# Scholar's Education Trust of India v. Authorized Officer, Bank of India & Anr

- **Citation:** (2021) 8 ILRA 858
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2021-07-06
- **Case number:** Writ C No. 14619 of 2021
- **Bench:** Manoj Misra, Dinesh Pathak
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/scholar-s-education-trust-of-india-v-authorized-officer-bank-of-india-anr-47320
- **Pages:** 3

## Headnote

SARFAESI Act, 2002 - Section 17 - During
the pendency of SARFAESI proceedings,
secured asset was put for auction/sale -
High court directed that the auction
scheduled to be held on 16.03.2021 shall
remain stayed till the case is finally
decided DRAT - despite injunction order
auction proceeded 16.03.2021 - petitioner
was the highest bidder - later upon status
of the auction marked as cancelled on
account
of
stay
-
Subsequently,
Securitisation
Application
dismissed
-
petitioner
prayed
for
quashing
the
cancellation status of the auction & for
direction to hand over the possession of
the auctioned property to the petitioner -
Held - auction took place when there was
restraint order in operation therefore,
according recognition to such an unlawful
act would defeat the ends of justice and
the prevalent public policy - prayer to
quash the cancellation status of the
auction and confirming the auction cannot
be accepted

Disposed off. (E-4)

List of Cases cited:

## Text

858 INDIAN LAW REPORTS ALLAHABAD SERIES
court
exercising
its
power
of
superintendence over that subordinate court
may not only set aside the order but may
issue such directions as may be justified in
law. But, here, we do not have the power of
superintendence over the Court at Chhapra
which falls in the State of Bihar therefore,
even if we find substance in the submission
of the learned counsel for the petitioner that
the suit as framed is barred by the
provisions of Section 34 of the SARFAESI
Act, it would not be appropriate on our part
to comment on the merits of the order of
Chhapra Court and declare it void more so
when the person who instituted the suit is
not party in this writ petition. We,
therefore, decline the prayer of the writ
petitioner and dispose off this petition by
giving liberty to the petitioner as well as
the respondents 3 and 4 to take recourse to
such other appropriate legal remedy as may
be advised to them.
----------

(2021)08ILR A858
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 06.07.2021

BEFORE

THE HON'BLE MANOJ MISRA, J.
THE HON'BLE DINESH PATHAK, J.

Writ C No. 14619 of 2021

Scholar's Education Trust of India
 ...Petitioner
Versus
Authorized Officer, Bank of India & Anr.
 ...Respondents

Counsel for the Petitioner:
Sri Sarveshwari Prasad

Counsel for the Respondents:
C.S.C., Sri R.V. Pandey, Sri Sanjeev Singh

SARFAESI Act, 2002 - Section 17 - During
the pendency of SARFAESI proceedings,
secured asset was put for auction/sale -
High court directed that the auction
scheduled to be held on 16.03.2021 shall
remain stayed till the case is finally
decided DRAT - despite injunction order
auction proceeded 16.03.2021 - petitioner
was the highest bidder - later upon status
of the auction marked as cancelled on
account
of
stay
-
Subsequently,
Securitisation
Application
dismissed
-
petitioner
prayed
for
quashing
the
cancellation status of the auction & for
direction to hand over the possession of
the auctioned property to the petitioner -
Held - auction took place when there was
restraint order in operation therefore,
according recognition to such an unlawful
act would defeat the ends of justice and
the prevalent public policy - prayer to
quash the cancellation status of the
auction and confirming the auction cannot
be accepted

Disposed off. (E-4)

List of Cases cited:
1. Surjit Singh & ors. Vs Harbans Singh & ors.
(1995) 6 SCC 50

2. Jehal Tanti & ors. Vs Nageshwar Singh (2013)
14 SCC 689

3. Vidur Impex and Traders Pvt. Ltd. & ors. Vs
Toshi Apartments Pvt Ltd. (2012) 8 SCC 384

(Delivered by Hon'ble Manoj Misra, J.
&
Hon'ble Dinesh Pathak, J.)

1. Heard Sri Sarveshwari Prasad for
the petitioner; Sri Sanjeev Singh for the
respondent no.1; learned Standing Counsel
for respondent no.2; and perused the
record.

2.

A
proceeding
under
the
Securitisation
and
Reconstruction
of
8 All. Scholar's Education Trust of India Vs. Authorized Officer, Bank of India & Anr.
859
Financial Assets and Enforcement of
Securities Interest Act, 2002 (In short
SARFAESI Act, 2002) was drawn against
M/s. Shiksha Education Trust. Aggrieved
by
those
proceedings,
M/s.
Shiksha
Education Trust filed an application (i.e
Securitisation Application No.107 of 2020),
under Section 17 of the SARFAESI Act,
2002, before the Debts Recovery Tribunal,
Allahabad. During the pendency of those
proceedings, the secured asset was put for
auction/sale. To put a stay on the auction
the applicant moved an application. When
stay could not be obtained it approached
the Debts Recovery Appellate Tribunal.
When it failed to secure relief there, the
applicant (i.e. M/s. Shiksha Education
Trust) filed Writ C No.8816 of 2021 in this
Court. This Court, by order dated 15th
March, 2021, disposed off the writ petition
filed by M/s Shiksha Education Trust by
directing that the auction scheduled to be
held on 16th March, 2021 shall remain
stayed till the case is finally decided by the
Debts
Recovery
Appellate
Tribunal,
Allahabad. However, despite the injunction
order of this Court, the auction proceeded
on 16th March, 2021. In that auction, the
petitioner was the highest bidder. But, later,
upon finding that the auction was stayed by
the writ court, the auction agency (MSTC),
on the web site concerned, marked the
status
of
the
auction
as
cancelled.
Subsequently, Securitisation Application
No.107 of 2020 filed by M/s. Shiksha
Education Trust came to be dismissed by
the Debts Recovery Tribunal, Allahabad
vide judgment and order dated 15th June,
2021.

3. Consequent to the dismissal of the
Securitisation Application filed by M/s.
Shiksha Education Trust, this writ petition
has been filed by the petitioner, that is, the
successful bidder in the auction held on
16th March, 2021, for quashing the
cancellation status of the auction and for a
direction upon the Authorized Officer,
Bank of India to hand over the possession
of the auctioned property to the petitioner
after confirmation of its sale after deciding
the representation made by the petitioner
on 17th June, 2021, followed by reminder
dated 23rd June, 2021.

4. The contention of the learned
counsel for the petitioner is that once the
Securitisation Application is dismissed, the
interim injunction order has merged in the
final order and, therefore, the auction made
should be confirmed and possession be
handed over to the petitioner.

5. Sri Sanjeev Singh, who appears for
the respondent Bank, submits that since by
order dated 15th March, 2021 of the writ
court the auction to be held on 16th March,
2021 was stayed, the auction proceedings
that were carried out, inadvertently, being
in the teeth of an injunction order were
void and, therefore, the Bank has no option
but to re-start the process of auction.

6. In response to the above
submission,
learned
counsel
for
the
petitioner submits that if the auction
proceedings
were
void,
the
money
deposited by the petitioner should have
been returned/restored to the petitioner.

7. Having considered the rival
submissions, we find that it is not in dispute
that the auction was held on 16th March,
2021, that is, when the injunction order of
the writ court, putting a restraint on the
auction, was operating. Once that is the
position, according recognition to such an
auction would defeat the ends of justice and
the prevalent public policy. Such an auction
would therefore be void. In this regard we
860 INDIAN LAW REPORTS ALLAHABAD SERIES
may notice a decision of the Apex Court in
Surjit Singh and others Versus Harbans
Singh and others, (1995) 6 SCC 50 where
it was held that on the basis of an
assignment made in violation of an
injunction order, no impleadment should be
allowed as recognition of such assignment
would defeat the ends of justice and the
prevalent public policy. Similar view has
been expressed in Jehal Tanti and others
Versus Nageshwar Singh, (2013) 14 SCC
689 and Vidur Impex and Traders Pvt.
Ltd. & Others Versus Toshi Apartments
Pvt Ltd., (2012) 8 SCC 384, where it was
observed that sale deed executed in the
teeth of order of injunction would be
unlawful and no valid title would pass.

8. The submission of the learned
counsel for the petitioner that the interim
injunction merged in the final order,
consequent
to
dismissal
of
the
Securitisation Application, therefore, now,
there are no fetters in recognition of the
auction cannot be accepted for two reasons,
firstly, because that auction took place
when there was restraint order in operation
and, therefore, according recognition to
such an unlawful act would defeat the ends
of justice and the prevalent public policy,
and, secondly, the purpose of an auction,
which is to discover the best price, might
not be achieved as people in the know of
injunction might have abstained from
participating in the auction. Hence, the
prayer of the petitioner to quash the
cancellation status of the auction and to
provide possession to the petitioner after
confirming the auction cannot be accepted
and is, accordingly, rejected.

9. The alternative oral prayer of the
petitioner that the money deposited by him
be returned to him, if the auction was
rendered void, is acceptable.

10. This writ petition is therefore
disposed off by giving liberty to the
petitioner to seek refund of the money
deposited by it without prejudice to his
right to participate in a fresh auction that
might take place of the property concerned.
If the petitioner seeks refund of the money
deposited by it, the same shall be returned
to the petitioner forthwith, subject to
necessary verification. The return of the
money shall be without prejudice to the
right of the petitioner to participate in fresh
auction of the property in accordance with
law.

11. The writ petition is disposed off.
----------
(2021)08ILR A860
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 06.08.2021

BEFORE

THE HON'BLE AJAY BHANOT, J.

Writ C No. 4773 of 2021

Asgar ...Petitioner
Versus
State of U.P. & Ors. ...Respondents

Counsel for the Petitioner:
Sri Yogendra Pal Singh

Counsel for the Respondents:
C.S.C., Sri Kaushal Kishore Mani

Civil Law - U.P. Revenue Code (8 of 2012)
- Sections 67 & 67 A- Power to prevent
wrongful occupation of Gram Panchayat
properties - Certain house sites to be
settled with existing owners thereof -
 proceedings
u/s
67
A
should
be
registered immediately if defence in that
regard is made in proceedings u/s 67 -
thereafter both proceedings u/s 67 & 67 A
of the Code, should be consolidated and