No Valid Sale Under Law If Notice Of Sale On Which Parties Acted Upon Has Been Set Aside: Kerala High Court

The Kerala High Court on Wednesday observed that when the notice of sale based on which the parties bid for property has been set aside, it can be presumed that there is no valid sale under the law. 

Justice Bechu Kurian Thomas thereby dismissed the plea which had sought a direction to the respondent to confirm the sale of the property auctioned by the petitioners after accepting the balance bid amount.

"Since the notice of sale which resulted in the petitioners bidding for the property has been set aside, there is no sale in the eye of law. Since there is no valid sale under law, the relief sought for in the writ petition cannot be granted."

According to the petitioners, lured by a publication on the website of the respondent intimating the e-auction of an immovable property, they sent a communication on 18-11-2021 offering their bid.

As per the terms of the auction notice, petitioners deposited 10% of the reserve price amounting to Rs.10,53,000/- on 06-12-2021. The auction was held on 08-12-2021, pursuant to which the petitioners were notified as the successful bidder having bid the property for Rs.1,06,25,000/-.

In the meantime, petitioners were intimated by the respondent that since their lawyer had advised not to confirm the sale till the disposal of a pending petition before this court, the sale could be confirmed only after the disposal of the said writ petition.

Aggrieved by this, the petitioners moved the Court. 

Advocates M.R. Venugopal, Dhanya P. Ashokan and S. Muhammad Alikhan for the petitioners argued that the sale of the property ought to be confirmed in their favour, after accepting the balance bid amount.

However, the Court noted that the petitioner in the other plea was the borrower who had challenged the sale notice scheduling the sale of the secured interest on 08-12-2021. As per the judgment in that case, it was found that the notice of sale was not properly served on the borrower, in terms of Rule 9(1) of the Security Interest Enforcement Rules, 2002.

Since the impugned notice of sale has been set aside, the Court found it appropriate to dismiss this petition.

Case Title: Ratnamani George & Ors. v. Authorised Officer

Citation: 2022 LiveLaw (Ker) 229

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