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IN THE HIGH COURT OF JUDICATURE AT BOMBAY

CIVIL APPELLATE JURISDICTION

WRIT PETITION NO.1211 OF 2026

Hill Top Estate … Petitioners

Vs.

Union of India through its Secretary and others … Respondents

WITH

WRIT PETITION NO.1457 OF 2026

HDFC Bank Limited … Petitioners

Vs.

Union of India through Ministry of Finance and ors. … Respondents

---

Mr. Kevic Setalvad, Senior Advocate a/w. Mr. Sidharth Samantaray, Mr. Abdullah

Qureshi and Ms. Nalvika Sachiv i/b. India Law LLP for Petitioner in

WP/1457/2026 and for Respondent No.2 in WP/1211/2026.

Mr. Zal Andhyarujina, Senior Advocate a/w. Mr. Shrey Sancheti, Mr. Carl Patel

and Ms. Sanaea Umrikar i/b. Mr. Carl Patel for Petitioner in WP/1211/2026 and

for Respondent No.4 in WP/1457/2026.

Mr. Mohamedali M. Chunawala with Mr. Ashutosh Mishra for Respondent No.1-

UOI in both the Petitions.

Mr. Anirudh Hariani a/w. Mr. Rohit Agarwal, Ms. Kruti Bhavsar, Mr. Pratik Barot

and Ms. Angel Pandey for Respondent Nos.2 and 3 in WP/1457/2026 and for

Respondents Nos.3 and 4 in WP/1211/2026.

Mr. Amir Arsiwala a/w. Ms. Vaishnavi Dhure for Respondent No.5 in both the

Petitions.

CORAM : MANISH PITALE &

SHREERAM V. SHIRSAT, JJ.

Reserved on : MARCH 11, 2026

Pronounced on : MARCH 24, 2026

JUDGEMENT : (Per Justice Manish Pitale)

. A bank and an auction purchaser are before this Court in these

two writ petitions to challenge an order passed by the Debt Recovery

Tribunal-III, Mumbai (DRT), whereby an auction conducted by the

petitioner bank, wherein the auction purchaser was successful in its bid,

has been set aside and the petitioner bank has been directed to take steps

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afresh. The order was passed in an interim application filed by the

respondent guarantors in their pending securitisation application. The

petitioners have directly filed these writ petitions without resorting to the

remedy of filing appeals before the Debt Recovery Appellate Tribunal

(DRAT), claiming that the impugned order passed by the DRT is without

jurisdiction as it is in the teeth of the provisions of the Securitisation and

Reconstruction of Financial Assets and Enforcement of Security Interest

Act, 2002 (for short 'Securtisation Act') and judgements of the Supreme

Court. It is further claimed that the DRT has granted relief beyond the

prayers made in the interim application and also in the final prayers

made in the securitisation application by the respondent guarantors. It is

also claimed that by the impugned order, the DRT has virtually granted

final relief at interim stage and that too in the teeth of the settled position

of law. Before considering the rival submissions, it would be appropriate

to first refer to the chronology of events leading upto filing of these two

writ petitions. The respondent Ritu Automobiles Private Limited,

presently in liquidation, is the borrower while respondents Manoj

Lalwani and Ritika Lalwani are the guarantors. They are being referred

to hereinafter as the borrower and the guarantors respectively.

2. The borrower availed loan facilities from the petitioner HDFC

Bank Limited and for that purpose created equitable mortgage on the

subject property. The property is located in Survey No.125 in Village

Gove, Taluka Bhiwandi, District Thane, Maharashtra. On 21.10.2019,

the petitioner bank classified the aforesaid loan account of the borrower

as a non-performing asset (NPA) and in that context, issued recall notice

to the borrower on 05.11.2019. In response thereto, the borrower

claimed that it would clear the dues along with interest by selling the

subject property and that a buyer had been identified. Since no further

steps were taken by the borrower, on 16.01.2020, the petitioner bank

issued notice under Section 13(2) of the Securitisation Act and recorded

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that there was a mortgage created over the subject property. As required

by law, the borrower as well as the guarantors were served with the

aforesaid notice. Since no steps were taken by the borrower and the

guarantors and they did not raise any objection to the said notice, on

10.09.2020, the petitioner bank issued symbolic possession notice in

respect of the subject property. The said notice was also published in two

newspapers and thereafter the petitioner bank issued a demand notice to

the respondent borrower with respect to a specific amount along with

interest. A valuation report was obtained on 01.10.2021 and in this

backdrop, in March 2022, the petitioner bank filed a petition before the

National Company Law Tribunal (NCLT) for initiating insolvency

resolution process in the context of the respondent borrower. The NCLT

admitted the said petition and eventually on 10.10.2024, the NCLT

passed an order admitting the respondent borrower into liquidation.

Meanwhile, Axis Bank Limited filed a petition under Section 95 of the

Insolvency and Bankruptcy Code, 2016 (IBC) against the respondent

guarantors, which was also admitted and the personal insolvency

resolution process commenced against them also. On 07.11.2024, the

petitioner bank filed Form D - Proof of Claim with the liquidator of the

respondent borrower for opting to realize the value of the subject

property outside the liquidation process.

3. On 21.11.2024, a possession notice was issued recording that the

petitioner bank had taken physical possession of the subject property

from the liquidator of the respondent borrower and the same was

published in two newspapers. The borrower did not raise any objection

despite such notice additionally being served upon it. On 27.03.2025, a

redemption notice under Rule 8(6) of the Securitisation Rules was issued

to the liquidator of the respondent borrower and the resolution

professional appointed for the respondent guarantors. It is in this

backdrop that on 16.05.2025 an e-auction notice was served on the

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liquidator of respondent borrower and also the resolution professional

for respondent guarantors, informing them that the subject property

would be auctioned on 21.06.2025 at the reserve price fixed at Rs.26.10

crores. At this stage on 18.06.2025, the respondent guarantors filed

Securitisation Application No.300 of 2025 before the DRT. They sought

the relief of quashing and setting aside of the aforementioned sale notice

dated 16.05.2025, whereby the e-auction was scheduled for 21.06.2025,

also praying for quashing and setting aside of the notice under Section

13(2) of the Securitisation Act. They further sought ancillary reliefs in

the said securitisation application. Along with the securitisation

application, the respondent guarantors filed Interim Application No.1910

of 2025 praying for interim reliefs. These included stay to the effect of

the sale notice dated 16.05.2025 for auction of the subject property,

injuncting the petitioner bank from alienating the subject property and

restraining the acceptance of bid amounts.

4. On 21.06.2025, the e-auction was conducted in which the auction

purchaser i.e. petitioner Hill Top Estate was declared as the successful

bidder. On the same date, the petitioner auction purchaser deposited 25%

of the bid amount i.e. Rs.6.61 crores and the sale was confirmed by the

petitioner bank. On 25.06.2025, the securitisation application along with

the interim application came up for consideration before the DRT but no

effective orders were passed. Thereafter, on 02.07.2025, when the

applications came up for consideration before the DRT, an order of

status quo was passed. On 17.07.2025, the DRT modified its order and

permitted the petitioner bank to receive the balance payment, but stay on

issuance of the sale certificate continued. On 28.07.2025, the petitioner

auction purchaser filed an interim application in the pending

securitisation application seeking intervention and other reliefs. Since

the DRT only permitted the petitioner auction purchaser to intervene and

the interim stay on issuance of sale certificate continued, the petitioner

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auction purchaser filed two writ petitions before this Court. In Writ

Petition (L) No.29997 of 2025, the petitioner auction purchaser sought a

direction to the petitioner bank to issue sale certificate and proceed for

registration thereof so that handing over of the subject property would be

facilitated. A further direction was sought for extension of time to the

petitioner auction purchaser to deposit the balance 75% of the amount.

In Writ Petition (L) No.12209 of 2025, the petitioner auction purchaser

sought for a specific direction from this Court for disposing of its

pending interim application by the DRT in a time-bound manner and

also reiterated the aforesaid prayer for extension of time to deposit the

balance 75% amount. On 19.09.2025, this Court disposed of both the

writ petitions by directing the petitioner auction purchaser to deposit the

balance amount in a no-lien account with the petitioner bank on or

before 28.09.2025 and further directed the DRT to dispose of the

pending interim applications in the securitisation application on or

before 25.09.2025. It is undisputed that on 21.09.2025, the petitioner

auction purchaser deposited the entire balance amount with the

petitioner bank as directed by this Court.

5. The proceedings before the DRT were adjourned from time to

time. In the meanwhile on 24.12.2025, the liquidator of the respondent

borrower filed affidavit / statement before the DRT in the pending

proceedings, stating that he was giving approval to the sale of the

secured asset at the reserve price, in compliance with Rule 9(2) of the

Securitisation Rules. In this backdrop, the DRT heard all the parties and

passed the impugned order on 09.01.2026.

6. As noted hereinabove, the DRT by the impugned order dated

09.01.2026 set aside the auction sale conducted on 21.06.2025. The DRT

further directed that the amount deposited by the petitioner auction

purchaser shall be returned to it within one month from the date of the

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order, failing which, interest @ 9% p.a. would run till the amount was

received by the petitioner auction purchaser. The respondent guarantors,

who were the applicants before the DRT, were directed to deposit a sum

of Rs.26.10 crores i.e. the bid amount with the petitioner bank on or

before 31.03.2026. Aggrieved by the said impugned order, the petitioner

bank as well as the petitioner auction purchaser filed these two writ

petitions before this Court. The petitioners and all the respondents

represented through counsel were heard.

7. Mr. Kevic Setalwad, learned senior counsel appearing for

petitioner bank submitted that the respondent guarantors in the first

place have no locus to file and maintain the securitisation application

before the DRT. It was submitted that the secured asset is registered in

the name of the respondent borrower, which is a corporate debtor and it

is undergoing liquidation. The liquidator has given his consent for sale

of the property by auction and therefore, the petitioner bank exercised its

right under Section 52 of the IBC to enforce the security interest outside

the process of liquidation. In such a situation, the guarantors clearly have

no right to maintain the securitisation application itself before the DRT.

It was further highlighted that the respondent guarantors themselves are

undergoing the process of personal insolvency under the provisions of

the IBC and they have no net worth at all to approach the DRT and

object to the aforesaid auction sale of the secured asset. By inviting

attention to the prayers in the securitisation application as well as the

interim application filed by the respondent guarantors, it was submitted

that the prayers had become infructuous, since the auction sale had

already been conducted and that in any case, there were no substantive

prayers on the basis of which relief could have been granted in the

manner in which it has been granted in the impugned order passed by the

DRT.

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8. On the objection of maintainability raised on behalf of the

respondent guarantors, it was submitted that in the present case, the DRT

had acted completely without jurisdiction, firstly because it passed the

impugned order in the teeth of the position of law laid down by the

Supreme Court and secondly, the impugned order had the effect of

granting final relief at interim stage, which is also a jurisdictional error.

On this basis, it was submitted that when a question of law was being

raised in this writ petition concerning jurisdiction of DRT, which goes to

the very root of the matter, it is not necessary for the petitioner bank to

be relegated to the alternative remedy. In this context, reliance was

placed on judgements of the Supreme Court in the cases of Union of

India and another Vs. State of Haryana and another, (2000) 10 SCC

482 and Godrej Sara Lee Limited Vs. Excise and Taxation Officer-cum-

Assessing Authority and others, 2023 SCC OnLine SC 95 as also

judgement of Division Bench of this Court in the case of HDFC Bank

Limited and others Vs. State of Maharashtra and others [judgement and

order dated 18.09.2024 passed in Writ Petition (L) No.23881 of 2024].

9. It was submitted that the impugned order virtually permitted

redemption of mortgage and that too at the behest of the respondent

guarantors in the face of the fact that the liquidator representing the

original borrower had consented to the auction sale. It was submitted

that this was in the teeth of Section 13(8) of the Securitisation Act,

which specifies that the right to redeem the mortgage stands

extinguished on the date of publication of the auction notice. In the

present case, the auction notice was issued on 16.05.2025 and on this

date, the right to redeem the mortgage stood extinguished. It was

submitted that the DRT completely ignored the law laid down by the

Supreme Court in this context in the cases of Celir LLP Vs. Bafna

Motors (Mumbai) Private Limited and others, (2024) 2 SCC 1 and M.

Rajendran and others vs. KPK Oils and Proteins India Private Limited

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and others, 2025 SCC OnLine SC 2036. It was submitted that since the

impugned order is in the teeth of the aforesaid statutory provision as also

the law clarified by the Supreme Court in that context, the impugned

order suffers from a jurisdictional error demonstrating that the writ

petition filed by the petitioner bank is maintainable.

10. It was further submitted that the findings rendered by the DRT in

the impugned order, to the effect that the notice under Section 13(2) was

defective and that the valuation report was also defective, suffer from

serious errors. By referring to the mortgage deed on record, it was

submitted that the land as well as structures thereon were mortgaged and

that, the DRT committed an error in holding that reference to structures

in the notice issued under Section 13(2) of the Securitisation Act

rendered the said notice defective. It was further submitted that the

defects found in the valuation report also suffered from the same error.

The DRT failed to appreciate that the valuation report, relied upon by the

petitioner bank correctly took into consideration the fact that a portion of

the subject land was utilised for construction of road and therefore, the

valuation was determined after deducting the said portion of land from

the larger piece of subject land. It was submitted that in any case, all

these issues could certainly not be raised by the respondent guarantors

and that they had absolutely no locus in the matter, considering the fact

that the liquidator representing the original borrower had already given

consent to the auction sale of the subject property. It was submitted that

therefore, the consequential steps in pursuance of the auction sale ought

to be permitted so that the auction purchaser, who has paid the entire

amount, is able to enjoy the fruits of the auction.

11. Mr. Zal Andhyarujina, learned senior counsel appearing for the

petitioner auction purchaser, supported the contentions raised on behalf

of the petitioner bank. It was reiterated that in the facts of the present

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case, the respondent guarantors could not have maintained the

securitisation application as also the interim application filed therein.

The respondent borrower through the liquidator had consented to the

auction sale of the secured asset and therefore, the guarantors could not

be heard, particularly after the auction sale notice dated 16.05.2025 had

been already issued and published on behalf of the petitioner bank. It

was emphasized that the DRT had virtually granted redemption of the

mortgage and that too, at the behest of the respondent guarantors while

the original borrower i.e. the respondent herein had through the

liquidator raised no objection to the auction sale of the subject secured

asset. It was submitted that the DRT committed a fundamental

procedural irregularity by granting sweeping relief in the impugned

order, when such relief was neither claimed in the securitisation

application nor in the interim application, which was disposed of by the

impugned order. On this basis, it was submitted that the respondent

guarantors could not claim that the petitioner auction purchaser had not

suffered from any prejudice or that principles of natural justice had not

been violated, simply for the reason that the argument of procedural

irregularity was being specifically raised on behalf of the petitioner

auction purchaser in its writ petition.

12. By placing reliance on judgements of the Supreme Court in the

cases of Celir LLP Vs. Bafna Motors (Mumbai) Private Limited and

others (supra) and M. Rajendran and others vs. KPK Oils and

Proteins India Private Limited and others (supra), it was submitted

that the impugned order was in the teeth of the said position of law

clarified by the Supreme Court of India. On this basis, it was submitted

that the order itself was rendered without jurisdiction and hence the

petitioner auction purchaser was entitled to maintain the writ petition

before this Court. On this basis, it was submitted that the petitioner

auction purchaser cannot be relegated to the alternative remedy of

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approaching the DRAT, in the facts and circumstances of the present

case. It was further submitted that jurisdictional error on the part of the

DRT was further manifested by the fact that the impugned order

virtually grants final relief at interim stage and that too, when no such

reliefs were claimed either in the main securitisation application or in the

interim application, which stood disposed of by the impugned order. On

this aspect, reliance was placed on judgements of the Supreme Court in

the cases of Vishnu Babu Tambe Vs. Apurva Vishnu Tambe, (2017) 2

SCC 454 and Samir Narain Bhojwani Vs. Aurora Properties and

Investments and another, (2018) 17 SCC 203.

13. The learned senior counsel appearing for the petitioner auction

purchaser specifically placed reliance on judgement of the Supreme

Court in the case of East India Commercial Company Limited, Calcutta

and another Vs. Collector of Customs, Calcutta, AIR 1962 SC 1893, to

contend that since the impugned order is in the teeth of the position of

law laid down by the Supreme Court, it is rendered without jurisdiction

and therefore, this Court ought to entertain the writ petition filed by the

petitioner auction purchaser.

14. It was further submitted that the mortgage deed, when appreciated

in the correct perspective, clearly demonstrated that the land with

structures was mortgaged. The valuation report was prepared on that

basis and in any case, the objections regarding the alleged defects in the

valuation report and the alleged defects in the notice issued under

Section 13(2) of the Securitisation Act by the Bank, could not have been

entertained by the DRT at the behest of the respondent guarantors,

particularly when the respondent original borrower never raised any

objection to the same. The liquidator of the respondent borrower had

specifically approached the DRT and consented by filing an affidavit on

record. In such circumstances, there was no question of entertaining the

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contentions raised on behalf of the respondent guarantors on merits and

granting relief well beyond the prayers made in the securitisation

application as well as in the interim application. It was further submitted

that the petitioner auction purchaser has parted with huge amount of

money and the entire amount as per the bid has been deposited with the

petitioner bank. In such a situation, the petitioner auction purchaser

ought not to be deprived of the fruits of the auction. On this basis, it was

submitted that the writ petition ought to be allowed.

15. On the other hand, Mr. Hariani, learned counsel appearing for the

contesting respondent guarantors submitted that the petitions filed by the

bank and the auction purchaser are not maintainable in the face of the

availability of the alternative efficacious remedy of approaching the

DRAT. It was submitted that the petitioners ought to have exhausted the

said remedy before approaching the writ court. It was submitted that the

petitioners have not made out any special case for directly entertaining

the writ petitions, without recourse to the alternative efficacious remedy.

In this regard, reliance was placed on judgement of the Supreme Court

in the case of United Bank of India Vs. Satyawati Tandon and others,

(2010) 8 SCCC 110, wherein the Supreme Court reiterated that the

statutory remedies available under the Securitisation Act must be taken

recourse to and that the Writ Court ought not to casually entertain such

writ petitions. It was further emphasized that even in the judgement

upon which the petitioners have placed reliance i.e. Celir LLP Vs.

Bafna Motors (Mumbai) Private Limited and others (supra), the

Supreme Court once again reiterated that writ petitions ought not to be

entertained casually and that the High Courts ought to follow the

repeated directions issued by the Supreme Court, including in the case of

United Bank of India Vs. Satyawati Tandon and others (supra) that

when there is a statutory dispensation available, writ petitions directly

filed to challenge the orders of the original authority ought not to be

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entertained. It was submitted that there was no question of violation of

principles of natural justice in the present case as both the petitioners

were exhaustively heard by the DRT and their contentions were

considered before passing the impugned order. It was submitted that

therefore, the petitioners cannot claim this to be a special case for

entertaining the writ petitions directly. Reliance was placed on

judgement of the Supreme Court in the case of State of Uttar Pradesh

Vs. Sudhir Kumar Singh, (2021) 19 SCC 706. It was submitted that in

any case, proceedings before the DRT are summary proceedings and that

they cannot be compared with the proceedings before civil court that are

governed by the Code of Civil Procedure, 1908 (CPC). By referring to

the prayer clauses in the securitisation application as well as the interim

application, it was submitted that the prayers were sufficiently widely

worded to cover the reliefs that were eventually granted in the impugned

order passed by the DRT. On this basis, it was submitted that there was

no question of any procedural irregularity committed by the DRT in the

present case.

16. It was further submitted that the contention raised on behalf of the

petitioners challenging the locus of respondent guarantors in filing the

applications before the DRT, is absolutely without any substance. By

referring to Section 17(1) of the Securitisation Act, it was emphasized

that any person aggrieved by measures taken under the Securitisation

Act can approach the DRT for relief. In the present case, the respondent

guarantors are clearly covered under the expression 'any person

aggrieved'. On this basis, it was submitted that the elaborate submissions

made on behalf of the petitioners with regard to the locus of the

respondent guarantors do not deserve any consideration.

17. On the aspect that the DRT in the impugned order had virtually

allowed redemption of a mortgage in the face of the law laid down by

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the Supreme Court in the case of Celir LLP Vs. Bafna Motors

(Mumbai) Private Limited and others (supra) and M. Rajendran and

others vs. KPK Oils and Proteins India Private Limited and others

(supra), it was submitted that the petitioners as the guarantors were not

seeking redemption of the mortgage, nonetheless, they were clearly

entitled to challenge the actions undertaken by the respondent bank

under the provisions of the Securitisation Act. It was this challenge that

the DRT found to be meritorious and therefore, it passed the impugned

order. The condition imposed in the impugned order that the respondent

guarantors shall deposit amount of Rs.26.01 crores before 31.03.2026 is

only with a view to ensure that if the respondent guarantors seek a stay

on the fresh auction proceedings that may be undertaken, they have to

show their bona fide. On this basis it was submitted that there was no

question of redemption of mortgage at the behest of the petitioners in the

impugned order that was passed by the DRT. Reliance was placed on

judgments of the Madras High Court in the cases of N. R. Sadasivam Vs.

Indian Bank, 2013 (1) CTC 53 and Star Trace Engineering Division Vs.

Registrar, DRT and others, (2023) SCC OnLine Mad. 8349, to contend

that if an auction sale is set aside by the tribunal or a court of law on

material irregularities, the right of redeem would automatically revive.

18. It was submitted that since the DRT found that the respondent

auction purchasers had made out a strong case on merits, demonstrating

that the initial action undertaken by the petitioner bank itself was in the

teeth of law, all consequential actions and the superstructure itself

collapsed. On this basis, it was submitted that the petitioners cannot

claim that the DRT permitted redemption of mortgage in the teeth of the

law laid by the Supreme Court.

19. On the merits of the matter, the learned counsel appearing for the

respondent guarantors defended the findings rendered by the DRT. It

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was submitted that glaring defects were found both in the notice issued

under Section 13(2) of the Securitisation Act as well as the valuation

report, which went to the very root of the matter. It was submitted that

all the grounds taken in the securitisation application were reiterated in

the interim application and the glaring defects were demonstrated on

behalf of the respondent mortgagors before the DRT. It was emphasized

that the notice under Section 13(2) of the Securitisation Act was clearly

defective inasmuch as it described the mortgaged property in variance to

the description of the mortgaged property in the mortgage deed itself and

further that the amount stated in the said notice did not give proper

bifurcation of the principal amount and the interest and other such

details. By placing reliance on judgement of this Court in the case of

Saraswat Co-op. Bank Limited Vs. National Flank Industries Limited

and others, 2025 SCC OnLine Bom. 3332, it was submitted that failure

to give such details in the notice under Section 13(2) of the

Securitisation Act, which were mandatorily required, rendered it

completely defective. As regards the valuation report, it was submitted

that the same included structures in the valuation when only open land

had been mortgaged. Even with regard to the open land, the entire piece

of land mortgaged was not taken into consideration while determining

the valuation, thereby rendering it fundamentally defective. It was

further submitted that the rights of the auction purchaser were not

crystallized and therefore, the DRT was justified in directing the

petitioner bank to undertake a fresh auction, which in the facts and

circumstances of the case, was a just, fair and reasonable order, requiring

no interference at the hands of this Court exercising writ jurisdiction. On

this basis, it was submitted that the writ petitions deserved to be

dismissed.

20. Having heard the learned counsel for the parties, we find that

since the respondent guarantors have specifically raised a ground with

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regard to the maintainability of the writ petitions, it would be

appropriate to first deal with the said contention. The respondent

guarantors have asserted that in the light of statutory remedy of appeal

available to the petitioners of filing an appeal before the DRAT under the

provisions of the Securitisation Act, these writ petitions filed directly to

challenge the order of the DRT are not maintainable. It has to be

appreciated that there is a difference between the concept of

“maintainability” on the one hand and that of “entertainability” on the

other.

21. The Supreme Court in the case of Godrej Sara Lee Limited Vs.

Excise and Taxation Officer-cum-Assessing Authority and others

(supra), considered the said two concepts and made the following

observations:-

“4. Before answering the questions, we feel the urge to say

a few words on the exercise of writ powers conferred by

article 226 of the Constitution having come across certain

orders passed by the High Courts holding writ petitions as

"not maintainable" merely because the alternative remedy

provided by the relevant statutes has not been pursued by the

parties desirous of invocation of the writ jurisdiction. The

power to issue prerogative writs under article 226 is plenary

in nature. Any limitation on the exercise of such power must

be traceable in the Constitution itself. Profitable reference in

this regard may be made to article 329 and ordainments of

other similarly worded articles in the Constitution. Article 226

does not, in terms, impose any limitation or restraint on the

exercise of power to issue writs. While it is true that exercise

of writ powers despite availability of a remedy under the very

statute which has been invoked and has given rise to the

action impugned in the writ petition ought not to be made in a

routine manner, yet, the mere fact that the petitioner before

the High Court, in a given case, has not pursued the

alternative remedy available to him/it cannot mechanically be

construed as a ground for its dismissal. It is axiomatic that the

High Courts (bearing in mind the facts of each particular case)

have a discretion whether to entertain a writ petition or not.

One of the self-imposed restrictions on the exercise of power

under article 226 that has evolved through judicial precedents

is that the High Courts should normally not entertain a writ

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petition, where an effective and efficacious alternative remedy

is available. At the same time, it must be remembered that

mere availability of an alternative remedy of appeal or

revision, which the party invoking the jurisdiction of the High

Court under article 226 has not pursued, would not oust the

jurisdiction of the High Court and render a writ petition "not

maintainable". In a long line of decisions, this court has made

it clear that availability of an alternative remedy does not

operate as an absolute bar to the "maintainability" of a writ

petition and that the rule, which requires a party to pursue the

alternative remedy provided by a statute, is a rule of policy,

convenience and discretion rather than a rule of law. Though

elementary, it needs to be restated that "entertainability" and

"maintainability" of a writ petition are distinct concepts. The

fine but real distinction between the two ought not to be lost

sight of. The objection as to "maintainability" goes to the root

of the matter and if such objection were found to be of

substance, the courts would be rendered incapable of even

receiving the lis for adjudication. On the other hand, the

question of "entertainability" is entirely within the realm of

discretion of the High Courts, writ remedy being

discretionary. A writ petition despite being maintainable may

not be entertained by a High Court for very many reasons or

relief could even be refused to the petitioner, despite setting

up a sound legal point, if grant of the claimed relief would not

further public interest. Hence, dismissal of a writ petition by a

High Court on the ground that the petitioner has not availed

the alternative remedy without, however, examining whether

an exceptional case has been made out for such entertainment

would not be proper.”

22. Thus, availability of an alternative remedy does not operate as an

absolute bar to the maintainability of a writ petition, and in a given case,

the High Court can entertain a writ petition despite availability of an

alternative remedy. Evidently, the rule of not entertaining a writ petition

due to availability of an alternative remedy is a self-imposed restraint by

the writ court and it is a rule of policy, convenience, prudence and

discretion, rather than a rule of law. In other words, if the petitioner

before the writ court makes out a case for entertaining the writ petition

despite availability of alternative remedy, the said writ petition can be

entertained and appropriate orders can be passed in such a writ petition.

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23. In these writ petitions, the petitioners have invoked the writ of

certiorari, asserting that the DRT, being a subordinate tribunal, has far

exceeded its jurisdiction while passing the impugned order. The grounds

raised while claiming such jurisdictional error include the assertion that

the impugned order is in the teeth of settled law laid down by the

Supreme Court in the case of Celir LLP Vs. Bafna Motors (Mumbai)

Private Limited and others (supra) and M. Rajendran and others vs.

KPK Oils and Proteins India Private Limited and others (supra).

Apart from this, it is in the teeth of the relevant provision i.e. Section

13(8) of the Securitisation Act, that the impugned order amounts to

granting final relief at the interim stage and further, that the reliefs

granted are well beyond the prayers in the securitisation application as

well as the interim application filed by the respondent guarantors before

the DRT.

24. In the case of East India Commercial Company Limited,

Calcutta and another Vs. Collector of Customs, Calcutta (supra), the

Supreme Court held that if an order is passed in the teeth of the position

of law laid down by a superior court, such an order itself is rendered

without jurisdiction. Although the said position has been laid down

while discussing jurisdiction under Article 227 of the Constitution of

India, which concerns supervisory jurisdiction of the High Courts, it is a

settled position of law that the jurisdiction that the High Courts exercise

while invoking the writ of certiorari, to a certain extent, overlaps with

the jurisdiction exercised under Article 227 of the Constitution of India.

Thus, the observations made in the said judgment are relevant to test the

ground of maintainability raised on behalf of the respondent guarantors.

25. The relevant portion of the said judgment of the Supreme Court in

the case of East India Commercial Company Limited, Calcutta and

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another Vs. Collector of Customs, Calcutta (supra) reads as follows:

“31. … It would be anomalous to suggest that a tribunal

over which the High Court has superintendence can ignore the

law declared by that court and start proceedings in direct

violation of it. If a tribunal can do so, all the subordinate

courts can equally do so, for there is no specific provision,

just like in the case of Supreme Court, making the law

declared by the High Court binding on subordinate courts. It

is implicit in the power of supervision conferred on a superior

tribunal that all the tribunals subject to its supervision should

conform to the law laid down by it. Such obedience would

also be conducive to their smooth working : otherwise, there

would be confusion in the administration of law and respect

for law would irretrievably suffer. We, therefore, hold that the

law declared by the highest court in the State is binding on

authorities or tribunals under its superintendence, and that

they cannot ignore it either in initiating a proceeding or

deciding on the rights involved in such a proceeding. If that

be so, the notice issued by the authority signifying the

launching of proceedings contrary to the law laid down by the

High Court would be invalid and the proceedings themselves

would be without jurisdiction.”

26. In the case of Union of India and another Vs. State of Haryana

and another (supra), the Supreme Court in the context of

maintainability of writ petition under Article 226 of the Constitution of

India in the face of an alternative remedy observed as follows:

“3.Having heard learned counsel for the parties at length,

we are of the view that these are the matters which should not

have been dismissed by the respective High Courts in

suggesting an alternative remedy. The question raised was

pristinely legal which required determination as to whether

provision of telephone connections and instruments amounted

to sale and even so why was the Union of India not exempt

from payment of sales tax under the respective statutes. The

respondents counter such stance. We think the question raised

was fundamental in character and need not have been put

through the mill of statutory appeals in the hierarchy. For this

reason alone, we set aside the respective impugned orders of

the High Courts and remit the writ petitions back to them for

decision in accordance with law. The recovery of tax would

stand stayed till the disposal of the writ petitions. Ordered

accordingly. No costs.”

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27. Thus, it is evident that if a fundamental question is raised that

goes to the very root of the matter, the party approaching the writ court

need not necessarily be relegated to the mill of statutory appeals in the

hierarchical context of a statutory framework. In the cases of Vishnu

Babu Tambe Vs. Apurva Vishnu Tambe (supra) and Samir Narain

Bhojwani Vs. Aurora Properties and Investments and another

(supra), the Supreme Court clearly indicated that if the impugned order

grants final relief at interlocutory stage, it is a manifest error and it

amounts to exceeding jurisdiction.

28. This would also apply to a situation where the impugned order

grants relief beyond the prayers that are made by the concerned

applicant before the tribunal.

29. We find that the petitioners in these writ petitions have raised such

grounds and they have claimed that there is a fundamental procedural

irregularity committed by the DRT in passing the impugned order. This

is raised as a facet of natural justice and it is claimed that therefore, the

writ petition is clearly maintainable. We are of the view that when the

said contention raised on behalf of the petitioners is appreciated in the

proper perspective, the argument of prejudice raised on behalf of the

respondent guarantors cannot be accepted. In such a situation, the

respondent guarantors cannot fall back on the argument that despite

violation of principles of natural justice, as per settled law, the

petitioners would still have to show some prejudice suffered by them

and only then could the writ petitions be maintainable. Thus, if the

petitioners succeed in demonstrating that there is a jurisdictional error

and a fundamental procedural irregularity committed by the DRT while

passing the impugned order, the argument of the respondent guarantors

regarding maintainability of the writ petitions will have to be rejected. In

that sense, the issues appear to be intertwined.

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30. There can be no quarrel with the proposition laid down by the

Supreme Court in the case of United Bank of India Vs. Satyawati

Tandon and others (supra), reiterated in the case of Celir LLP Vs.

Bafna Motors (Mumbai) Private Limited and others (supra), that

ordinarily a writ petition would not be maintainable in the face of

availability of alternative efficacious remedy, but the aforesaid self-

restraint and the rule of policy, convenience and discretion would not be

exercised by this Court if a fundamental jurisdictional error is found in

the order of the tribunal.

31. The true nature of the impugned order passed by the DRT will

have to be examined in order to consider the specific contentions raised

on behalf of the petitioners in this regard. By the impugned order dated

09.01.2026, the DRT set aside the auction conducted on 21.06.2025. The

amount deposited by the petitioner auction purchaser was directed to be

returned back and further, the respondent guarantors were directed to

remit the sum of Rs. 26.10 crores with the petitioner bank on or before

31.03.2026. We find that the directions contained in the impugned order

amount to permitting redemption of the mortgage. It is difficult to

understand the argument of the respondent guarantors that even if the

effect is of redeeming the mortgage, such was not the relief claimed by

the respondent guarantors and instead, they had merely challenged the

actions undertaken by the petitioner bank under the provisions of the

Securitisation Act. We find that the petitioner bank as well as the

petitioner auction purchaser have specifically raised the issue of

extinguishing of rights of redemption in the facts and circumstances of

the present case. It was also specifically argued on their behalf that the

DRT would not have any inherent power to set aside a sale when no such

specific prayer was made in the securitisation application itself. We find

that the DRT failed to discuss the said aspects of the matter in the

impugned order and proceeded to pass an order that effectively

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amounted to allowing redemption for mortgage.

32. In the case of Celir LLP Vs. Bafna Motors (Mumbai) Private

Limited and others (supra), the Supreme Court specifically took into

consideration the effect of the amendment in Section 13(8) of the

Securitisation Act. The comparison between the pre-amendment position

and the post-amendment position was examined and thereafter, the

Supreme Court specifically made certain observations, which are

relevant for the present case. Relevant portions of the judgment of the

Supreme Court in the case of Celir LLP Vs. Bafna Motors (Mumbai)

Private Limited and others (supra) read as follows:

“61. Before proceeding with the analysis of the provision of

Section 13(8) of the Sarfaesi Act, it would be appropriate to

refer to the said provision as it stood prior to the amendment

and as it stands after the amendment, which is given below:

Pre-amendment Section 13(8) Post-amendment Section 13(8)

“13. (8) If the dues of the

secured creditor together with

all costs, charges and expenses

incurred by him are tendered to

the secured creditor at any time

before the date fixed for sale or

transfer, the secured asset shall

not be sold or transferred by the

secured creditor, and no further

step shall be taken by him for

transfer or sale of that secured

asset.”

“13. (8) Where the amount of

dues of the secured creditor

together with all costs, charges

and expenses incurred by him is

tendered to the secured creditor

at any time before the date of

publication of notice for public

auction or inviting quotations or

tender from public or private

treaty for transfer by way of

lease, assignment or sale of the

secured assets—

(i) the secured assets shall not be

transferred by way of lease

assignment or sale by the

secured creditor; and

(ii) in case, any step has been

taken by the secured creditor for

transfer by way of lease or

assignment or sale of the assets

before tendering of such amount

under this sub-section, no

further step shall be taken by

such secured creditor for transfer

by way of lease or assignment or

sale of such secured assets.”

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* * * * *

64. We are of the view that the failure on the part of the

borrower in tendering the entire dues including the charges,

interest, costs, etc. before the publication of the auction-notice

as required by Section 13(8) of the Sarfaesi Act, would also

sufficiently constitute extinguishment of right of redemption

of mortgage by the act of parties as per the proviso to Section

60 of the 1882 Act. Furthermore, in the case on hand, there

was no claim for right of redemption by the borrower either

before the publication of the auction-notice or even thereafter.

The borrowers entered into the fray only after coming to

know of the confirmation of auction. Be that as it may, once

Section 13(8) stage was over and auction stood concluded, it

could be said that there was an intentional relinquishment of

his right of redemption under Section 13(8), whereby the

Bank declared the appellant as the successful auction-

purchaser having offered the highest bid in accordance with

the terms of the auction-notice.

65. The Sarfaesi Act is a special law containing an overriding

clause in comparison to any other law in force. Section 60 of

the 1882 Act, is a general law vis-à-vis the amended Section

13(8) of the Sarfaesi Act which is special law. The right of

redemption is clearly restricted till the date of publication of

the sale notice under the Sarfaesi Act, whereas the said right

continues under Section 60 of the 1882 Act till the execution

of conveyance of the mortgaged property. The legislative

history has been covered in the preceding paragraphs of this

judgment and how Parliament desired to have express

departure from the general provision of Section 60 of the

1882 Act. The Sarfaesi Act is a special law of recovery with a

paradigm shift that permits expeditious recovery for the banks

and the financial institutions without intervention of courts.

Similarly, Section 13(8) of the Sarfaesi Act is a departure

from the general right of redemption under the general law i.e.

the 1882 Act. Further, the legislature has in the Objects and

Reasons while passing the amending Act specifically stated

“to facilitate expeditious disposal of recovery applications, it

has been decided to amend the said Acts…”. Thus, while

interpreting Section 13(8) vis-à-vis Section 60 of the 1882

Act, an interpretation which furthers the said Objects and

Reasons should be preferred and adopted. If the general law is

allowed to govern in the manner as sought to be argued by the

borrowers, it will defeat the very object and purpose as well

as the clear language of the amended Section 13(8).

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69. However, with the advent of the 2016 Amendment,

Section 13(8) of the Sarfaesi Act now uses the expression

“before the date of publication of notice for public auction or

inviting quotations or tender from public or private treaty for

transfer by way of lease, assignment or sale of the secured

assets” which by no stretch of imagination could be said to be

in consonance with the general rule under the 1882 Act that

the right of redemption is extinguished only after conveyance

by registered deed. Thus, in the light of clear inconsistency

between Section 13(8) of the Sarfaesi Act and Section 60 of

the 1882 Act the former special enactment overrides the latter

general enactment in light of Section 35 of the Sarfaesi Act.

Thus, the right of redemption of mortgage is available to the

borrower under the Sarfaesi Act only till the publication of

auction-notice and not thereafter, in light of the amended

Section 13(8).”

33. The said position of law was further reiterated by the Supreme

Court in the case of M. Rajendran and others vs. KPK Oils and

Proteins India Private Limited and others (supra). In the said

judgment, the Supreme Court took into consideration the issue as

regards the manner in which its earlier judgment in the case of Celir

LLP Vs. Bafna Motors (Mumbai) Private Limited and others (supra)

was being construed by various High Courts. The Supreme Court further

took into consideration a situation where the secured asset was sought to

be sold, not by way of auction but by way of private treaty. Taking into

consideration the aforesaid situation also, the Supreme Court in the case

of M. Rajendran and others vs. KPK Oils and Proteins India Private

Limited and others (supra) held as follows:-

“105. To put it simply, as per sub-section (8) of Section 13 of

the SARFAESI Act, a borrower can tender the amount of dues

to the secured creditor along with all costs, charges and

expenses, at any time, before the date of publication of notice

for public auction or inviting quotations or tender from public

or private treaty, as the case may be.

106. A borrower has no unfettered right to tender such

amount of dues, as stipulated in Section 13(8), after the date

of publication of notice for public auction or inviting

quotations or tender from public or private treaty, as the case

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may be, because the restriction on the secured creditor, from

transferring the secured asset, envisaged under clause(s) (i)

and (ii) of the said provision, would only be attracted, if the

dues are tendered prior to the publication of notice for public

auction or inviting quotations or tender from public or private

treaty, as the case may be. Where the borrower tenders such

dues after the publication of the notice stipulated in Section

13(8), the secured creditor is not bound to accept it, and can

continue to proceed with the transfer of the secured asset, by

way of lease, assignment or sale.”

34. Thus, it is abundantly clear that once the auction sale notice is

published, the borrower completely loses the right to seek redemption of

the mortgage by operation of Section 13(8) of the Securitisation Act, as

amended, and in the light of the clear position of law laid down by the

Supreme Court in the aforementioned judgments. In the present case, it

was incumbent upon DRT to examine the said aspect of the matter,

particularly in light of the fact that such specific objection was raised on

behalf of the petitioners.

35. In the present case, on 27.03.2025, the petitioner bank issued

specific notice to the respondent borrower through its liquidator, as well

as the resolution professional appointed by the NCLT in the context of

the personal insolvency of the respondent guarantors. They did not raise

any objection to the steps contemplated by the petitioner bank in respect

of auction sale of the secured asset. It is in this backdrop that the

petitioner bank issued the auction sale notice and published the same in

newspapers on 16.05.2025. The moment the aforesaid auction sale

notice was published, by operation of Section 13(8) of the Securitisation

Act, the right of the respondent borrower to redeem the mortgage was

extinguished. This has been emphatically laid down by the Supreme

Court in the aforementioned judgments in the cases of Celir LLP Vs.

Bafna Motors (Mumbai) Private Limited and others (supra) and M.

Rajendran and others vs. KPK Oils and Proteins India Private

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Limited and others (supra). The DRT, while passing the impugned

order, which effectively granted redemption of mortgage, ought to have

considered the said position before passing any order in the matter.

Instead, the DRT went ahead to examine the merits of the matter, which

demonstrates the jurisdictional error committed by the DRT. In the

process, the DRT also committed an error in granting final relief while

disposing of the interim application. We find that since the order of the

DRT is in the teeth of the settled position of law, in terms of the law laid

down by the Supreme Court in the case of East India Commercial

Company Limited, Calcutta and another Vs. Collector of Customs,

Calcutta (supra), the impugned order is rendered without jurisdiction.

36. We also find that the nature of the impugned order is such that it

amounts to granting final relief at interim stage. In the case of Samir

Narain Bhojwani Vs. Aurora Properties and Investments and

another (supra), the Supreme Court held that when such a situation

occurs, where final relief is granted at interlocutory stage, it amounts to

a manifest error and such an order can be said to be in excess of

jurisdiction.

37. We have also perused the securitisation application as well as the

interim application and we find that there is no prayer clause in the

applications for setting aside of the auction sale. Yet, the DRT passed the

impugned order on the interim application, setting aside the auction and

giving further directions. This amounts to granting relief that is not even

prayed by the respondent guarantors in the aforementioned applications.

This is another instance of the DRT having committed a jurisdictional

error while passing the impugned order. We are unable to accept the

contention of the respondent guarantors that the prayer clauses were

pertaining to the situation when the securitisation application and the

interim application were filed on 18.06.2025. As a matter of fact,

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subsequent events had occurred and the parties were not only before the

DRT, but before this Court in writ petitions filed by the petitioners in

which specific directions were issued. Nothing prevented the respondent

guarantors from appropriately amending the securitisation application as

well as the interim application for making specific prayers for the relief

of setting aside of the auction. No such steps were taken by the

respondent guarantors, which the DRT completely failed to appreciate

and it proceeded as if it was finally deciding the pending applications,

including the securitisation application.

38. At this stage, it would be relevant to note some glaring facts in the

present case. It is an admitted position that the notice under Section

13(2) of the Securitisation Act was issued as far back as on 16.01.2020

by the petitioner bank. As per law, the notice was duly served upon the

borrower as well as the guarantors. It is the matter of fact that the

respondent borrower went into corporate insolvency and eventually into

liquidation. The liquidator was duly put to notice with regard to the

actions being undertaken by the petitioner bank. Equally, the resolution

professional appointed in the context of personal insolvency proceedings

pending before the NCLT as against the respondent guarantors, was also

duly put to notice about the actions being undertaken by the petitioner

bank under the Securitisation Act. Not only this, the liquidator appeared

before the DRT in the pending proceeding and specifically recorded that

he had no objection for the sale of the secured asset in terms of the

actions undertaken by the petitioner bank as a secured creditor. The

resolution professional concerning the personal insolvency proceedings

pending against the respondent guarantors also did not raise any

objection. We find that the facts that come to the fore clearly

demonstrate that the respondent guarantors chose to remain fence-sitters

from the year 2020, despite the fact that they were aware about the

proceedings being undertaken by the petitioner bank in terms of the

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notice issued under Section 13(2) of the Securitisation Act. For more

than a period of five years, no steps were taken in the matter. Even when

the securitisation application along with the interim application were

filed before the DRT, no efforts were made to amend the applications in

an appropriate manner in the light of the auction sale having been

conducted and the auction purchaser having come into the picture. This

demonstrates that the DRT committed a manifest error in not taking into

consideration the aforesaid circumstances and also committed a grave

procedural irregularity by granting final relief at interim stage and also

granting reliefs well beyond the specific prayers made in the

applications filed by the respondent guarantors.

39. We find that the petitioners in these petitions have specifically

invoked the writ of certiorari. The discussions and findings rendered

hereinabove clearly show that the DRT, while passing the impugned

order dated 09.01.2026, committed a serious jurisdictional error, and

therefore, this Court is required to invoke the writ of certiorari and

interfere with the impugned order. This Court while exercising writ

jurisdiction can also not ignore the admitted position on facts that the

respondent guarantors are themselves undergoing the process of personal

insolvency before the NCLT. They have no net worth and yet after more

than five years, they approached the DRT seeking certain reliefs and the

DRT without examining the totality of facts ended up granting reliefs far

beyond the specific prayers made in the two applications filed by the

respondent guarantors. It is also significant to note that the respondent

borrower, through the liquidator, has already given no objection to the

steps taken by the petitioner bank under the provisions of the

Securitisation Act. The respondent guarantors cannot be in a position

better than the original borrower and enjoy reliefs, which even the

original borrower would not be entitled to.

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40. In this background, we do not find substance in the contention

raised on behalf of the respondent guarantors that they were simply

challenging the validity of the process undertaken by the petitioner bank

under the provisions of the Securitisation Act and that they never

claimed any redemption of mortgage. This Court is concerned with the

nature of the impugned order passed by the DRT, which effectively

shows that the mortgage has been redeemed. In this context, reliance

placed on behalf of the respondent borrowers on the judgement of the

Madras High Court in the cases of N. R. Sadasivam Vs. Indian Bank

(supra) and Star Trace Engineering Division Vs. Registrar, DRT and

others (supra), to contend that if eventually Section 13(2) notice under

Securitisation Act issued by the petitioner bank is found to be

unsustainable, the mortgage would then be open for redemption. Even if

that be so, the said question would have to be decided in the

securitisation application, which is still pending before the DRT. In fact,

this further shows that the DRT erred in granting final relief at interim

stage, thereby re-enforcing the conclusion that this was a fundamental

jurisdictional error committed by the DRT. In this situation, we find that

although elaborate submissions were made on behalf of the respondent

guarantors to defend the findings rendered by the DRT on the alleged

defects in the Section 13(2) notice issued by the petitioner bank and the

valuation report, having reached the conclusions hereinabove, we do not

find it necessary to go into the said submissions. It was for the DRT to

have first examined as to whether any interim relief could be granted in

the application. Instead, the DRT discussed issues pertaining to the

merits of the challenge during the pendency of the securitisation

application and ended up granting relief that could not have been granted

in the light of the settled position of law. As a matter of fact, in the face

of the aforesaid findings rendered in the impugned order passed by the

DRT in the interim application, there is nothing left to be decided in the

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securitisation application, which itself demonstrates the error committed

by the DRT.

41. We also find that the DRT gave emphatic findings with regard to

purported defects in the valuation report. It is to be noted that the

respondent guarantors had also produced their valuation report, which as

a matter of fact, recorded the value of the structures to be zero. As

regards the area of the land taken into consideration and the valuation

report of the petitioner bank, we do find that the valuer took into

consideration the fact that a part of the land was acquired and utilized for

construction of road. It was in this backdrop that the actual valuation of

the land was undertaken on the piece of land available for auction sale

and the DRT completely failed to appreciate the said aspect of the

matter. In any case, such findings could have been only interlocutory in

nature, but the tenor of the order of the DRT, which is impugned in these

writ petitions, shows that final and emphatic findings were rendered by

the DRT, which further demonstrates the grave error committed while

passing the impugned order.

42. In view of the above discussion, we find the impugned order to be

unsustainable. The DRT could not have granted reliefs in the nature of

final relief at interlocutory stage and that too, effectively amounting to

redemption of mortgage, when in the light of the position of law

clarified by the Supreme Court, such a relief could not be granted even

finally in the proceedings pending before the DRT. As a result, the writ

petitions are allowed. The impugned order is quashed and set aside. The

DRT shall proceed to decide the securitisation application expeditiously,

strictly in accordance with law. Although rival submissions were made

on the locus of the respondent guarantors, the said question is left open

to be decided by the DRT while considering the securitisation

application. We have expressed no opinion on the said aspect of the

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matter, which DRT shall decide in accordance with law.

43. Pending applications, if any, in these writ petitions, are also

disposed of.

(SHREERAM V. SHIRSAT, J.) (MANISH PITALE, J.)

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Minal Parab

MINAL

SANDIP

PARAB

Digitally signed

by MINAL

SANDIP PARAB

Date: 2026.03.24

17:23:06 +0530