Authority: High Court of Judicature at Madras (Chief Justice Sushrut Arvind Dharmadhikari and Justice G. Arul Murugan)

Order Date: 07 July 2026

Case Overview

  • Petitioner: M. Emayavaramban, residing at No.1, Kallar Street, Kallukuzhi, Jamal Mohammed College, Tiruchirappalli District, filed a writ petition under Article 226 seeking a mandamus directing Indian Overseas Bank (Authorized Officer, Regional Office, Chennai and Chief Manager, Ekkatuthangal Branch) to refund Rs21,10,000 paid for the property situated at R.S.No.27/B/4 and 34/5 Plot No.27‑B, Kamarajar Street, Iyappan Nagar, K.Sathanur Village, Srirangam Taluk, Tiruchirappalli District.
  • The property was purchased through an e‑auction notice dated 03‑Nov‑2019; the auction was held on 21‑Nov‑2019. The petitioner was the highest bidder with a bid of Rs21,10,000, which was accepted. The full consideration was remitted, a sale certificate was executed on 16‑Dec‑2019, and the sale was registered on 09‑Jan‑2020 as Document No.101 of 2020 before the Sub‑Registrar, K.Sathanur.
  • The borrower (third respondent) T. Vikram, Proprietor of M/s The Radicals, challenged the auction before the Debts Recovery Tribunal‑II, Chennai (DRT) in S.A.No.442 of 2019. The DRT, by order dated 30‑Sep‑2022, set aside the SARFAESI‑driven sale, finding that the bank had acted covertly to favor the petitioner. No appeal was filed, rendering the DRT order final.
  • After the sale was declared void, the petitioner sent a representation on 12‑Aug‑2023 to the bank requesting refund of the sale consideration with interest. The bank did not respond, leading to the filing of the writ petition.
  • The bank contended that the debt had been assigned to an Asset Reconstruction Company and argued that a mandamus could not be issued, asserting that the matter should be decided by the DRT.

Final Outcome

  • The Court held that once the DRT set aside the sale, the transaction is void and the bank must restore the status quo ante.
  • Respondents 1 and 2 (the Authorized Officer and the Chief Manager of Indian Overseas Bank) are directed to refund the full sale consideration of Rs21,10,000 to the petitioner within four weeks from the receipt of a copy of this order.
  • The bank is also ordered to pay interest at the rate of 9% per annum on the principal amount, calculated from 09‑Dec‑2019 until the date of actual realization.
  • No order as to costs was made.

Topics: Court Order, Banking Refund, SARFAESI Auction