Secured property sale by tender upheld where adequate publicity and fair price were achieved despite no public auction.

Sale of secured property by a State Financial Corporation is not invalid merely because it is conducted by tender or private negotiation rather than public auction, if the method is reasonable in the circumstances and secures a fair price after adequate publicity. Public auction remains the preferred mode, but the controlling consideration is obtaining the best price, and the validity of a tender sale depends on the facts. Here, repeated default by the borrower, prior opportunities to secure a better offer, absence of any higher bid despite advertisements, and a sale price above valuation supported the process. Lack of prior intimation before acceptance of the final offer caused no material prejudice, so the challenge failed.

---

---

Issues: Whether the sale of the mortgaged unit by the State Financial Corporation through tender and private negotiation, instead of public auction, was invalid for not securing the best price and for alleged non-compliance with the governing guidelines.

Analysis: In disposing of property, the dominant consideration is to secure the best price, and public auction is generally the preferred mode. But sale by tender is not per se impermissible. Its validity depends on the facts, including whether adequate publicity was given and whether the process yielded a reasonable price. Here, the borrower had repeatedly defaulted despite repeated rescheduling and opportunities. No higher offer emerged despite advertisements, and the sale price ultimately obtained was higher than the valuation placed on the unit. The absence of prior intimation to the borrower before acceptance of the final offer did not materially prejudice it, as it had sufficient opportunity to procure a better offer but failed to do so.

Conclusion: The sale was valid and the challenge to it failed.

Final Conclusion: The High Court's interference with the sale was unwarranted, and the writ petition challenging the Corporation's action was dismissed.

Ratio Decidendi: A sale of secured property by a State Financial Corporation is not invalid merely because it is conducted by tender or negotiation instead of public auction, so long as the method adopted is reasonable in the circumstances and secures a fair price after adequate publicity.

---