2007 (3) TMI 370 - HC - Companies Law

High Court vacates interim orders in UCO Bank case on mortgaged property sale dispute.

The High Court of Gauhati allowed UCO Bank's application to vacate interim orders in a writ petition regarding the sale of a mortgaged property. The Court ... Right to appeal Issues:Vacation of interim orders in a writ petition regarding sale of mortgaged property.Analysis:The High Court of Gauhati heard the applicant-UCO Bank's plea to vacate interim orders dated 15-2-2007 and 21-2-2007 in a writ petition. The bank issued a notice under section 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 to the writ petitioners for non-repayment of a loan taken for a hotel construction. Despite attempts to negotiate, the bank took possession of the property after cheques were dishonored. Subsequently, the bank issued a sale notification offering the property for sale, receiving offers, with respondent No. 3's offer being the highest.The writ petitioners challenged the sale notice, arguing that as Scheduled Tribe community members, the property should only be sold to a Scheduled Tribe person. The bank contended that the writ petition was not maintainable as the borrowers had a statutory remedy of appeal under the Act, which they did not pursue. The bank had followed legal procedures, including issuing notices and taking possession before the sale notice.The Court considered the timelines of actions taken by the bank and the borrowers' failure to utilize statutory remedies available under the Act. It was noted that the borrowers did not challenge the sale notice promptly and delayed approaching the Court. As the borrowers had remedies available to them throughout the process but did not act diligently, the Court held that the writ petition was not maintainable. Consequently, the Court allowed the application, vacating the stay orders on the sale of the mortgaged property.