SMT KANDRA PRATHIMA vs CENTRAL BANK OF INDIA on 22 October 2026

1. This appeal is filed against the final order passed in S.A. 224 of 2026 by the Learned Presiding Officer, DRT, Visakhapatnam on 5^th day of October, 2026. S.A. has been filed to set aside the auction conducted on 17.3.2026 in pursuance of the E-Auction Sale Notice dated 02.03.2026 and the consequential acts of confirmation of sale, issuance of sale certificate and its registration and other consequential and incidental reliefs. On dismissal of the S.A. this appeal is filed.

2. Learned Counsel for the Petitioner/Appellant submitted that Appellant has raised two main grounds with regard to the sale of the property (i) The property was valued to an extent of Rs.1.65 crore when the value of the property was Rs.4.85 crore at the time of availing the loan in the year 2016. The same property was valued by the same valuer in the year 2025 at Rs.1.87 crore for the purpose of sale, it shows that the property was grossly undervalued and sold. (ii) The Sale Notice dated 2.3.2026 claiming the due amount of Rs.2,42,50,000.00 as on 11.01.2019 was issued on 02.3.2026. It was served on the petitioner only on 04.3.2026. The Sale Notice was published in the newspaper on 4.3.2026 and it is not affixed on 2.3.2026. Therefore, it is evident that there is no clear 15 days' notice from the date of sale notice and the date of sale. There is violation of a mandatory provision of SARFAESI Act and Rules, especially Rules 8(6) and 9(1) of SIE Rules, 2002. Though these two points were raised before the Tribunal and interim order was passed by the Learned Presiding Officer, it was not considered at the time of final disposal of the S.A. and the S.A. was dismissed. Against the dismissal of the SA. this appeal is filed along with the waiver application.

3. It is further submitted that after the sale of the property the Bank offered O.T.S. for Rs.2.20 crore. As per the O.T.S. offer the petitioner paid Rs.2.20 crore and it is available with the Bank. On these grounds Learned Counsel for the Petitioner/appellant seeks waiver for pre deposit and no other ground is urged.

4. Responding to the submission of the Learned Counsel for the Petitioner/appellant, it is the submission of the Learned Counsel for the 1^st Respondent that the Securitization Application was filed only challenging the sale held and subsequent actions, but the Sale Notice was not challenged. The ground now raised by the Learned Counsel for the Petitioner had been answered by the DRT in negative. It is not correct to state that the Sale Notice was received by the Appellant only on 4.3.2026. On 2.3.2026 itself the Sale Notice was served on the husband of the Appellant. The Sale Notice was published on 4.3.2026 and affixed on 2.3.2026. It is not the first sale attempt but the fourth sale attempt. Earlier three sale attempts failed for want of bidders. Therefore, Bank had to reduce the reserve price. The first three sale attempts failed for want of bidders. In the first sale reserve price was fixed at Rs.2.15 crore; the reserved price was reduced to Rs.1.95 crore and Rs.2.18 crore and Rs.1.87 crore in the successive sale attempts. Therefore, it is not correct to say that the property was undervalued and sold. The Auction Purchaser paid the entire sale consideration on 21.3.2026. S.A. was filed on 30.3.2026. Once the sale is completed it cannot be challenged without an allegation of fraud, collusion, under valuation, etc., as settled by the Hon'ble Supreme Court of India.

5. It is further submitted that on the date of sale on 17.3.2026, there was a due of Rs.7,85,45,049.06. The Bank has not offered any O.T.S. After the sale was over and the sale price was deposited by the Auction Purchaser on 21.3.2026, Petitioner voluntarily submitted the O.T.S. but it was not accepted by the Bank. Sum of Rs.2.20 crore was deposited by the Appellant on 24.3.2026 voluntarily and it is now lying in the current account of the Bank. The Bank has already exercised the right of lien against this amount as such there is no O.T.S. payment. Pre deposit is mandatory for entertaining this appeal.

6. Learned Counsel for 2^nd Respondent submitted that Auction Purchaser paid entire sale price and is a bona fide purchaser. Pre-deposit is mandatory for entertaining this appeal.

7. Considered the rival submissions and perused the records.

8. S.A. has been filed to challenge the sale and consequential acts of issuance of sale certificate and sale registration. The first issue on which the appeal lies is with regard to non-service of Sale Notice giving clear notice of 15 days. Perusal of the impugned sale notice dated 2.3.2026 shows that there is a name of one person with cell phone number and a date 4.3.2026. There is also a signature of one Smt. K. Prathima. It is clarified by the Learned Counsel for the Petitioner that in all the papers, attached to this appeal, her signature appears. Respondent has not produced any material except the Sale Notice to show that the Sale Notice was served on 2.3.2026. Therefore, it is obvious that there was no clear 15 days notice from the date of sale notice to the date of sale.

9. Second issue is with regard to under valuation of the property. It is not disputed by the 1^st Respondent that the property was valued at Rs.4.45 crore in 2016. The Reserve Price for the first sale was Rs.2.15 crore which was reduced to Rs.1.95 and Rs.2.18 crore and Rs.1.87 crore in successive sale attempts. It is also brought to my notice by the Learned Counsel for the Petitioner/appellant that stamp duty was paid at Rs.10,28,750.00 with the registration charge of Rs.93,650.00 on the chargeable value of Rs.3,92,01,300.00. This is pertinent to notice that after sale and at the time of registration of sale certificate, the property was valued at Rs.3,92,01,300.00. According to Learned Counsel for the petitioner/appellant, even then price is less than the market price.

10. Though this Tribunal finds that there is prima facie case made out with regard to not giving clear 15 days' notice and the plea to canvas the under valuation, this aspect will be considered in detail at the time of final disposal of the appeal.

11. That apart under the provisions of the SARFAESI Act appeal is only to be entertained subject to payment of pre-deposit on the Debt due, inclusive of interest, as decided by the Hon'ble Supreme Court of India in ***Sidha Neelkanth Paper Industries Private Limited and Another -vs- Prudent ARC Limited and Others***, reported in 2023 SCC Online SC.

12. As per the submission of the Learned Counsel for 1^st Respondent the debt due as on 17.3.2026 was Rs.7,85,45,049.06p without considering the sale price.

13. Since the property has already been sold and a third party interest is created, this Tribunal is of the view that directing the Petitioner/Appellant to deposit 30% of Rs.7,85,45,049.06p (rounded off to Rs.7,85,45,049/-) would meet the requirement under Section 18(1) of SARFAESI Act, 2002, for entertaining the Appeal.

14. Admittedly, 30% of Rs.7,85,45,049/- comes to Rs.2,35,63,514.70p (rounded off to Rs.2,35,63,515/-)

15. Therefore, Petitioner/Appellant shall deposit Rs.2,35,63,515/- on or before 23.11.2026.

16. It is made clear that failure to deposit of above said amount, the Appeal shall stand rejected. On making such deposit by Petitioner/Appellant, Registrar DRAT, Kolkata, is to invest the same in a Nationalized Bank, from time to time, till further orders are passed and the Appeal shall be numbered.

17. Post the case on 25.11.2026, for compliance of payments.

[Justice G. Chandrasekharan] CHAIRPERSON (In- Charge, DRAT, Kolkata)

Dated: 22^nd October, 2026

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