2021 (12) TMI 276

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....thapuram. Relating to the loan transaction, two properties were offered by the said person in relation to which equitable mortgage was created on 7.10.2005. The borrower committed default, pursuant to which, the petitioner Bank proceeded under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 ('the SARFAESI Act'), for realisation of an amount of Rs. 38,20,839/-. The properties were sold in auction and an amount of Rs. 29,33,100/- was realised. As on the date of sale, an amount of Rs. 42,78,527/- was due to the petitioner Bank. The petitioner Bank also filed O.A. No. 254/2008 before the DRT, for realisation of the balance amount of Rs. 46,30,295/- along with interest. The said OA....

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....without any jurisdiction. They have been passed in violation of the specific provisions contained in the SARFAESI Act and the Transfer of Property Act. Error is apparent on the face of the record; the orders are perverse and arbitrary and therefore liable to be set aside. The learned counsel drew the attention of this Court to Sections 26(e), 34 and 35 of the SARFAESI Act as well as Section 31(b) of the Recovery of Debts and Bankruptcy Act, 1993. Reference was also made to the dictum laid down in Madhan S. vs. Sub Registrar, Kollam (2014(1) KHC 249) and Secretary, Keechery Service Cooperative Bank Ltd. vs. Sajitha Nizar alias Sajitha (2020(5) KHC 231) in support of the arguments advanced. In these decisions, it has been held that attachment....

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.... said decision has held that the mandatory requirements under Section 73 will have to be satisfied by a party claiming ratable distribution. One of the conditions to be satisfied is that the application for execution should have been filed to the court which holds the assets before the assets came into the custody of the court. The learned single Judge in the said case has also referred to a Division Bench decision of this Court, namely, Boban vs. Sajith Kumar (2003 KHC 1428) wherein it has been held that no rateable distribution can be claimed unless all the conditions contemplated under Section 73 are fulfilled. To enable the decree holder to participate in the assets of a judgment debtor, the following conditions are to be satisfied by t....