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2018 (9) TMI 1600 - HC - Indian LawsRecovery proceedings - Sale of mortgaged properties for recovery of loan amount - The companies contend that the upset price in auction is ludicrously low; they also maintain that one property answers the description of agricultural land. So Section 31 of the SARFAESI Act bars its sale. Do the petitioners have an efficacious alternative remedy to challenge the DRT's Ext.P1 order? - Held that:- The petitioners questioned the Bank’s recovery proceedings before the Tribunal. Faced with an adverse order, they chose to file this writ petition, rather than invoke Section 18: filing an appeal before the Debt Recovery Appellate Tribunal. The petitioners defend their choice of forum, claiming that they have raised here a jurisdictional question. The alternative remedy, the petitioners maintain, does not affect the case prospects. This plea could have been probed, but the Bank came forward to repel the petitioners’ case on merits, too. True, the Bank did take a plea about the alternative remedy-only after a fashion - Much time spent on hearing the case on merits, I reckon it is imprudent for me to shun adjudication on this count: the alternative remedy - this issue needs no answer. Does the alleged undervaluation affect the sale of the secured assets? - Held that:- Curious is the petitioners’ plea. They pleaded, as noticed by the DRT, that they had sold all the mortgaged properties (4 items) to various persons for ₹ 1,52,35,000/-. So the DRT observed that the sale price of all the four properties by the petitioners themselves was very much below the Reserve Price of the 1st item in the auction. In the writ petition, too, this pleading remained unamended or explained, as rightly contended by the Bank’s counsel. So I find this issue against the petitioners: the Bank did assign valid reasons for the upset price it fixed. Did the Bank bring to sale any agricultural land, violating Section 31 of the Act? - Held that:- Thekkemukkalil Company (a) does not answer the description of an agriculturist; (b) does not cultivate the land; (c) derives no income from agriculture; (d) does not have agriculture as an object; and (e) did not inform the Bank that the secured asset is an agricultural land. So it does not fit into the niche Blue Coast Hotels created to protect genuine agriculturists - the debtor’s last gasp effort to save the property with endless excuses and plethora of pleas should wilt in the judicial gaze. A salutary provision aimed at protecting poor peasants cannot aid corporate concerns camouflaged as agriculturists. Here, the companies induced the Bank to lend, offered property, kept the Bank in dark about the alleged nature of the property, bargained with the Bank, borrowed time, and finally, driven to wall, cried foul. Petition dismissed.
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