2020 (2) TMI 1059

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....l disposal of the present Special Civil Application, the Auction Notice published by the respondents in Gujarati daily viz. "Gujrat Samachar" and "Divya Bhaskar" on 04.11.2015. C. to stay, pending the hearing and final disposal of the present Special Civil Application, the auction proceedings scheduled on 02.12.2015. D. to grant the ad-interim relief in terms of para-B and C above. E. to provide for the costs of this Special Civil Application. F. to pass such other and further orders in this Hon'ble Court deems fit and proper in the facts and circumstances of the case." 2. The case of the writ-applicant Bank, in its own words as pleaded in the writ-application is as under: "2.1. The petitioner states that M/s. Computer Skill Ltd. (CSL/ borrower) had availed various credit facilities from Union Bank of India (UBI), the petitioner and others viz., IDBI bank Ltd. (IDBI Bank), Gujarat Industrial Investment Corporation Ltd. (GIIC) and Gujarat State Financial Corporation (GSFC) inter alia against the security by way of hypothecation of plant and machinery and mortgage of immovable property bearing Block no. 213 paiki, Plot no. B, C, D a....

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....DBI bank, GSFC and GIIC plus further interest, expenses and charges. However, the 2nd auction was also unsuccessful. 2.6. The petitioner further states that respondent no.2 by letter dated 24.09.2013 addressed to the authorised officer of the petitioner bank informed that the sales tax dues under the Gujarat Sales Tax Act ­ Central Sales Tax Act and Gujarat Value Added Tax amounting to Rs. 4,75,97,160/­, is to be recovered from the borrower company for which immovable property has been attached and annexed Gam Namuna no. 6 containing Mutation Entry no.1858 dated 28.03.2013 (Kachha Entry) for Rs. 3,67,25,597/­ land Mutation Entry no. 1449 dated 27.01.2008 for the sales tax dues of Rs. 1,08,71,563/­ land requested to ensure that their dues are also recovered during the auction of the property of the borrower. Copy of the Letter dated 24.09.2013 with enclosures is annexed hereto and marked as Annexure­6 colly. 2.7. The petitioner further states that the respondent no.2 addressed another letter dated 10.10.2013 to the authorised officer of the petitioner bank informing inter alia that the movable and immovable properties of the borrower has been at....

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....2015 and without supplying the copy of the valuation report based on which the upset price of the assets of the borrower company has been fixed by the respondents, requested by letter dated 20.11.2015 (copy at Annexure­10 hereto) to the petitioner to hand over the keys of the business place of the above named company and the petitioner, in response thereto, addressed a letter dated 21.11.2015 (copy at Annexure­11 hereto) to the respondent no.2 stating that the petitioner is unable to accede to the request to hand over the keys and reiterated the request made by letter dated 07.11.2015." 3. Thus, it appears from the materials on record and the pleadings that the subject matter of challenge is the auction notice issued by the respondents in exercise of power under section 46 of the Gujarat Value Added Tax Act, 2003. The auction notice was issued by the respondents putting forward the claim of first charge over the assets of the original borrower. The first charge is sought to be claimed on the strength of Section 48 of the Gujarat Value Added Tax Act, 2003. To put it in other words, the stance of the respondents is that the State has to recover an amount of Rs. 6 crore tow....

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....he public auction for which notice was issued. According to the petitioner, being a secured creditor, it would have first charge over the properties. Counsel for the petitioner pointed out that the bank has also taken physical possession of the property in question in exercise of powers under the the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 ("SARFAESI Act" for short), acting on behalf of all the secured creditors. 2. We realise that it may take some time before the petition can be finally heard. Counsel for the petitioner however submitted that even to protect the property, the bank has to deploy security. With passage of time, the cost for security is mounting. The petitioner may be permitted to dispose of the property so that such recurring cost may be stopped. 3. Since the dispute is primarily between the petitioner bank claiming to be a secured creditor under SARFAESI Act and the State tax department, pending the petition, we would like to provide for a formula under which the property in question can be sold and the proceedings thereof can be invested. This would ensure that the expenditure for prote....