TMI Blog2012 (6) TMI 550X X X X Extracts X X X X X X X X Extracts X X X X ..... raise objections to the valuation submitted under Rule 8(5) - upholding the constitutional validity of Rule 8(5) of the Rules of 2002 that Rule 8(6) of the Rules of 2002 protects the interest of the borrower giving thirty days' clear notice to the borrower regarding the sale of the mortgaged property giving him an opportunity to redress any grievance as regards the fixation of the valuation of the property and the upset price. - WRIT PETITION NO. 1956 OF 2011 - - - Dated:- 14-11-2011 - DR. D.Y. CHANDRACHUD AND A.A. SAYED, JJ. Vishwas Shah, K.I. Shah, Jeetendra Ranawat and Manoj Kadam for the Petitioner. M.S. Bhardwaj and Rajinderkumar for the Respondent. JUDGMENT Dr. D.Y.Chandrachud, J. - The Petitioners hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... officer is empowered in consultation with the secured creditor to fix the reserve price. According to the Petitioners, Rule 8(5) does not contemplate that the borrower should be consulted. Hence, according to the Petitioners, the Rule is ultra vires . 4. Under Rule 8(5), the authorised officer has to obtain a valuation of the property from an approved valuer before effecting a sale under sub-rule (1) of Rule 9. The reserve price of the property is required to be fixed in consultation with the secured creditor by the authorised officer. Sub-rule (5) then provides the methods by which the property can be sold. Sub-rule (6) of Rule 8 stipulates that the authorised officer shall serve to the borrower a notice of 30 days for the sale of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e is issued under sub-rule (6) of Rule 8. The issuance of a notice is not without purpose. One of the purposes is to enable the borrower to repay the dues of the secured creditor together with the costs, charges and expenses under Section 13(8). The borrower can also object to the valuation upon receipt of a notice under rule 8(6). This is implicit in Rule 8(6). 6. In view of this legal position, there is no merit in the constitutional challenge to Rule 8(5). The view which we have taken accords with the law laid down in a judgment of the Gujarat High Court in Kanha International v. Union of India , AIR 2011 Guj 108. A Division Bench of the Gujarat High Court consisting of Mr. Justice S.J. Mukhopadhaya, (as His Lordship then was) and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e sale of the mortgaged property is to give him an opportunity to redress any grievance as regards the fixation of the valuation of the property and the upset price. We clarify that if any action under Rule 8(5) is arbitrary and unreasonable, such action can be gone into by appropriate forum and if in a given case the borrower is having the valuation of the property by another approved valuer having substantial difference, he may forward the copy of the valuation report to the authorized officer to take into consideration the said aspect and such material may also be considered by the authorized officer even after fixation of the reserved price." We are in respectful agreement with the judgment of the Division Bench of the Gujarat High Co ..... X X X X Extracts X X X X X X X X Extracts X X X X
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