Joint sale permissibility: combined e-auction upheld where joint sale maximises realisation and SARFAESI remedies remain intact.

Where possession of guarantor properties exists under the SARFAESI framework and the Adjudicating Authority determines that a combined sale of corporate-debtor and guarantor assets will maximise realisation, a joint e-auction is permissible; the article states such a refusal to stay the combined auction will not be interfered with absent demonstrated prejudice, and that statutory remedies under SARFAESI remain available to the guarantor. The dominant legal point is that a mode of sale that enhances overall realisation is lawful and will not automatically extinguish SARFAESI rights or justify injunctive relief against the e-auction.

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Issues: (i) Whether the Adjudicating Authority erred in refusing to stay the e-auction notice for a joint sale of the corporate debtor's assets and the guarantor's assets when the joint sale was held to maximize realisation.

Analysis: The Tribunal considered the Adjudicating Authority's finding that selling the corporate debtor's assets together with the guarantor's land and factory would maximise the overall realisation. The Tribunal noted that possession of the guarantor's properties had been taken under the SARFAESI regime and that joint sale was proposed to enhance value. Applying the principle that a mode of sale which maximises asset realisation is permissible and will not necessarily prejudice stakeholders, the Tribunal examined whether any legal right of the appellant under SARFAESI was extinguished by permitting a combined auction. The Tribunal found no error in the Adjudicating Authority's assessment that combined sale would not cause prejudice and observed that statutory remedies under SARFAESI remain available to the appellant.

Conclusion: The Adjudicating Authority's order refusing to stay the e-auction for a joint sale is upheld and the appeal is dismissed.

Ratio Decidendi: Where (a) possession of guarantor properties is taken under the SARFAESI framework and (b) the Adjudicating Authority is satisfied that a joint sale will maximize realisation of assets, the authority may lawfully permit a combined e-auction and refusal to stay such auction will not be interfered with absent demonstrated prejudice.

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