Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 – Debt Recovery – Auction – Respondents no.1 and 2 committed default in repayment of their dues – Respondents owed Rs.135 crore approx. to Edelweiss ARCL – In proceedings under the SARFAESI Act, 2002, an auction was conducted – Bid of GBJ Hotels for a sum of Rs.108 crores was accepted by Edelweiss ARCL – Before the High Court, a third party (GRT Hotels) offered to pay Rs.120 crores – High Court instructed GBJ Hotels to obtain instruction as to whether it was willing to improve its offer – However, GBJ Hotels refused to raise the offer – Edelweiss agreed to accept the offer of GRT Hotels – Correctness:
Held: Both GBJ Hotels and GRT Hotels were invited to improve their bids – The same was done in exercise of the inherent power to fetch the best of offers when the secured asset was reportedly worth much more than what was offered before the High Court – GRT Hotels improved it to Rs.153 crore, which was Rs.17 crore more than GBJ Hotels – GRT Hotels deposited in the Registry a sum of Rs.33 crore – GRT Hotels was declared to be the successful bidder – It was also recorded that Rs.27 crore had been returned by Edelweiss ARCL to GBJ Hotels – This Court directs that the sum of Rs.27 crore which was to be returned to GBJ Hotels, shall carry interest at the rate of 18% per annum – Sale certificate was issued in favour of GRT Hotels by Edelweiss ARCL – All other consequential steps to be taken by Edelweiss ARCL in accordance with law. [Paras 5-10, 14, 16, 17]
As published in the Supreme Court Reports, Supreme Court of India. Headnotes prepared by: Ankit Gyan. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.
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