M/S JAPAN ELECTRONICS vs PUNJAB NATIONAL BANK on 29 September 2026

1. The instant application is filed under third proviso to Section 18(1) of the SARFAESI Act for reduction the pre-deposit from 50% to 25%. It is stated that as per the demand notice dated 26.11.2021 a sum of Rs.30,08,088/- was due against the appellants. The counsel for the appellants stated that the appellants have already deposited Rs.8 lakhs which comes to about 25% of the amount as claimed in the demand notice dated 26.11.2021. Accordingly, the requirement of making pre-deposit stands complied with. The application stands disposed of.

**Misc. Appeal No.352/2026**

2. Arguments heard in appeal. In the present appeal the challenge is to the order dated 02.09.2026 whereby interim application bearing no.1153/2023 filed by the appellant for seeking interim protection against further proceedings initiated by the respondent in respect of the secured asset. DRT-II, Chandigarh vide order dated 02.09.2026 dismissed the said application.

3. It is appearing that the respondents have filed S.A. bearing no.331/2026 titled as **M/s Japan Electronics & another V. Punjab National Bank & others** which is stated to be pending before DRT-II, Chandigarh. The appellant filed an interim application bearing no.1153/2023 for seeking interim protection against further proceedings stated to have been initiated by the respondents 1 to 4 in respect of the secured assets. DRT-II, Chandigarh vide the impugned order dated 02.09.2026 has dismissed the said application. The relevant portion of the order dated 02.09.2026 is reproduced as under:-

1. **17. The Respondent has further placed on record that the secured asset has already been auctioned on 26.05.2026 and the Sale Certificate was issued on 25.06.2026. Consequently, the relief sought by the Applicants has to be examined not only from the standpoint of the dispute between the borrowers and the Bank but also in the backdrop of the third-party rights stated to have been created in favour of the auction purchaser.**

2. **18. In these circumstances, the Applicants have failed to demonstrate a strong prima facie case warranting exercise of the discretionary jurisdiction for grant of interim protection. The plea of balance of convenience and irreparable loss, by itself, cannot overcome the substantial objection regarding delay, the earlier proceedings between the parties and the subsequent completion of the auction process.**

3. **19. It is also significant that the Applicants have not impleaded the auction purchaser, despite the Respondent's specific case that the auction has been completed and a Sale Certificate has already been issued in his favour. Any order having the effect of adversely affecting the rights of such auction purchaser, without his being before this Tribunal, would not be appropriate at this stage.**

4. **20. Accordingly, considering the inordinate delay in approaching the Tribunal, the serious objection regarding limitation, the earlier litigation concerning the same secured asset, and the fact that the auction has already been concluded and Sale Certificate issued, this Tribunal is not satisfied that the Applicants have made out a case for grant of interim stay/protection. Consequently, I.A. No.1153/2026 is dismissed.**

1. 4. Sh. Saksham Saxena, Advocate for the appellants stated that the appellants have already paid Rs.19.5 lacs to the respondents 1 to 4 against the loan of Rs.25 lacs and had submitted various one-time settlement proposals which were not accepted by the respondents 1 to 4.

2. 5. The counsel for the respondents 1 to 4 stated that the secured asset has already been auctioned on 26.05.2026 and sale certificate thereafter was issued on 25.06.2026. Accordingly, this Tribunal is of the opinion that under the circumstances no relief can be granted to the appellants. The impugned order does not require any interference by this Tribunal. There is no illegality or infirmity in the impugned order. The present appeal is accordingly dismissed along with pending applications, if any.

6. The appellants have not impleaded the auction purchaser as one of the necessary parties in the present appeal. However, the appellant is given liberty to file appropriate application before DRT for impleading the auction purchaser as necessary party and also to file appropriate application before the DRT for protection of the secured assets.

7. The pre-deposit already made by the appellant shall be refunded to the appellant as per law.

Sd/- ----- **(Dr. Justice Sudhir Kumar Jain)** **Chairperson**

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