UNION BANK OF INDIA on 14 November 2024

ORDER

1. 1. This Review Application has been filed by the Defendant Bank, to review of the order passed by this Tribunal in D.No.5275/2024 in SA No.350/2024.

2. 2. It is submitted that the subject matter of immovable property belonging to the 1^st Respondent/Applicant was sold in the e-auction conducted by this petitioner on 30/04/2024 to the Respondents 2 & 3 for Rs. 7,08,50,000/- which was paid by the said respondents and sale was confirmed by this Petitioner Bank and Sale Certificate was also issued on 07/05/2024 and Symbolic possession of the auctioned property was also handed over.

The 1^st Respondent/Applicant obtained a status quo order from the Hon'ble DRT dated 27/05/2024, on condition that the 1^st Respondent/Applicant should deposit a sum of Rs. 6.40 crores, being the entire outstanding, within 10 days, which order was complied with by the 1^st Respondent/Applicant, and the interim order was continued by this Hon'ble Tribunal.

During this situation, the Respondents 2 & 3/ Defendants 2 & 3, seeking for a refund of the entire sale consideration amount moved vide D.No. 5275/2024, since they wanted to withdraw their bid for the reason that the 1^st Respondent/Applicant had paid Rs.6.40 crores towards their Outstanding.

Further, Applicant stated that, this petitioner had filed a counter, wherein they had categorically stated that a sum Rs. 52,17,716/- over and above the sum of Rs. 6.40 crores was still due and payable by the 1^st Respondent/Applicant. Hon'ble Tribunal while passing final orders dated 16/08/2024, in the said order point No.(i)

(i) Sale Certificate (already surrendered by the auction purchasers)) issued by the Respondent Bank is cancelled. Further, Respondent Bank is directed to refund the entire amount to the petitioners/auction purchasers paid by them within 30 days from the date of receipt of this order.'

Whereas, point No.(iii) mentions:

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(iii) Further, Respondent Bank is entitled to adjust the balance amount of sale proceeds (after adjustment of loan account) of Rs. 44,64,277.42 in the borrowers loan account.'

It is being clarified here that out of the sale consideration of Rs. 7,08,50,000/- paid by the auction purchasers, after appropriating Rs. 6,63,85,722.58 into the CC loan account, balance Rs. 44,64,277.42 had not been appropriated but kept in the account, for the reason that the status quo order was received from this Hon'ble Tribunal. Hence, it is being reiterated that the amount of Rs. 44,64,277.42 forms a part of the amount which had been paid by the auction purchaser towards sale consideration, which as per point No. (i) of the order, has to be refunded to the auction purchaser. This was not considered by this Hon'ble Tribunal.

Hence, the Petitioner respectfully submit that, it is just and necessary for this Hon'ble Tribunal to Review the order passed by this Hon'ble Tribunal in Memo D.No. 5275/2024 in S.A.No. 350/2024 dated 16.08.2024 to meet the ends of justice.

3. On the other hand 1^st auction purchaser filed the notes of arguments and submitted that they have paid a sum of Rs.7,08,50,000/- and same was accepted by the Bank and the Bank executed a sale certificate dated 07.05.2024 in favour of the auction purchasers and delivered the symbolic possession of the auctioned property. But, borrowers paid a sum of Rs.6.40 crores being the entire outstanding within 10 days as per the direction of this Tribunal. Hence, interim order was in force, this purchaser has invested huge amount and cannot wait indefinitely. Hence, auction purchasers want to surrender the sale certificate and seek return of the money from bank. Accordingly, Auction purchasers filed this memo for refund of money paid by them along with original sale certificate.

Accordingly, this Tribunal also closed this SA and directed the 1^st defendant bank to return the money paid by the auction purchaser without interest within one months time. Further, this Tribunal also granted liberty to bank to proceed against the property if the remaining dues are not paid by the borrowers.

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The present Review petition filed by Bank seeking direction to sell the properties in case the borrowers fails to make the balance payment, the said liberty has already given by this Tribunal and for the purpose, the bank no need to hold the money by paid the auction purchasers. Moreover, bank informed that they cannot proceed under this Act, as the claim amount had come down below 20% and in view of the exemption granted under section 31(j) of the Act. Once, 13(2) demand notice is issued under SARAFESI Act, it cannot bind under section 31(j) of the Act.

Hence, auction purchasers want dismissal of this Review Application and direct the Applicant Bank to refund the entire sale consideration amount along with the interest of 18% per annum from the date of deposit to till the date of payment and disposal of this Review Application.

4. Counsel for Applicant appeared and opposed to review the order passed in SA No.350/2024.

5. Having heard the parties and after considering the entire facts and circumstances of the case, I find that the Bank has filed this Review Application with a prayer to direct the borrowers to pay the balance amount of Rs.52,17,716/- within short time and with regard to the order dated 16.08.2024 in which the point no.(iii), the respondent bank is entitled to adjust the balance amount sale proceeds (after adjustment of loan account) of Rs.44,64,277.42 in the borrowers loan account.

I find that, auction purchaser memo was already disposed on 16.09.2024 with a direction that, Respondent Bank is directed to refund the entire amount to the auction purchaser paid by them within 30 days from the date of receipt of this order. Further, bank is entitled to proceed as per law for remaining dues.

This Review Application was filed only for clarification of the point no.(iii), with regard to balance of sale amount Rs.44,64,277.42 i.e, after adjustment of CC loan account, which is auction purchaser's amount. I find that, in point no.(iii) in the order dated 16.08.2024, there is an apparent arithmetical error, which can be rectified.

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Therefore, the Order passed in Memo D.No.5275/2024, dated 16.08.2024 is modified / Review Application is disposed off, with following direction:

- (i) Sale Certificate (already surrendered by the auction purchasers) issued by the Respondent Bank is already cancelled by the order dated 16.08.2024. Now, Respondent Bank is directed to refund the entire sale amount to the petitioners/auction purchasers paid by them within 15 days from the date of receipt of this order.

- (ii) Further, Respondent Bank is directed to adjust the entire amount inclusive of interest paid by the borrowers as per the conditional order imposed by this Tribunal.

- (iii) Bank is at liberty to refund the entire sale consideration amount to the auction purchaser inclusive of the amount lying with the bank (sale balance amount of Rs.44,64,277.42i.e, after adjustment of CC loan account)

- (iv) After adjustment of aforesaid amounts, the Respondent Bank is entitled to recover the remaining dues from the borrower as per law, if any.

- (v) Main prayer of the Applicant is that, to quash the E-Auction sale scheduled to be held on 08.04.2024 and further proceedings. Sale and sale certificate is cancelled vide order dated 16.08.2024. Hence, nothing survives in this appeal as infructuous.

Accordingly, Review Application is disposed off.

*(Dictated to the PS, taken down, transcribed, typed by him corrected and pronounced by me in the open court this the*

**(SEEMA SINHA)** **PRESIDING OFFICER**

**(SEEMA SINHA)** **PRESIDING OFFICER**

Typed by me (PS)

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