AATAM GEMS Vs. ORIENTAL BANK COMMERCE

JUDGEMENT

(1.) In Original Application No. 252 of 2004, the Debt Recovery Tribunal II, Mumbai, passed an order on 28th June, 2005 granting a decree in favour of Oriental Bank of Commerce declaring mortgage over Flat No. 41, 4th Floor, Vijaydeep, Ridge Road, Malabar Hill, Walkeshwar, Mumbai 400 006, in furtherance to which, a recovery certificate was issued by the Presiding Officer for a sum of Rs. 6,39,33,830.56 with interest and costs in favour of the said bank. It further directed that the amount be recovered in mode and manner prescribed under sections 25 and 28 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (hereinafter referred to as "the Act") form the Certificate Debtors. The said mortgaged property came to be attached and affidavit of attachment was filed vide Exhibit 6 on 15th March, 2007. The reserve price of the property was fixed at Rs. 7 crores and EMD was ordered to be kept at Rs. 70 lakhs in furtherance to the valuation report submitted to that forum on 7th June, 2007. The sale of the property attached was scheduled for 25th September, 2007. On or about 24th September, 2007, the applicants-defendants in the main petition, filed an application praying for deferment/postponement of the scheduled sale on the following grounds :-

(2.) Both these grounds were dealt with by the Recovery Officer vide his order dated 27th September, 2007 where he held that the applicants had approached the forum late as the Warrant of Attachment was served on 15th March, 2007 and no reason whatsoever had been stated for approaching that forum at that belated stage. According to the Recovery Officer, the demise of defendant No. 3 and not bringing his legal representatives on record would not invalidate the proceedings in its entirety as the Bank could choose to proceed against other defendants and it had a right to proceed against defendant Nos. 2 and 5 to whom the property belonged and sell the property in terms of the order of recovery certificate. The Proclamation of Sale issued was also found to be not defective inasmuch as the mistake of EMD amount was due to publication only and was corrected immediately thereafter by publishing a corrigendum on 28th August, 2007. This was also clarified at the time of the auction and it recorded a finding of fact that subsequent publication did not cause any prejudice to any person including the defendants. Consequently, it rejected the objections taken and dismissed the said application.

(3.) Aggrieved by the order dated 27th September, 2007, the defendants in the application filed an Appeal, being Appeal No. 71 of 2007, under section 30 before the Debt Recovery Tribunal II, Mumbai. By a detailed order dated 11th March, 2008, the Tribunal also dismissed the appeal. Still another appeal, being Appeal No. 46 of 2008, was preferred by M/s. Aatam Gems and others against the order dated 11th March, 2008.