AO Vs Sri Vijaylakshmi Raw & Boiled Rice Mill (DART Kolkata)
The appeal before the Debts Recovery Appellate Tribunal, Kolkata arose from an order dated 24 December 2024 passed by the Debts Recovery Tribunal, Visakhapatnam in S.A. No. 588 of 2023. By the impugned order, the DRT had allowed the securitisation application, set aside the sale notice and the e-auction sale, cancelled the sale deed, and directed the bank to return the sale consideration to the auction purchaser along with interest at the rate of 9% per annum. Aggrieved by this decision, the appellant bank preferred the present appeal.
The Appellate Tribunal heard learned counsel for both parties and examined the records. As regards the factual background, there was no dispute that the borrower, M/s Sri Vijaylakshmi Raw & Boiled Rice Mill, had availed a loan from the bank and that the loan account was classified as a non-performing asset. Thereafter, the bank initiated proceedings under the SARFAESI Act, 2002 and issued notices under Sections 13(2) and 13(4) of the Act. These notices were challenged by the borrower by filing S.A. No. 155 of 2022, which was dismissed by the DRT on 30 August 2022. Since the borrower did not challenge that order, the issues relating to the validity of the Section 13(2) and 13(4) notices and the classification of the account as NPA attained finality.
