Sk. Nasir Mohammad And Another vs Uco Bank And Another
2022 Latest Caselaw 5603 Cal

S/L. 23.
August 18, 2022.
MNS.


                                      WPA No. 18700 of 2022

                                  Sk. Nasir Mohammad and another
                                                Vs.
                                       UCO Bank and another


                          Mr. Ranjan Kali,
                          Ms. Mitul Chakraborty,
                          Ms. Anindita Maity,
                          Ms. Mili Saha

                                          ... for the petitioners.

                          Mr. Saptanshu Basu,
                          Mr. Samrat Mukherjee

                                    ...for the respondent-bank.

Affidavit-of-service filed in Court today be

kept on record.

The petitioners contend that the e-auction

sale notice dated June 28, 2022 suffers from

several infirmities, both legal and factual.

It is contended that the provisions of Rule

8, sub-rules (5), (6) and (7) of the Security

Interest (Enforcement) Rules, 2002 (2002 Rules)

have been grossly violated. It is submitted that

prior to obtaining valuation of the property-in-

question, the borrowers, that is, the present writ

petitioners, were not given any notice or

opportunity of addressing such valuation, which is

palpably to the detriment of the borrowers.

Inasmuch as sub-rule (6) is concerned,

learned counsel for the petitioners argues that the

authorised officer has to, mandatorily, serve to

the borrower a notice of thirty days for sale of the

immovable secured assets under sub-rule (5),

which has also not been served in the present

case.

Regarding sub-rule (7) of Rule 8, it is

contended that the provisions of the same have

not been complied with properly as well in the

present case.

Learned counsel further places reliance on

Rule 9(1) of the 2002 Rules to contend that the

provisions of the said sub-rule have also not been

adhered to in the present process of e-auction

sale.

Learned counsel places reliance on a co-

ordinate Bench judgement dated August 3, 2022

passed in WPA 17412 of 2022 in this regard.

The learned Senior Advocate appearing

for the respondent-bank controverts and refutes

all the submissions of the petitioners.

In so far as Section 8(5) of the 2002 Rules

is concerned, it is argued that there is no

mandate under the statute to serve a prior notice

before valuation of the property on the borrower.

As far as sub-rule (6) is concerned, the

learned Senior Advocate submits that the

borrowers, that is, the writ petitioners were duly

served a notice under the said clause.

It is also submitted that the notice of sale

did not suffer from any infirmity or irregularity.

As regards the other allegation raised by

learned counsel for the petitioners, the learned

Senior Advocate argues that there were several

notices under Section 13(2) of the Securitisation

and Reconstruction of Financial Assets and

Enforcement of Security Interest Act, 2002 (2002

Act) issued in respect of different properties in the

context of the same loan. As such, the date of

notice as given in the e-auction notice, which has

been annexed to the writ petition (Annexure- P1

ate page 15), pertains to a different property,

which has also been mentioned in the said notice.

The learned Senior Advocate submits that

the sale itself, in respect of which the e-auction

notice was given and challenged in the present

writ petition, was concluded on July 19, 2022. It is

further contended that the sale notice dated July

28, 2022 was duly served on July 29, 2022.

Inasmuch as the contention of the

petitioners in respect of purported vacancy of the

DRT-III Bench is concerned, where the

petitioners' application under Section 17 of the

2002 Act is pending, it is submitted that the said

application was filed on July 27, 2022 whereas

the said Bench became vacant on and from

August 2, 2022.

However, such fact is controverted by

learned counsel for the petitioners, who submits

that the date of superannuation of the Presiding

Officer of the said Bench was July 30, 2022.

Upon hearing learned counsel appearing

for the parties, it is clear from the provisions of

Rule 8(5) of the 2002 Rules that, as rightly

contended by the petitioners, the same does not

envisage any prior notice to the borrower before

valuation. As such, the said requirement does not

exist in law and consequentially the allegation of

violation of such non existent provision cannot be

accepted as a ground for setting aside the e-

auction notice impugned herein.

Rule 8(6), on the other hand, has two

prongs. In the first, the authorised officer is

required to serve to the borrower a notice of thirty

days for sale of immovable secured assets under

sub-rule (5). Under the second (proviso) it is

indicated that if the sale of such secured asset is

being effected by either inviting tenders from the

public or by holding public auction, the secured

creditor shall cause a public notice in the Form

given in Appendix IV-A to be published in two

leading newspapers including one in vernacular

language having wide circulation in the locality.

As such, since the present intended sale was by

way of a public auction (e-auction), the proviso to

Rule 8(6) squarely applies. The annexures to the

writ petition itself show that such provision was

duly complied with by the respondent-bank.

Moreover, the respondents are armed with copies

of service of personal notice, given to the

petitioner over and above the public notice. Be

that as it may, in view of the earlier observation,

such personal notice becomes irrelevant.

Rule 8(7) of the 2002 Rules provides for

every notice of sale to be affixed on a

conspicuous part of the immovable property and

the authorised officer shall upload the detailed

terms and conditions of the sale on the website of

the secured creditor. The said sub-rule is followed

by several sub-clauses. Sub-clause (f) stipulates

that the modes as contemplated under sub-rule

(7) may be on any other terms and conditions,

which the authorised officer considers it

necessary for a purchaser to know the nature and

value of the property.

In the present case, the

petitioners/borrowers cannot claim to have a

defeasible interest in such mode, since the

petitioners are in no way concerned with the

welfare of the purchasers.

Inasmuch as Rule 9(1) of the 2002 Rules

is concerned, the proviso thereto stipulates 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

authorised officer shall serve, affix and publish

notice of sale of not less than fifteen days to the

borrower for any subsequent sale. As such, in the

present case, since this was the third occasion

when the subject matter of the proceeding was

sought to be sold, the proviso applies and

issuance of a notice of fifteen days would suffice.

In so far as the alleged irregularities

regarding the dates of the notice under Sections

13(2) and 13(4) are concerned, sufficient reply

has been given by the respondents to satisfy the

court that several properties were involved in the

said process, in respect of some of which the

notice under Sections 13(2) and 13(4) was given,

as published in the public notice annexed to the

writ petition.

That apart, since an application under

Section 17 has been filed by the petitioners and

the same is pending before the DRT-III and the

respondents have substantially complied with all

terms and conditions as stipulated in law while

issuing the e-auction notice impugned herein,

there ought not to be any interference in the writ

jurisdiction of this court.

Inasmuch as the contention sought to be

raised by the petitioners regarding the valuation

being low is concerned, there is nothing on record

in the present writ petition to impress upon the

court palpably that such undervaluation was

done, sufficient to interfere in the present matter.

As far as the unreported judgment of the

co-ordinate Bench is concerned, it is seen from

the same that, in the facts of the said case, the

court observed that the court does not want to get

into the merits of the case since the petitioners'

application is already pending before the DRT-III.

However, since the DRT-III was not functioning

since June, 2022, the petitioners were held to be

entitled to a limited measure of protection.

Accordingly, the Bank was directed not to act in

terms of the Section 14 order of the District

Magistrate passed in connection with the said

proceeding.

The scope and conspectus of the present

matter is entirely different, in view of the present

challenge being against an e-auction notice,

which much preceded the conclusion of the sale,

which itself was effected prior to the filing of the

writ petition.

That apart, the said observations made by

the learned Single Judge do not apply on facts to

the present case at all, nor is any general

proposition of law found to have been laid down

in the said judgment which can have a

precedentiary value in the present matter. The

judgment was rendered in the facts of the said

case.

In such view of the matter, there is no

scope of interference in the present writ petition.

It appears that the present writ petition has

been preferred merely in an attempt to stall the

sale process by the borrowers.

Hence, WPA No. 18700 of 2022 is

dismissed with costs of Rs. 10,000/- payable to

the respondents within a fortnight from date.

Since no affidavits were directed in the

matter, it is deemed that none of the allegations

made by any of the parties are admitted by their

respective adversaries.

Urgent photostat certified copies of this

order, if applied for, be made available to the

parties upon compliance of the requisite

formalities.

(Sabyasachi Bhattacharyya, J.)