Hill Top Estate vs Union Of India - Writ Petition

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Hill Top Estate vs Union Of India Thr Its Secretary And Ors on 24 March, 2026

Author: Manish Pitale

Bench: Manish Pitale

2026:BHC-AS:13944-DB

                                                                          WP1211&1457_26.doc

                 IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                              CIVIL APPELLATE JURISDICTION
                               WRIT PETITION NO.1211 OF 2026
         Hill Top Estate                                         ...        Petitioners
         Vs.
         Union of India through its Secretary and others         ...        Respondents
                                          WITH
                           WRIT PETITION NO.1457 OF 2026
         HDFC Bank Limited                                   ...            Petitioners
         Vs.
         Union of India through Ministry of Finance and ors. ...            Respondents
                                               ---
         Mr. Kevic Setalvad, Senior Advocate a/w. Mr. Sidharth Samantaray, Mr. Abdullah
         Qureshi and Ms. Nalvika Sachiv i/b. India Law LLP for Petitioner in
         WP/1457/2026 and for Respondent No.2 in WP/1211/2026.
         Mr. Zal Andhyarujina, Senior Advocate a/w. Mr. Shrey Sancheti, Mr. Carl Patel
         and Ms. Sanaea Umrikar i/b. Mr. Carl Patel for Petitioner in WP/1211/2026 and
         for Respondent No.4 in WP/1457/2026.
         Mr. Mohamedali M. Chunawala with Mr. Ashutosh Mishra for Respondent No.1-
         UOI in both the Petitions.
         Mr. Anirudh Hariani a/w. Mr. Rohit Agarwal, Ms. Kruti Bhavsar, Mr. Pratik Barot
         and Ms. Angel Pandey for Respondent Nos.2 and 3 in WP/1457/2026 and for
         Respondents Nos.3 and 4 in WP/1211/2026.
         Mr. Amir Arsiwala a/w. Ms. Vaishnavi Dhure for Respondent No.5 in both the
         Petitions.

                                        CORAM : MANISH PITALE &
                                                     SHREERAM V. SHIRSAT, JJ.
                                       Reserved on : MARCH 11, 2026
                                     Pronounced on : MARCH 24, 2026

         JUDGEMENT : (Per Justice Manish Pitale)

         .      A bank and an auction purchaser are before this Court in these
         two writ petitions to challenge an order passed by the Debt Recovery
         Tribunal-III, Mumbai (DRT), whereby an auction conducted by the
         petitioner bank, wherein the auction purchaser was successful in its bid,
         has been set aside and the petitioner bank has been directed to take steps 1/30::: Uploaded on - 24/03/2026                      ::: Downloaded on - 24/03/2026 20:46:39 ::: WP1211&1457_26.doc

afresh. The order was passed in an interim application filed by the
respondent guarantors in their pending securitisation application. The
petitioners have directly filed these writ petitions without resorting to the
remedy of filing appeals before the Debt Recovery Appellate Tribunal
(DRAT), claiming that the impugned order passed by the DRT is without
jurisdiction as it is in the teeth of the provisions of the Securitisation and
Reconstruction of Financial Assets and Enforcement of Security Interest
Act, 2002 (for short 'Securtisation Act') and judgements of the Supreme
Court. It is further claimed that the DRT has granted relief beyond the
prayers made in the interim application and also in the final prayers
made in the securitisation application by the respondent guarantors. It is
also claimed that by the impugned order, the DRT has virtually granted
final relief at interim stage and that too in the teeth of the settled position
of law. Before considering the rival submissions, it would be appropriate
to first refer to the chronology of events leading upto filing of these two
writ petitions. The respondent Ritu Automobiles Private Limited,
presently in liquidation, is the borrower while respondents Manoj
Lalwani and Ritika Lalwani are the guarantors. They are being referred
to hereinafter as the borrower and the guarantors respectively.

1. The borrower availed loan facilities from the petitioner HDFC Bank Limited and for that purpose created equitable mortgage on the subject property. The property is located in Survey No.125 in Village Gove, Taluka Bhiwandi, District Thane, Maharashtra. On 21.10.2019, the petitioner bank classified the aforesaid loan account of the borrower as a non-performing asset (NPA) and in that context, issued recall notice to the borrower on 05.11.2019. In response thereto, the borrower claimed that it would clear the dues along with interest by selling the subject property and that a buyer had been identified. Since no further steps were taken by the borrower, on 16.01.2020, the petitioner bank issued notice under Section 13(2) of the Securitisation Act and recorded 2/30::: Uploaded on - 24/03/2026 ::: Downloaded on - 24/03/2026 20:46:39 ::: WP1211&1457_26.doc

that there was a mortgage created over the subject property. As required
by law, the borrower as well as the guarantors were served with the
aforesaid notice. Since no steps were taken by the borrower and the
guarantors and they did not raise any objection to the said notice, on
10.09.2020, the petitioner bank issued symbolic possession notice in
respect of the subject property. The said notice was also published in two
newspapers and thereafter the petitioner bank issued a demand notice to
the respondent borrower with respect to a specific amount along with
interest. A valuation report was obtained on 01.10.2021 and in this
backdrop, in March 2022, the petitioner bank filed a petition before the
National Company Law Tribunal (NCLT) for initiating insolvency
resolution process in the context of the respondent borrower. The NCLT
admitted the said petition and eventually on 10.10.2024, the NCLT
passed an order admitting the respondent borrower into liquidation.
Meanwhile, Axis Bank Limited filed a petition under Section 95 of the
Insolvency and Bankruptcy Code, 2016 (IBC) against the respondent
guarantors, which was also admitted and the personal insolvency
resolution process commenced against them also. On 07.11.2024, the
petitioner bank filed Form D - Proof of Claim with the liquidator of the
respondent borrower for opting to realize the value of the subject
property outside the liquidation process.

1. On 21.11.2024, a possession notice was issued recording that the petitioner bank had taken physical possession of the subject property from the liquidator of the respondent borrower and the same was published in two newspapers. The borrower did not raise any objection despite such notice additionally being served upon it. On 27.03.2025, a redemption notice under Rule 8(6) of the Securitisation Rules was issued to the liquidator of the respondent borrower and the resolution professional appointed for the respondent guarantors. It is in this backdrop that on 16.05.2025 an e-auction notice was served on the 3/30::: Uploaded on - 24/03/2026 ::: Downloaded on - 24/03/2026 20:46:39 ::: WP1211&1457_26.doc

liquidator of respondent borrower and also the resolution professional
for respondent guarantors, informing them that the subject property
would be auctioned on 21.06.2025 at the reserve price fixed at Rs.26.10
crores. At this stage on 18.06.2025, the respondent guarantors filed
Securitisation Application No.300 of 2025 before the DRT. They sought
the relief of quashing and setting aside of the aforementioned sale notice
dated 16.05.2025, whereby the e-auction was scheduled for 21.06.2025,
also praying for quashing and setting aside of the notice under Section
13(2) of the Securitisation Act. They further sought ancillary reliefs in
the said securitisation application. Along with the securitisation
application, the respondent guarantors filed Interim Application No.1910
of 2025 praying for interim reliefs. These included stay to the effect of
the sale notice dated 16.05.2025 for auction of the subject property,
injuncting the petitioner bank from alienating the subject property and
restraining the acceptance of bid amounts.

1. On 21.06.2025, the e-auction was conducted in which the auction purchaser i.e. petitioner Hill Top Estate was declared as the successful bidder. On the same date, the petitioner auction purchaser deposited 25% of the bid amount i.e. Rs.6.61 crores and the sale was confirmed by the petitioner bank. On 25.06.2025, the securitisation application along with the interim application came up for consideration before the DRT but no effective orders were passed. Thereafter, on 02.07.2025, when the applications came up for consideration before the DRT, an order of status quo was passed. On 17.07.2025, the DRT modified its order and permitted the petitioner bank to receive the balance payment, but stay on issuance of the sale certificate continued. On 28.07.2025, the petitioner auction purchaser filed an interim application in the pending securitisation application seeking intervention and other reliefs. Since the DRT only permitted the petitioner auction purchaser to intervene and the interim stay on issuance of sale certificate continued, the petitioner 4/30::: Uploaded on - 24/03/2026 ::: Downloaded on - 24/03/2026 20:46:39 ::: WP1211&1457_26.doc

auction purchaser filed two writ petitions before this Court. In Writ
Petition (L) No.29997 of 2025, the petitioner auction purchaser sought a
direction to the petitioner bank to issue sale certificate and proceed for
registration thereof so that handing over of the subject property would be
facilitated. A further direction was sought for extension of time to the
petitioner auction purchaser to deposit the balance 75% of the amount.
In Writ Petition (L) No.12209 of 2025, the petitioner auction purchaser
sought for a specific direction from this Court for disposing of its
pending interim application by the DRT in a time-bound manner and
also reiterated the aforesaid prayer for extension of time to deposit the
balance 75% amount. On 19.09.2025, this Court disposed of both the
writ petitions by directing the petitioner auction purchaser to deposit the
balance amount in a no-lien account with the petitioner bank on or
before 28.09.2025 and further directed the DRT to dispose of the
pending interim applications in the securitisation application on or
before 25.09.2025. It is undisputed that on 21.09.2025, the petitioner
auction purchaser deposited the entire balance amount with the
petitioner bank as directed by this Court.

1.  The proceedings before the DRT were adjourned from time to
   

   time. In the meanwhile on 24.12.2025, the liquidator of the respondent
   borrower filed affidavit / statement before the DRT in the pending
   proceedings, stating that he was giving approval to the sale of the
   secured asset at the reserve price, in compliance with Rule 9(2) of the
   Securitisation Rules. In this backdrop, the DRT heard all the parties and
   passed the impugned order on 09.01.2026.

2.  As noted hereinabove, the DRT by the impugned order dated
   

   09.01.2026 set aside the auction sale conducted on 21.06.2025. The DRT
   further directed that the amount deposited by the petitioner auction
   purchaser shall be returned to it within one month from the date of the 5/30::: Uploaded on - 24/03/2026 ::: Downloaded on - 24/03/2026 20:46:39 ::: WP1211&1457_26.doc

order, failing which, interest @ 9% p.a. would run till the amount was
received by the petitioner auction purchaser. The respondent guarantors,
who were the applicants before the DRT, were directed to deposit a sum
of Rs.26.10 crores i.e. the bid amount with the petitioner bank on or
before 31.03.2026. Aggrieved by the said impugned order, the petitioner
bank as well as the petitioner auction purchaser filed these two writ
petitions before this Court. The petitioners and all the respondents
represented through counsel were heard.

1. Mr. Kevic Setalwad, learned senior counsel appearing for petitioner bank submitted that the respondent guarantors in the first place have no locus to file and maintain the securitisation application before the DRT. It was submitted that the secured asset is registered in the name of the respondent borrower, which is a corporate debtor and it is undergoing liquidation. The liquidator has given his consent for sale of the property by auction and therefore, the petitioner bank exercised its right under Section 52 of the IBC to enforce the security interest outside the process of liquidation. In such a situation, the guarantors clearly have no right to maintain the securitisation application itself before the DRT. It was further highlighted that the respondent guarantors themselves are undergoing the process of personal insolvency under the provisions of the IBC and they have no net worth at all to approach the DRT and object to the aforesaid auction sale of the secured asset. By inviting attention to the prayers in the securitisation application as well as the interim application filed by the respondent guarantors, it was submitted that the prayers had become infructuous, since the auction sale had already been conducted and that in any case, there were no substantive prayers on the basis of which relief could have been granted in the manner in which it has been granted in the impugned order passed by the DRT.

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1.  On the objection of maintainability raised on behalf of the
   

   respondent guarantors, it was submitted that in the present case, the DRT
   had acted completely without jurisdiction, firstly because it passed the
   impugned order in the teeth of the position of law laid down by the
   Supreme Court and secondly, the impugned order had the effect of
   granting final relief at interim stage, which is also a jurisdictional error.
   On this basis, it was submitted that when a question of law was being
   raised in this writ petition concerning jurisdiction of DRT, which goes to
   the very root of the matter, it is not necessary for the petitioner bank to
   be relegated to the alternative remedy. In this context, reliance was
   placed on judgements of the Supreme Court in the cases of Union of
   India and another Vs. State of Haryana and another, (2000) 10 SCC
   482 and Godrej Sara Lee Limited Vs. Excise and Taxation Officer-cum-
   Assessing Authority and others, 2023 SCC OnLine SC 95 as also
   judgement of Division Bench of this Court in the case of HDFC Bank
   Limited and others Vs. State of Maharashtra and others [judgement and
   order dated 18.09.2024 passed in Writ Petition (L) No.23881 of 2024].

2.  It was submitted that the impugned order virtually permitted
   

   redemption of mortgage and that too at the behest of the respondent
   guarantors in the face of the fact that the liquidator representing the
   original borrower had consented to the auction sale. It was submitted
   that this was in the teeth of Section 13(8) of the Securitisation Act,
   which specifies that the right to redeem the mortgage stands
   extinguished on the date of publication of the auction notice. In the
   present case, the auction notice was issued on 16.05.2025 and on this
   date, the right to redeem the mortgage stood extinguished. It was
   submitted that the DRT completely ignored the law laid down by the
   Supreme Court in this context in the cases of Celir LLP Vs. Bafna
   Motors (Mumbai) Private Limited and others, (2024) 2 SCC 1 and M.
   Rajendran and others vs. KPK Oils and Proteins India Private Limited 7/30::: Uploaded on - 24/03/2026 ::: Downloaded on - 24/03/2026 20:46:39 ::: WP1211 &1457_26.doc

and others, 2025 SCC OnLine SC 2036. It was submitted that since the
impugned order is in the teeth of the aforesaid statutory provision as also
the law clarified by the Supreme Court in that context, the impugned
order suffers from a jurisdictional error demonstrating that the writ
petition filed by the petitioner bank is maintainable.

1.  It was further submitted that the findings rendered by the DRT in
   

   the impugned order, to the effect that the notice under Section 13(2) was
   defective and that the valuation report was also defective, suffer from
   serious errors. By referring to the mortgage deed on record, it was
   submitted that the land as well as structures thereon were mortgaged and
   that, the DRT committed an error in holding that reference to structures
   in the notice issued under Section 13(2) of the Securitisation Act
   rendered the said notice defective. It was further submitted that the
   defects found in the valuation report also suffered from the same error.
   The DRT failed to appreciate that the valuation report, relied upon by the
   petitioner bank correctly took into consideration the fact that a portion of
   the subject land was utilised for construction of road and therefore, the
   valuation was determined after deducting the said portion of land from
   the larger piece of subject land. It was submitted that in any case, all
   these issues could certainly not be raised by the respondent guarantors
   and that they had absolutely no locus in the matter, considering the fact
   that the liquidator representing the original borrower had already given
   consent to the auction sale of the subject property. It was submitted that
   therefore, the consequential steps in pursuance of the auction sale ought
   to be permitted so that the auction purchaser, who has paid the entire
   amount, is able to enjoy the fruits of the auction.

2.  Mr. Zal Andhyarujina, learned senior counsel appearing for the
   

   petitioner auction purchaser, supported the contentions raised on behalf
   of the petitioner bank. It was reiterated that in the facts of the present 8/30::: Uploaded on - 24/03/2026 ::: Downloaded on - 24/03/2026 20:46:39 ::: WP1211&1457_26.doc

case, the respondent guarantors could not have maintained the
securitisation application as also the interim application filed therein.
The respondent borrower through the liquidator had consented to the
auction sale of the secured asset and therefore, the guarantors could not
be heard, particularly after the auction sale notice dated 16.05.2025 had
been already issued and published on behalf of the petitioner bank. It
was emphasized that the DRT had virtually granted redemption of the
mortgage and that too, at the behest of the respondent guarantors while
the original borrower i.e. the respondent herein had through the
liquidator raised no objection to the auction sale of the subject secured
asset. It was submitted that the DRT committed a fundamental
procedural irregularity by granting sweeping relief in the impugned
order, when such relief was neither claimed in the securitisation
application nor in the interim application, which was disposed of by the
impugned order. On this basis, it was submitted that the respondent
guarantors could not claim that the petitioner auction purchaser had not
suffered from any prejudice or that principles of natural justice had not
been violated, simply for the reason that the argument of procedural
irregularity was being specifically raised on behalf of the petitioner
auction purchaser in its writ petition.

1. By placing reliance on judgements of the Supreme Court in the cases of Celir LLP Vs. Bafna Motors (Mumbai) Private Limited and others (supra) and M. Rajendran and others vs. KPK Oils and Proteins India Private Limited and others (supra), it was submitted that the impugned order was in the teeth of the said position of law clarified by the Supreme Court of India. On this basis, it was submitted that the order itself was rendered without jurisdiction and hence the petitioner auction purchaser was entitled to maintain the writ petition before this Court. On this basis, it was submitted that the petitioner auction purchaser cannot be relegated to the alternative remedy of 9/30::: Uploaded on - 24/03/2026 ::: Downloaded on - 24/03/2026 20:46:39 ::: WP1211&1457_26.doc

approaching the DRAT, in the facts and circumstances of the present
case. It was further submitted that jurisdictional error on the part of the
DRT was further manifested by the fact that the impugned order
virtually grants final relief at interim stage and that too, when no such
reliefs were claimed either in the main securitisation application or in the
interim application, which stood disposed of by the impugned order. On
this aspect, reliance was placed on judgements of the Supreme Court in
the cases of Vishnu Babu Tambe Vs. Apurva Vishnu Tambe, (2017) 2
SCC 454 and Samir Narain Bhojwani Vs. Aurora Properties and
Investments and another, (2018) 17 SCC 203.

1.  The learned senior counsel appearing for the petitioner auction
   

   purchaser specifically placed reliance on judgement of the Supreme
   Court in the case of East India Commercial Company Limited, Calcutta
   and another Vs. Collector of Customs, Calcutta, AIR 1962 SC 1893, to
   contend that since the impugned order is in the teeth of the position of
   law laid down by the Supreme Court, it is rendered without jurisdiction
   and therefore, this Court ought to entertain the writ petition filed by the
   petitioner auction purchaser.

2.  It was further submitted that the mortgage deed, when appreciated
   

   in the correct perspective, clearly demonstrated that the land with
   structures was mortgaged. The valuation report was prepared on that
   basis and in any case, the objections regarding the alleged defects in the
   valuation report and the alleged defects in the notice issued under Section 13(2) of the Securitisation Act by the Bank, could not have been
   entertained by the DRT at the behest of the respondent guarantors,
   particularly when the respondent original borrower never raised any
   objection to the same. The liquidator of the respondent borrower had
   specifically approached the DRT and consented by filing an affidavit on
   record. In such circumstances, there was no question of entertaining the 10/30::: Uploaded on - 24/03/2026 ::: Downloaded on - 24/03/2026 20:46:39 ::: WP1211&1457_26.doc

contentions raised on behalf of the respondent guarantors on merits and
granting relief well beyond the prayers made in the securitisation
application as well as in the interim application. It was further submitted
that the petitioner auction purchaser has parted with huge amount of
money and the entire amount as per the bid has been deposited with the
petitioner bank. In such a situation, the petitioner auction purchaser
ought not to be deprived of the fruits of the auction. On this basis, it was
submitted that the writ petition ought to be allowed.

1. On the other hand, Mr. Hariani, learned counsel appearing for the contesting respondent guarantors submitted that the petitions filed by the bank and the auction purchaser are not maintainable in the face of the availability of the alternative efficacious remedy of approaching the DRAT. It was submitted that the petitioners ought to have exhausted the said remedy before approaching the writ court. It was submitted that the petitioners have not made out any special case for directly entertaining the writ petitions, without recourse to the alternative efficacious remedy. In this regard, reliance was placed on judgement of the Supreme Court in the case of United Bank of India Vs. Satyawati Tandon and others, (2010) 8 SCCC 110, wherein the Supreme Court reiterated that the statutory remedies available under the Securitisation Act must be taken recourse to and that the Writ Court ought not to casually entertain such writ petitions. It was further emphasized that even in the judgement upon which the petitioners have placed reliance i.e. Celir LLP Vs. Bafna Motors (Mumbai) Private Limited and others (supra), the Supreme Court once again reiterated that writ petitions ought not to be entertained casually and that the High Courts ought to follow the repeated directions issued by the Supreme Court, including in the case of United Bank of India Vs. Satyawati Tandon and others (supra) that when there is a statutory dispensation available, writ petitions directly filed to challenge the orders of the original authority ought not to be 11/30::: Uploaded on - 24/03/2026 ::: Downloaded on - 24/03/2026 20:46:39 ::: WP1211&1457_26.doc

entertained. It was submitted that there was no question of violation of
principles of natural justice in the present case as both the petitioners
were exhaustively heard by the DRT and their contentions were
considered before passing the impugned order. It was submitted that
therefore, the petitioners cannot claim this to be a special case for
entertaining the writ petitions directly. Reliance was placed on
judgement of the Supreme Court in the case of State of Uttar Pradesh
Vs. Sudhir Kumar Singh, (2021) 19 SCC 706. It was submitted that in
any case, proceedings before the DRT are summary proceedings and that
they cannot be compared with the proceedings before civil court that are
governed by the Code of Civil Procedure, 1908 (CPC). By referring to
the prayer clauses in the securitisation application as well as the interim
application, it was submitted that the prayers were sufficiently widely
worded to cover the reliefs that were eventually granted in the impugned
order passed by the DRT. On this basis, it was submitted that there was
no question of any procedural irregularity committed by the DRT in the
present case.

1.  It was further submitted that the contention raised on behalf of the
   

   petitioners challenging the locus of respondent guarantors in filing the
   applications before the DRT, is absolutely without any substance. By
   referring to Section 17(1) of the Securitisation Act, it was emphasized
   that any person aggrieved by measures taken under the Securitisation
   Act can approach the DRT for relief. In the present case, the respondent
   guarantors are clearly covered under the expression 'any person
   aggrieved'. On this basis, it was submitted that the elaborate submissions
   made on behalf of the petitioners with regard to the locus of the
   respondent guarantors do not deserve any consideration.

2.  On the aspect that the DRT in the impugned order had virtually
   

   allowed redemption of a mortgage in the face of the law laid down by 12/30::: Uploaded on - 24/03/2026 ::: Downloaded on - 24/03/2026 20:46:39 ::: WP1211&1457_26.doc

the Supreme Court in the case of Celir LLP Vs. Bafna Motors
(Mumbai) Private Limited and others (supra) and M. Rajendran and
others vs. KPK Oils and Proteins India Private Limited and others (supra), it was submitted that the petitioners as the guarantors were not
seeking redemption of the mortgage, nonetheless, they were clearly
entitled to challenge the actions undertaken by the respondent bank
under the provisions of the Securitisation Act. It was this challenge that
the DRT found to be meritorious and therefore, it passed the impugned
order. The condition imposed in the impugned order that the respondent
guarantors shall deposit amount of Rs.26.01 crores before 31.03.2026 is
only with a view to ensure that if the respondent guarantors seek a stay
on the fresh auction proceedings that may be undertaken, they have to
show their bona fide. On this basis it was submitted that there was no
question of redemption of mortgage at the behest of the petitioners in the
impugned order that was passed by the DRT. Reliance was placed on
judgments of the Madras High Court in the cases of N. R. Sadasivam Vs.
Indian Bank, 2013 (1) CTC 53 and Star Trace Engineering Division Vs.
Registrar, DRT and others, (2023) SCC OnLine Mad. 8349, to contend
that if an auction sale is set aside by the tribunal or a court of law on
material irregularities, the right of redeem would automatically revive.

1.  It was submitted that since the DRT found that the respondent
   

   auction purchasers had made out a strong case on merits, demonstrating
   that the initial action undertaken by the petitioner bank itself was in the
   teeth of law, all consequential actions and the superstructure itself
   collapsed. On this basis, it was submitted that the petitioners cannot
   claim that the DRT permitted redemption of mortgage in the teeth of the
   law laid by the Supreme Court.

2.  On the merits of the matter, the learned counsel appearing for the
   

   respondent guarantors defended the findings rendered by the DRT. It 13/30::: Uploaded on - 24/03/2026 ::: Downloaded on - 24/03/2026 20:46:39 ::: WP1211&1457_26.doc

was submitted that glaring defects were found both in the notice issued
under Section 13(2) of the Securitisation Act as well as the valuation
report, which went to the very root of the matter. It was submitted that
all the grounds taken in the securitisation application were reiterated in
the interim application and the glaring defects were demonstrated on
behalf of the respondent mortgagors before the DRT. It was emphasized
that the notice under Section 13(2) of the Securitisation Act was clearly
defective inasmuch as it described the mortgaged property in variance to
the description of the mortgaged property in the mortgage deed itself and
further that the amount stated in the said notice did not give proper
bifurcation of the principal amount and the interest and other such
details. By placing reliance on judgement of this Court in the case of Saraswat Co-op. Bank Limited Vs. National Flank Industries Limited
and others, 2025 SCC OnLine Bom. 3332, it was submitted that failure
to give such details in the notice under Section 13(2) of the
Securitisation Act, which were mandatorily required, rendered it
completely defective. As regards the valuation report, it was submitted
that the same included structures in the valuation when only open land
had been mortgaged. Even with regard to the open land, the entire piece
of land mortgaged was not taken into consideration while determining
the valuation, thereby rendering it fundamentally defective. It was
further submitted that the rights of the auction purchaser were not
crystallized and therefore, the DRT was justified in directing the
petitioner bank to undertake a fresh auction, which in the facts and
circumstances of the case, was a just, fair and reasonable order, requiring
no interference at the hands of this Court exercising writ jurisdiction. On
this basis, it was submitted that the writ petitions deserved to be
dismissed.

1. Having heard the learned counsel for the parties, we find that since the respondent guarantors have specifically raised a ground with 14/30::: Uploaded on - 24/03/2026 ::: Downloaded on - 24/03/2026 20:46:39 ::: WP1211&1457_26.doc

regard to the maintainability of the writ petitions, it would be
appropriate to first deal with the said contention. The respondent
guarantors have asserted that in the light of statutory remedy of appeal
available to the petitioners of filing an appeal before the DRAT under the
provisions of the Securitisation Act, these writ petitions filed directly to
challenge the order of the DRT are not maintainable. It has to be
appreciated that there is a difference between the concept of
"maintainability" on the one hand and that of "entertainability" on the
other.

1. The Supreme Court in the case of Godrej Sara Lee Limited Vs. Excise and Taxation Officer-cum-Assessing Authority and others (supra), considered the said two concepts and made the following observations:-

"4. Before answering the questions, we feel the urge to say
a few words on the exercise of writ powers conferred by article 226 of the Constitution having come across certain
orders passed by the High Courts holding writ petitions as
"not maintainable" merely because the alternative remedy
provided by the relevant statutes has not been pursued by the
parties desirous of invocation of the writ jurisdiction. The
power to issue prerogative writs under article 226 is plenary
in nature. Any limitation on the exercise of such power must
be traceable in the Constitution itself. Profitable reference in
this regard may be made to article 329 and ordainments of
other similarly worded articles in the Constitution. Article 226 does not, in terms, impose any limitation or restraint on the
exercise of power to issue writs. While it is true that exercise
of writ powers despite availability of a remedy under the very
statute which has been invoked and has given rise to the
action impugned in the writ petition ought not to be made in a
routine manner, yet, the mere fact that the petitioner before
the High Court, in a given case, has not pursued the
alternative remedy available to him/it cannot mechanically be
construed as a ground for its dismissal. It is axiomatic that the
High Courts (bearing in mind the facts of each particular case)
have a discretion whether to entertain a writ petition or not.
One of the self-imposed restrictions on the exercise of power
under article 226 that has evolved through judicial precedents
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petition, where an effective and efficacious alternative remedy
is available. At the same time, it must be remembered that
mere availability of an alternative remedy of appeal or
revision, which the party invoking the jurisdiction of the High
Court under article 226 has not pursued, would not oust the
jurisdiction of the High Court and render a writ petition "not
maintainable". In a long line of decisions, this court has made
it clear that availability of an alternative remedy does not
operate as an absolute bar to the "maintainability" of a writ
petition and that the rule, which requires a party to pursue the
alternative remedy provided by a statute, is a rule of policy,
convenience and discretion rather than a rule of law. Though
elementary, it needs to be restated that "entertainability" and
"maintainability" of a writ petition are distinct concepts. The
fine but real distinction between the two ought not to be lost
sight of. The objection as to "maintainability" goes to the root
of the matter and if such objection were found to be of
substance, the courts would be rendered incapable of even
receiving the lis for adjudication. On the other hand, the
question of "entertainability" is entirely within the realm of
discretion of the High Courts, writ remedy being
discretionary. A writ petition despite being maintainable may
not be entertained by a High Court for very many reasons or
relief could even be refused to the petitioner, despite setting
up a sound legal point, if grant of the claimed relief would not
further public interest. Hence, dismissal of a writ petition by a
High Court on the ground that the petitioner has not availed
the alternative remedy without, however, examining whether
an exceptional case has been made out for such entertainment
would not be proper."
22. Thus, availability of an alternative remedy does not operate as an
absolute bar to the maintainability of a writ petition, and in a given case,
the High Court can entertain a writ petition despite availability of an
alternative remedy. Evidently, the rule of not entertaining a writ petition
due to availability of an alternative remedy is a self-imposed restraint by
the writ court and it is a rule of policy, convenience, prudence and
discretion, rather than a rule of law. In other words, if the petitioner
before the writ court makes out a case for entertaining the writ petition
despite availability of alternative remedy, the said writ petition can be
entertained and appropriate orders can be passed in such a writ petition.

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1.  In these writ petitions, the petitioners have invoked the writ of
   

   certiorari, asserting that the DRT, being a subordinate tribunal, has far
   exceeded its jurisdiction while passing the impugned order. The grounds
   raised while claiming such jurisdictional error include the assertion that
   the impugned order is in the teeth of settled law laid down by the
   Supreme Court in the case of Celir LLP Vs. Bafna Motors (Mumbai)
   Private Limited and others (supra) and M. Rajendran and others vs.
   KPK Oils and Proteins India Private Limited and others (supra).
   Apart from this, it is in the teeth of the relevant provision i.e. Section
   13(8) of the Securitisation Act, that the impugned order amounts to
   granting final relief at the interim stage and further, that the reliefs
   granted are well beyond the prayers in the securitisation application as
   well as the interim application filed by the respondent guarantors before
   the DRT.

2. In the case of East India Commercial Company Limited,
   Calcutta and another Vs. Collector of Customs, Calcutta (supra), the
   Supreme Court held that if an order is passed in the teeth of the position
   of law laid down by a superior court, such an order itself is rendered
   without jurisdiction. Although the said position has been laid down
   while discussing jurisdiction under Article 227 of the Constitution of
   India, which concerns supervisory jurisdiction of the High Courts, it is a
   settled position of law that the jurisdiction that the High Courts exercise
   while invoking the writ of certiorari, to a certain extent, overlaps with
   the jurisdiction exercised under Article 227 of the Constitution of India.
   Thus, the observations made in the said judgment are relevant to test the
   ground of maintainability raised on behalf of the respondent guarantors.

3.  The relevant portion of [the said judgment](https://indiankanoon.org/doc/1839963/) of the Supreme Court in
   

   the case of East India Commercial Company Limited, Calcutta and 17/30::: Uploaded on - 24/03/2026 ::: Downloaded on - 24/03/2026 20:46:39 ::: WP1211&1457_26.doc another Vs. Collector of Customs, Calcutta (supra) reads as follows:

"31. ... It would be anomalous to suggest that a tribunal
over which the High Court has superintendence can ignore the
law declared by that court and start proceedings in direct
violation of it. If a tribunal can do so, all the subordinate
courts can equally do so, for there is no specific provision,
just like in the case of Supreme Court, making the law
declared by the High Court binding on subordinate courts. It
is implicit in the power of supervision conferred on a superior
tribunal that all the tribunals subject to its supervision should
conform to the law laid down by it. Such obedience would
also be conducive to their smooth working : otherwise, there
would be confusion in the administration of law and respect
for law would irretrievably suffer. We, therefore, hold that the
law declared by the highest court in the State is binding on
authorities or tribunals under its superintendence, and that
they cannot ignore it either in initiating a proceeding or
deciding on the rights involved in such a proceeding. If that
be so, the notice issued by the authority signifying the
launching of proceedings contrary to the law laid down by the
High Court would be invalid and the proceedings themselves
would be without jurisdiction."
26. In the case of Union of India and another Vs. State of Haryana
and another (supra), the Supreme Court in the context of
maintainability of writ petition under Article 226 of the Constitution of
India in the face of an alternative remedy observed as follows:

"3. Having heard learned counsel for the parties at length,
we are of the view that these are the matters which should not
have been dismissed by the respective High Courts in
suggesting an alternative remedy. The question raised was
pristinely legal which required determination as to whether
provision of telephone connections and instruments amounted
to sale and even so why was the Union of India not exempt
from payment of sales tax under the respective statutes. The
respondents counter such stance. We think the question raised
was fundamental in character and need not have been put
through the mill of statutory appeals in the hierarchy. For this
reason alone, we set aside the respective impugned orders of
the High Courts and remit the writ petitions back to them for
decision in accordance with law. The recovery of tax would
stand stayed till the disposal of the writ petitions. Ordered
accordingly. No costs."
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1.  Thus, it is evident that if a fundamental question is raised that
   

   goes to the very root of the matter, the party approaching the writ court
   need not necessarily be relegated to the mill of statutory appeals in the
   hierarchical context of a statutory framework. In the cases of Vishnu
   Babu Tambe Vs. Apurva Vishnu Tambe (supra) and Samir Narain
   Bhojwani Vs. Aurora Properties and Investments and another (supra), the Supreme Court clearly indicated that if the impugned order
   grants final relief at interlocutory stage, it is a manifest error and it
   amounts to exceeding jurisdiction.

2.  This would also apply to a situation where the impugned order
   

   grants relief beyond the prayers that are made by the concerned
   applicant before the tribunal.

3.  We find that the petitioners in these writ petitions have raised such
   

   grounds and they have claimed that there is a fundamental procedural
   irregularity committed by the DRT in passing the impugned order. This
   is raised as a facet of natural justice and it is claimed that therefore, the
   writ petition is clearly maintainable. We are of the view that when the
   said contention raised on behalf of the petitioners is appreciated in the
   proper perspective, the argument of prejudice raised on behalf of the
   respondent guarantors cannot be accepted. In such a situation, the
   respondent guarantors cannot fall back on the argument that despite
   violation of principles of natural justice, as per settled law, the
   petitioners would still have to show some prejudice suffered by them
   and only then could the writ petitions be maintainable. Thus, if the
   petitioners succeed in demonstrating that there is a jurisdictional error
   and a fundamental procedural irregularity committed by the DRT while
   passing the impugned order, the argument of the respondent guarantors
   regarding maintainability of the writ petitions will have to be rejected. In
   that sense, the issues appear to be intertwined.

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1.  There can be no quarrel with the proposition [laid down by](https://indiankanoon.org/doc/190735110/) the
   

   Supreme Court in the case of United Bank of India Vs. Satyawati
   Tandon and others (supra), reiterated in the case of Celir LLP Vs.
   Bafna Motors (Mumbai) Private Limited and others (supra), that
   ordinarily a writ petition would not be maintainable in the face of
   availability of alternative efficacious remedy, but the aforesaid self-
   restraint and the rule of policy, convenience and discretion would not be
   exercised by this Court if a fundamental jurisdictional error is found in
   the order of the tribunal.

2.  The true nature of the impugned order passed by the DRT will
   

   have to be examined in order to consider the specific contentions raised
   on behalf of the petitioners in this regard. By the impugned order dated
   09.01.2026, the DRT set aside the auction conducted on 21.06.2025. The
   amount deposited by the petitioner auction purchaser was directed to be
   returned back and further, the respondent guarantors were directed to
   remit the sum of Rs. 26.10 crores with the petitioner bank on or before
   31.03.2026. We find that the directions contained in the impugned order
   amount to permitting redemption of the mortgage. It is difficult to
   understand the argument of the respondent guarantors that even if the
   effect is of redeeming the mortgage, such was not the relief claimed by
   the respondent guarantors and instead, they had merely challenged the
   actions undertaken by the petitioner bank under the provisions of the Securitisation Act. We find that the petitioner bank as well as the
   petitioner auction purchaser have specifically raised the issue of
   extinguishing of rights of redemption in the facts and circumstances of
   the present case. It was also specifically argued on their behalf that the
   DRT would not have any inherent power to set aside a sale when no such
   specific prayer was made in the securitisation application itself. We find
   that the DRT failed to discuss the said aspects of the matter in the
   impugned order and proceeded to pass an order that effectively 20/30::: Uploaded on - 24/03/2026 ::: Downloaded on - 24/03/2026 20:46:39 ::: WP1211&1457_26.doc

amounted to allowing redemption for mortgage.

1. In the case of Celir LLP Vs. Bafna Motors (Mumbai) Private Limited and others (supra), the Supreme Court specifically took into consideration the effect of the amendment in Section 13(8) of the Securitisation Act. The comparison between the pre-amendment position and the post-amendment position was examined and thereafter, the Supreme Court specifically made certain observations, which are relevant for the present case. Relevant portions of the judgment of the Supreme Court in the case of Celir LLP Vs. Bafna Motors (Mumbai) Private Limited and others (supra) read as follows:

"61. Before proceeding with the analysis of the provision of Section 13(8) of the Sarfaesi Act, it would be appropriate to
refer to the said provision as it stood prior to the amendment
and as it stands after the amendment, which is given below:

Pre-amendment Section 13(8) Post-amendment Section 13(8) "13. (8) If the dues of the "13. (8) Where the amount of
secured creditor together with dues of the secured creditor
all costs, charges and expenses together with all costs, charges
incurred by him are tendered to and expenses incurred by him is
the secured creditor at any time tendered to the secured creditor
before the date fixed for sale or at any time before the date of
transfer, the secured asset shall publication of notice for public
not be sold or transferred by the auction or inviting quotations or
secured creditor, and no further tender from public or private
step shall be taken by him for treaty for transfer by way of
transfer or sale of that secured lease, assignment or sale of the
asset." secured assets--
(i) the secured assets shall not be
transferred by way of lease
assignment or sale by the
secured creditor; and

(ii) in case, any step has been
taken by the secured creditor for
transfer by way of lease or
assignment or sale of the assets
before tendering of such amount
under this sub-section, no
further step shall be taken by
such secured creditor for transfer
by way of lease or assignment or
sale of such secured assets."

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   *                *          *             *                  * 64. We are of the view that the failure on the part of the

borrower in tendering the entire dues including the charges,
interest, costs, etc. before the publication of the auction-notice
as required by Section 13(8) of the Sarfaesi Act, would also
sufficiently constitute extinguishment of right of redemption
of mortgage by the act of parties as per the proviso to Section
60 of the 1882 Act. Furthermore, in the case on hand, there
was no claim for right of redemption by the borrower either
before the publication of the auction-notice or even thereafter.
The borrowers entered into the fray only after coming to
know of the confirmation of auction. Be that as it may, once Section 13(8) stage was over and auction stood concluded, it
could be said that there was an intentional relinquishment of
his right of redemption under Section 13(8), whereby the
Bank declared the appellant as the successful auction-
purchaser having offered the highest bid in accordance with
the terms of the auction-notice.

1. The Sarfaesi Act is a special law containing an overriding clause in comparison to any other law in force. Section 60 of the 1882 Act, is a general law vis-à-vis the amended Section 13(8) of the Sarfaesi Act which is special law. The right of redemption is clearly restricted till the date of publication of the sale notice under the Sarfaesi Act, whereas the said right continues under Section 60 of the 1882 Act till the execution of conveyance of the mortgaged property. The legislative history has been covered in the preceding paragraphs of this judgment and how Parliament desired to have express departure from the general provision of Section 60 of the 1882 Act. The Sarfaesi Act is a special law of recovery with a paradigm shift that permits expeditious recovery for the banks and the financial institutions without intervention of courts. Similarly, Section 13(8) of the Sarfaesi Act is a departure from the general right of redemption under the general law i.e. the 1882 Act. Further, the legislature has in the Objects and Reasons while passing the amending Act specifically stated "to facilitate expeditious disposal of recovery applications, it has been decided to amend the said Acts...". Thus, while interpreting Section 13(8) vis-à-vis Section 60 of the 1882 Act, an interpretation which furthers the said Objects and Reasons should be preferred and adopted. If the general law is allowed to govern in the manner as sought to be argued by the borrowers, it will defeat the very object and purpose as well as the clear language of the amended Section 13(8).

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1. However, with the advent of the 2016 Amendment, Section 13(8) of the Sarfaesi Act now uses the expression
   "before the date of publication of notice for public auction or
   inviting quotations or tender from public or private treaty for
   transfer by way of lease, assignment or sale of the secured
   assets" which by no stretch of imagination could be said to be
   in consonance with the general rule under the 1882 Act that
   the right of redemption is extinguished only after conveyance
   by registered deed. Thus, in the light of clear inconsistency
   between Section 13(8) of the Sarfaesi Act and Section 60 of
   the 1882 Act the former special enactment overrides the latter
   general enactment in light of Section 35 of the Sarfaesi Act.
   Thus, the right of redemption of mortgage is available to the
   borrower under the Sarfaesi Act only till the publication of
   auction-notice and not thereafter, in light of the amended Section 13(8)."

2.  The said position of law was further reiterated by the Supreme
   

   Court in the case of M. Rajendran and others vs. KPK Oils and
   Proteins India Private Limited and others (supra). In the said
   judgment, the Supreme Court took into consideration the issue as
   regards the manner in which its earlier judgment in the case of Celir
   LLP Vs. Bafna Motors (Mumbai) Private Limited and others (supra)
   was being construed by various High Courts. The Supreme Court further
   took into consideration a situation where the secured asset was sought to
   be sold, not by way of auction but by way of private treaty. Taking into
   consideration the aforesaid situation also, the Supreme Court in the case
   of M. Rajendran and others vs. KPK Oils and Proteins India Private
   Limited and others (supra) held as follows:-

"105. To put it simply, as per sub-section (8) of Section 13 of
the SARFAESI Act, a borrower can tender the amount of dues
to the secured creditor along with all costs, charges and
expenses, at any time, before the date of publication of notice
for public auction or inviting quotations or tender from public
or private treaty, as the case may be.

1. A borrower has no unfettered right to tender such amount of dues, as stipulated in Section 13(8), after the date of publication of notice for public auction or inviting quotations or tender from public or private treaty, as the case 23/30::: Uploaded on - 24/03/2026 ::: Downloaded on - 24/03/2026 20:46:39 ::: WP1211&1457_26.doc

may be, because the restriction on the secured creditor, from
transferring the secured asset, envisaged under clause(s) (i)
and (ii) of the said provision, would only be attracted, if the
dues are tendered prior to the publication of notice for public
auction or inviting quotations or tender from public or private
treaty, as the case may be. Where the borrower tenders such
dues after the publication of the notice stipulated in Section
13(8), the secured creditor is not bound to accept it, and can
continue to proceed with the transfer of the secured asset, by
way of lease, assignment or sale."
34. Thus, it is abundantly clear that once the auction sale notice is
published, the borrower completely loses the right to seek redemption of
the mortgage by operation of Section 13(8) of the Securitisation Act, as
amended, and in the light of the clear position of law laid down by the
Supreme Court in the aforementioned judgments. In the present case, it
was incumbent upon DRT to examine the said aspect of the matter,
particularly in light of the fact that such specific objection was raised on
behalf of the petitioners.

1.  In the present case, on 27.03.2025, the petitioner bank issued
   

   specific notice to the respondent borrower through its liquidator, as well
   as the resolution professional appointed by the NCLT in the context of
   the personal insolvency of the respondent guarantors. They did not raise
   any objection to the steps contemplated by the petitioner bank in respect
   of auction sale of the secured asset. It is in this backdrop that the
   petitioner bank issued the auction sale notice and published the same in
   newspapers on 16.05.2025. The moment the aforesaid auction sale
   notice was published, by operation of Section 13(8) of the Securitisation
   Act, the right of the respondent borrower to redeem the mortgage was
   extinguished. This has been emphatically laid down by the Supreme
   Court in the aforementioned judgments in the cases of Celir LLP Vs.
   Bafna Motors (Mumbai) Private Limited and others (supra) and M.
   Rajendran and others vs. KPK Oils and Proteins India Private 24/30::: Uploaded on - 24/03/2026 ::: Downloaded on - 24/03/2026 20:46:39 ::: WP1211 &1457_26.doc Limited and others (supra). The DRT, while passing the impugned
   order, which effectively granted redemption of mortgage, ought to have
   considered the said position before passing any order in the matter.
   Instead, the DRT went ahead to examine the merits of the matter, which
   demonstrates the jurisdictional error committed by the DRT. In the
   process, the DRT also committed an error in granting final relief while
   disposing of the interim application. We find that since the order of the
   DRT is in the teeth of the settled position of law, in terms of the law laid
   down by the Supreme Court in the case of East India Commercial
   Company Limited, Calcutta and another Vs. Collector of Customs,
   Calcutta (supra), the impugned order is rendered without jurisdiction.

2.  We also find that the nature of the impugned order is such that it
   

   amounts to granting final relief at interim stage. In the case of Samir
   Narain Bhojwani Vs. Aurora Properties and Investments and
   another (supra), the Supreme Court held that when such a situation
   occurs, where final relief is granted at interlocutory stage, it amounts to
   a manifest error and such an order can be said to be in excess of
   jurisdiction.

3.  We have also perused the securitisation application as well as the
   

   interim application and we find that there is no prayer clause in the
   applications for setting aside of the auction sale. Yet, the DRT passed the
   impugned order on the interim application, setting aside the auction and
   giving further directions. This amounts to granting relief that is not even
   prayed by the respondent guarantors in the aforementioned applications.
   This is another instance of the DRT having committed a jurisdictional
   error while passing the impugned order. We are unable to accept the
   contention of the respondent guarantors that the prayer clauses were
   pertaining to the situation when the securitisation application and the
   interim application were filed on 18.06.2025. As a matter of fact, 25/30::: Uploaded on - 24/03/2026 ::: Downloaded on - 24/03/2026 20:46:39 ::: WP1211&1457_26.doc

subsequent events had occurred and the parties were not only before the
DRT, but before this Court in writ petitions filed by the petitioners in
which specific directions were issued. Nothing prevented the respondent
guarantors from appropriately amending the securitisation application as
well as the interim application for making specific prayers for the relief
of setting aside of the auction. No such steps were taken by the
respondent guarantors, which the DRT completely failed to appreciate
and it proceeded as if it was finally deciding the pending applications,
including the securitisation application.

1. At this stage, it would be relevant to note some glaring facts in the present case. It is an admitted position that the notice under Section 13(2) of the Securitisation Act was issued as far back as on 16.01.2020 by the petitioner bank. As per law, the notice was duly served upon the borrower as well as the guarantors. It is the matter of fact that the respondent borrower went into corporate insolvency and eventually into liquidation. The liquidator was duly put to notice with regard to the actions being undertaken by the petitioner bank. Equally, the resolution professional appointed in the context of personal insolvency proceedings pending before the NCLT as against the respondent guarantors, was also duly put to notice about the actions being undertaken by the petitioner bank under the Securitisation Act. Not only this, the liquidator appeared before the DRT in the pending proceeding and specifically recorded that he had no objection for the sale of the secured asset in terms of the actions undertaken by the petitioner bank as a secured creditor. The resolution professional concerning the personal insolvency proceedings pending against the respondent guarantors also did not raise any objection. We find that the facts that come to the fore clearly demonstrate that the respondent guarantors chose to remain fence-sitters from the year 2020, despite the fact that they were aware about the proceedings being undertaken by the petitioner bank in terms of the 26/30::: Uploaded on - 24/03/2026 ::: Downloaded on - 24/03/2026 20:46:39 ::: WP1211&1457_26.doc

notice issued under Section 13(2) of the Securitisation Act. For more
than a period of five years, no steps were taken in the matter. Even when
the securitisation application along with the interim application were
filed before the DRT, no efforts were made to amend the applications in
an appropriate manner in the light of the auction sale having been
conducted and the auction purchaser having come into the picture. This
demonstrates that the DRT committed a manifest error in not taking into
consideration the aforesaid circumstances and also committed a grave
procedural irregularity by granting final relief at interim stage and also
granting reliefs well beyond the specific prayers made in the
applications filed by the respondent guarantors.

1. We find that the petitioners in these petitions have specifically invoked the writ of certiorari. The discussions and findings rendered hereinabove clearly show that the DRT, while passing the impugned order dated 09.01.2026, committed a serious jurisdictional error, and therefore, this Court is required to invoke the writ of certiorari and interfere with the impugned order. This Court while exercising writ jurisdiction can also not ignore the admitted position on facts that the respondent guarantors are themselves undergoing the process of personal insolvency before the NCLT. They have no net worth and yet after more than five years, they approached the DRT seeking certain reliefs and the DRT without examining the totality of facts ended up granting reliefs far beyond the specific prayers made in the two applications filed by the respondent guarantors. It is also significant to note that the respondent borrower, through the liquidator, has already given no objection to the steps taken by the petitioner bank under the provisions of the Securitisation Act. The respondent guarantors cannot be in a position better than the original borrower and enjoy reliefs, which even the original borrower would not be entitled to.

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1. In this background, we do not find substance in the contention raised on behalf of the respondent guarantors that they were simply challenging the validity of the process undertaken by the petitioner bank under the provisions of the Securitisation Act and that they never claimed any redemption of mortgage. This Court is concerned with the nature of the impugned order passed by the DRT, which effectively shows that the mortgage has been redeemed. In this context, reliance placed on behalf of the respondent borrowers on the judgement of the Madras High Court in the cases of N. R. Sadasivam Vs. Indian Bank (supra) and Star Trace Engineering Division Vs. Registrar, DRT and others (supra), to contend that if eventually Section 13(2) notice under Securitisation Act issued by the petitioner bank is found to be unsustainable, the mortgage would then be open for redemption. Even if that be so, the said question would have to be decided in the securitisation application, which is still pending before the DRT. In fact, this further shows that the DRT erred in granting final relief at interim stage, thereby re-enforcing the conclusion that this was a fundamental jurisdictional error committed by the DRT. In this situation, we find that although elaborate submissions were made on behalf of the respondent guarantors to defend the findings rendered by the DRT on the alleged defects in the Section 13(2) notice issued by the petitioner bank and the valuation report, having reached the conclusions hereinabove, we do not find it necessary to go into the said submissions. It was for the DRT to have first examined as to whether any interim relief could be granted in the application. Instead, the DRT discussed issues pertaining to the merits of the challenge during the pendency of the securitisation application and ended up granting relief that could not have been granted in the light of the settled position of law. As a matter of fact, in the face of the aforesaid findings rendered in the impugned order passed by the DRT in the interim application, there is nothing left to be decided in the 28/30::: Uploaded on - 24/03/2026 ::: Downloaded on - 24/03/2026 20:46:39 ::: WP1211&1457_26.doc

securitisation application, which itself demonstrates the error committed
by the DRT.

1.  We also find that the DRT gave emphatic findings with regard to
   

   purported defects in the valuation report. It is to be noted that the
   respondent guarantors had also produced their valuation report, which as
   a matter of fact, recorded the value of the structures to be zero. As
   regards the area of the land taken into consideration and the valuation
   report of the petitioner bank, we do find that the valuer took into
   consideration the fact that a part of the land was acquired and utilized for
   construction of road. It was in this backdrop that the actual valuation of
   the land was undertaken on the piece of land available for auction sale
   and the DRT completely failed to appreciate the said aspect of the
   matter. In any case, such findings could have been only interlocutory in
   nature, but the tenor of the order of the DRT, which is impugned in these
   writ petitions, shows that final and emphatic findings were rendered by
   the DRT, which further demonstrates the grave error committed while
   passing the impugned order.

2.  In view of the above discussion, we find the impugned order to be
   

   unsustainable. The DRT could not have granted reliefs in the nature of
   final relief at interlocutory stage and that too, effectively amounting to
   redemption of mortgage, when in the light of the position of law
   clarified by the Supreme Court, such a relief could not be granted even
   finally in the proceedings pending before the DRT. As a result, the writ
   petitions are allowed. The impugned order is quashed and set aside. The
   DRT shall proceed to decide the securitisation application expeditiously,
   strictly in accordance with law. Although rival submissions were made
   on the locus of the respondent guarantors, the said question is left open
   to be decided by the DRT while considering the securitisation
   application. We have expressed no opinion on the said aspect of the 29/30::: Uploaded on - 24/03/2026 ::: Downloaded on - 24/03/2026 20:46:39 ::: WP1211&1457_26.doc

                     matter, which DRT shall decide in accordance with law.
   

3.  Pending applications, if any, in these writ petitions, are also
                     disposed of.
   

(SHREERAM V. SHIRSAT, J.) (MANISH PITALE, J.)

MINAL Digitally
by MINAL
signed

SANDIP SANDIP PARAB
Date: 2026.03.24
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