) of the SARFAESI Act. Applying the law laid down in the aforesaid two decisions to the facts of the case on hand and when no evidence was led at all on behalf of the borrowers that the secured properties in question were actually put to use as agricultural land and/or any agricultural activity was

¶547

¶548

178

¶549

SA no.527/2023 & SA no.528/2023

¶550

going on, the High Court has committed an error in applying Section 31(i) of the SARFAESI Act and quashing and setting aside the entire Possession Notice, Auction Notice as well as Sale etc. 7.3 The High Court has also materially erred in shifting the burden upon the secured creditor to prove that the properties were not non-agricultural lands or have been put to non-agricultural use. When it was the case on behalf of the borrowers that in view of Section 31(i) of the SARFAESI Act, the properties were agricultural lands, the same were being exempted from the provisions of the SARFAESI Act, the burden was upon the borrower to prove that the secured properties were agricultural lands and actually being used as agricultural lands and/or agricultural activities were going on. Therefore, the High Court has materially erred in shifting the burden upon the secured creditor to prove that the properties are non-agricultural lands or have been put to non-agricultural use.

¶551

8. In view of the above and for the reasons stated above, the impugned judgment and order paSsed by the High Court is unsustainable and the same deserves to be quashed and set aside. Accordingly, the impugned judgment and order dated 06.03.2020 passed by the High Court for the State of Telangana at Hyderabad in Writ Petition No.12081/2019 is hereby quashed and set aside and the judgment and order dated 16.052019 passed by the Debts Recovery Tribunal-I, Hyderabad dismissing SA No.171/2016 is hereby restored

¶552

Further, the applicants have also raised the issue about emarcation of the land. That in the absence of physical demarcation such as fences or boundary walls the vacant land

¶553

,re generally identified through the legal ocumentation, government land records, and professional urveying and every registered piece of land is assigned unique identifiers by state revenue departments to track ownership and boundaries without physical markers. That in many regions of this country, Khasra number/khata number are identify the pecific parcel of land and the owner's account (khata) in the revenue records and the Sale Deed/Title Deed also contains a "schedule of property" that describes the land's boundaries relative to neighbouring plots and upon the registration of the

¶554

5d-

¶555

179

¶556

SA no.527/2023 & SA no.528/2023

¶557

sale deed/sale certificate, the legal title and "symbolic possession" of the land transfer to the buyer and thereafter the purchaser must apply for mutation in the local revenue or municipal records to update the land records with their name. However, for vacant land, the legal principle "possession follows title" generally applies, meaning the title holder is presumed to be in possession and it is duty of the purchaser to perform visible acts to protect their rights and prevent adverse possession claims by others, but in the present matter there is no dispute from the other side/neighbours regarding demarcation of the land, even otherwise, the auction purchaser has not raised any such objection regarding demarcation of land. Accordingly, the objection of the applicants regarding demarcation of the land is not substantiable in the eyes of law and thus the said objection stands rejected.

¶558

That as per the above discussion and in view of the foresaid judgement of Hon'ble Supreme Court, this Tribunal is f the affirmed view that Section 31 (i) of the SARFAESI Act, 002 does not apply to the secured interest created in favor of he respondent bank qua the properties in question at the time f sanctioning the loan facilities to the borrower/guarantor/ mortgagor. Accordingly the said argument of the applicants is not sustainable in the eyes of law and the same stands ejected.

¶559

180

¶560

SA no.527/2023 & SA no.528/2023

¶561

Apparently, the aforesaid demand notices under Section 13 (2), symbolic possession notice under section 13 (4) of SARFAESI Act and sale notice have been duly issued and served upon the borrower/mortgagor/guarantor and after declaring the account as NPA on 31.12.2012 the borrower has not cleared the dues of the respondent bank. Further, the respondent bank has issued the demand notice dated 05.02.2014 under Section 13 (2) of the SARFAESI Act, 2002 thereby calling upon the borrower/mortgagor/guarantor to pay the dues of the respondent bank within 60 days, but despite receiving the said demand notice in the year 2014 these borrowers/mortgagors/guarantors have failed to pay the dues of the respondent bank before the date of issuance of sale notice dated 07.09.2023 (i.e. after availing more than nine years), therefore, the respondent bank has proceeded further under the SARFAESI Act, 2002 and the Security Interest (Enforcement) Rules, 2002 to recover its dues. Admittedly, the orrower/ mortgagor/ guarantor has not denied about the vailment of the loan facilities from the respondent bank against the mortgage of the properties in question. Apparently, there is no illegality or irregularity in the measures taken by the espondent bank under the SARFAESI Act, 2002 including the emand notice under section 13 (2) and symbolic possession notice under section 13 (4) and sale notice dated 07.09.2023. Sa

¶562

181

¶563

SA no.527/2023 & SA no.528/2023

¶564

Though, the securitization applicants have relied upon various judgments of Hon'ble Supreme Court, Hon'ble High Courts and Hon'ble DRATs, but the same are not helpful to them because of the reason that all the necessary compliances before taking the actual & physical possession of properties in question and auctioning properties in question were duly complied with and there was no ambiguity, illegality or irregularity therein.

¶565

In view of the above facts and circumstances and SARFAESI Act and Rules, this Tribunal is of the affirmed view that the respondent bank has followed the mandatory procedures as laid down under the SARFAESI Act and Rules, w^{hile initiating measures for recovery of its dues including the} auction sale qua the properties in question. Thus, no case is made out in favour of the applicants and balance of convenience also does not lie in favour of the applicants for allowing the present securitization application. Rather, the respondent bank of course would suffer irreparable loss in case the present securitization applications are allowed in favour of the S. applicants as the respondent bank has to recover public oney of huge amount in crores in the present accounts as per h ale notice dated 07.09.2023 issued by the respondent bank. Accordingly, the present SARFAESI Applications are liable to be

¶lismissed.

sa -

• 182

SA no.527/2023 & SA no.528/2023

¶570

(ORDER)

¶571

The SARFAESI Applications filed by the applicants stands dismissed along with pending applications, if any. The respondent bank may proceed further under the SARFAESI Act, 2002 as per law. The present order be uploaded immediately on the website of this Tribunal.

¶572

•

¶573

Final Order signed, sealed, dated and pronounced in the open court on this 9th January, 2026.

¶574

Dictated & Corrected by me.

¶575

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

¶576

•

Ms Nuray Realtech Private Limited v. Punjab and Sind Bank

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Ms Nuray Realtech Private Limited v. Punjab and Sind Bank

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