2021 (12) TMI 1483 - SC - Indian Laws

Refund of the amount deposited being 25% of the auction sale consideration - HELD THAT - The High Court ought to have allowed the refund of the amount deposited being 25% of the auction sale consideration. Considering the fact that though initially the appellant deposited 25% of the auction sale consideration however subsequently she could not deposit balance 75% due to COVID-19 pandemic. It is required to be noted that subsequently the fresh auction has taken place and the property has been sold. It is not the case of the respondents that in the subsequent sale lesser amount is received. Thus as such there is no loss caused to the respondents. The order of forfeiture of 25% of the amount of auction sale consideration is set aside - the respondent Bank are directed to refund/return the amount earlier deposited by the appellant deposited as the part auction sale consideration (minus 50, 000/- towards the expenditure which were required to be incurred by the respondent Bank for conducting the fresh auction) within a period of four weeks from today - appeal allowed.

Summary

Issues: Refund of auction sale consideration due to COVID-19 pandemic.

In this judgment delivered by the Supreme Court, Justices M.R. Shah and B.V. Nagarathna granted leave to hear the case. The appellant's counsel faced connectivity issues while arguing from a car, leading to the Court refusing to hear the counsel due to poor connectivity. However, in the interest of justice, the Court considered the matter on its merits and heard the respondents' counsel. The Court reviewed the impugned judgment and orders of the High Court and found that the High Court should have allowed the refund of the amount deposited, which was 25% of the auction sale consideration. The appellant had initially deposited 25% but could not deposit the remaining 75% due to the COVID-19 pandemic. Subsequently, a fresh auction took place where the property was sold, and it was confirmed that no loss was incurred by the respondents in the subsequent sale. Based on these facts, the Court set aside the order of forfeiture of 25% of the auction sale consideration and directed the respondent Bank to refund the amount deposited by the appellant, minus a specific amount towards the bank's auction expenditure, within four weeks from the judgment date. The appeals were allowed with no costs incurred by either party.