Bank of Baroda v. Union of India Ministry of Finance & Ors.

1. With the consent of learned counsel for the parties, W.P.(C) 10459/2023 & W.P.(C) 14524/2023 shall stand dispose of by this common order.

2. W.P.(C) 10459/2023 has been filed by Bank of Baroda challenging the correctness of order passed on 30.06.2023 by the Recovery Officer attached to the learned Debt Recovery Tribunal- II[1], Delhi in RC 327/2015 in OA 203/2013. The Recovery Officer has held that he had no Pecuniary Jurisdiction to proceed with the issuance of the sale proclamation and the consequent auction sale on 02.03.2023 in view of notification No. 4718(E) issued by Government of India on 04.10.2022.

3. The notification No. 4718(E) dated 04.10.2022 reads as under:- DRT-II

4. There was another notification No. 4719(E) which was issued on 04.10.2022 pertaining to jurisdiction of the learned DRT, Western Region, which was the subject matter of challenge before the Bombay High Court on 17.11.2022 in WP(C) 11164/2022. The Bombay High Court stayed the notification No. 4719(E) and the Recovery Officer attached to learned DRT-II, Delhi wrongly assumed that notification No. 4718(E) has been stayed because the said notifications were identically worded, pursuant thereto, the auction sale took place and highest bidder deposited the amount. Ultimately, the Recovery Officer found that the Order (E-Auction Sale Notice) dated 02.03.2023 was without jurisdiction because notification No. 4718(E) was not the subject matter of challenge before the Bombay High Court as clarified by this Court vide order dated 05.07.2023 passed in W.P.(C) 7571/2023 titled as “Assets Care Reconstruction Enterprise Ltd. v. M/s Sheena Textiles Limited & Ors.”.

5. Consequently, the Recovery Officer ordered refund of the amount which was deposited in the Fixed Deposit Receipt to the highest bidder and the matter was transferred to Recovery Officer attached to the learned DRT-III which has the Pecuniary Jurisdiction.

6. Learned counsel for the Bank of Baroda submits that though Recovery Officer assumed wrongful jurisdiction, however, some solution is required to be found by the Court in order to regularize the sale.

7. It has been noticed that learned Additional Solicitor General had been requested to suggest a solution, however, today, learned Senior Counsel for the Union of India has submitted that in view of the notification, the Order passed by the Recovery Officer is without jurisdiction.

8. It is evident that the Recovery Officer attached to the learned DRT-II, had wrongly assumed jurisdiction because in this case the amount involved is ₹ 100 crores and the jurisdiction exclusively vests with learned DRT-III and not with learned DRT-II.

9. Keeping in view the aforesaid position, the Order dated 30.06.2023 passed by the Recovery Officer ordering refund of the amount to the highest bidder and transferring the matter to learned DRT-III does not require interference.

10. In W.P.(C) 14524/2023, the highest bidder prays for refund of the amount along with interest. Learned counsel for the Bank of Baroda admits that the amount has been deposited in a Fixed Deposit Receipt by the Recovery Officer in Bank of Baroda and if a direction is issued, the amount will be refunded along with the accrued interest.

11. It is noted here that 90% of the amount has already been refunded by the Bank to the highest bidder [Petitioner in W.P.(C) 14524/2023], pursuant to the interim Order passed on 07.12.2023.

12. Keeping in view the aforesaid position, W.P.(C) 14524/2023 is disposed of with a direction to Bank of Baroda to refund the remaining 10% amount along with accrued interest in the Fixed Deposit Receipt on the entire amount within a period of two weeks.

13. Considering the peculiar facts of the case, the Recovery Officer attached to the learned DRT-III is requested to proceed with the matter forthwith.

14. Accordingly, the present Writ Petitions along with pending application(s), if any, shall stand disposed of. ANIL KSHETARPAL, J HARISH VAIDYANATHAN SHANKAR, J AUGUST 5, 2025/tk/kr/ia