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Judgment
R.S. Dalvi, J.—The petitioner and his partner took a loan of Rs. 150,00,000/- from the respondent-Bank. The Bank''s suit was decreed. The petitioner defaulted, causing the mortgaged property of the petitioner to be auctioned on 26th April, 2006. The petitioner has challenged the auction as malafide on certain grounds.
The petitioner contends that under Rule 37(11)(e) of The Multi-State Co-operative Societies Rules, 2002 (the Rules), the proclamation of sale of the property was required mandatorily to have four aspects mentioned:
(i) the property to be sold;
(ii) any encumbrances to which the property is liable;
(iii) the amount of the recovery of which sale is ordered; and
(iv) every other matter which the Sale Officer considers material for a purchaser to know in order to judge the nature and value of the property.
The first three aspects were mentioned in the proclamation notice. The fourth aspect is in respect of every other matter which is left to the discretion of the sale officer, depending upon the nature and the value of the property. It is contended on behalf of the petitioner that this shows that the valuation of the property was a mandatory requirement. Reading of the four provisions of the aforesaid rule does not show any such mandatory requirement.
The petitioner has also argued that under Rule 37(g) of the Rules, 15% of the price was to be deposited at the time of sale. However, if the decree-holder was the auction purchaser, the decree-holder would be entitled to set off the purchase money against 15% requirement of the deposit. In this case, the respondent Bank was the decree-holder, and was also the auction purchaser. The respondent-Bank was, therefore, not required to comply with Rule 37(g).
It is also contended that the valuation of the property was much lower than the real valuation and consequently, the respondent-Bank purchased the property at an undervaluation.
Both the parties have submitted their valuation reports. The petitioner''s valuation report shows that the auctioned property was valued at Rs. 1500/- per sq. metre. The valuation made by the Bank shows it to be Rs. 750/- per sq. metre. The learned Advocate General, upon our query, has produced an abstract of ready reckoner, issued by the Stamp Office for payment of stamp duty showing the valuation in 2009 to be Rs. 600/- per sq. metre and in 2012 to be Rs. 1200/- per sq. metre. Consequently, the value at which the property came to be sold is not so grossly inadequate or shockingly low as to require this Court''s interference.
The petitioner was present at the auction. The petitioner claims that he left the proceedings of auction sale and, thereafter, the respondent Bank purchased the mortgaged property at the auction. The petitioner, therefore, contends that 5 Wp176-07 the value should not be accepted. It was for the petitioner to challenge the valuation within 30 days of the auction sale. This was not done. The property was duly put up for auction and the auction has proceeded. We are told that there were two earlier auctions, but the property could not be sold and in the aforesaid auction, the Bank itself purchased the property for Rs. 520,00,000/-.
The respondent-Bank has sold the property to the third party purchaser under Deed of Sale dated 2nd August, 2006, after confirmation of the sale on 27th July, 2006. The respondent-Bank purchased the property at Rs. 520,00,000/- and sold it at Rs. 550,00,000/-. The test of inadequate valuation would be demonstrated by a sale for a much higher amount soon after the purchase. Had the respondent Bank sold it at much higher value, the malafides could have been imputed. The sale of the property by respondent Bank for a marginally increased price three months'' after purchase, itself shows the adequacy of the consideration.
It is contended that the agreement to sell by way of 6 Wp176-07 the offer of the Bank and the acceptance of the third party purchaser was made prior to the confirmation of sale. The offer and acceptance will only denote oral agreement to sell. The Bank had not sold the property at that time. There was no completed contract. The sale deed has been entered into much later on 2nd August, 2006, after statutory 30 days'' period from the date of auction. Hence, the sale deed is in order.
There is no substance in the petition which is hereby dismissed. Rule is discharged. No order as to costs. F.M. REIS, J. SMT.R.S. DALVI, J. ssm.