2016 (10) TMI 1397 - HC - Indian Laws

Sale of the mortgaged project - part construction carried out - invocation of provisions of Section 13(12) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act 2002 - HELD THAT - The Court is informed that the respondent No.1 has not even nominated a counsel on whom an advance copy of the present petition could be served. As a result the respondent No.1/Bank has been served directly at the address given in the memo of parties. Despite the same none is present on behalf of the said respondent. Issue notice to the respondents on the petitioner filing the process fee by ordinary process and speed post returnable on the date fixed - Till the next date of hearing the respondents shall maintain status quo in respect of the subject project.

Summary

Issues: Petition for quashing sale of mortgaged project, stay on auction sale, compliance with guidelines on sale notice issuance, respondent's actions questioned.

Issue 1: Petition for quashing sale of mortgaged project
The petitioner filed a petition seeking to quash the sale of a mortgaged project on a parcel of land in Haryana. The respondent Bank had issued a sale notice due to the petitioner's inability to repay the amount due. The petitioner's Senior Advocate argued that the sale notice was issued under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. The respondent Bank had taken possession of the project and proceeded to sell it, which was contested by the petitioner.

Issue 2: Stay on auction sale
HDFC Ltd. filed a writ petition in another High Court against the petitioner and flat allottees, leading to a stay on the auction sale. The Flat Buyers Association also filed a civil suit for injunction, further delaying the sale. The respondent Bank had to defer the auction scheduled for a specific date due to these legal actions.

Issue 3: Compliance with guidelines on sale notice issuance
The petitioner challenged the respondent Bank's actions, citing guidelines from a Supreme Court case that state if a sale does not occur following a notice, the procedure must be followed afresh. The petitioner argued that the Bank's sale of the project did not adhere to these guidelines, as the auction was deferred but later proceeded without following the proper process.

Issue 4: Respondent's actions questioned
The respondent Bank's lack of representation in court was noted, as they did not nominate a counsel to receive the petition. Despite attempts to serve the respondent, no representation was made on their behalf. The court issued notice to the respondents to appear and directed them to maintain the status quo regarding the project until the next hearing.

In conclusion, the judgment addressed the petitioner's concerns regarding the sale of the mortgaged project, the legal actions taken to delay the auction sale, the compliance with guidelines on sale notice issuance, and the respondent Bank's lack of representation in court. The court issued notices and directives to ensure proper legal procedures were followed and to maintain the status quo until the next hearing.