Sri. V. Ravi Kumar v. Union Bank Of India

\ t 334Q I HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction) MONDAY ,THE TWENTIETH DAY OF MARCH TWO THOUSAND AND TWENTY THREE PRESENT THE HONOURABLE SRI JUSTICE P NAVEEN RAO AND THE HONOURABLE SRI JUSTICE NAGESH BHEEMAPAKA WRIT N NO:7533 oF 2423 Between Sri. V. Ravi Kumar, S/o. Anantha Krishna, aged about 48 years, Fl/o. Flat No. 601, 601A, Pavani Estates, Hyderabad.

...PETITIONER AND Union Bank of lndia, 3rd Flobr, Andhra Bank Building, Sultan Bazaar, Koti, Hyderabad- 500095.

...RESPONDENT Petition under Article 226 of the Constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased to issue a writ, direction or order(s) more particularly in the nature of Writ of Mhndamus. 1) Setting aside the Sale Notice dated 24t02t2023, and the proceedings conducted in the e-auction held on 14tlgt2}23, and all further proceedings pursuant to the said Notice and the E-auctio,n. 2) Direct the Respondent not to conduct any further proceedings with respect to the Scheduled property under SARFAEST Act, till the final disposal of SA No. 58 of 2023 pending before the Honourable DRT.

il2il lA NO: 1 OF 2023 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to direct the Respondents not to take any further action under SARFAESI Act, with respect to the Schedule property.

lA NO: 2 OF 2023 Petition under section 151 cPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High court may be pleased to direct the Respondent not to confirm the sale, issue Sale Certificate or registration of the same, pursuant to the proceedings conducted in the e-auction held on 14103t2023 with respect to the Schedule property.

counsel for the petitioner : sRl. s. RAV| sENloR couNSEL REp R.S. ASSOCIATES Counsel for the Respondents: Ms V. DYUMANI The Court made the following: ORDER l I I i , i I

PNR,J & NBK,J llt.P.No.7533 oJ 2023 HONOURABLE SRI JUSTICE P.NAVEEN RAO & HON'BLE SRI JUSTICE NAGESH BHEEMAPAI(A UIRIT PETITION 7533 0F 20/23 ORDER: (per Hon'ble Sri Justire P.Naueen Rao) Petitioner is the guarantor. Aggrieved by various measures initiated by the respondent-Bank under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act,2OO2 (for short, Act, 2OO2), petitioner filed S.A.No.58 of 2023 before the Debts Recovery Tribunal-I, Hyderabad, praying to set aside the e-auction sale notice dated 05.12.2022 and, e-auction sale notice dated 04.O2.2O23 proposing to conduct auction on 23.02.2023; set aside the Advocate-Commissioner notice dated 04.O2.2O23 pursuant to the warrant in Cr1.M.P.No.86 of 2023 on the file of Hon'ble Chief Metropolitan Magistrate, Nampally at Hyderabad; set aside any other/all further proceedings under the Act, 2OO2 against the application schedule property.

2.

Petitioner filed I.A.No.303 of 2023 in A.S.No.S8 of 2023 praying to grant stay of all further proceedings inctuding taking physical possession of the schedule property pursuant to the auction sale notice dated 05.12.2022, fixing the date of auction on 23.02.2023.

i l I PNR,J & NBK.J W.P.No 7533 of 2023 I J !

i 3.

On consideration of the rival submissions, Debts Recovery I I Tribunal-l passed orders on 17.O2.2O23 granting conditional stay of confirmation of sale subject to petitioner depositing { 2.OO crores in two instalments; first instalment of t 1.O0 crore should be deposited by 10.03.2023 and balance < 1.00 crore has to be deposited within three weeks thereafter to the credit of the loan account with the respondent-Bank.

4.

While so, the respondent-bank issued e-auction sale notice dated 2:4.02.2023 proposing to conduct auction on 14.03.2023. They are concerned with the property no.4 in the list of properties proposed for auction on 14.03.2023. Having come to know that auction was conducted on 14.03.2023 selling the property no.4, this writ petition is filed.

5.

We have heard the learned senior counsel Sri S.Ravi for the petitioner and the learned standing counsel Ms. V.Dyumani for the respondent-Bank.

6.

According to the learned senior counsel, the subsequent e-auction notice dated 24.02.2023 and conducting of auction on 14.03.2023 is ex facie illegal in the teeth of the interim order passed by the Debts Recovery Tribunal on 17.O2.2O23.

PNR.J & NBK,J llr.P.No.7533 ot2023 7.

During the subsistence of the said interim order, the respondent-Bank could not have conducted further auction without leave of the Tribunal. He would submit that as per the directions of the Debts Recovery Tribunal, the amount was deposited on 1o.o3.2o23, it was reaLized and credited to the account by 14.o3.2023.

8.

Learned standing counsel trying to justi$z the action of the respondent-Bank in conduction auction on r4.o3.2o2s on the ground that interim order passed by the Tribunal was confined to the proposed e-auction on 23.02.2023 in pursuant to the sale notice dated 05.12.2022. whereas on the said date, auction could not be conducted and, therefore, fresh auction notice was issued and fresh auction notice is valid since the earlier e-auction procedure was not successful. This is an independent cause of action and, therefore, the order passed by the Debts Recovery Tribunal does not come in the way of respondent-Bank in proceeding to conduct auction. Learned standing counsel sought to contend that as directed by the Tribunal, the amount has to be deposited on or before lo.og.2o2z, whereas two cheques were presented on 10.o3.

2029 after closure of Bank hours and the amount was realized on r4.og.2o2s and, therefore, it would amount to violation of the directions of the Court and, therefore, there was no embargo.

1., .;j .,.r l.

PNR,J & NBK,J W.P.No.7533 of 2023 the Tribunal was conditional and the amount was not paid on or before 1O.O3.2O23 g.

We do not appreciate the said stand of the respondent-Bank. As noticed above, the comprehensive relief was sought before the Debts Recovery Tribunal in S.A.No.58 of 2023. The petitioner not only challenged the e-auction notice dated 05.12.2022, sale notice dated O4.O2.2O23, but also charllenged taking physical possession of the properties, and notice issued by the Advocate-Commissioner and all further proceedings that would be initiated by the respondentBank. Having considered the respective submissions, the Debts Recovery Tribunai passed interlocutory order staying further proceedings except conducting of auction subject to petitioner depositing the amount as directed by the Tribunal. As directed by the Tribunal, { 1.OO crore was deposited on 10.O3.2023 and the amount was already realized by the Bank and when S.A.

, is pending and interlocutory order is subsisting, respondent-Bank could not have gone for conducting fresh auction. We do not appreciate the manner in which the proceedings are undertaken by the respondent-Bank. However, we are informed that petitioner has already filed application seeking amendment of the prayer in S.A., and therefore this issue is now under consideration by the Debts Recovery Tribunal.

PNR,J & NBK,J llt.P.No.7533 of 2023 both parties. However, we cannot permit the respondent-Bank to confirm the sale at this stage.

10. Writ Petition is disposed of, granting liberty to the petitioner to pursue the pending S.A.No.58 of 2023. However, till further orders are passed by the Debts Recovery Tribunal, on due consideration of the application that may be filed by the petitioner or in S.A., as the case may be, the respondent-Bank shall not confirm the sale in favour of the auction purchaser in the auction conducted on L4.O3.2O23 pursuant to the auction notice dated 24.02.2023 concerning the property no.4, which is part and parcel of building bearing no. 1- 1 18/33 on plot no.33, comprising Rohini Layout, admeasuring 311 square yards in T.S.No.64 part, in Sy.No.64, situated at Madhapur village, Serilingampalli Mandal, Ranga Reddy District. It is also made clear that we have not expressed any opinion on the conditional order passed by the Debts Recovery Tribunal. Pending miscellaneous applications, if any, shall stand closed. SD/. A.V.S.S. PRASAD ASSTSTANT REGISTRAR U SECTION OFFICER //TRUE COPY// To,

1. The Union Bank of lndia, 3rd Flobr, Andhra Bank Building, Sultan Bazaar, Koti, Hyderabad- 500095.

2. One CC to SR!. R.S. ASSOCIATES, Advocate. IOPUC]

3. One CC to Ms. V. DYUMANI, Advocate. [OPUC]

4. Two CD Copies SB *\\r"

I HIGH COURT DATE :2010312023

ORDER

f'

J '+"* .a\ ).i* WP.No,7533 of 2023 27 l|lAn ?[?3 t DISPOSING OF THE WRIT PETITION WITHOUT COSTS %