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2022 (9) TMI 1553 - PUNJAB & HARYANA HIGH COURTMaintainability of petition - alternative remedy available to petitioner to approach the Debt Recovery Tribunal under Section 17 of the Act - claim of refund - seeking quashing of the e-mail dt.15.12.2021 issued by respondent No. 2 forfeiting the said amount deposited towards the earnest money by him - suppression of factum by secured creditor like SBI of the pendency of litigation in respect of the secured asset being put to sale, from persons intending to participate in the e-auction - It is the contention of the petitioner that it was the duty of the Bank to disclose about the pending litigation in the e-auction notice, and suppression of the said fact by the Bank is contrary to law. Maintainability of petition - alternative remedy available to petitioner to approach the Debt Recovery Tribunal under Section 17 of the Act - HELD THAT:- If there is a violation of the provisions of the Act by the respondent-Bank while taking steps to recover it's dues under the Act, the Writ Petition can be entertained by this Court, and it is not necessary to relegate the parties to avail alternative remedy. Though counsel for respondents have placed reliance on the decision of the Supreme Court in the case of Aggarwal Tracom Pvt. Ltd. v. Punjab National Bank [2017 (11) TMI 1523 - SUPREME COURT] to contend that the Writ Petitions under Article 226 of the Constitution of India cannot be entertained when effective statutory remedy is available to the aggrieved person, in a later judgment rendered in the case of AUTHORIZED OFFICER, STATE BANK OF TRAVANCORE AND ANOTHER VERSUS MATHEW K.C. [2018 (2) TMI 25 - SUPREME COURT], the Supreme Court held that there are well defined exceptions to the rule of exhaustion of alternative remedy as laid down in decision of COMMISSIONER OF INCOME TAX & OTHERS VERSUS CHHABIL DASS AGARWAL [2013 (8) TMI 458 - SUPREME COURT] and one of such exceptions mentioned in Para 15 of the said judgment is “where the statutory authority has not acted in accordance with the provisions of the enactment in question.” - the plea of the respondent that the Writ Petition ought to be dismissed in view of existence of alternative remedy under Sec.17 of the Act is rejected. Whether it was proper for a secured creditor like SBI to suppress from persons intending to participate in the e-auction being conducted by it under the SARFAESI Act, 2002, the factum of the pendency of litigation in respect of the secured asset being put to sale by it? - HELD THAT:- It is settled law that persons holding positions of trust have to act in a bonafide manner and transparently and cannot mislead persons sought to be affected by their actions by suppressing material facts and circumstances. Rule 8(6)(f) of the Rules protects the interest of the intending purchaser to be put on notice as to encumbrance as otherwise, he or she would be purchasing property, and simultaneously buying litigation as well, and the intending purchaser may not bid in the event, if he or she came to know any encumbrance over the property. That is why the Rules specifically contemplate a provision for the Authorized Officer, while notifying the sale, to specifically state as to the encumbrance. Merely by mentioning in the e-auction notice that the sale is on as is where is basis, as is what is basis and whatever there is basis, the Bank is not absolved of its statutory obligation of disclosing the “encumbrances” attached to the property brought for sale by way of tender or any auction or sale by public auction. In Joginder Singh [2022 (7) TMI 1505 - PUNJAB AND HARYANA HIGH COURT] also there was civil litigation pending in respect of the secured asset which was not disclosed in the tender/public notice issued the Bank, and this Court has held that if such a fact had been disclosed, the petitioner might not have participated in the tender issued by the Bank at all as no intending purchaser wants to buy a fresh litigation or take on other unknown liabilities against third parties, and the action of the Bank was arbitrary and contrary to the provisions of the Act of 2002. It was not proper for a secured creditor like SBI to suppress from persons intending to participate in the e-auction being conducted by it under the SARFAESI Act, 2002, the factum of the pendency of litigation in respect of the secured asset being put to sale by it; and that it ought to have refunded the amount deposited by petitioner, instead of forfeiting it. The email dt.15.12.2021 (Annexure P-16) issued by respondent No. 2 to the petitioner is set aside; and respondents 1 to 3 are directed to refund within 4 weeks Rs. 16,08,250/- to the petitioner with interest @ 7% per annum from the date such deposit(s) were made till the date of refund - petition allowed.
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