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Axis Bank Limited v. Naren Sheth and Another
REED 2023 SC 09525
Corporate Insolvency – Section 7 Application – Admitted – Appeal – Limitation
September 12, 2023
Sections 7, 61, Insolvency and Bankruptcy Code, 2016
Sections 3(1), 5, 14, 18, 18(1), 18(2), Limitation Act, 1963
Sections 13(2), 13(4), 14, SARFAESI Act, 2002
Acknowledgments of debt within the meaning of Section 18 of the Limitation Act extended the limitation period for filing an insolvency petition under the Insolvency and Bankruptcy Code, making the petition valid.
In this Supreme Court judgment, the case revolves around a dispute related to the Insolvency and Bankruptcy Code, 2016. The appellant had challenged a decision by the National Company Law Appellate Tribunal (NCLAT) that upheld the admission of an application under Section 7 of the IBC against the Corporate Debtor.
The dispute originated from a leave and license agreement between the appellant and Universal Premises and Textiles Private Limited. A significant security deposit was made by the appellant during this agreement. Subsequently, Universal Premises merged with another entity, becoming the Corporate Debtor, and the appellant sought the refund of their security deposit.
Respondent No. 2, the State Bank of India, declared the Corporate Debtor as a Non-Performing Asset (NPA) due to a default, and legal proceedings ensued. Acknowledgments of the debt were made by the Corporate Debtor in its balance sheet and through various one-time settlement (OTS) proposals.
The key argument in the case was whether these acknowledgments extended the limitation period for filing the insolvency petition. The Supreme Court ruled in favour of Respondent No. 2, stating that the acknowledgments fell within the provisions of Section 18 of the Limitation Act, allowing for a fresh limitation period to be computed from each acknowledgment. Therefore, the insolvency petition was filed within the extended limitation period, making it valid.
The Supreme Court also addressed the appellant's objections regarding the admissibility of certain documents and the genuineness of the OTS proposals, stating that these issues could be dealt with in the proceedings before the Adjudicating Authority.
Ultimately, the Apex Court dismissed the appeal, finding that Respondent No. 2's insolvency petition was not time-barred and that the acknowledgments of debt were valid under the law.
Latif Yusuf Manikkoth v. The Board of Directors of the Bank of Baroda and Others
REED 2023 Bom 07685
Writ Petition - Petitioner, a guarantor to a loan taken by a borrower company, filed a petition under Article 226 of the Constitution of India, seeking various reliefs related to the loan and the actions taken by the respondent bank
July 20, 2023
Article 226, Constitution of India
Sections 17, 18, RDB Act, 1993
Sections 9, 14, Insolvency and Bankruptcy Code, 2016
Sections 9, 10, Micro, Small and Medium Enterprises Development Act, 2006
Sections 13(2), 13(3), 13(4), 14, SARFAESI Act, 2002
Sections 34, 38, 41, Specific Relief Act, 1963
The petitioner's writ petition was dismissed as it sought the same reliefs already pursued through other proceedings, emphasizing the importance of utilizing established statutory remedies for debt recovery.
The petitioner, a guarantor to a loan taken by a borrower company, filed a petition under Article 226 of the Constitution of India, seeking various reliefs related to the loan and the actions taken by the respondent bank. The petitioner's main contentions were centered around the applicability of the Micro, Small and Medium Enterprises Development (MSMED) Act over the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, and the jurisdiction of the bank to declare the petitioner as a willful defaulter.
The borrower company had defaulted on its loan, leading to the respondent bank declaring its loan account as a Non-Performing Asset (NPA) and initiating SARFAESI proceedings. The petitioner challenged this action through multiple proceedings, including civil suits, writ petitions, and securitization applications. The petitioner argued that the MSMED Act, being a later law, should prevail over the SARFAESI Act and sought protection under the MSMED Act's provisions.
The High Court analysed the sequence of events and legal arguments put forth by both parties. The High Court referred to previous Supreme Court judgments emphasizing the importance of utilizing statutory remedies like those provided by the Debts Recovery Tribunal (DRT) and the SARFAESI Act before seeking relief under Article 226. The High Court noted that the petitioner had already availed the remedies available under the SARFAESI Act by filing securitization applications before the DRT.
The High Court also highlighted that the borrower company's moratorium under the Insolvency and Bankruptcy Code did not extend to the petitioner's assets, as the petitioner was the owner of the secured asset. The High Court referred to a previous Supreme Court judgment that clarified that the SARFAESI proceedings against a guarantor could continue even during the borrower's insolvency proceedings.
Given the multiple legal proceedings already initiated by the petitioner, the High Court concluded that the present writ petition was not maintainable, as it sought the same reliefs that were previously sought in other proceedings. The High Court emphasized that the petitioner had the option to pursue remedies available under the SARFAESI Act and DRT proceedings. The High Court cautioned against using Article 226 as a parallel remedy and dismissed the petitioner's writ petition, emphasizing the importance of adhering to the statutory framework for debt recovery and legal redressal.
SCM Silks Private Limited v. The State of Tamil Nadu
REED 2023 Mad 07204
Writ Petition – Petitioner was seeking protection under SARFAESI Act as bona fide purchasers of land
July 7, 2023
Section 507(a), Delhi Municipal Corporation Act, 1957
Section 15, Limitation Act, 1963
Sections 17, 31(1), SARFAESI Act, 2002
Sections 3(22), 5(1)(d)(i), 20A, 37B, 37B(1)(b), 37B(2), 37B(3), 37B(4), 66(b), 70, 73, 73(ii), 73(vi), 73(vii), 94, 126B, Tamil Nadu Land Reforms (Fixation of Ceiling on Land) Act, 1961
Section 43, Transfer of Property Act, 1882
The government was not bound by the sale transactions between banks and third-party purchasers, and the claims made by the petitioners for exemption, promissory estoppel, and limitation were rejected. The High Court ruled that the petitioners failed to provide sufficient evidence and did not comply with the provisions of the Land Reforms Act, which led to the dismissal of their claims.
The High Court judgment revolved around two writ petitions filed by the Petitioner M/s. SCM Silks Private Limited and International Asset Reconstruction Company Private Limited. Both petitions challenged the validity of an order issued by the Secretary to Government, Revenue and Disaster Management Department, Chennai, rejecting M/s. SCM Silks Private Limited's application seeking exemption under Section 73(vi) & Section 73 (vii) of The Tamil Nadu Land Reforms (Fixation of Ceiling on Land) Act, 1961. The order stated that further action would be taken after resuming the land from Sri Ramachandra Educational and Health Trust.
The Petitioner argued for exemption based on principles of promissory estoppel, waiver, and legitimate expectation, claiming that the government's actions had recognized the sale of lands to third parties and thus waived its right to take further action. They also invoked the SARFAESI Act's protection as bona fide purchasers and argued that the government's powers under Section 37-B were time-barred.
The case also involved the interpretation of the Land Reforms Act's applicability to lands reclassified as primary residential zones.
The High Court directed a detailed inquiry and considered various legal arguments and factual aspects. It referred to several relevant precedents from the Supreme Court of India to support its decision.
In another part of the judgment, the High Court examined the scope of Section 37-B of the Act, which deals with applications made by public trusts seeking permission to hold or acquire land for educational or hospital purposes. It emphasized that the permission sought is for acquiring land, not for ratifying sales already made in contravention of the Act.
The Court upheld the government's power to cancel Section 37-B permission if conditions were violated and rejected the claims of exemption, promissory estoppel, and limitation raised by the petitioners. It concluded that the actions of the government and third parties were not barred by estoppel, as they were unaware of the 37-B permission due to certain documents not being brought to their notice.
Overall, the judgment clarified the interpretation of various legal provisions and highlighted the importance of adhering to the Land Reforms Act's provisions and not misusing exemption clauses. The Court also emphasized the need for a wider interpretation of welfare legislation to achieve social justice goals. The judgment ultimately dismissed both writ petitions.
Sameer Khullar v. Cholamandalam Investment and Finance Company Limited
REED 2023 DRAT Del 06251
SARFAESI Proceedings – Sale deed clearly transferred ownership to respondents 2 and 3, and the appellant's remedies for redressal were available through civil and criminal actions - Appeal
June 30, 2023
Sections 2(o), 13(2), 13(4), 14, 17(1), SARFAESI Act, 2002
Rule 8(1), Security Interest (Enforcement) Rules, 2002
The appellant's claim for protection against possession by the respondent-Financial Institution was dismissed as the sale deed clearly transferred ownership to respondents 2 and 3, and the appellant's remedies for redressal were available through civil and criminal actions.
In the present case, the Debts Recovery Appellate Tribunal (DRAT) issued an order in response to Appeal No. 120/2023. The appeal arose from an impugned order dated 28.03.5023 passed by the Presiding Officer, DRT-I, Delhi. The impugned order dealt with a securitization application filed by the appellant, challenging a receiver notice and possession notice issued in relation to a property in Delhi.
The appellant claimed to be the owner of the property, gifted to him by his father in 2007. He entered into an agreement in 2011 to sell the second floor without roof rights to respondents no. 2 and 3, his brother and sister, with conditions related to constructing a third floor. However, the appellant alleged that the respondents had forged the agreement and changed the terms, leading to a dispute. The respondents obtained loans from the respondent no. 1 bank against the mortgage of the property, which later became a non-performing asset.
The appellant contended that despite filing a suit for cancellation of the sale deed, the respondent no. 1 bank initiated proceedings under the SARFAESI Act for recovery. The DRT held that the respondent no. 1 bank had followed proper procedures under the SARFAESI Act. The DRT dismissed the appellant's securitization application, allowing the respondent no. 1 bank to proceed further in accordance with the law.
The appellant challenged the DRT's order in an appeal, arguing that the bank should not have taken action in the dispute between him and respondents no. 2 and 3. The appellant also contended that the bank did not inspect the property before granting the loan. However, the DRAT found that the sale deed allowed respondents no. 2 and 3 to use and mortgage the property and that the appellant's possession claims were not substantiated.
The DRAT further stated that the appellant had other legal remedies available, such as filing a complaint and a suit for specific performance, to resolve the dispute with respondents no. 2 and 3. Consequently, the appeal was dismissed, upholding the DRT's order.
Vimla Devi Sharma v. Bank of Baroda and Others
REED 2023 DRAT Del 06244
SARFAESI Proceedings – Appeal - Unregistered agreement-to-sell documents did not confer ownership rights
June 26, 2023
Section 420, Indian Penal Code, 1860
Sections 17, 17(1)(b), Registration Act, 1908
The unregistered agreement-to-sell documents did not confer ownership rights, and the bank's actions in granting loans based on registered sale deeds were found to be valid and in accordance with the law.
The appellant, Mrs. Vimla Devi Sharma, and Mr. Kailash Chand Sharma filed separate appeals, numbered 155/2023 and 156/2023, respectively, challenging the common order dated 15.05.2023 passed by the Presiding Officer of the Debts Recovery Tribunal (DRT) in Jaipur. The impugned order dealt with two separate cases related to the mortgage of properties. The appellants claimed their rights over the properties based on unregistered agreement-to-sell documents executed in 2017 and 2018. However, the bank, as the respondent, argued that the appellants' claims were invalid since the agreements were not registered as required under the Registration Act, 1908.
The Debts Recovery Appellate Tribunal (DRAT) dismissed the appeals, stating that the unregistered agreement-to-sell documents did not confer ownership rights to the appellants. The bank had granted loans to the borrowers/mortgagors based on registered sale deeds in their favour. The Presiding Officer found no infirmity or illegality in the bank's actions and stated that the appellants could pursue legal remedies against the borrowers/mortgagors separately.
The appellants argued that they were in possession of the properties and had filed a civil suit for specific performance, claiming to have been deceived by the borrowers/mortgagors. They had also registered an FIR for fraud against the borrowers/mortgagors. The DRAT concluded that the filing of a civil suit did not prevent the bank from recovering its dues under the SARFAESI Act, 2002, and the appellants could seek redress through the available legal remedies.
Consequently, the appeals were dismissed, and the DRAT found no infirmity or illegality in the impugned order. The appellants were not granted any protection by the DRAT, and the case files were consigned to the record room
Syed Hidayathulla v. The Authorized Officer, Canara Bank
REED 2023 AP 06284
SARFAESI Proceedings – One Time Settlement - Auction sale – Petitioner is entitled to a refund of the deposited amounts
June 23, 2023
Rules 8, 8(5), 8(6), 8(6)(a), 8(6)(f), 9, 9(3), 9(4), 9(5), Security Interest (Enforcement) Rules, 2002
Bank's premature adjustment of the deposit and failure to disclose key property details in the auction notice, coupled with the bank's One Time Settlement with the borrower, entitled the petitioner to a refund of the deposited amounts.
In the present high court order, the petitioner filed a writ petition seeking a writ of Mandamus to declare the inaction of the respondent Bank in not considering the representation for a refund of the sale consideration amount as illegal. The petitioner had participated in an auction but could not pay the full amount due to health reasons, seeking an extension of time. The Bank had adjusted part of the amount towards the borrower's loan account.
The High Court considered the Rules under the SARFAESI Act governing the sale of immovable property. It noted that the right to forfeit the deposit only arose on the last date for payment, which was 25.10.2019. Therefore, the Bank's adjustment of the amount on 09.09.2019 was found to be in error. The High Court also discussed the issue of the property being 'L' shaped and behind buildings, which had not been adequately disclosed in the auction notice.
Ultimately, the High Court ruled in favour of the petitioner, stating that the Bank's conduct was high-handed, and they had voluntarily entered into a One Time Settlement with the borrower, which estopped them from claiming the deposited amounts. The High Court ordered the refund of the deposited amounts to the petitioner and allowed the writ petition, with no costs.
Anthony Samy v. The Authorised Officer, State Bank of India and Another
REED 2023 DRAT Chn 06232
SARFAESI Proceedings - Limitation – Condonation of delay – Appeal - There must be bona fide reasons to condone delay
June 23, 2023
Section 5, Limitation Act, 1963
Sections 17, 17(1), SARFAESI Act, 2002
The DRAT dismissed the appeal, upholding the DRT’s decision to reject the application for condonation of delay due to the appellant's failure to provide convincing and bona fide reasons for the 945-day delay in filing the SARFAESI Application.
The Appeal, MA (SA) 32/2021, was filed against the Order dated 20.01.2021 in IA 1001/2020 in SA SR No. 2591/2020 of the Debt Recovery Tribunal (DRT) in Madurai.
The Appellant had filed SA SR No. 2591/2020 challenging the actions of the Bank under the SARFAESI Act, 2002. The DRT returned the SA on the grounds of limitation. The Appellant then approached the Madras High Court, filing WP (MD) 7879/2020. The High Court held that the Appellant could file an Application for condonation of delay under Section 17 of the SARFAESI Act, 2002, and disposed of the Writ accordingly. Based on this, the Appellant filed IA 1001/2020 to condone the delay of 945 days in filing the SARFAESI Application.
The Bank and Auction Purchaser opposed the Application, and after considering their contentions, the Tribunal dismissed the Application, stating that the Appellant failed to provide convincing and bona fide reasons for the delay. Dissatisfied, the Appellant filed the present Appeal.
The Counsel for the Appellant argued that the Bank did not follow the provisions of the SARFAESI Act, 2002, and did not provide the Appellant with an opportunity before unilaterally selling the property. The Advocate requested an opportunity to determine the rights of the parties on merits.
The Counsel for the Bank contended that the Tribunal was correct in dismissing the Application as the Appellant did not provide sufficient and convincing reasons for the 945-day delay. They cited relevant court decisions to support their argument.
The Counsel for the Auction Purchaser adopted the arguments of the Bank and submitted that the Tribunal's Order was reasoned and should not be interfered with.
After examining the relevant documents and considering the arguments, the Debts Recovery Appellate Tribunal (DRAT) found that the Appeal lacked merit. The DRAT agreed with the Tribunal's dismissal of the Application and concluded that there were no grounds for interference.
Therefore, the Appeal, MA (SA) 32/2021, was dismissed, and each party was ordered to bear their own costs. All pending Interlocutory Applications (IAs) were closed
Akola Janata Commercial Co-operative Bank Limited and Others v. Sharad Automobiles and Others
REED 2023 Bom 06283
SARFAESI Proceedings – Auction sale - Whether the bank's participation in the auction sale, which took place under the SARFAESI Act, was in compliance with the law - Auction sale null and void due to the bank's non-compliance with the SARFAESI Act
June 22, 2023
Section 294, Civil Procedure Code, 1882
Order XXI Rule 72, Order XXI Rule 72A, Code of Civil Procedure, 1908
Article 300A, Constitution of India
Section 29, RDB Act, 1993
Sections 13, 13(1), 13(2), 13(4), 13(5A), 17, 17(2), 17(4), 35, 37, SARFAESI Act, 2002
Sections 69, 69A, Transfer of Property Act, 1882
Rules 8(5), 8(6), 8(6)(b), Security Interest (Enforcement) Rules, 2002
A secured creditor's participation in an auction sale of mortgaged property under the SARFAESI Act, without strict compliance with the Act's provisions, renders the sale voidable at the borrower's option.
In the present high court judgment, a complex legal dispute unfolded, centering on the enforcement of a loan agreement between a scheduled bank (petitioner 1) and a partnership firm (borrower). The bank had extended a cash credit loan of Rs. 50,00,000 to the borrower, and as collateral, another firm had mortgaged a property. When the borrower defaulted on the loan repayment, the bank invoked the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act) to recover the outstanding amount.
The case took a contentious turn when the bank conducted an auction sale of the mortgaged property on 31-12-2007 without granting sufficient opportunity for the borrower to address their objections and without ensuring a proper valuation of the asset. Subsequently, the Debts Recovery Tribunal (DRT) and the Debts Recovery Appellate Tribunal (DRAT), ruled against the bank's actions. The DRT, in its judgment dated 25-7-2008, nullified the auction sale and allowed the petitioners to undertake further actions after addressing the borrower's objections and obtaining a fresh valuation report. The DRAT, in its judgment dated 30-6-2010, upheld the DRT's decision.
The central issue revolved around whether the bank's participation in the auction sale, which took place under the SARFAESI Act, was in compliance with the law. The high court meticulously examined the relevant statutory provisions, which governed the sale of secured assets under the SARFAESI Act. It was determined that the bank's actions, including the manner in which they participated in the auction through their authorized officer, were in violation of these provisions. Moreover, the court found discrepancies in the valuation reports and concluded that the reserve price was not correctly set.
In delivering its judgment, the high court emphasized the critical importance of adhering to statutory provisions, particularly in auctions involving secured assets. The ruling underscored that even if immediate prejudice was not evident, a breach of these provisions could not be ignored. The court delved into various legal aspects, such as the distinction between mandatory and directory rules, the requirement for court permission for decree-holders to bid on properties, and the relevance of market-based valuations and confirmation of auction sales.
In essence, the judgment upheld the borrower's rights and declared the auction sale null and void due to the bank's non-compliance with the SARFAESI Act. This case serves as a significant precedent highlighting the necessity for strict adherence to statutory procedures and transparency in auctions involving secured assets, ultimately safeguarding the interests of all parties involved.
Biswajit Ghosh, Through LRs Purabi Debbarma (Ghosh), Gourab Ghosh and Sourab Ghosh v. Tripura Gramin Bank and Another
REED 2023 DRAT Kol 06257
SARFAESI Proceedings - Appellant's claims and pleas were not pleaded in the application – Appeal
June 21, 2023
Section 13(2), Section 13(4), Section 17, SARFAESI Act, 2002
Rule 8(6), Rule 9(1), Security Interest (Enforcement) Rules, 2002
The DRAT dismissed the appeal against the SARFAESI Application, as the appellant's claims and pleas were not pleaded in the application and the notice under Section 13(2) was duly served, thereby upholding the legality of the sale conducted by the bank.
An instant appeal was filed against the judgment and order of the Debts Recovery Tribunal, Guwahati, which dismissed the SARFAESI Application made by the borrower’s LRs. The application sought to set aside the sale notice issued by the bank.
The borrower had taken two loans from the respondent bank, and he had partially repaid both loans. However, there were outstanding amounts against each loan according to the bank's statements. The bank issued a sale notice, and the borrower claimed that it was illegal because the required sixty days notice under Section 13(2) of the SARFAESI Act was not given. He also expressed willingness to make full payment and requested additional time.
The bank replied to the SARFAESI Application, stating that an over-limit amount was sanctioned to the borrower, and due to irregularities, the loan accounts were classified as non-performing assets (NPA).
The bank served a notice under Section 13(2) of the SARFAESI Act to the borrower and the guarantors. No objection was submitted by him. Possession of the secured assets was taken, and an auction was conducted, resulting in the sale of the property to the auction purchaser. The bank claimed that all proceedings were conducted in accordance with the law.
The DRT dismissed the SARFAESI Application, stating that the sale was conducted in accordance with the law, and the notice under Section 13(2) was duly served.
The appellant appealed the decision, arguing that the findings were perverse and against the record. It was claimed that notice under Section 13(2) was not served, and the validity of the sale notice and possession notice were not considered. The burden of proof was placed on the bank to establish the service of the notice. The compliance of certain rules was also questioned.
The DRAT also noted that certain pleas raised during the hearing were not taken in the SARFAESI Application and, therefore, could not be adjudicated.
The DRAT held that the pleas raised by the appellant were not pleaded in the SARFAESI Application and could not be considered. It stated that evidence cannot be relied upon if it is not in line with the pleadings. The DRAT also noted that the appellant's grounds of challenging the sale notice were misconceived.
The DRAT further observed that the bank had served the notice under Section 13(2) of the SARFAESI Act, and the sale was conducted in compliance with the relevant rules. It concluded that the appeal lacked merit, and the impugned order was not legally flawed.
As a result, the appeal was dismissed.
Central Bank of India v. Purnima Sharad Halkarni and Others
REED 2023 DRAT Mum 06274
SARFAESI Proceedings – Appeal - Sale could only be set aside on limited grounds of fraud
June 16, 2023
Rules 60, 61, Income Tax Act, 1961 (IInd Schedule)
Section 30, RDB Act, 1993
The sale of the property cannot be set aside solely based on the grounds of improper service of notice on legal representatives, and there was substantial representation of the legal representatives during the proceedings, making the impugned orders of the DRT stayable.
In the present case, there were two appeals, Appeal No. 40 of 2022 and Appeal No. 29 of 2023, filed challenging orders made by the Debts Recovery Tribunal (DRT) in Aurangabad. Appeal No. 40 of 2022 challenged the order of the DRT allowing the appeal, which resulted in the setting aside of the auction sale and refund of the purchase price to the auction purchaser. Appeal No. 29 of 2023 was filed to challenge a subsequent order directing the Appellant Bank to recover possession of the property from the auction purchaser after refunding the sale consideration paid in full.
Considering that both applications pertained to the implementation of the original order, the DRT disposed of the stay applications through a common order.
The relevant facts for the disposal of these applications were as follows: The 1st Respondent and others had obtained a loan from the Appellant bank under two facilities. The properties of late Sharad Ramachandra Halkarni, the husband of the 1st Respondent and father of Respondents Nos. 2 and 3, were mortgaged as security for the loan. However, the repayment was defaulted, leading to legal proceedings.
The DRT issued a Recovery Certificate, and the property was put up for sale in 2010 but failed to find bidders. Subsequent legal proceedings ensued, and finally, the auction sale was conducted and confirmed in favour of the highest bidder, the 4th Respondent.
Respondent Nos. 1 to 3 challenged the sale after the sale certificate was issued and possession was handed over to the 4th Respondent in the appeal before the Presiding Officer DRT. The Presiding Officer set aside the sale mainly due to improper service of notice on the legal representatives and the auction being carried out in the name of the deceased.
The Appellant Bank was aggrieved by the DRT's order and filed Appeal No. 40 of 2022, while the 4th Respondent filed an application for a refund of the purchase price. The Debts Recovery Appellate Tribunal (DRAT) disposed of the refund application and directed the 4th Respondent to approach the DRT for a refund or contempt, if applicable. As no stay was granted in Appeal No. 40 of 2022, the DRT fixed a date for handing over possession of the property to the Bank and directed a refund of the sale consideration to the auction purchaser.
The Appellant Bank filed Appeal No. 20 of 2023, aggrieved by the order of the DRT, and both appeals had stay applications filed.
During the proceedings, the Senior Counsel for the Appellants argued that the sale proclamation was not in the name of the deceased and that there was proper representation of legal heirs in the proceedings. He relied on legal precedents to support the contention that the 1st Respondent, who was already on record, sufficiently represented the estate of the deceased, and hence, the other legal heirs were bound by the decision.
On the other hand, the Counsel for the 4th Respondent vehemently opposed the stay applications, arguing that the DRT's orders were not flawed and no irreparable injury would be caused to the Appellant Bank.
After considering the arguments and perusing the records, the DRAT found that there was substantial representation of the legal representatives during the proceedings, and the decision in Kadir Mohideen v. N.V. Muthukrishna Ayyar & Another was applicable. The DRAT observed that the sale could only be set aside on limited grounds of fraud, and no such allegation was made by the Respondents. The description of the property in the proclamation as belonging to the deceased did not render the proclamation invalid. Therefore, the DRAT concluded that it was in the interest of justice to stay the impugned orders of the DRT, Aurangabad, until the disposal of the appeals.
Consequently, I.A. Nos. 166 of 2022 in Appeal No. 40 of 2022 and I.A. No. 281 of 2023 in Appeal No. 29 of 2023 were allowed, and the DRT's orders dated 17.01.2022 and 13.04.2023, along with any subsequent orders, were stayed until the disposal of the appeals.