TaxTMI 
TaxTMI 
2020 (4) TMI 881
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....akhs. 4. According to the petitioners, the first respondent did not release the term loan in time making the business situation of the petitioners unviable disabling the petitioners from participating in the tenders invited by the Government for printing text books. The loan account of the first petitioner therefore became NPA on May 31, 2017. 5. Thereafter the first respondent-bank issued demand notice under section 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short "the Act") on June 3, 2017 stating that the petitioners have to pay Rs. 25,55,410.96 towards OCC loan account as well as term loan account. 6. The petitioners contends that thereafter the petitioners paid Rs. 8 lakhs on December 27, 2017 and the entire OCC loan liability of Rs. 7,43,766.96 as mentioned in the notice issued under section 13(2) of the Act was cleared by the first petitioner. 7. Later, on February 21, 2018 the first respondent-bank issued notice under rule 8(6) of the SARFAESI Rules informing about proposed sale (30 days notice) of the secured asset, i. e., a house bearing No. SRT 59(1-7-38/6) admeasuring 150 sq. yds. co....
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....ion as June 14, 2018 and (iii) to declare that the action of the first respondent in contemplating to take physical possession of the property pursuant to the notice dated August 10, 2018 issued by the Advocate- Commissioner as per the warrant under section 14 of the Act from the Chief Metropolitan Magistrate, Hyderabad is illegal, arbitrary and to set it aside. The pleas in the SA of the petitioners 15. In the S. A., it is the contention of the petitioners that the notice dated February 21, 2018 issued under rule 8(6) of the Rules mentions that the first respondent had taken possession of the secured asset on November 15, 2017 but the petitioners were not served with any possession notice dated November 15, 2017 as is alleged by the first respondent and such notice was never affixed or published as mandated in the Act and Rules ; that even notice dated February 21, 2018 issued under rule 8(6) of the Rules was defective for want of proper service, affixture and publication in the news papers as mandated under law ; and that notice dated May 5, 2018 published in Andhra Jyothi newspaper dated May 10, 2018 was also not served or affixed. 16. It was contended that the said not....
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....tter. 25. It is contended that orders were obtained from the Chief Metropolitan Magistrate, Nampally under section 14 of the Act in Crl. M. P. No. 328 of 2018, that an Advocate-Commissioner was appointed by the said court to evict the second petitioner, and on August 10, 2018 the Advocate-Commissioner gave notice to the second petitioner to vacate and handover physical possession of the secured asset. 26. It is alleged that the petitioner came to the Tribunal with unclean hands; that an interim order was granted on September 4, 2018 directing the petitioners to deposit Rs. 1 lakh in one week, but the petitioners did not comply and merely issued a cheque for the said amount on September 5, 2018 ; that the first respondent-bank informed the petitioner that the account had become "NPA" and any cheque drawn on the said account cannot be acted upon. 27. It is also stated that the petitioners had deposited Rs. 2 lakhs on June 14, 2018 after the auction had been conducted and sought for stopping of the auction proceedings, and taking into account their request, sale confirmation letter was not issued to the successful bidder. But since the petitioners did not close the loan accou....
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.... He also contended that the S. A. was filed on September 4, 2018 within time from the date of passing of order under section 14 of the Act by the Chief Metropolitan Magistrate ; that the bank extended time for payment by delaying deliberately the sale confirmation though rule 9(2) says sale confirmation must be on the date of the auction ; and that the bank cannot sell property worth Rs. 1 crore to realize dues of Rs. 10,76,373. 36. He also contended that the date of auction was not informed to the petitioner and there was no waiver by the petitioner. 37. According to him, there is no proper valuation also before the property was put to sale and the order of the Tribunal is thus vitiated because payments made of Rs. 2 lakhs on June 14, 2018 and Rs. 8.25 lakhs paid on March 5, 2018 were not taken into account. The stand of the second respondent/auction purchaser before this court 38. The second respondent filed a counter stating that on September 26, 2019 he had gifted the secured property purchased by him in the e-auction sale held on June 14, 2018 to his wife and two children under a registered gift deed dated September 26, 2019. 39. Therefore, the wife and children....
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....fective alternative remedy. Therefore, we hold that this is a fit case to entertain the writ petition against the impugned order passed by the Tribunal. Whether the SA is barred by limitation ? 45. We shall first deal with the issue of limitation raised by the first respondent-bank before the Tribunal in the S. A., which plea was accepted by the said Tribunal. 46. Admittedly, the S. A. was filed on September 4, 2018 by the petitioners under section 17 of the Act. They had questioned in the S. A. : (i) notice dated May 5, 2018 under rule 8(6) of the Rules published on May 10, 2018, (ii) e-auction notice dated May 13, 2018 published in Andhra Jyothi newspaper fixing the date of auction as June 14, 2018, and (iii) also the proposed action of the first respondent-bank in contemplating to take physical possession of the secured asset through Advocate- Commissioner appointed in Crl. M. P. No. 328 of 2018 by the Chief Metropolitan Magistrate, Hyderabad and the notice dated August 10, 2018 issued by the Advocate-Commissioner. 47. It was the specific plea of the petitioner in the S. A. that the petitioners had enquired on June 15, 2018 about the result....
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....im of law, recognised and established, that no man shall take advantage of his own wrong ; and this maxim, which is based on elementary principles, is fully recognised in courts of law and of equity, and, indeed, admits of illustration from every branch of legal procedure.' The reasonableness of the rule being manifest, we proceed at once to show its application by reference to decided cases. It was noted therein that a man shall not take advantage of his own wrong to gain the favourable interpretation of the law. In support thereof, the author has placed reliance on another maxim frustra legis auxilium invocat quaerit qui in legem committit. He relies on Perry v. Fitzhowe [1846] 8 QBD 757 ; (15 LJ QB 239). At page 192, it is stated that if a man be bound to appear on a certain day, and before that day the obligee puts him in prison, the bond is void. At page 193, it is stated that 'it is moreover a sound principle that he who prevents a thing from being done shall not avail himself of the non-performance he has occasioned'. At page 195, it is further stated that 'a wrong doer ought not to be permitted to make a profit out of his own wrong'. At page 199....
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....waiver by the petitioners of their right to contend about illegality if any committed in the conduct of e- auction on June 14, 2018 by the first respondent-bank. 57. This aspect was considered by the Supreme Court in Vasu P. Shetty v. Hotel Vandana Palace [2014] 186 Comp Cas 82 (SC) ; [2014] 5 SCC 660. In the said judgment, the Supreme Court held as under (page 110 of 186 Comp Cas) : "The moot question is, even if there were delaying tactics adopted by the borrower in respect of the first two auctions, whether that con duct of the borrower would amount to waiving the mandatory requirement of publishing subsequent notice dated April 27, 2006 fixing the date of auction as May 8, 2006 ? Our answer has to be in the negative. The aforesaid conduct cannot be taken as waiver of the mandatory condition of 30 days' notice for auction as well as other requirements. For examining the plea of waiver, we will have to see as to whether by implied or express actions, the borrower has waived the aforesaid mandatory requirement when the property was put to sale. We do not find, nor is it suggested, even the slightest move on the part of the borrower in this regard which may amount t....
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.... ought to be issued to the auction purchaser on the day of the sale itself unless the amount offered by way of sale price is less than the reserve price. On no other count can issuance of sale confirmation letter be delayed by the secured creditor to the auction purchaser. 61. Contrary to this rule, though e-auction sale took place on June 14, 2018 sale confirmation letter was not issued to the second respondent till June 27, 2018 and this is clearly an attempt by the first respondent-bank to favour the auction purchaser by giving him more time that what is permitted by rule 9(4) to make payment of the 75 per cent. balance sale consideration. 62. Though under rule 9(3) the auction purchaser has to deposit the 25 per cent. of the amount of sale price immediately after sale, admittedly the second respondent deposited the 25 per cent. of the sale consideration on June 15, 2018, i. e., after the day of the sale, and not immediately after the sale. 63. Further, under rule 9(4), the auction purchaser should pay 75 per cent. of the balance consideration within fifteen days of the confirmation of the sale, i. e., within fifteen days from June 14, 2018, i. e., before June 29, 2018.....
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....081 of 2019 pronounced by this very Bench. 69. So since the challenge to the e-auction notice was already held by us to be not barred by limitation, by applying the above principle, to challenge the series of steps from the date of issue of section 13(4) of the Act up to the date of the auction notice, i. e., notice dated May 5, 2018 under rule 8(6) of the Rules published on May 10, 2018 and also the proposed action of the first respondent-bank in contemplating to take physical possession of the secured asset through Advocate-Commissioner appointed in Crl. M. P. No. 328 of 2018 by the Chief Metropolitan Magistrate, Hyderabad and the notice dated August 10, 2018 issued by the Advocate-Commissioner. 70. Therefore we hold that the plea in the SA about the invalidity of the notice dated May 5, 2018 issued under rule 8(6) is not barred by limitation and the Tribunal erred in taking the said view. Non-compliance with rule 8(6) 71. No material has been produced by the first respondent-bank that it had complied with the service affixture and publication of the possession notice dated November 15, 2017 and notice dated February 21, 2018 under rule 8(6), and service and affixture....