Auction Purchaser Can Challenge Before DRT Action Of Secured Creditor In Forfeiting Deposit Made By It: SC [Read Judgment]

Auction purchaser is entitled to challenge the action of the secured creditor before the DRT by filing an application under Section 17 of the SARFAESI Act, the court held.The Supreme Court, in Agarwal Tracom Pvt Ltd Vs Punjab National Bank, has held that an action of secured creditor in forfeiting the deposit made by the auction purchaser is a part of the measures taken by the secured. Auction purchaser is entitled to challenge the action of the secured creditor before the DRT by filing an application under Section 17 of the SARFAESI Act, the court held. The Supreme Court, in Agarwal Tracom Pvt Ltd Vs Punjab National Bank, has held that an action of secured creditor in forfeiting the deposit made by the auction purchaser is a part of the measures taken by the secured creditor under Section 13 of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. The bench said: “The expression "provisions of this Act and the Rules made thereunder" occurring in sub-sections,, and of Section 17 clearly suggests that it includes the action taken under Section 13 as also includes therein the action taken under Rules 8 and 9 which deal with the completion of sale of the secured assets.” The court also observed that the auction purchaser is one such person, who is aggrieved by the action of the secured creditor in forfeiting their money and, therefore, falls within the expression “any person” as specified under Section 17 and hence is entitled to challenge the action of the secured creditor before the DRT by filing an application under Section 17 of the SARFAESI Act.