Fresh sale notice and written consent for time extension are mandatory in SARFAESI auctions; non-compliance invalidates the sale.

Under the SARFAESI Act and the Security Interest (Enforcement) Rules, a sale notified for a particular date lapses if it does not materialise and the secured creditor must restart from the stage of issuing a fresh sale notice under Rule 8(6); a postponed auction cannot be completed by relying on the earlier notice, and the sale is treated as invalid. Rule 9 also requires strict compliance with post-sale payment conditions: 25% of the bid price must be deposited on the sale day, the balance must be paid within the prescribed time, and any extension must be agreed in writing by all concerned parties, including the borrower. Non-compliance makes confirmation and the sale certificate unsustainable.

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Issues: (i) Whether the secured creditor could postpone the scheduled auction sale and complete the sale on a later date without issuing a fresh sale notice after the earlier notified date did not materialise; (ii) Whether the auction purchaser's deposit of the bid amount and extension of time for payment of the balance complied with the mandatory procedure under the SARFAESI Act and the Security Interest (Enforcement) Rules, 2002.

Issue (i): Whether the secured creditor could postpone the scheduled auction sale and complete the sale on a later date without issuing a fresh sale notice after the earlier notified date did not materialise

Analysis: The statutory scheme under Section 13(8) of the SARFAESI Act and Rules 8 and 9 of the Security Interest (Enforcement) Rules, 2002 requires clear notice of sale and adherence to the prescribed procedure. Where a sale notified for a particular date does not take place for reasons not solely attributable to the borrower, the earlier notice lapses and the secured creditor must begin afresh from the stage of issuing sale notice under Rule 8(6). A postponed sale cannot be completed by relying on the earlier notification or by invoking adjournment machinery inconsistently with the mandatory safeguards recognised in the governing precedent.

Conclusion: The postponement and subsequent sale on the later date without fresh notice were invalid, and the sale was illegal.

Issue (ii): Whether the auction purchaser's deposit of the bid amount and extension of time for payment of the balance complied with the mandatory procedure under the SARFAESI Act and the Security Interest (Enforcement) Rules, 2002

Analysis: Rule 9 requires immediate deposit of 25% of the sale price on the day of sale and payment of the balance within the prescribed period, with any extension to be agreed upon in writing between the concerned parties. The record showed that confirmation was treated as occurring after the sale date and that extension for payment of the balance was granted without the borrower's written consent. As the borrower is included within the expression parties for this purpose, the extension could not be granted unilaterally by the bank.

Conclusion: The post-sale deposit and extension procedure did not satisfy the mandatory requirements, and the confirmation and sale certificate were unsustainable.

Final Conclusion: The writ petition succeeded, the Tribunal's order was set aside, the auction sale and all consequential steps were annulled, and the secured creditor was left free to proceed afresh in accordance with law.

Ratio Decidendi: When a sale under the SARFAESI framework does not occur on the notified date for reasons not solely attributable to the borrower, the earlier sale notice lapses and a fresh sale process is mandatory; compliance with the post-sale deposit requirements under Rule 9 is also mandatory, and any extension of time must be agreed to in writing by all concerned parties including the borrower.

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