In Brief
A bank foreclosed a mortgage over industrial property through the SARFAESI Act and conducted an auction won by the petitioner (successful auction purchaser) for Rs. 105.05 crore in June 2023. The borrower sought redemption before the High Court (which allowed it), but the Supreme Court reversed this in September 2023, holding that redemption rights extinguish upon publication of the auction notice under amended Section 13(8) of SARFAESI Act, and directed the bank to issue a sale certificate to the petitioner. However, the borrower, having redeemed the mortgage in compliance with the High Court's order before the Supreme Court's reversal, transferred the property to a third party (Subsequent Transferee) on the same day. The Supreme Court held the borrower and the Subsequent Transferee guilty of contempt for wilfully disobeying its judgment and attempting to circumvent its implementation through frivolous litigation in multiple forums. The Court declared the assignment agreement void due to lis pendens, upheld the auction as valid, confirmed absolute title in the petitioner, and ordered cancellation of the release deed and restitution of possession to the petitioner.
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