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Allahabad High Court · body

2018 DIGILAW 2573 (ALL)

RAKESH KUMAR KAUSHAL v. STATE OF U. P.

2018-12-20

ALOK MATHUR, DEVENDRA KUMAR ARORA

body2018
JUDGMENT Hon’ble Alok Mathur, J.—Heard Sri Surya Mani Pandey, learned counsel for the petitioner and Sri Prashant Kumar Srivastava, learned counsel appearing for respondent No. 2. 2. Petitioner by means of this writ petition under Article 226 of the Constitution has sought indulgence of this Court for a direction to the respondent No. 2 (Authorised officer/Chief Manager, Allahabad Bank, Sultanpur Branch, to refund the entire amount of Rs. 60,00,000/-(Rupees 60 Lacs) with 18% interest and Rs. 15 lakhs (rupees fifteen lakh) as damages. 3. In brief, the conspectus of the controversy emanates from the fact that the petitioner, who is an auction-purchaser of secured assets auctioned by the Allahabad Bank, in proceedings conducted in pursuance to the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as the “SARFAESI Act”), has deposited the entire bid amount at the auction held on 28.6.2017, yet the possession of the property has not been handed over to him, despite lapse of nearly one and a half year and level best efforts made by him. 4. It has been submitted by the Counsel for the petitioner that the petitioner has participated in the e-auction sale in respect of property “land Plot No. 384 M, House No. 12/2, measuring 3060 sq.ft., situated at Village - Payagipur, Pargana - Meeranpur, Tehsil - Sadar, District - Sultanpur” in the name of Vinod Kumar Pandey s/o Shri Ram Murti Pandey, against recovery of sum of Rs. 31,89,156/- with interest expenses thereon due on M/s Farmer Agro Traders through its proprietor Vijay Kumar Pandey. In the auction notice dated 25.5.2-17, the reserve price of the property was fixed as Rs. 60 Lacs. The petitioner with an intention to participate in auction proceedings deposited Rs. 6 lakhs known as Earnest Money Deposit (hereinafter referred to as “EMD”) with the opposite party number 2, through a cheque bearing number 000862 dated 23/06/17 in the name of Authorised Officer, Allahabad Bank, Sultanpur. Thereafter, he participated in the auction proceedings held on 28/06/17 and quoted Rs. 60 Lacs for the aforesaid property, as the bid of the petitioner was highest, the bid was released in his favour. As per terms and condition of the bid, the petitioner deposited 25% of the bid amount i.e. Rs. Thereafter, he participated in the auction proceedings held on 28/06/17 and quoted Rs. 60 Lacs for the aforesaid property, as the bid of the petitioner was highest, the bid was released in his favour. As per terms and condition of the bid, the petitioner deposited 25% of the bid amount i.e. Rs. 9 lakhs on the same day, as required under Rule 9 (3) of Security Interest (Enforcement) Rules, 2002 (hereinafter referred to as “Rules, 2002”) but the sale confirmation letter was not issued in his favour. 5. It has been averred by the petitioner in the writ petition that the petitioner was directed to pay remaining 75% of the sale amount within a period of 15 days from the date of auction. Accordingly, he deposited 75% of the bid amount i.e Rs. 44,40,000/-and Rs. 60,000/ to the Income Tax officer as per the directions of respondent No. 2. In this manner, the petitioner paid the entire auction price amounting Rs. 60 lakhs well within time to opposite party No. 2 as required under Rule 9 (4) of the Rules 2002. 6. Despite deposit of the entire amount of Rs. 60 lakhs well within time, the respondent No. 2 neither confirmed the sale nor handed over the sale certificate to the petitioner and only false assurances were extended by the respondent No. 2 that the possession of the said schedule property would be handed over to the petitioner very soon. 7. The petitioner brought to the notice of the Bank that he has got information from reliable sources that the property is in possession of other persons, and it is for this reason, the possession of the property could not be taken by the opposite party No. 2 and handed over to the petitioner. 8. The main plank of the petitioner’s argument is that there was defect in the title of the aforesaid property, which was never disclosed by the respondent bank at any stage of the proceedings under the SARFAESI Act, and even after lapse of more than one and a half year, the possession of the property has not been handed over to him, which entitles him for refund of the entire amount paid by him to the respondent Bank alongwith damages and interest. 9. 9. Counsel for the petitioner has placed before the Court the Recovery Management Policy 2017 - 2018 (hereinafter referred to as “the Policy”) which has been annexed alongwith the writ petition which provides for refund of EMD/Sale Proceeds in Part or Full. The relevant portion of the Policy reads as under : “If under noted exceptional conditions bank can consider refund of EMD/sale proceeds deposited by the successful bidder. a. If any defect is found in the title of the mortgager of the property under sale. b. If bank is not able to deliver physical possession of the property beyond 6 months from the auction date due to restrain/conditional order passed by Court/DRT or any other valid reasons justifying such refund. c. To comply with the DRT/Court orders” 10. Counsel for the petitioner has emphasized and relied upon the aforesaid Policy and submitted that the respondents have failed to deliver physical possession of the property for last one and a half year without any valid reason and justification and therefore, as per Policy of the respondent Bank, the petitioner is entitled for refund of the entire amount with damages. 11. Rebutting the allegations of the petitioner, the Counsel for the Bank has submitted that the petitioner is not entitled for the reliefs as sought for by the petitioner and submitted that petitioner has an equally efficacious alternative remedy by way of filing an appeal under Section 17 of the SARFAESI Act and without exhausting the said remedy he has rushed to this Court invoking Article 226 of the Constitution of India. 12. According to the learned Counsel for the Bank, the Bank after taking the symbolic possession of the property in question on 27/01/17, moved an application under Section 14 of the SARFAESI Act before the District Magistrate, Sultanpur on 08/05/17. The Bank has also written a letter dated 23/03/18 to the District Magistrate, Sultanpur requesting for disposal of the pending application as per law but till date the District Magistrate has failed to comply with the provisions of Section 14 of the SARFAESI act. 13. It has been pointed out by him that in terms of the SARFAESI Act, the Bank has published the e-auction notice on 25/05/2017 fixing 28/06/2017 as date for the auction, in which the petitioner had participated. 13. It has been pointed out by him that in terms of the SARFAESI Act, the Bank has published the e-auction notice on 25/05/2017 fixing 28/06/2017 as date for the auction, in which the petitioner had participated. The said property was put to auction on the basis “as is where is, as it is where it is” and the assertion of the petitioner about the nondisclosure of the “physical possession” of the secured assets, is totally false and baseless as the petitioner had knowledge regarding the physical possession or actual position of the property. He further pointed out that in the e-auction notice dated 25/05/2017 it was mentioned in explicit words that the interested bidders can inspect the property if they want to ascertain the location and nature of the property to be auctioned and also the interested bidders can also approach the Bank in between 17th June 2017 to 22nd June, 17. Therefore, it is not open for him to demand the refund of the amount as it would amount to cancellation of the entire proceedings initiated under the SARFAESI Act, without there being any fault on part of the respondent-Bank. 14. It has also been urged by the learned Counsel for the Bank that the Bank is always ready to hand over the physical possession of the property in question to the petitioner. They have also asserted that they have already confirmed the sale by issuing a sale certificate on 15/07/2017 after closing the loan account of the borrower on 30/07/2017. The Bank is always ready to execute the sale-deed in favour of the auction purchaser. 15. After hearing learned Counsel for the parties and perusal of the pleadings, the undisputed facts of the case can be summarized as follows : a. That property situated at land Plot No. 384 M, House No. 12/2, measuring 3060 sq.ft., situated at Village - Payagipur, Pargana - Meeranpur, Tehsil - Sadar, District - Sultanpur of one Vinod Kumar Pandey was sought to be auctioned by the respondent bank to realize outstanding loan amount of Rs. 31,89,580/- b. The symbolic possession of the said property was taken on 27/01/2017 and a sale notice was published in 2 newspapers on 25/05/2017 fixing 28/06/2017 for auction. c. The petitioner deposited the Earnest Money of Rs. 6 lakhs, by means of cheque number 000862 entitling him to participate in the said auction. 31,89,580/- b. The symbolic possession of the said property was taken on 27/01/2017 and a sale notice was published in 2 newspapers on 25/05/2017 fixing 28/06/2017 for auction. c. The petitioner deposited the Earnest Money of Rs. 6 lakhs, by means of cheque number 000862 entitling him to participate in the said auction. d. The petitioner participated in the auction proceedings which were held on 28/06/2017, and his bid for Rs. 60 lakhs was declared as highest and successful by the respondent bank. e. As per terms and conditions of the auction, the petitioner deposited the balance of 25% of the bid amount i.e Rs. 9 lakhs on the same day, and deposited 75% of the remaining amount i.e Rs. 44,40,000/-on 12/07/2017 and also Rs. 60,000 in income tax office on 15/07/2017, in this way the entire auction price of Rs. 60.00 lakhs was paid within the time prescribed. f. Till date the possession of the property has not been handed over to the petitioner, despite repeated representations given by the petitioner. g. As per the Policy, the Bank under exceptional circumstances can refund the EMD/sale proceeds in part or full, in case the bank is not able to deliver physical possession of the property beyond 6 months from the date of auction due to any valid reasons justifying such refund. 16. Considering the submissions made on behalf of both the parties and perusing the record, following issues arise for our consideration : i. Whether the writ petition on behalf of the auction purchaser seeking relief of refund of the sale consideration deposited by the auction purchaser is maintainable before the High Court under Article 226 of the Constitution of India, or he has remedy of appeal under Section 17 of the SARFAESI Act? ii. Whether by imposing a condition “as is where is” “as is what is” the bank is not under obligation to hand over vacant physical possession of the secured assets to the auction purchaser? iii. Whether the secured creditor is bound to hand over the physical possession of the secured asset to the auction purchaser, who has fulfilled all the conditions and paid the entire sale consideration as per the terms of the bid, and to what relief the petitioner/auction purchaser is entitled to in the circumstances of the case? 17. iii. Whether the secured creditor is bound to hand over the physical possession of the secured asset to the auction purchaser, who has fulfilled all the conditions and paid the entire sale consideration as per the terms of the bid, and to what relief the petitioner/auction purchaser is entitled to in the circumstances of the case? 17. A perusal of Section 17 of the SARFAESI Act, 2002 reveals that it gives a right of filing an appeal to any person aggrieved by any of the measures referred to in sub-sections (4) of Section 13 taken by the secured creditor or his authorised officer under this chapter, may make an application alongwith such fee which may be prescribed to the Debt Recovery Tribunal having jurisdiction in the matter within 45 days from the date on which such measure has been taken. 18. In the present peculiar set of circumstances, where the petitioner being the auction purchaser has deposited the entire amount of the bid-money to the full satisfaction of the respondent bank, and the bank in turn has duly accepted the same and has also issued sale certificate acknowledging the receipt of the sale price, the entire procedure as laid down in Section 13 of the SARFAESI Act has been fulfilled, and there is no dispute in this regard between the auction-purchaser and the respondent bank. The petitioner is not aggrieved by any of the measures taken by the bank referred to in sub-section 4 of Section 13. 19. Even if, it is assuming that an application under the present set of the circumstances was maintainable before the Debt Recovery Tribunal (hereinafter referred to as “the DRT”), the powers of the DRT in this regard have been spelt out in sub-section (2) to sub-section (7) of SARFAESI Act, which would inadequate to redress the grievance of the petitioner in the present circumstances. Section 17 of the SARFAESI Act is reproduced as follows : “17. Application against measures to recover secured debts.—(1) Any person (including borrower), aggrieved by any of the measures referred to in sub-section (4) of Section 13 taken by the secured creditor or his authorised officer under this Chapter, may make an application alongwith such fee, as may be prescribed, to the Debts Recovery Tribunal having jurisdiction in the matter within forty-five days from the date on which such measure had been taken. Provided that different fees may be prescribed for making the application by the borrower and the person other than the borrower. Explanation—For the removal of doubts, it is hereby declared that the communication of reasons to the borrower by the secured creditor for not having accepted his representation or objection or the likely action of the secured creditor at the stage of communication of reasons to the borrower shall not entitle the person (including borrower) to make an application to the Debts Recovery Tribunal under sub-section (1) of Section 17. (1A) An application under sub-section (1) shall be filed before the Debts Recovery Tribunal within the local limits of whose jurisdiction- (a) the cause of action, wholly or in part arises; (b) where the secured asset is located; or (c) the branch or any other office of a bank or financial institution is maintaining an account in which debt claimed is outstanding for the time being. (2) The Debts Recovery Tribunal shall consider whether any of the measures referred to in sub-section (4) of Section 13 taken by the secured creditor for enforcement of security are in accordance with the provisions of this Act and the rules made thereunder. (3) If, the Debts Recovery Tribunal, after examining the facts and circumstances of the case and evidence produced by the parties, comes to the conclusion that any of the measures referred to in sub-section (4) of Section 13, taken by the secured creditor are not in accordance with the provisions of this Act and the rules made thereunder, and require restoration of the management or restoration of possession, of the secured assets to the borrower or other aggrieved person, it may, by order,- (a) declare the recourse to any one or more measures referred to in sub-section (4) of Section 13 taken by the secured creditor as invalid; and (b) restore the possession of secured assets or management of secured assets to the borrower or such other aggrieved person, who has made an application under sub-section (1), as the case may be; and (c) pass such other direction as it may consider appropriate and necessary in relation to any of the recourse taken by the secured creditor under sub-section (4) of Section 13. (4) If, the Debts Recovery Tribunal declares the recourse taken by a secured creditor under sub-section (4) of Section 13, is in accordance with the provisions of this Act and the rules made thereunder, then, notwithstanding anything contained in any other law for the time being in force, the secured creditor shall be entitled to take recourse to one or more of the measures specified under sub-section (4) of Section 13 to recover his secured debt. (4A) Where- (i) any person, in an application under sub-section (1), claims any tenancy or leasehold rights upon the secured asset, the Debt Recovery Tribunal, after examining the facts of the case and evidence produced by the parties in relation to such claims shall, for the purpose of enforcement of security interest, have the jurisdiction to examine whether lease or tenancy,- (a) has expired or stood determined; or (b) is contrary to Section 65A of the Transfer of Property Act, 1882 (4 of 1882); or (c) is contrary to terms of mortgage; or (d) is created after the issuance of notice of default and demand by the Bank under sub-section (2) of Section 13 of the Act; and (ii) the Debt Recovery Tribunal is satisfied that tenancy right or leasehold rights claimed in secured asset falls under the sub-clause (a) or sub-clause (b) or sub-clause (c) or sub-clause (d) of clause (i), then notwithstanding anything to the contrary contained in any other law for the time being in force, the Debt Recovery Tribunal may pass such order as it deems fit in accordance with the provisions of this Act. (5) Any application made under sub-section (1) shall be dealt with by the Debts Recovery Tribunal as expeditiously as possible and disposed of within sixty days from the date of such application. Provided that the Debts Recovery Tribunal may, from time to time, extend the said period for reasons to be recorded in writing, so, however, that the total period of pendency of the application with the Debts Recovery Tribunal, shall not exceed four months from the date of making of such application made under sub-section (1). Provided that the Debts Recovery Tribunal may, from time to time, extend the said period for reasons to be recorded in writing, so, however, that the total period of pendency of the application with the Debts Recovery Tribunal, shall not exceed four months from the date of making of such application made under sub-section (1). (6) If the application is not disposed of by the Debts Recovery Tribunal within the period of four months as specified in sub-section (5), any party to the application may make an application, in such form as may be prescribed, to the Appellate Tribunal for directing the Debts Recovery Tribunal for expeditious disposal of the application pending before the Debts Recovery Tribunal and the Appellate Tribunal may, on such application, make an order for expeditious disposal of the pending application by the Debts Recovery Tribunal. (7) Save as otherwise provided in this Act, the Debt Recovery Tribunal shall, as far as may be, dispose of application in accordance with the provisions of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (51 of 1993) and the rules made thereunder.” 20. A careful scrutiny of the aforesaid provisions would indicate that the Debt Recovery Tribunal shall consider whether any of the measures referred to in sub-section (4) of Section 13 of SARFAESI Act taken by the secured creditor for enforcement of security, are in accordance with the provisions of this Act and the Rules made there under, and sub-section (3) provides that the DRT after examining the facts and circumstance of the case and evidence produced by the parties comes to the conclusion that any of the measures referred to in sub-section (4) of Section 13 of SARFAESI Act, taken by the secured creditor are not in accordance with the provisions of the SARFAESI Act and Rules, may declare the recourse to any of the measures referred to in sub-section (4) of Section 13 of SARFAESI Act taken by the secured creditor as invalid, and may also restore possession of the secured assets or management of the secured assets to the borrower or such an aggrieved person, who has made an application under sub-section (1) as the case may be and pass any such other direction as it becomes appropriate and necessary in relation to any of the recourse taken by secured creditor under sub-section (4) of Section 13. 21. 21. The manner and procedure, in which the secured assets have to be disposed of, has been detailed in the Rules, 2002, and especially in Rule 8 and 9 of the said Rules. For ready reference Rule 8 and 9 are quoted below : “8. Sale of immovable secured assets.— (1) Where the secured asset is an immovable property, the authorised officer shall take or cause to be taken possession, by delivering a possession notice prepared as nearly as possible in Appendix IV to these rules, to the borrower and by affixing the possession notice on the outer door or at such conspicuous place of the property. (2) The possession notice as referred to in sub-rule (1) shall also be published in two leading newspapers, one in vernacular language having sufficient circulation in that locality, by the authorised officer. (3) In the event of possession of immovable property is actually taken by the authorised officer, such property shall be kept in his own custody or in the custody of any person authorised or appointed by him, who shall take as much care of the property in his custody as a owner of ordinary prudence would, under the similar circumstances, take of such property. (4) The authorised officer shall take steps for preservation and protection of secured assets and insure them, if necessary, till they are sold or otherwise disposed of. (5) Before effecting sale of the immovable property referred to in sub-rule (1) of Rule 9, the authorised officer shall obtain valuation of the property from an approved valuer and in consultation with the secured creditor, fix the reserve price of the property and may sell the whole or any part of such immovable secured asset by any of the following methods:— (a) by obtaining quotations from the persons dealing with similar secured assets or otherwise interested in buying the such assets; or (b) by inviting tenders from the public; (c) by holding public auction; or (d) by private treaty. (6) The authorised officer shall serve to the borrower a notice of thirty days for sale of the immovable secured assets, under sub-rule (5): Provided that if the sale of such secured asset is being effected by either inviting tenders from the public or by holding public auction, the secured creditor shall cause a public notice in two leading newspapers one in vernacular language having sufficient circulation in the locality by setting out the terms of sale, which shall include,— (a) The description of the immovable property to be sold, including the details of the encumbrances known to the secured creditor; (b) the secured debt for recovery of which the property is to be sold; (c) reserve price, below which the property may not be sold; (d) time and place of public auction or the time after which sale by any other mode shall be completed; (e) depositing earnest money as may be stipulated by the secured creditor; (f) any other thing which the authorised officer considers it material for a purchaser to know in order to judge the nature and value of the property. (7) Every notice of sale shall be affixed on a conspicuous part of the immovable property and may, if the authorised officer deems if fit, put on the web-site of the secured creditor on the Internet. (8) Sale by any method other than public auction or public tender, shall be on such terms as may be settled between the parties in writing. 9.Time of sale, issues of sale certificate and delivery of possession, etc.— (1) No sale of immovable property under these rules shall take place before the expiry of thirty days from the date on which the public notice of sale is published in newspapers as referred to in the proviso to sub-rule (6) or notice of sale has been served to the borrower. (2) The sale shall be confirmed in favour of the purchaser who has offered the highest sale price in his bid or tender or quotation or offer to the authorised officer and shall be subject to confirmation by the secured creditor: Provided that no sale under this rule shall be confirmed, if the amount offered by sale price is less than the reserve price, specified under sub-rule (5) of Rule 9: Provided further that if the authorised officer fails to obtain a price higher than the reserve price, he may, with the consent of the borrower and the secured creditor effect the sale at such price. (3) On every sale of immovable property, the purchaser shall immediately pay a deposit of twenty-five per cent. of the amount of the sale price, to the authorised officer conducting the sale and in default of such deposit, the property shall forthwith be sold again. (4) The balance amount of purchase price payable shall be paid by the purchaser to the authorised officer on or before the fifteenth day of confirmation of sale of the immovable property or such extended period as may be agreed upon in writing between the parties. (5) In default of payment within the period mentioned in sub-rule (4), the deposit shall be forfeited and the property shall be resold and the defaulting purchaser shall forfeit all claim to the property or to any part of the sum for which it may be subsequently sold. (6) On confirmation of sale by the secured creditor and if the terms of payment have been complied with, the authorised officer exercising the power of sale shall issue a certificate of sale of the immovable property in favour of the purchaser in the form given in Appendix V to these rules. (7) Where the immovable property sold is subject to any encumbrances, the authorised officer may, if the thinks fit, allow the purchaser to deposit with him the money required to discharge the encumbrances and any interest due thereon together with such additional amount that may be sufficient to meet the contingencies or further cost, expenses and interest as may be determined by him. (8) On such deposit of money for discharge of the encumbrances, the authorised officer may issue or cause the purchaser to issue notices to the persons interested in or entitled to the money deposited with him and take steps to make the payment accordingly. (9) The authorised officer shall deliver the property to the purchaser free from encumbrances known to the secured creditor on deposit of money as specified in sub-rule (7) above. (10) The certificate of sale issued under sub-rule (6) shall specifically mention that whether the purchaser has purchased the immovable secured asset free from any encumbrances known to the secured creditor or not.” 22. The aforesaid provisions enjoins that Authorised Officer shall take or cause to be taken possession, by delivering a possession notice, and the same should also be published within 7 days in two leading newspapers, and the notice is also to be served upon the borrower as per the methods prescribed therein. 23. Sub-rule (3) of Rule 8 provides for possession of immovable property if it is actually taken by the Authorised Officer, who shall keep the same in his own custody or in the custody of any other person appointed by him, and it shall be his duty to take steps for preservation and protection of the secured interest. The rules further provides for obtaining the valuation of the property by the approved valuer and the secured asset also to fix reserve price of property by methods provided for in sub-rule (5) by obtaining quotations, tenders, public auctions or by private treaty, and in case the secured asset is being sold by inviting tenders or holding public auction the secured creditor shall have the notice published in two leading newspapers having sufficient circulation clearly stating the terms for sale including description of the immovable property to be sold, the detail of encumbrances known to the secured creditor, the reserve price and place of public auction, deposit of earnest money, and any other thing which the Authorised Officer considers it material for a purchaser to know in order to judge the nature and value of the property. 24. Rule 9 of the aforesaid Rules provides for time of sale, issue of sale certificate and delivery of possession apart from other mandatory guidelines. Further, sub-rule (9) of Rule 9 provides that the Authorised Officer shall deliver the property to the purchaser free from encumbrances. 25. 24. Rule 9 of the aforesaid Rules provides for time of sale, issue of sale certificate and delivery of possession apart from other mandatory guidelines. Further, sub-rule (9) of Rule 9 provides that the Authorised Officer shall deliver the property to the purchaser free from encumbrances. 25. As far as the present case is concerned, the petitioner is not aggrieved by any of the measures taken by the respondent bank, rather he is aggrieved by inaction in not handing over the possession of the auction property and, therefore, there is no occasion for the petitioner to approach the Debt Recovery Tribunal challenging any action of the Bank taken under sub-section (4) of Section 13.Under sub-section (b), the Debt Recovery Tribunal can only restore the possession. It is admitted case of the parties that the petitioner was never in possession, inasmuch as he is only an auction-purchaser seeking possession of the auctioned property being the successful bidder. 26. The entire gamut of remedies provided under Section 17 of the SARFAESI Act is to oversee that the statutory provisions of Section 13(4) read with Rule 8 and 9 of the Rules, 2002 are adhered to, and the Debt Recovery Tribunal would immediately step in, whenever it finds any infraction by the secured creditor. 27. The respondent Bank in paragraph 8 of its short counter-affidavit has stated that they have moved an application under Section 14 of the SARFAESI Act on 08/05/2017, which was supposed to be disposed of by 7th June 2017, but the District Magistrate has failed to pass the order even till date i.e. 26.11.2018 despite the case being fixed on fifty nine occasions. It is for this reason that the physical possession could not be handed over to the petitioner and the Bank is eventually pursuing the matter before the District Magistrate Sultanpur. They have also stated that the Field General Manager of the Bank has also written a letter dated 09/08/2018 to the Director General, Directorate of Institutional Finance, Uttar Pradesh for early disposal of various application moved by the Bank under Section 14 of the SARFAESI Act where the property in question is also involved. They have also stated that the Field General Manager of the Bank has also written a letter dated 09/08/2018 to the Director General, Directorate of Institutional Finance, Uttar Pradesh for early disposal of various application moved by the Bank under Section 14 of the SARFAESI Act where the property in question is also involved. 28.That the respondent bank in support of its contention with regard to the alternative remedy has placed before us judgement of the Hon’ble Supreme Court in the case of Agarwal Tracom Pvt. Ltd. v. Punjab National Bank and others, 2017 AIR (SC) 5562. 29. That in the aforesaid judgment there was a dispute between the bank and the auction purchaser whereby the bank had forfeited the deposit money as the appellant therein had failed to pay regular instalments towards sale money in terms of memorandum of understanding. The Hon’ble Supreme Court in paragraph number 31 of the said judgement have stated that the auction purchaser is one such person who is aggrieved by the action of the secured creditor in forfeiting their money, and found that the action of secured creditor in forfeiting the deposit made by the auction purchaser is part of the measures taken by the secured creditor under Section 13 (4) and, therefore, the High Court was justified in dismissing the writ petition on the ground of availability of alternate remedy. 30. So far as the present case is concerned, there is no dispute between the auction-purchaser and the Bank with regard to any of the measures under Section 13 (4) of the SARFAESI Act read with Rule 8 and 9 of the Rules, 2002. Here, the petitioner, who is a auction-purchaser has deposited the entire amount of bid and the Bank has issued a sale certificate dated 15/07/2017, wherein it has been recorded that “the undersigned acknowledges the receipt of the sale price of Rs. 60 lakhs in full and handed over the delivery in possession of the schedule property”. The said sale certificate issued under Rule 9(6) has been signed by Authorised Officer, Allahabad bank. The Bank has stated that though the sale certificate has not been received by the petitioner, but the Bank is ready to hand over the sale certificate to the petitioner. The said sale certificate issued under Rule 9(6) has been signed by Authorised Officer, Allahabad bank. The Bank has stated that though the sale certificate has not been received by the petitioner, but the Bank is ready to hand over the sale certificate to the petitioner. In view of the above the judgment of the Hon’ble Apex Court in the case of Agarwal Tracom Pvt. Ltd. v. Punjab National Bank and others, is clearly distinguishable on facts, and in the peculiar set of facts and circumstances of this case, the petitioner does not have any efficacious alternative remedy under the SARFAESI Act. 31. Putting it differently, here the petitioner is not aggrieved by the action of the secured creditor nor any of the reliefs to which the DRT is empowered to grant under this section, would be of any use to redress the grievance of the petitioner, and therefore the plea of alternate remedy raised by the respondent bank is misconceived and is rejected. 32. It may be clarified here that the District Magistrate has not passed any order in excise of powers conferred upon him under Section 14 of the SARFAESI Act, despite 59 dates having been fixed in this regard, and we, therefore, record our strong disapproval in the manner in which the District Magistrate has not taken any action on the application of the bank. It has further been brought out on record that a list of 47 properties is being enclosed wherein application under Section 14 of SARFAESI Act have been moved before the various District Magistrates in Uttar Pradesh, which are pending for more than 60 days without any order. The inaction on part of the District Magistrates will have a detrimental effect in securing the possession of the properties and therefore effective mechanism must be taken by respondent No. 1 in this regard. 33. The 2nd issue which arises for our consideration is with regard to the clause contained in the advertisement for e-auction, which provides that the property was being sold on “as is where is Basis, as it is where it is Basis and whatever there is”, which according to the Bank, dis-entitles the petitioner from seeking any claim against the respondent bank. 34. 34. In this regard, we would like to mention that relevant provisions of the SARFAESI Act and the Security Interest (Enforcement) Rules have already been quoted wherein sub-rule (5) of Rule 8 of the Rules, 2002, provides for publication of the notice into leading newspapers which shall include details as set forth in sub-clause (a) to (f). Sub-clause 6 (f) of Rule 8 provides for publishing of “any other thing which the authorised officer considers it material for a purchaser to know in order to judge the nature and value of the property”. In these circumstance, a duty is cast upon the Authorized Officer to publish all details with regard to the property, whether the property has any encumbrances or not, whether the property is a vacant property or is tenanted, whether there is any other charge on the said property, and all other details which is material for the purchaser to know in order to judge the nature and value of the property. 35. In the present case, the advertisement does not disclose any such detail about the property from which it can be easily inferred that the same is in possession of some third-party, or that there is a litigation pending or for some material reason, it would be difficult to obtain the vacant possession of the property. A joint reading of Section 13 (4) of the SARFAESI Act and Rule 9 (clauses 9 and 10) would clearly show that the Authorised Officer, shall deliver the property to the purchaser, free from all encumbrances, on deposit of money as specified in sub-rule 2. However, the aforesaid rule does not prevent the bank from bringing the property for auction, when there are encumbrances attached to the property. Merely, by including a clause “as is where is basis or as is what is’ condition stated in the sale notice does not obviate the bank from disclosing the encumbrances attached to the property, brought for auction. 36. The bank cannot shrug off its responsibility in disclosing the encumbrances in the advertisement when it is known that transparency is the essence of good governance and fair play. Concept of transparency is is becoming a core value in democratic and participative governance. The public demand for transparency is getting stronger in good governance. 36. The bank cannot shrug off its responsibility in disclosing the encumbrances in the advertisement when it is known that transparency is the essence of good governance and fair play. Concept of transparency is is becoming a core value in democratic and participative governance. The public demand for transparency is getting stronger in good governance. Transparency is built on the basis of free flow of information and the whole process of Government, institutions and information needs to be accessible to the interested parties, as well as the information provided should be sufficient to be understood. 37. The undisputed fact in the case at hand is that when notice under Section 13(4) of the SARFAESI Act was issued by the Bank, the physical possession of the mortgaged property was not taken. There is a duty cast upon the Bank under clause (9) of Rule 9 of the Rules, 2002 to deliver the property to the purchaser free from encumbrances known to the secured creditor on deposit of money as specified in sub-rule (7). In the writ petition it has rightly been asserted by the petitioner that he was shocked when he came to know that there were some defects in title of the aforesaid property and the same is defective, which was not disclosed by the Bank at any stage, rather it suppressed the material information. 38. It may be noted that when a person participates in auction to purchase a property, he relies on the auction notice and the documents shown to him by the secured creditor, as he is under a bona fide belief that any material aspect of the property must have been disclosed by the secured creditor inasmuch as the secured creditor is under a mandate to disclose any aspect which the Authorised Officer considers it material for the purchaser to know in order to judge the nature and value of the property as mandated under Rule 8(6). The respondent bank has failed to disclose any such circumstance or material fact from which it could be gathered that the physical possession of the property would be difficult or near impossible. In the aforesaid circumstances the respondent Bank cannot take umbrage of the clause “as is where is” “as it is where it is” in order to deny physical possession of the auction property to the petitioner and to non-suit him. In the aforesaid circumstances the respondent Bank cannot take umbrage of the clause “as is where is” “as it is where it is” in order to deny physical possession of the auction property to the petitioner and to non-suit him. In other words, the respondent cannot shirk away the statutory responsibility to deliver possession of the property free from all encumbrances, to the person who was paid full consideration for the said property. 39. Accepting the contention of the Bank would be absolutely inequitable, wholly arbitrary and may on the contrary permit withholding of necessary information by the secured creditor in relation to its valuation in order to seek a higher price of the property. If such an advantage is permitted, it would directly affect the credibility of the entire process and the object of the SARFAESI Act, which is sought to be achieved. 40. The third-party, who comes forward to purchase the secured asset must have the confidence that he would get the property at the earliest and in case, considerable long time is consumed in transferring the property not only it would defeat the purpose of the Act but would also cause colossal loss and injury to a auction-purchaser, like the petitioner. 41. In light of the above, we are of the considered opinion that by merely inserting a clause “as is where is” and “as is what is” the responsibility of the Bank does not get diluted nor it can in any manner assist the bank in denying physical possession to the auction purchaser. 42. Needless to say, that when the Bank has information that there is certain charge on the property, or the property is already encumbered, etc. it can be made known when a notice is published under Rule 8(6) and it would not be necessary for the Bank in such a situation to hand over the physical possession of the property. But in the present case, the Bank has not given any details of any encumbrances, or charge on the property or any such fact which would deny the auction purchaser from the physical possession of the property, and therefore, just by inserting a clause “as is where is”” as is what is” it would not dis-entitle the successful auction purchaser from claiming the physical possession of the secured asset after paying the bid price to the satisfaction of the secured creditor. 43. 43. In the case at hand, the petitioner has written number of applications, which have been brought on record, but for some reason the bank had chosen not to respond any of the letter written by the petitioner. It seems that the Bank woke up from deep slumber when the petitioner gave a representation dated 8.5.2018 to the Governor, Reserve Bank of India, which was responded vide letter dated 18/06/18 and the petitioner was informed that they had not assured that they would give possession within 15 days of the sale, and are pursuing the matter regarding obtaining of possession in the Court of Additional District Magistrate, who is not cooperating with the proceedings due to which the matter is pending. However, they are hopeful that the physical possession would be obtained shortly, and will be handed over to the petitioner. 44. From the facts narrated above, we are of the view that that the petitioner had totally complied with the terms and conditions of the auction, and tendered full consideration of the bid amount, which has duly been accepted by the Bank, who has also issued a sale certificate, which clearly acknowledges receipt of the sale price of Rs 60 lakhs in full and further records that “handed over the delivery in possession of the scheduled property”. 45. From the facts narrated above, it can easily be inferred that the petitioner has been put in a very helpless situation which compelled him to take refund of the entire consideration of Rs. 60 lakhs as more than 17 months have elapsed but possession of the property has not been delivered to him. It has been informed by the petitioner that he had taken a cash credit limit of Rs. 65 lakhs from HDFC Bank to whom, he is paying interest @ 12% per annum plus miscellaneous charges, and further an amount of Rs. 15 lakhs was taken as loan from Muthut Finance, where also he is paying interest @ 16%. 46. As discussed above, it was a duty of the respondent Bank to deliver vacant possession of the secured asset to the petitioner within a reasonable time. Having failed to deliver possession, the petitioner has rightly exercised his option to get refund of the bid amount deposited with the Bank alongwith interest and damages. 46. As discussed above, it was a duty of the respondent Bank to deliver vacant possession of the secured asset to the petitioner within a reasonable time. Having failed to deliver possession, the petitioner has rightly exercised his option to get refund of the bid amount deposited with the Bank alongwith interest and damages. As noticed above, in the Recovery Management Policy 2017- 2018 there is a provision of refunding the amount of EMD/sale proceeds, if the Bank is not able to deliver physical possession of the property beyond six months from the date of auction. We are satisfied that the reasonable period for giving physical possession of the auction property to the auction purchaser would be six months, keeping in view that under Section 13(4) the District Magistrate is under a statutory obligation to decide the application of the Bank within a maximum period of 60 days, and even taking into account certain delay in moving the application and other administrative delays, the possession of the property ought to have been handed over to the auction purchaser at least within a period of six months from the date of the auction. 47. In light of the aforesaid discussion, we allow this writ petition with the direction to the respondent bank to refund Rs. 60 lakhs, which was deposited by the petitioner being the auction-purchaser of the aforesaid property, to the petitioner within a period of one month, alongwith interest @ 9 percent. Considering the mental trauma and harassment with which the petitioner has suffered during such a long period after investing such a huge amount, we impose a cost of Rupees two lakhs to secure the ends of justice, which shall be paid by the Bank to the petitioner within a period of one month from today failing which petitioner will approach the District Magistrate, Sultanpur, who shall recover the amount aforesaid, as arrears of land revenue and pay the same to the petitioner or to any person authorized by him.