LAWS(UTN)-2015-7-16

SHARIQ Vs. PUNJAB NATIONAL BANK AND ORS.

Decided On July 21, 2015
Shariq Appellant
V/S
Punjab National Bank and Ors. Respondents

JUDGEMENT

(1.) Undisputed facts of the present case, inter alia, are that respondent no. 3 has borrowed money from the Punjab National Bank, Patel Nagar, Dehradun, while respondent nos. 4, 5 and 6 stood guarantors of the loan amount; respondent nos. 3, 4, 5 and 6 were declared NPA and ultimately notice under Section 13 (2) of the Securitization and Re-construction of Financial Assets and Enforcement of Security Interest Act, 2002 was issued and thereafter, assets of the borrower was taken into possession under sub-section (4) of Section 13 of the Act; auction notice was issued by the Bank on 18.06.2013 inviting the bids on or before 22.07.2013 to sell the mortgaged property of the borrower fixing reserve price as Rs. 1,19,00,000/-; petitioner has furnished his bid of Rs. 2,01,00,000/- on 22.07.2013 along with Earnest Money Deposit (EMD) of Rs. 11,90,000/-; as per the condition of the bid/auction, successful bidder has to deposit 25% of the bid amount on acceptance of the bid; on 25.07.2013, borrower i.e. respondent no. 3 has preferred an appeal before the D.R.T Lucknow challenging the auction notice dated 18.06.2013; D.R.T. vide order dated 26.07.2013, after hearing the counsel for the borrower as well as the Bank, was pleased to direct that since auction has to be held today on 26.07.2013, therefore, Bank may go on with the auction, however, confirmation of sale shall be kept in abeyance till further orders; auction was held on 26.07.2013 itself, however, neither petitioner nor other bidders were made aware of the interim order passed by the D.R.T. on 26.07.2013 itself; petitioner went to the Bank on 27.07.2013 to deposit Rs. 38,35,000/- i.e. balance of 25% of the bid amount; without informing the petitioner that confirmation of the sale was directed to be kept in abeyance by the D.R.T. vide order dated 26.07.2013, Bank has accepted Rs. 38, 35,000/- from the petitioner on 27.07.2013; vide order dated 14.10.2013, interim order granted by the D.R.T. on 26.07.2013 was vacated; vide letter dated 18.10.2013, Bank has informed the petitioner that since interim order had already been vacated vide order dated 14.10.2013, therefore, petitioner being the highest bidder should deposit balance 75 % of the bid amount within 15 days; vide letter dated 25.10.2013, petitioner has made request to the Bank that since litigation is pending before the D.R.T., assailing the auction notice, in question, therefore, he may be permitted to deposit the balance 75 % of the bid amount after the disposal of the case pending before the D.R.T.; Bank did not reply to the letter dated 25.10.2013, whereby the petitioner has made request to permit him to deposit balance 75 % of the bid amount after disposal of the case pending before the D.R.T.; again vide letter dated 28.10.2013, Bank directed the petitioner to deposit balance 75% of the bid amount at the earliest, failing which, earnest money deposited by the petitioner shall be liable to be forfeited; petitioner through his counsel Shri Manoj Kumar Tripathi, sent legal notice to the Bank on 01.11.2013, informing the Bank that since litigation is pending before the D.R.T., assailing the auction notice, in question, therefore, he is not interested in purchasing the property, in question, therefore, total amount deposited by him Rs. 50,40,000/- may be refunded to the petitioner with interest; Bank did not reply to the legal notice dated 01.11.2013 as to why, petitioner is not entitled for the refund of Rs. 50,40,000/- in view of the pendency of the litigation; rather instead issued another letter dated 06.11.2013 asking the petitioner to deposit balance 75% of the bid amount within three days; petitioner once again by letter dated 12.11.2013 requested the Bank that the amount deposited by him i.e. 50,40,000/- may be refunded to him in view of the pendency of the litigation before D.R.T., since petitioner did not want to keep himself waiting for the outcome of the litigation; however, no reply to the letter dated 12.11.2013 was sent by the Bank as to why he is not entitled for refund of the amount; rather instead Bank has issued another letter dated 21.11.2013 to the petitioner asking him to deposit the balance 75% of the bid amount on or before 26.11.2013; since, case before the D.R.T. was listed for 28.11.2013, therefore, petitioner again requested the Bank vide letter dated 25.11.2013 to grant him time to deposit balance 75% of the bid amount after disposal of the case, pending before the D.R.T., which was listed for 28.11.2013; Bank did not reply to the letter dated 25.11.2013 too; however, Bank was pleased to issue re-auction notice dated 05.03.2014 inviting fresh bids.

(2.) Feeling aggrieved, petitioner has approached this Court under Article 226 of the Constitution of India, assailing the re-auction notice dated 05.03.2014 and further seeking writ of mandamus commanding the Bank to execute deed of conveyance pursuant to the auction sale dated 26.07.2013 in favour of the petitioner or alternatively to refund the money deposited by the petitioner.

(3.) On 01.04.2014, this Court was pleased to direct the Bank to file affidavit specifically stating therein that as to why decision is not taken on the request of the petitioner for extension of time to deposit balance 75 % of the bid amount after the decision in the pending case before the Tribunal. This Court was further pleased to direct that re-auction pursuant of Annexure No. 13 shall be subject to final decision in the writ petition.