RAKESH BIRANI (D) THROUGH LRS. versus PREM NARAIN SEHGAL & ANR.

RAKESH BIRANI (D) THROUGH LRS. versus PREM NARAIN SEHGAL & ANR.

The correct interpretation of Rule 9 is that the period for depositing the balance amount starts from the date of confirmation of sale by the secured creditor; since the auction purchaser deposited the 75% amount within 15 days of confirmation, the sale certificate was validly issued and the auction cannot be set aside.

Parties
Appellant: Rakesh Birani (D) through LRs.; Respondent: Prem Narain Sehgal & Anr.
Jurisdiction
India
Judgment Date
21 March 2018
Procedural Posture
Civil Appeal / Supreme Court Appeal From Division Bench Judgment of Allahabad High Court Affirming Single Judge
Outcome
Appeal allowed; impugned orders set aside.
Legal Topics
Auction Sale of Immovable Property, Security Interest Enforcement, Interpretation of Security Interest (enforcement) Rules, 2002
Banking Law Property Law Auction Sale of Immovable Property Security Interest Enforcement Interpretation of Security Interest (enforcement) Rules, 2002

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Parties

Rakesh Birani (D) through LRs.

Appellant

Prem Narain Sehgal & Anr.

Respondent

Procedural Posture

Civil Appeal / Supreme Court Appeal From Division Bench Judgment of Allahabad High Court Affirming Single Judge

Legal Issues

  1. 1 When does the period of 15 days for deposit of remaining 75% of auction sale amount commence under Rule 9 of Security Interest (Enforcement) Rules, 2002 – from the date of confirmation of sale or date of auction?

Ratio Decidendi

The correct interpretation of Rule 9 is that the period for depositing the balance amount starts from the date of confirmation of sale by the secured creditor; since the auction purchaser deposited the 75% amount within 15 days of confirmation, the sale certificate was validly issued and the auction cannot be set aside.

Court Disposition

Appeal allowed; impugned orders set aside.

Orders

  • Sale certificate issued to auction purchaser is valid.
  • Auction is not set aside; possession to be delivered to auction purchaser as expeditiously as possible in accordance with law.