Judgment Intelligence
Petition Allowed- Court
- Supreme Court of India
- Date of Decision
- 30 September 2026
- Bench
- Justice Pamidighantam Sri Narasimha and Justice Alok Aradhe
- Relevant Acts & Sections
- Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 — Section 13(8) (as it stood before 01.09.2016); Security Interest (Enforcement) Rules, 2002 — Rules 8, 9; Constitution of India — Article 300A
The borrower's appeals were allowed and the purchaser's appeals dismissed; the High Court's judgment of 23.08.2013 was set aside. The contempt petitions were not pursued, the SLP on the borrower's amalgamation with Thomas Cook (India) was dismissed as not surviving, and there was no order as to costs (para 36).
Key holdings
- Receiving bids while a restraint order operates is itself a forbidden step; a later judgment cannot validate it (para 31.1).
- The period of a tribunal's restraint is excluded when computing the 30-day period under Rule 9(1) (para 31.2).
- A sale certificate cannot issue to a nominee of the successful bidder, still less to a firm not in existence when bids were invited (para 31.4).
- The finality of auction sales protects only auctions conducted in accordance with law (para 33).
- The Court left open whether an authorised officer can cancel a sale certificate and whether it needed registration (para 35).
Brief Facts
Court's Findings
Legal Principle
Precedents Relied Upon
- Taylor v. Taylor (1875) 1 Ch D 426
Where a statute requires a thing to be done in a particular manner, it must be done in that manner or not at all.
- Ramchandra Keshav Adke v. Govind Joti Chavare (1975) 1 SCC 559
Where a statute prescribes the manner of doing a thing, other modes of performance are necessarily forbidden.
- Mardia Chemicals Ltd. & Ors. v. Union of India & Ors. (2004) 4 SCC 311
The SARFAESI Act was upheld because its power of sale without court intervention is hedged in by procedural safeguards protecting the borrower.
View all precedents (11)
- Mathew Varghese v. M. Amritha Kumar & Ors. (2014) 5 SCC 610
Rules 8 and 9 are mandatory; the thirty days' notice gives the borrower a real opportunity to redeem under Section 13(8), and a sale in breach of them cannot stand.
- J. Rajiv Subramaniyan & Anr. v. Pandiyas & Ors. (2014) 5 SCC 651
A sale effected in breach of the mandatory requirements of the Rules cannot be sustained and may be set aside even after confirmation.
- Surjit Singh & Ors. v. Harbans Singh & Ors. (1995) 6 SCC 50
An act done in violation of a court's order is without legal effect, and the party cannot retain its advantage.
- Delhi Development Authority v. Skipper Construction Co. Pvt. Ltd. & Anr. (1996) 4 SCC 622
A court will not permit a party to retain the advantage secured by defying its order.
- Valji Khimji and Company v. Official Liquidator of Hindustan Nitro Product (Gujarat) Ltd. & Ors. (2008) 9 SCC 299
Emphasises the sanctity of auction sales; relied on by the purchaser, but it concerned an auction whose legality was not in doubt.
- Celir LLP v. Bafna Motors (Mumbai) (P) Ltd. & Ors. (2024) 2 SCC 1
Cautions against lightly setting aside confirmed auction sales; of no help where the auction itself was not conducted in accordance with law.
- Divya Manufacturing Co. Pvt. Ltd. v. Union Bank of India & Ors. (2000) 6 SCC 69
A sale vitiated by material irregularity, fraud or non-compliance with mandatory procedure may be set aside even after confirmation.
- Vidya Devi v. State of Himachal Pradesh & Ors. (2020) 2 SCC 569
The right to property is a constitutional right under Article 300A; a person can be deprived of property only by authority of law.
