R.A(S.A):68/2009
1. This appeal impugns the order dated 18.03.2009 passed by the Learned Presiding Officer, DRT Bangalore in ASA No.359/2008.
2. The case of the appellant may be stated as follows:
It is stated that the 13th respondent stood as a guarantor to the credit limits sanctioned to the borrower viz., the 14threspondent owned by the 15th respondent as its Proprietor. It is stated that the 13th respondent as a guarantor mortgaged his immovable property viz., No.32/9, Cholourpalya, Magadi Road , Bangalore
It is stated that while accepting the said property as a security the appellant as per the legal opinion of the panel advocate obtained a declaration from Respondent Nos.2, 3 and 4 (the sons of R13) declaring that the property belonged to R13 and that he is empowered to create a mortgage over the same and the present mortgage had been created with their consent and knowledge.
It is also stated that R13 also gave a declaration that he is the sole owner of the mortgaged property and no one has any right over the property. It is stated that as the borrower committed default the account was classified as a ‘NPA’ in 2005 and the appellant bank invoked the provisions of the SARFAESI Act and issued the demand notice dated 19.8.2005 under Section 13(2) of the Act.
It is stated that the said demand notices were also issued to Respondent Nos. 13, 14, 15 and 16. It is stated that as the borrowers failed to repay the dues the appellant bank issued the possession notice to R13 on 17.5.2006 by serving a copy on him.
It is stated that the appellant also issued sale notice dated 15.6.2006 fixing the date of sale on 31.7.2006. It is stated that after the sale notice was issued the borrowers remitted a sum of Rs.15 lakhs and on 29.7.2006 requested the bank for a time of 45 days to clear the dues and therefore the appellant bank postponed the auction fixed on 31.7.2006.
It is stated that even after the expiry of 45 days the borrowers failed to clear the dues as promised and therefore the appellant bank issued the second notice of sale on 2.12.2006 fixing the auction on 9.1.2007. It is stated that the 14thRespondent filed ASA No.6/2007 on the file of DRT,Bangalore
It is stated that as the borrowers failed to repay the dues as ordered by the Tribunal below the appellant was constrained to issue the sale notice dated 14.2.2008 for the fourth time fixing the reserve price at Rs.36,62,300/- on the basis of the valuation report dated 14.6.2006 obtained from an approved valuer. It is stated that the said sale notice was sent to the borrower and as he was not available the notice was affixed on the secured asset and was also published in “Indian Express” and “Kannada Prabha” both dated 15.2.2008.
It is stated that the appellant conducted the auction on 17.3.2008 and there were two bidders and as against the upset of price of Rs.36,62,300/- the highest bidder V. Radha Rajashekar and Roopa Gopal Rao represented by their Authorized agent S. Gopal Rao made the highest bid of Rs. 64 lakhs. It is stated that the said bid was accepted by the Authorized officer and on receipt of entire sale consideration the sale certificate was issued on 31.3.2008 and the said sale certificate was also registered before the Sub Registrar’s Officer, Vijaya Nagar,Bangalore
It is stated that the Respondent Nos.1 to 12 being the LRs of R13 filed IR No.401/2008 against the sale on the file of DRT Bangalore and obtained interim orders on 16.4.2008 stating that they are the legal heirs of R13 and the property mortgaged is a HUF property and that R13 has no right to mortgage the said property. It is stated that the appellant filed a detailed counter stating that Respondent Nos.1 to 12 are not “aggrieved persons’ and therefore the appeal is not maintainable.
It is stated that the Tribunal below without deciding the objections on the question of the maintainability allowed the ASA by order dated 18.3.2009 holding that the appellant bank has not produced the publication of the sale notice and the valuation report and that the appellant has also not explained the circumstances under which a declaration has been obtained from the legal heirs of R13 and further that some mischief had been played by the bank in conducting the sale without proper publications and without the valuation of the property.
It is stated that the Tribunal below also gave liberty to R1 to R12 to deposit the entire loan amount within 45 days of the order. It is stated that aggrieved by the order of the Ld. Presiding Officer, DRT Bangalore dated 18.3.2009 the appellant bank has filed the present appeal. It is prayed that the appeal be allowed.
3. The appellant filed synopsis and the same forms part of record.
4. Respondent Nos.2 to 12 and 13 filed their written submissions and the same forms part of record.
5. Heard the Ld. Counsel.
6. A perusal of the paragraph 4 of the order of the Ld. Presiding Officer reveals that the Ld. Presiding Officer had disposed of the Securitization Application in ASA No.359/2008 based on the following conclusions: -
“1. The counter filed by the bank states that there was only one bidder who participate in the auction and whereas the sale certificate reveals that there were two persons who purchased the properties.
2. The sale was conducted without a proper publication.
3. The sale was conducted without taking valuation certificate before fixing of the price of the property.”
7. A perusal of the letter dated 17.3.2008 written by one Smt. Roopa Gopal Rao addressed to the Chief Manager, Allahabad Bank reveals that she wished to participate in the auction and that she is authorizing Shri S. Gopal Rao, her husband to participate in the auction and that in the event she is declared as the successful bidder the sale certificate may be issued in favour of herself and one Smt. V. Radha Rajasekhar.
This clearly reveals that the auction purchaser wanted the sale certificate to be issued in her name alongwith the name of another person and therefore the finding of the Ld. Presiding Officer that issuance of sale certificate in the name of two persons is improper and does not hold water.
8. A perusal of the records also reveals that the bank has taken steps to properly publish the sale as required under law and has in fact published the sale notice in “The Indian Express“ and “Kannada Prabha“ both dated 15.2.2008. It is also seen that the bank has also engaged the services of M/s Techno Trade Consultants to value the property. Therefore from the above it can be seen that the sale notice has been properly published and the property has been properly valued.
9. From the above it can been seen that the Ld. Presiding Officer has erroneously arrived at the decision that there was a contravention of the provisions of the SARFAESI Act and therefore this Tribunal is driven to conclude that the order of the Ld. Presiding Officer is liable to be set aside.
10. Accordingly the appeal is allowed and the order of the Ld. Presiding Officer, DRT Bangalore
Order delivered on 12th Sep 2011 by DRAT ,Chennai
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