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Issues: (i) Whether the civil revision petition was maintainable under the High Court's jurisdiction under Articles 226 and 227 of the Constitution of India. (ii) Whether the sale notices and sale certificates issued under the SARFAESI framework were vitiated for non-compliance with the mandatory 30-day notice requirement under Rules 8 and 9 of the Security Interest (Enforcement) Rules, 2002, and whether such requirement could be treated as waived because of the borrower's conduct. (iii) Whether the appellate tribunal could sustain the auction sale while simultaneously permitting the borrower to redeem the property and directing consequential restitution to the auction purchaser.
Issue (i): Whether the civil revision petition was maintainable under the High Court's jurisdiction under Articles 226 and 227 of the Constitution of India.
Analysis: The territorial and supervisory objection was rejected. The jurisdiction of the High Court over DRT and DRAT proceedings was held to remain available under Articles 226 and 227, and the curtailment of civil revisional jurisdiction did not take away constitutional supervisory review. The order proceeded on the basis that the High Court could examine jurisdictional errors and legality in proceedings before the tribunals.
Conclusion: The objection to maintainability was overruled.
Issue (ii): Whether the sale notices and sale certificates issued under the SARFAESI framework were vitiated for non-compliance with the mandatory 30-day notice requirement under Rules 8 and 9 of the Security Interest (Enforcement) Rules, 2002, and whether such requirement could be treated as waived because of the borrower's conduct.
Analysis: The sale proceedings were held to have been initiated in continuation of earlier notices, yet the notices actually preceding the sales afforded only seven days and three days, respectively, instead of the statutory 30 days. The statutory scheme under Rules 8 and 9 requires strict adherence before sale of secured immovable property. The borrower's alleged dilatory conduct, default in repayment, or earlier failed challenges did not amount to waiver of the mandatory notice requirement. The Court applied the principle that the secured creditor cannot ignore the statutory procedure merely because the borrower is in default or has been litigating.
Conclusion: The sale notices and consequential sale certificates were invalid for breach of the mandatory statutory procedure, and the plea of waiver failed.
Issue (iii): Whether the appellate tribunal could sustain the auction sale while simultaneously permitting the borrower to redeem the property and directing consequential restitution to the auction purchaser.
Analysis: The appellate tribunal's approach was found internally inconsistent because it affirmed the sale in favour of the auction purchaser but still enabled redemption by the borrower on payment of the entire amount to the bank. That direction was incompatible with the conclusion that the sale had been affirmed, and the impugned order was therefore unsustainable. The Court also preserved limited equitable relief for the auction purchaser by directing refund of the bid amount with interest and payment of registration charges, while restoring possession if the borrower had been dispossessed.
Conclusion: The appellate tribunal's order was set aside, with consequential restitutionary directions in favour of the auction purchaser and restoration of possession to the borrower if dispossessed.
Final Conclusion: The revision succeeded. The impugned appellate order was set aside for non-compliance with the mandatory SARFAESI sale procedure, while equitable restitution was ordered to protect the auction purchaser and the borrower's possession rights were restored as directed.
Ratio Decidendi: Sale of immovable secured assets under the SARFAESI Rules requires strict compliance with the mandatory 30-day notice procedure, and borrower default or dilatory conduct does not by itself amount to waiver of that statutory safeguard.
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