Kamlesh Verma, a resident of Shanti Nagar colony, had filed an application under Securitization and reconstruction of financial assets and enforcement of security interest Act (SARFAESAI) 2002 for quashing the notice issued to him by PNB Housing Finance forfeiting his deposit and seeking other reliefs.
Applicant’s counsels Nirnay Gupta and Shreyas Dubey said Verma had participated in the e-auction for purchase of an immovable property in Raipur district and was declared successful for bidding at a price of Rs 9.60 lakh. The applicant had deposited Rs 96,000 pre-requisite earnest money for participating in the bidding process. The PNB housing finance granted him 15 days’ time to deposit the remaining amount of the reserved price and the applicant deposited the second instalment of Rs two lakh on May five this year.
During the argument before the debt recovery tribunal Jabalpur, which had its sitting at Cuttack, applicant’s counsels argued that due to the pandemic spread all over the world and lockdown being departed throughout the nation, the financial health of the applicant became sensitive and he could not overcome the financial burdens because of continuous lockdown and loss of business. Hence, the applicant persistently requested PNB housing to grant a few months’ time to deposit the remaining amount to get the physical possession of immovable property and sale deed registered in his name.
However, the housing finance company on June 30 issued a forfeiture letter and informed the applicant regarding the deficiency in full payment along with re-auctioning of the secured asset, according to the order. Later, the applicant approached the tribunal alleging that the housing finance company went ahead for re-auction despite his willingness to pay the remaining amount.
After hearing both the parties, the debt recovery tribunal presiding officer P Ravi Kiran passed an order noting the submission of the applicant that he could not deposit the amount due to CoVID-19 pandemic situation and his willingness to pay the balance amount.” If the applicant has not paid in time 25 per cent of sale confirmation amount within the stipulated period, it was the duty of the financial institution to issue forfeiture letter but the financial institution issued such a letter only after receipt of Rs 2 lakh and after three months 10 days of auction which is not permissible under the law”, the order said.
The tribunal quashed the notice and letter of the financial institution and directed PNB housing finance to allow the applicant to deposit the balance amount of Rs 6.64 lakh within 30 days, issue sale certificate and handover possession of immovable property within 15 days from the date of deposit of the amount.