HC dismisses plea challenging J&K Bank auction sale under SARFAESI
24/03/2026
SRINAGAR, Mar 23: The High Court of Jammu & Kashmir and Ladakh has dismissed a writ petition challenging an auction sale conducted by Jammu and Kashmir Bank, holding that the borrowers' right of redemption stood extinguished after publication of the auction notice.
A Division Bench of Justice Sindhu Sharma and Justice Shahzad Azeem delivered the judgment in Abdul Rouf Bhat & Ors vs J&K Bank Ltd & Ors, upholding the sale of the mortgaged property in favour of auction purchaser Masarat Tabasum.
The petitioners, Abdul Rouf Bhat and others, had challenged the auction notice dated April 19, 2024 and the subsequent sale certificate issued on June 7, 2024, alleging violation of procedure under the SARFAESI Act.
Appearing for the petitioners, Mohammad Younis Bhat argued that statutory notices were neither properly served nor published. The bank, represented by Shafqat Nazir, along with counsel for the auction purchaser Hashir Shafiq Khan, refuted the claims, submitting records to show due compliance with legal requirements.
The court noted that the loan account had turned non-performing in 2017 and recovery proceedings were initiated under the SARFAESI Act. Multiple notices, including demand and possession notices, were duly served and published in newspapers.
Observing that the borrowers failed to clear dues before the publication of the auction notice, the Bench relied on the Supreme Court ruling in M. Rajendran vs KPK Oils and Proteins India Pvt Ltd to hold that the right of redemption does not survive beyond that stage.
The court further found that the auction had been completed, full consideration paid, and possession handed over to the auction purchaser, who was held to be a bona fide buyer.
The Bench also took note of the petitioners' failure to disclose a parallel civil suit pending before a Srinagar court concerning the same property, terming it concealment of material facts and an abuse of process.
"Writ jurisdiction under Article 226 is equitable and discretionary, and litigants must approach the court with clean hands," the court observed.
Dismissing the petition as "misconceived," the High Court held that no interference was warranted after completion of the auction process and issuance of the sale certificate.
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