TMI Blog2015 (3) TMI 815X X X X Extracts X X X X X X X X Extracts X X X X ..... other than public auction or public tender can be on such terms as may be settled between the parties in writing. As far as sub-rule (8) is concerned, the parties referred to can only relate to the SECURED CREDITOR and the borrower. It is therefore, imperative that for the sale to be effected under Section 13(8), the procedure prescribed under Rule 8 read along with 9(1) has to be necessarily followed, inasmuch as that is the prescription of the law for effecting the sale as has been explained in detail by us in the earlier paragraphs by referring to Sections 13(1), 13(8) and 37, read along with Section 29 and Rule 15.In our considered view any other construction will be doing violence to the provisions of the SARFAESI Act, in particular Section 13(1) and (8) of the said Act. In view of our reasons and in view of the conclusion arrived at by the Appellate Tribunal, with which we have agreed to, the position of law as opined by the Supreme Court in Mathew Varghese's case [2015 (1) TMI 461 - SUPREME COURT], we do not see any reason for this Court to interfere with the impugned judgment in exercise of our discretionary jurisdiction under Article 226 and 227 of the Constitution ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he petitioners herein were the highest bidders having bid the property for ₹ 84.2 lakhs. Their bid was accepted and after confirmation of sale and deposit of the consideration amount, the sale certificate was issued in their favour on October 03, 2008. The physical possession of the property was taken. As the property had been sold, sale consideration received by the bank, the sale certificate had been issued, the Bank filed IA 880/2008 in S.A. No. 47/2008 for dismissing the S.A. as having become infructuous. Smt. Archana Mishra, respondent No. 2 also filed an application being IA 887/2008 challenging the action, confirmation of sale and also sought a direction for de-sealing of the property. Simultaneously, it appears, the respondent No. 2 had filed a writ petition bearing No. 8968/2008 before this Court, which was dismissed as withdrawn with liberty to approach the DRT for relief available under law and a direction that status quo of the property in question be maintained. Respondent No. 2 filed IA 14/2009 before the DRT in S.A. No. 47/2008 for setting aside the sale as well as for restoring the possession of the property and redemption of mortgage on payment of ₹ 95 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 13(2) and 13(4) of the SARFAESI Act, with the following directions: (i) that upon making payment of the entire dues of ₹ 1,72,14,846/- plus future interest w.e.f. 31.8.2006 together with all costs, charges and expenses (minus the amount deposited by any other borrower(s) or received from any other borrower(s) and after service of the notice) within 30 days hereof, the impugned sale shall be cancelled. The sale certificate shall also stand cancelled. The applicant is in possession of the property under the orders and she will continue to be in possession. (ii) in the event of non-payment of the amount within 30 days as directed above, the applicant shall handover the possession to the Bank who may in turn deliver the possession to the Auction Purchasers as per rules. If need be, the Bank shall be entitled to take police assistance also. (iii) In the eventuality, the payment is made by the applicant, as directed above, the sale proceeds deposited with the Bank shall be refunded to the highest bidders/auction purchasers along with interest @ 9% p.a. as per banking norms applicable in relation to term deposit. (iv) Costs of the SA shall be borne out by the respectiv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... equirement of the proviso to Rule 8(6) of the Security Interest (Enforcement) Rules, 2002 [ Enforcement Rules?, in short] has sufficiently been complied and the contrary finding is unsustainable. He would also state that the Appellate Tribunal has not considered in proper perspective, the certificate issued by the Sales and Marketing Department of the Rashtriya Sahara?, New Delhi that the Delhi edition had circulation in Faridabad which is a proof to show that the notice was properly published. He would further state that the respondent No. 2 herein had filed an amended Securitization Application, wherein, she has specifically admitted that she has knowledge about the sale of the mortgaged property by sale notice dated July 22, 2008 and as such, she cannot agitate the issue that newspaper containing the sale notice had no circulation in Faridabad inasmuch as the purpose of the notice was only to inform public at large about sale of the property. 5. On the other hand, Mr. Mithilesh Kumar, learned counsel for the respondent No. 2 would justify the order of the Appellate Tribunal and states; (1) that the requirement under Rule 8(6) of the Enforcement Rules specifically stipulates ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vernacular language; (iii) Having sufficient circulation in the locality, setting out the terms of sale. 8. Suffice to state here, there is no dispute between the parties that the word locality? has a reference to the area where the property is situated. It is also an admitted case that the property is situated in Faridabad. The question raised before the Appellate Tribunal was whether the newspaper namely Economic Times? (in English) and Rashtriya Sahara? (in Hindi) had sufficient circulation in Faridabad? It can be inferred from the perusal of the aforesaid Rule that both the newspapers must have sufficient circulations in the locality where the property is situated. The reason is obvious, best possible price can be secured, if the persons who would be interested in purchase are informed and made aware. Insofar as the Economic Times? is concerned, there was nothing on record that it has sufficient circulation in Faridabad. The learned counsel for the respondent No. 2 had, before the Appellate Tribunal submitted that the said newspaper was known for business ventures but its circulation was limited to a specific class which had interest in financial matters. Even though, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... am also of the view that when the said newspaper had an independent edition for the State of Haryana, it appears unlikely that the edition meant for Delhi would have any circulation in Faridabad. The respondent bank has not come up with any explanation as to why the notice was not published in Haryana edition of Rashtriya Sahara? and was published in Delhi edition and that too on such a page which was meant for east Delhi. I, however, agree with the bank?s counsel that the said newspaper does not have any east Delhi edition, but it does not appear that the Delhi edition has a specific page for east Delhi as is reflected from the copy of the original newspaper filed by the bank along with its application. In view of above, I am of the considered view that by publishing the sale notice in Delhi edition of Rasthriya Sahara? on 26.7.2008, which does not appear to have sufficient circulation in Faridabad locality, where the property in question is situated, the requirement of the proviso to rule 8(6) of the Enforcement Rules has not been sufficiently complied with. The main purpose of publication of the sale notice in a newspaper of vernacular language having sufficient circulation in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the petitioners are in the business of sale and purchase of the properties and some of the properties purchased have been rented out to the Bank itself. We also note, that only five bids were received pursuant to notice dated July 26, 2008. The auction was held in the bank premises in Delhi. The bids show a narrow movements marginally and just above the reserved price. These facts affirm the view and finding of the Appellate Tribunal regarding non compliance of Rule 8(6) of the Enforcement Rules. If that be so, such a sale cannot be validated. The Supreme Court, in its recent opinion reported as (2014) 5 SCC 610, Mathew Varghese Vs. M. Amritha Kumar and Ors., interpreting the provisions of the SARFAESI Act, Transfer of Property Act, in para 43 and 53, has held as under: 43. The above principles laid down by this Court also makes it clear that though the recovery of public dues should be made expeditiously, it should be in accordance with the procedure prescribed by law and that it should not frustrate a Constitutional Right, as well as the Human Right of a person to hold a property and that in the event of a fundamental procedural error occurred in a sale, the same can be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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