IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) TUESDAY, THE THIRTIETH DAY OF JUNE TWO THOUSAND AND NINE PRESENT THE HON'BLE MR JUSTICE GHULAM MOHAMMED and THE HON'BLE MR JUSTICE VILAS V. AFZULPURKAR WRIT PETITION NO : 4453 of 2009 Between: M/s,. Jaibajrangabali Enterprises 2-525, Reddy Street, Kongareddipalle , Chittoor Rep. by its Proprietor N. Sateesh Babu ..... PETITIONER AND 1 Indian Bank , Chittoor, Chittoor District Rep. by its Authorised Officer Cum Chief Manager 2 Indian Bank , Kongareddipalli Branch Chittoor District, Rep. by its Branch Manager. .....RESPONDENT(S) Petition under Article 226 of the constitution of India praying that in the circumstances stated in the Affidavit filed herein the High Court will be pleased to to issue a writ order or direction more particularly one in the nature of writ of Mandamus to declare the action on the part of the respondents in auctioning the properties as mentioned in the notice dt. 24-1-2009 issued under Rule 6(2) & 8(6) of Security interest (Enforcement) Rules 2002 under SARFAESI Act at Indian Bank , Kongareddipalli Branch on 5-3-2009 at 1200 Amounts to erroneous arbitrary and violative of Art. 14 and 21 of the Constitution of India, besides being violative of provisions contemplated under SARFAESI Act and Rules made there under and set aside the same and consequently direct the respondents not to take any cohesive steps pursuant to the notice issued Under Rule 6(2) & 8(6) of Security Interest (Enforcement) Rules 2002 under SARFAESI Act and to pass Counsel for the Petitioner:MR.T.C.KRISHNAN Counsel for the Respondent No.: MR.AMBADIPUDI SATYANARAYANA The Court made the following : ORDER: (Per Sri Justice GHULAM MOHAMMED) This Writ Petition has been filed with the following prayer: “ The petitioner herein prays that this Hon’ble Court may be pleased to issue a writ, order or direction more particularly one in the nature of writ of Mandamus to declare the action on the part of the respondents in auctioning the properties as mentioned in the notice dated 24.1.2009 issued under SARFAESI Act at Indian Bank , Longareddipalli Branch on 5.3.2009 at 12.00 Noon amounts to erroneous arbitrary and violative of Article 14 and 21 of the Constitution of India, besides being violative of Provisions contemplated under SARFAESI Act and Rules made thee under and set aside the same and consequently direct the respondents not to take any cohesive steps pursuant to the notice issued under Rule 6(2) & 8(6) of Security Interest (Enforcement) Rules 2002 under SARFAESI Act and to pass necessary order or orders as this Hon’ble Court may deem fit.” Brief facts of the case are that the petitioner herein approached the respondent-Bank to avail loan facility for business purpose to run cement and steel shop. The respondent-Bank sanctioned total amount of Rs. 4,65,000/- on two spells i.e. on 18.12.1999 for a sum of Rs. 1,25,000 and the remaining balance on 31.8.2002 by obtaining security by way of equitable mortgage. As the petitioner firm became sick and unable to pay the amount the first respondent-Bank issued notice under Section 13(2) of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short “the SARFAESI Act”) on 22.9.2008. In fact the said notice could not be received by the petitioner firm. It is stated that when the notice dated 19.12.2008 issued under Section 13(4) of the Act is served, then petitioner-firm and the other guarantor rushed to the Bank and requested to settle the debt by way of one time settlement as per the guidelines issued by the Reserve Bank of India. But no action has been taken by the Bank, instead it issued notice dated 24.1.2009 under Rule 6(2) and 8(6) of Security Interest (Enforcement) Rules 2002 (for short ‘the Rules’) wherein and whereby the auction schedule of the property is fixed on 5.3.2009. Being aggrieved by the same, the present Writ Petition has been filed. This Court while ordering notice before admission on 04.3.2009 granted interim stay, which reads as under: “Interim stay of confirmation of the auction proposed to be held on 5.3.2009 subject to the condition of the petitioner depositing a sum of Rs. 2,50,000/- (Rupees Two Lakh Fifty Thousand Only) within three weeks from today failing which, interim stay stands vacated. However, it is open for the respondents to receive sealed tenders. In case, the petitioner fails to pay a sum of Rs. 2,50,000/- within three weeks from today, it is open for the respondents to proceed further in accordance with law.” It is submitted that the conditional order passed by this Court on 4.3.2009 has been complied with by the petitioner. A request is made by the petitioner that if some instalments or some time is granted to pay the amount, it will pay the entire balance amount. Having regard to the facts and circumstances of the case, we deem it appropriate to dispose of the Writ petition directing the petitioner to pay the entire balance amount together with interest and costs within a period of three months from today failing which, respondent-bank is at liberty to proceed with the matter in accordance with law. Accordingly, the Writ Petition is disposed of. There shall be no order as to costs. _____________________________ GHULAM MOHAMMED, J ______________________________ VILAS V. AFZULPURKAR, J Dt. 30.06.2009 KA Note: Furnish copy in three days. ..... REGISTRAR // TRUE COPY // SECTION OFFICER To 1. 2 CD Copies