Govind Kumar Sharma & Anr Vs Bank of Baroda & Ors (Supreme Court of India)
SARFAESI Auction irregularity: SC directs refund with interest & allows Tenants Who Bid to Stay After Auction Set Aside
In the case of Govind Kumar Sharma & Anr Vs Bank of Baroda & Ors, the Supreme Court of India delves into the intricacies of SARFAESI Act and the consequences of procedural irregularities in auction sales. The appellants contested the validity of an auction sale that was set aside due to non-compliance with statutory procedures.
The crux of the matter revolved around the auction sale conducted by the Bank under SARFAESI Act. The appellants, highest bidders in the auction, found themselves embroiled in a legal tussle when the sale was challenged by the borrowers. The Debt Recovery Tribunal and Appellate Tribunal both upheld the decision to set aside the sale, citing the Bank’s failure to adhere to mandatory notice requirements.
The Supreme Court analyzed the sequence of events, highlighting the admission by the Bank regarding non-compliance with procedural rules. This admission formed the basis for affirming the setting aside of the auction sale. Moreover, the Court scrutinized the implications on the appellants, who transitioned from tenants to owners post-sale confirmation.
