SHRI. DATTA SAHAKARI SAKHAR KARKHANA LTD vs KOLHAPUR DISTRICT CENTRAL CO OPERATIVE BANK LTD on 18 September 2025

Judgment

(Delivered on 18th September, 2025)

1. By this application the applicant Sakhar Karkhana claimed to condone the delay of 5 months and 21 days in filing

Securitisation Application against the defendant bank.

2. The averments in the application can be summarized as under:

The applicant Sakhar Karkhana is a Co-operative Society registered under the provisions of Maharashtra Co- operative Society Act, 1960.

3. It is the case of the applicant Sakhar Karkhana that it was leased out. However, the Regional Joint Director (Sugar) and Joint Registrar Co-operative Society, Kolhapur vide Order dated 18th September, 2006 appointed Liquidator for management of applicant Sakhar Karkhana. When Liquidator was looking after the business of applicant Sakhar Karkhana, the defendant bank issued Demand Notice and put the said Karkhana for sale in the year 2012. Though the Liquidator filed SA No.28/2013 challenging the said sale, later on he withdrawn and got disposed of the Securitisation Application without pursuing the same. At last the defendant bank sold the said Karkhana in auction and took possession of it.

4. Thereafter, the order of appointment of Liquidator was got cancelled from the Minister on 1st July, 2017. Hence, the

Board of Administrator was appointed for looking after management of applicant Sakhar Karkhana which was functioning till 23rd October, 2021 when Board of Director was appointed by election.

5. The new Committee pursued the matter before Regional Joint Director (Sugar) and Joint Registrar Co-operative Society, Kolhapur for reconstruction and restoration of possession of the said Karkhana. In the meantime, due to lockdown mater could not be proceeded. Thereafter, the Joint Director (Sugar) and Joint Registrar Co-operative Society, Kolhapur by order dated 5th May, 2022 directed new Board of Directors to file case under the SARFAESI Act in the Court/Tribunal as the said Karkhana has been sold. Therefore, in view of these facts delay of five (05) months and twenty-one (21) days in filing Securitisation Application ensued.

6. It is further contended that while selling the said Karkhana in auction the defendant bank has committed breach of provisions of SARFAESI Act and injustice has been caused to the applicant Sakhar Karkhana and number of members who are dependent and connected with the

said Karkhana functioning. The applicant Sakhar Karkhana is willing to challenge the measures, particularly, sale of the said Karkhana in auction under the SARFAESI Act. Therefore, delay may be condoned in filing Securitisation Application.

7. The defendant bank by filing Reply/Objection cum Notes of Important Events (Exhibit-11) resisted the application. It is contended that applicant Sakhar Karkhana has not pleaded grounds sufficient to condone the delay. There is inordinate delay in filing Securitisation Application. The defendant bank for recovery of loan amount which was Rs.11337.33 lakhs had initiated proceeding against the applicant Sakhar Karkhana under the SARFAESI Act and there is no illegality committed by defendant bank.

8. The defendant bank had sold the said Karkhana in auction and Rs.108 Crores have been recovered therefrom and loan has been satisfied. There is delay of ten years/3650 plus days and not of five (05) months and twenty-one (21) days. Since grounds for delay are not adequate, the application may be dismissed.

9. The following points arise for my determination and I

record my findings as under:

Whether there are sufficient grounds to condone the delay?

What order?

Findings:

1. Point No.1 – In the affirmative

2. Point No.2 – As per final order.

Reasons

10. Heard both the parties. The learned Advocates for both the parties reiterated facts mentioned in the application and reply, respectively.

11. The learned Advocate for the applicant relied upon the following Authorities:

Inder Singh Vs. The State of Madhya Pradesh reported in 2025 LiveLaw (SC) 339.

Mool Chandra Vs. Union of India and another reported in (2025) 1 Supreme Court Cases 625.

University of Delhi Vs. Union of India reported in (2020) 12 Supreme Court Cases 745.

Om Prakash Gupta alias Lalloowa (Now Deceased) & Others Vs. Satish Chandra (Now Deceased) reported

[Kaur] TMA No.1/2023 Page 6 of 10

in 2025 SCC OnLine SC 291.

12. The learned Advocate for the defendant bank relied upon the Judgment passed by the Hon’ble Supreme Court in the matter of Union of India Vs. Jahangir Byramji Jeejeebhoy (D) Through his LR reported in (2024) 4 S.C.R.76.

13. Perused the record. As to Point Nos.1 and 2

14. Admittedly, the Liquidator was appointed in the year 2006 for looking after management of applicant Sakhar Karkhana and his appointment was cancelled in the year 2017. In the meantime, the defendant bank initiated action under the SARFAESI Act against the applicant Sakhar Karkhana. The defendant bank put the said Karkhana for sale by auction. Though the Liquidator challenged that auction by filing SA No.28/2013, later on he withdrawn the same for the reasons best known to him.

15. After order of appointment of Liquidator was cancelled in the year 2017, new Committee of Administrator was appointed for looking after management of applicant Sakhar Karkhana. They were making efforts for reconstruction of the said Karkhana and made

correspondence with Regional Joint Director (Sugar) and Joint Registrar Co-operative Society, Kolhapur but due to non-holding of election of applicant Sakhar Karkhana, the Regional Joint Director (Sugar) did not give response.

16. In the meantime, there was lockdown for more than one year due to Covid and therefore, the matter could not be proceeded. Further, election was conducted on 23rd October, 2021 and Board of Directors came into existence who approached Regional Joint Director (Sugar) and Joint Registrar Co-operative Society for reconstruction and restoration of possession of the Sakhar Karkhana. At last, Regional Joint Director and Joint Registrar Co-operative Society vide letter dated 5th May, 2022 instructed Board of Directors of applicant Sakhar Karkhana to file case under the SARFAESI Act in the Court/Tribunal as the Sakhar Karkhana has been sold in auction by defendant bank under the provisions of SARFAESI Act.

17. Under these circumstances, the applicant Sakhar Karkhana could not take action against the defendant bank who had initiated action under the SARFAESI Act. It is not disputed that in the lockdown period all

activities of every Company/Entity/Factory were closed. Further, limitation period for filing all kinds of litigations was extended by Order passed in OM SMW (C) No.3/2020 by Hon’ble Supreme Court.

18. According to applicant Sakhar Karkhana, the defendant bank has committed serious illegalities in selling the Sakhar Karkhana in auction and other actions under the SARFAESI Act which it wish to challenge. If Liquidator would have pursued SA No.28/2013, some result would have come from the order of Court passed therein. However, Liquidator withdrew that Securitisation Application for reasons best known to him. If applicant is given an opportunity to challenge the measures taken by defendant bank under the SARFAESI Act in respect of the Sakhar Karkhana, no prejudice would be caused to the defendant bank. Per contra, defendant will get an opportunity to contest the Securitisation Application.

19. In view of these observations, I hold that grounds elaborated in the application and supporting documents are adequate and sufficient to condone the delay. According to applicant Sakhar Karkhana, there is delay of

five (05) months and twenty-one (21) days whereas according to defendant bank there is delay of 3650 days. At this juncture, it is to be noted that while considering delay condonation application, Court should not consider the length of delay but should consider cause of delay and its quality. That apart, while dealing with delay condonation application Court should take pragmatic and liberal view as opposite party would get an opportunity to contest main application.

20. With great regard, I mention that Authority cited supra by defendant bank is not applicable to present case as facts in that case turn on different points than facts of the present case. At the same time, I hold that Authorities cited supra by applicant Sakhar Karkhana are squarely applicable to the present case.

21. Resultantly, I hold that application and relief claimed therein deserves to be allowed. Therefore, by answering these points accordingly, I pass the following order:

ORDER

A. The application is allowed. B. Delay of five (05) months twenty-one (21) days

in filing Securitisation Application is hereby condoned subject to applicant Sakhar Karkhana pay costs of Rs.4,00,000/- (Rupees Four Lakhs only) to Maharogi Sewa Samiti, Warora within three weeks from today. C. After payment of costs Securitisation Application be registered. D. Payment of costs is condition precedent for registration of Securitisation Application. E. This application is disposed of. Pronounced in open Court

Place: Pune Date: 18.09.2025 Sd/- (Dilip G. Murumkar) Presiding Officer Debts Recovery Tribunal, Pune