Bombay High Court
Union Bank Of India vs Indus Mechnical Eng Co Pvt Ltd And Anr on 18 April, 2026
Author: Manish Pitale
Bench: Manish Pitale
2026:BHC-AS:18486-DB
11_WP11848&group_25.doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
WRIT PETITION NO.11848 OF 2025
Union Bank of India ... Petitioner
Vs.
Indus Mechanical Eng. Co. Pvt. Ltd. and another ... Respondents
WITH
INTERIM APPLICATION (ST.) NO.20162 OF 2025
IN
WRIT PETITION NO.11848 OF 2025
K. P. Ridge Pvt. Ltd. ... Applicant
In the matter between:
Union Bank of India ... Petitioner
Vs.
Indus Mechanical Eng. Co. Pvt. Ltd. and another ... Respondents
WITH
WRIT PETITION NO.17555 OF 2025
Juana Sanjeev Uppal ... Petitioner
Vs.
Indus Mechanical Eng. Co. Pvt. Ltd. and another ... Respondents
WITH
INTERIM APPLICATION NO.491 OF 2026
IN
WRIT PETITION NO.17555 OF 2025
K. P. Ridge Pvt. Ltd. through its Director ... Applicant
In the matter between:
Juana Sanjeev Uppal ... Petitioner
Vs.
Indus Mechanical Eng. Co. Pvt. Ltd. and another ... Respondents
WITH
WRIT PETITION NO.12930 OF 2025
K. P. Ridge Pvt. Ltd. through its Director ... Petitioner
MINAL by
Digitally signed
MINAL
Vs.
SANDIP Date:
SANDIP PARAB
PARAB 2026.04.20
15:09:05 +0530
Union Bank of India and others ... Respondents
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WITH
WRIT PETITION NO.16755 OF 2025
K. P. Ridge Pvt. Ltd. through its Director ... Petitioner
Vs.
Union Bank of India and others ... Respondents
---
Mr. Girish Godbole, Senior Advocate with Mr. Rishabh Shah, Mr. Anuj
Jhaveri and Mr. Ritik Sinha i/b. Mr. Anuj Jhaveri for Petitioner in
WP/12930/2025 and WP/16755/2025.
Mr. Ravi Kadam, Senior Advocate a/w. Mr. Ashish Mehta, Mr.Vaibhav Bhure
a/w. Ms. Khushi Rawloni and Ms. Mahima Sharma i/b. Mr. Ramiz Shaikh for
Petitioner (Auction Purchaser) in WP/17555/2025.
Dr. Birendra Saraf, Senior Advocate a/w. Ms. Malaika C., Mr.Charles Desouza
a/w. Mr. Rupak Sawangikar and Mr. Roshan Gaud i/b. Orbit Law Services for
Union Bank of India in all Petitions i.e. for Petitioner in WP/11848/2025, for
Respondent No.1 in WP/12930/2025 and WP/16755/2025 and for Respondent
No.2 in WP/17555/2025.
Mr. Yeshwant Shenoy a/w. Ms. Pooja Singh for Respondent No.1 in
WP/17555/2025 and WP/11848/2025 and for Respondent Nos.3 and 6 in
WP/12930/2025 and WP/16755/2025.
CORAM : MANISH PITALE &
SHREERAM V. SHIRSAT, JJ.
DATE : APRIL 18, 2026
P.C. :
. There are four writ petitions for consideration. Writ Petition
No.11848 of 2025 is filed by Union Bank of India (secured creditor).
Writ Petition No.17555 of 2025 is filed by the auction purchaser.
2. Writ Petition Nos.12930 of 2025 and 16755 of 2025 are filed by
K. P. Ridge Pvt. Ltd., claiming to be owner of the land, which is subject
matter of the proceedings. The said petitioner is aggrieved by its
intervention application being rejected by the Debts Recovery Appellate
Tribunal (DRAT) by the impugned order and the other writ petition has
been filed by the said petitioner for direction to the Debt Recovery
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Tribunal (DRT) to consider Transfer Securitisation Application (TSA)
No.151 of 202 filed by the said petitioner and to dispose of the same
expeditiously.
3. We have considered the rival submissions and since we find that
the impugned orders passed by the DRAT and the DRT are required to
be set aside and the matter needs to be remanded to the DRT, on a short
point, detailed reference to the chronology of events is not necessary.
4. We find that both, the DRT as well as the DRAT completely
missed the point that goes to the root of the matter to the effect that the
DRT could not have granted relief of setting aside a sale certificate
issued in favour of the petitioner (auction purchaser) in an interim
application without any substantive pleadings and prayer in the main
proceeding i.e. the pending Securitisation Application No.92 of 2021.
We find that this is a glaring error, particularly when specific allegations
of fraud have not been made by the respondent borrower i.e. the
applicant in the said securitisation application. In the absence of any
pleadings in the securitisation application and there being no substantive
prayer in the securitisation application for setting aside the sale
certificate issued in favour of the auction purchaser, the DRT proceeded
to set aside the sale certificate on the basis of prayers made only in an
interim application. This is a glaring irregularity and the approach
adopted by the DRT is clearly in the teeth of the settled position of law
laid down by the Supreme Court in a number of judgements.
5. The petitioner bank (secured creditor) was constrained to invoke
the provisions of the Securitisation and Reconstruction of Financial
Assets and Enforcement of Security Interest Act, 2002 (for short
‘Securitisation Act‘) against the respondent borrower in the light of its
default in repayment of loan and credit facilities. It is undisputed that the
petitioner bank proceeded to conduct auctions as many as on six
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occasions in respect of the secured assets to recover the amount due. All
the six attempts failed as there were no bidders. When the seventh
attempt was made in the form of a sale notice dated 11.04.2023, it led to
the present controversy. The sale as per the auction sale notice dated
11.04.2023 was fixed for 11.05.2023. In the light of the said sale notice,
the respondent borrower filed Interim Application No.1957 of 2023 in
the pending securitisation application for setting aside the sale notice
and also praying for interim reliefs. On 11.05.2023, the said interim
application was taken up for consideration. As per the sale notice, the
auction was to be conducted between 11:00 a.m. and 01.00 p.m. on
11.05.2023.
6. When the application was taken up for consideration at about
11:15 a.m., the petitioner bank informed the DRT that no bids were
received till then and hence the proceeding was kept back awaiting the
result of the auction. It appears that the interim application was again
called out at 12:15 p.m., when the counsel for the petitioner bank was
absent and in the light of the position informed to the DRT at about
11:15 a.m. in the morning that no bids were received, the DRT
proceeded to dismiss the interim application of the respondent borrower
as infructuous.
7. It is the case of the petitioner auction purchaser that it submitted
its online bid at 12:50 p.m., which was accepted and follow-up action
was taken, resulting in issuance and registration of the sale certificate on
the very same day.
8. The petitioner bank claims that its counsel had approached the
DRT to inform the subsequent events, but the board had been discharged
by DRT. It is in this backdrop that the borrower filed Interim Application
No.2666 of 2023 in the aforesaid pending Securitisation Application
No.92 of 2021, wherein the following prayers were made:-
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“a. This Hon’ble Tribunal may be pleased to allow the
instant I.A. for cancellation of the Sale certificate dated 11-05-
2023 bearing Registration No.6553/2023 dated 12-05-2023,
executed between the Respondent No.1 and Respondent No.2
with respect to the said property-Duplex Bungalow at 27, Juhu
Tara Road, Jitendra Lane, Santacruz (W) Mumbai – 400054 till
the disposal of the above IA.
b. This Hon’ble Tribunal may be pleased to grant
injunction restraining the Respondent No.2 from creating any
third party right over the said property -Duplex Bungalow at
27, Juhu Tara Road, Jitendra Lane, Santacruz (W) Mumbai –
400054 till the disposal of the above IA.
c. To initiate contempt proceeding against the Authorized
officer and other concerned officers of the Respondent No.1
bank for committing fraud upon this Hon’ble Tribunal.
d. For ad-interim orders in terms of prayer clauses (a) to (b)
above.
e. Any other other as this Hon’ble Court deem fit in the
interest of justice.”
9. The petitioner bank and the petitioner auction purchaser opposed
the said application. The DRT, by its order dated 12.10.2023, allowed
the application and set aside the auction sale conducted on 11.05.2023
with all consequences thereof.
10. The petitioner bank as well as the petitioner auction purchaser
filed appeals before the DRAT challenging the said order, inter alia, on
the ground that such reliefs could not have been granted in the absence
of any pleading or prayer in the substantive proceeding i.e.
Securitisation Application No.92 of 2021.
11. By the impugned order dated 10.03.2025, the DRAT dismissed
the appeals and confirmed the order of the DRT. It was held that the
petitioner auction purchaser was entitled for refund of sale consideration
with interest rate as applicable to fixed deposits and the bank was
directed to conduct a fresh auction. The interim applications filed by the
petitioner K. P. Ridge Pvt. Ltd. in the said appeals were dismissed with
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liberty to agitate the issues raised therein before the DRT in Transfer
Securitisation Application (TSA) No.151 of 2023. It is relevant to note
that although the impugned order of the DRAT runs into several
paragraphs and pages, there is no discussion in the said order with regard
to the aforesaid point indicated by this Court, which goes to the very
root of the matter.
12. Mr. Ravi Kadam, learned senior counsel appearing for the
petitioner auction purchaser and Dr. Saraf, learned senior counsel
appearing for the petitioner Union Bank of India submitted that this
Court may consider allowing the petitions on the short ground noted
hereinabove. It was submitted that in the absence of any substantive
pleadings and prayers in Securitisation Application No.92 of 2021, the
DRT could not have considered the serious allegations of fraud while
virtually granting final relief in the interim application. It was submitted
that the said approach adopted by the DRT was in the teeth of the settled
position of law as recognized by the Supreme Court in the case of
Cotton Corporation of India Limited Vs. United Industrial Bank Limited
and others, (1983) 4 SCC 625 and State of Orissa Vs. Madan Gopal
Rungta, AIR 1952 SC 12. It was submitted that only after such
substantive pleadings and prayers were incorporated in the said
securitisation application, that the DRT could have considered the
prayers made in that regard.
13. It was specifically pointed out that before the aforesaid interim
application of the borrower was taken up for consideration,
Securitisation Application No.92 of 2021 came up for consideration
before the DRT on 19.06.2023, where this very submission was
advanced. The DRT had specifically recorded that the issue regarding
the last date and time of receiving the bids would be kept open, to be
agitated by the parties during the final hearing of the securitisation
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application and it was further recorded that all issues were kept open.
14. On this basis, it was submitted that the DRT committed a serious
jurisdictional error and a procedural irregularity in considering prayers
made in the interim application filed by the borrower for setting aside
the sale certificate in the absence of any substantive pleadings in the
main proceeding i.e. Securitisation Application No.92 of 2021. It was
submitted that if this Court were to agree with the aforesaid petitioners,
orders passed by DRT and DRAT deserve to be set aside and the matter
can be placed before the DRT for consideration of the said securitisation
application in accordance with law. It was submitted that DRAT
completely missed the aforesaid point, while confirming the order
passed by the DRT.
15. Mr. Godbole, learned senior counsel appearing for the petitioner
K. P. Ridge Pvt. Ltd. submitted that the DRAT ought not to have
dismissed its applications for impleadment, for the reason that the said
petitioner claims to be owner of the land in respect of which, the
petitioner bank i.e. secured creditor proceeded under the provisions of
the Securitisation Act. It is the case of the said petitioner that only the
structure was given to the borrower and not the land underneath, and
therefore, the said petitioner has a vital interest in the proceedings. It
was submitted that since the said petitioner had already filed its
securitisation application before the DRT, the impleadment application
ought to have been allowed. It was brought to our notice that in these
writ petitions also intervention applications have been filed by the said
petitioner.
16. It was further submitted that since fraud vitiates everything and
the DRT as well the DRAT found sufficient material demonstrating fraud
committed by the petitioner bank as well as the petitioner auction
purchaser, this Court may not interfere with the impugned orders.
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17. Mr. Shenoy, learned counsel appearing for the respondent
borrower in these petitions vehemently submitted that the findings
rendered by the DRT and confirmed by the DRAT show the blatant fraud
committed by the auction purchaser and the bank, not only on the
borrower but also on the DRT, for the manner in which the auction was
conducted on 11.05.2023. It was submitted that the DRT was
deliberately kept in dark about the fact that the auction purchaser
intended to submit its bid and also about the sole bid of the auction
purchaser being accepted. It was submitted that the DRT as well as the
DRAT specifically referred to the chronology of events of the crucial
date i.e. 11.05.2023 to reach findings that are unassailable and therefore,
this Court may not interfere with the impugned orders.
18. We have considered the rival submissions. We find that the
position of law upon which the petitioner bank and the petitioner auction
purchaser rely, clearly lays down that interim relief can be granted only
in aid of and as ancillary to the main relief, which may be available to
the party on final determination of its rights in a suit or proceeding. The
said position of law has been laid down by the Supreme Court in its
judgement in the case of State of Orissa Vs. Madan Gopal Rungta
(supra), rendered as far back as in the year 1951 and followed
subsequently in a number of judgements. In the case of Cotton
Corporation of India Limited Vs. United Industrial Bank Limited
and others (supra), the Supreme Court reiterated the same by observing
as follows:-
“10. Mr Sen, learned counsel for the respondent Bank,
contended that Section 41(b) is not at all attracted because it
deals with perpetual injunction and the temporary or interim
injunction is regulated by the Code of Civil Procedure specially
so provided in Section 37 of the Act. Expression ‘injunction’ in
Section 41(b) is not qualified by an adjective and therefore, it
would comprehend both interim and perpetual injunction. It is,
however, true that Section 37 specifically provides that
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11_WP11848&group_25.doctime or until further order of the court are regulated by the Code
of Civil Procedure. But if a dichotomy is introduced by
confining Section 41 to perpetual injunction only and Section
37 read with Order 39 of the Code of Civil Procedure being
confined to temporary injunction, an unnecessary grey area will
develop. It is indisputable that temporary injunction is granted
during the pendency of the proceeding so that while granting
final relief the court is not faced with a situation that the relief
becomes infructuous or that during the pendency of the
proceeding an unfair advantage is not taken by the party in
default or against whom temporary injunction is sought. But
power to grant temporary injunction was conferred in aid or as
auxiliary to the final relief that may be granted. If the final relief
cannot be granted in terms as prayed for, temporary relief in the
same terms can hardly if ever be granted. In State of Orissa v.
Madan Gopal Rungta [1951 SCC 1024 : AIR 1952 SC 12 :
1952 SCR 28 : 1951 SCJ 764] a Constitution Bench of this
Court clearly spelt out the contours within which interim relief
can be granted. The Court said that ‘an interim relief can be
granted only in aid of, and as ancillary to, the main relief which
may be available to the party on final determination of his rights
in a suit or proceeding’. If this be the purpose to achieve which
power to grant temporary relief is conferred, it is inconceivable
that where the final relief cannot be granted in the terms sought
for because the statute bars granting such a relief ipso facto the
temporary relief of the same nature cannot be granted. To
illustrate this point, let us take the relief which the Bank seeks
in its suit. The prayer is that the Corporation be restrained by an
injunction of the court from presenting a winding up petition
under the Companies Act, 1956 or under the Banking
Regulation Act, 1949. In other words, the Bank seeks to restrain
the Corporation by an injunction of the court from instituting a
proceeding for winding up of the Bank. There is a clear bar in
Section 41(b) against granting this relief. The court has no
jurisdiction to grant a perpetual injunction restraining a person
from instituting a proceeding in a court not subordinate to it, as
a relief, ipso facto temporary relief cannot be granted in the
same terms The interim relief can obviously be not granted also
because the object behind granting interim relief is to maintain
status quo ante so that the final relief can be appropriately
moulded without the party’s position being altered during the
pendency of the proceedings.”
19. We are conscious that in the said case, the Court was concerned
with a situation where the main relief could not have been granted. But,
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if the party seeking interim relief has not sought such relief in the main
proceeding and granting such relief amounts to final relief at interim
stage, even in absence of any pleadings and prayer in the main
proceeding, the said position of law equally inures to the benefit of the
petitioners – Bank and auction purchaser in this case. There is no main
relief in the present case and therefore, no question of granting such
relief at interim stage. The said position of law makes it abundantly clear
that unless the main relief is claimed and is available to a party, interim
relief cannot be granted in a proceeding and that too when it virtually
amounts to granting final relief. In the present case, the pending
Securitisation Application No.92 of 2021 was admittedly not amended
and as a matter of fact, the respondent borrower had not filed any
application for amendment of the securitisation application to
substantively challenge the sale certificate issued in favour of the
auction purchaser. This is an admitted position on facts. We find that the
respondent borrower pursued its case of alleged fraud only on the basis
of contents of Interim Application No.2666 of 2023 filed in the said
securitisation application. The prayer clause in the said application,
quoted hereinabove, also shows that even while seeking cancellation of
the sale certificate dated 11.05.2023, the same was prayed for only till
‘disposal of the interim application’. It is difficult to understand how
such a prayer could have been entertained by the DRT, which virtually
amounted to granting final relief even during pendency of the interim
application and in the absence of any pleadings in the main proceeding
i.e. Securitisation Application No.92 of 2021 for setting aside of the sale
certificate.
20. We find that the ground on which respondent borrower sought
setting aside of sale certificate was fraud, which is indeed a serious
matter and it requires specific pleadings to be placed on record. The
record shows that there was no such pleading in Securitisation
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Application No.92 of 2021 and the respondent borrower did not even
make an attempt to amend the aforesaid securitisation application to
place on record such pleadings and substantive prayers.
21. Despite this admitted position on facts, the DRT not only
entertained the application, but proceeded to grant relief to the
respondent borrower of setting aside the sale certificate on the purported
ground of fraud. We are of the opinion that the said approach adopted by
the DRT was in the teeth of the settled position of law, noted
hereinabove. As a matter of fact, as per law laid down by the Supreme
Court in the case of East India Commercial Company Limited Vs.
Collector of Customs, Calcutta, AIR 1962 SC 1893, such finding given
in the teeth of settled position of law renders the order of an authority,
court or tribunal as without jurisdiction. We also find that this cannot
merely be termed as a procedural irregularity but a substantive error
committed by the DRT while passing the said order. The erroneous
approach of the DRT is compounded by the fact that in its earlier order
dated 19.06.2023, it had specifically kept all issues open, including the
aforesaid specific issue to that effect being raised on behalf of the
petitioner bank.
22. The DRAT also completely failed to appreciate the said aspect of
the matter. In its order running into several paragraphs and pages
discussing the concept of fraud and how such a case of fraud was
allegedly made out in the facts of the present case, there was no
reference made to the specific ground taken on behalf of the petitioners
i.e. the bank and the auction purchaser with regard to the said position of
law clarified by the Supreme Court in the case of Cotton Corporation
of India Limited Vs. United Industrial Bank Limited and others
(supra). It is brought to our notice that even in the written submissions
before the DRAT, the said specific ground was taken. Instead, the DRAT
simply observed that any act, including judicial act, could be challenged
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in any Court at any time and even in collateral proceedings and once the
fraud is unravelled, the consequential orders have to follow.
Surprisingly, the DRAT returned a finding that in view of the said
position, fraud would be undone even in the order passed in an
interlocutory application, completely ignoring the fact that there was no
prayer, much less any pleading in the main proceeding i.e. Securitisation
Application No.92 of 2021.
23. We find that the aforesaid approach of the DRAT was completely
erroneous, for the reason that fraud, concerning serious allegations and
counter allegations made by parties against each other, needs to be
pleaded substantively in the main proceedings, in this case, the
securitisation application, before the Court or tribunal can take up the
issue for consideration. In the absence of any such substantive pleadings
and there being no prayer for setting aside the sale certificate on the
ground of fraud in the securitisation application, the DRT could not have
proceeded to pass the aforesaid order and the DRAT erred in confirming
the same. On this short ground, we are inclined to allow the writ
petitions filed by the petitioner bank and the petitioner auction
purchaser.
24. As regards Writ Petition No.16755 of 2025 filed by K. P. Ridge
Pvt. Ltd., we find that since we are setting aside the impugned orders
and the said entity has already filed its substantive securitisation
application before the DRT, no orders are necessary on the said writ
petition and it can be disposed of. Writ Petition No.12930 of 2025 is
filed by K. P. Ridge Pvt. Ltd. for a direction to the DRT to consider its
securitisation application expeditiously. The said direction can be issued
as we intend to issue consequential directions to the DRT.
25. In view of the above, Writ Petition Nos.11848 of 2025 and 17555
of 2025 are allowed. The impugned order dated 10.03.2025 passed by
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the DRAT is quashed and set aside. The order dated 12.10.2023 passed
by the DRT in Interim Application No.2666 of 2023 in Securitisation
Application No.92 of 2021 is also quashed and set aside. The respondent
borrower and the petitioner K. P. Ridge Pvt. Ltd. are at liberty to pursue
their pending securitisation applications before the DRT.
26. The DRT is directed to take up the said applications i.e.
Securitisation Application No.92 of 2021 and Transfer Securitisation
Application (TSA) No.151 of 2025 for consideration at the earliest and it
shall make an endeavor to dispose of the same on their own merits,
expeditiously and preferably within three months of this order being
placed before the DRT. In view of the above, Writ Petition Nos.16755 of
2025 and 12930 of 2025 are also disposed of.
27. At this stage, the learned counsel for the respondent borrower
submitted that the said respondent intends to approach the DRT for
amending the pending Securitisation Application No.92 of 2021. The
respondent borrower is at liberty to do so. This Court has not expressed
any opinion on the said matter and rights and contentions of all parties in
that regard are kept open.
28. The learned counsel for the respondent borrower prayed for stay
of the order of this Court for a period of four weeks.
29. In the light of the reasons recorded hereinabove, we are not
inclined to grant the aforesaid prayer and hence, the prayer is rejected.
30. It is clarified that all issues are kept open, to be decided by the
DRT on their own merits.
31. All pending interim applications are disposed of.
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