Redemption rights under SARFAESI continue until sale is completed, and mandatory auction notice rules must be strictly followed.

The borrower's right of redemption under the SARFAESI Act is stated to continue until the secured asset is actually sold or transferred in accordance with law, so payment before completion can preserve redemption. The text also states that, where a secured creditor proceeds by public auction, the Security Interest (Enforcement) Rules require strict compliance with the prescribed thirty-day notice and publication procedure. Non-compliance with those mandatory requirements justifies intervention, and the writ court may set aside the sale notice and related tribunal order when the statutory timeline is breached.

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Issues: (i) whether the borrower's right of redemption under section 13(8) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 survived until the date fixed for sale or transfer, and (ii) whether the impugned sale notice and the order of the Debts Recovery Tribunal were liable to be set aside for non-compliance with the mandatory procedure under the Security Interest (Enforcement) Rules, 2002.

Issue (i): whether the borrower's right of redemption under section 13(8) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 survived until the date fixed for sale or transfer.

Analysis: The statutory scheme preserves the borrower's right to clear the secured creditor's dues together with costs, charges and expenses at any time before the date fixed for sale or transfer. That right remains available until the sale is completed by transfer in accordance with law. The acceptance of payment by the secured creditor and the absence of completion of conveyance reinforced that the right had not been extinguished.

Conclusion: The right of redemption remained available to the petitioner and could be exercised before completion of sale or transfer.

Issue (ii): whether the impugned sale notice and the order of the Debts Recovery Tribunal were liable to be set aside for non-compliance with the mandatory procedure under the Security Interest (Enforcement) Rules, 2002.

Analysis: When the secured creditor resorted to public auction, the rules required service of a thirty-day notice upon the borrower and publication of public notice in accordance with the prescribed timeline. The sale notice did not satisfy the mandatory time requirements, and the Tribunal's order did not address these statutory breaches. The internal statutory remedy rule was treated as one of self-limitation, and in the circumstances the writ court intervened because the action was prima facie contrary to the statutory procedure.

Conclusion: The sale notice and the Tribunal's order were liable to be quashed for non-compliance with the mandatory rules.

Final Conclusion: The petition succeeded, the impugned sale proceedings were set aside, and the petitioner was entitled to redemption and restoration of possession subject to the directions issued in the order.

Ratio Decidendi: Where the secured creditor elects to sell secured assets by public auction, strict compliance with the statutory notice and sale procedure is mandatory, and the borrower's statutory right of redemption subsists until sale or transfer is completed.

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