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32. Lakshmi Mohan (Dead) through LHs. & Anr. v. Airtech Projects Engineers Pvt. Ltd. & Ors.
2026 INSC 909 August 21, 2026
SARFAESI – Auction sale – Earnest money deposit – Shortfall in EMD prescribed by sale notice – Subsequent deposit of 25% of sale consideration – Technical non-compliance causing no prejudice – validity of auction not affected. [Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002; Security Interest (Enforcement) Rules, 2002, Rr.8, 9]
FACTS
The borrower defaulted in repayment of a cash-credit facility and the Bank initiated proceedings under the SARFAESI Act. A possession-cum-sale notice required intending bidders to deposit EMD of Rs. 21,50,000/- and stipulated that an offer without EMD would be rejected.
The auction purchasers submitted their bid with EMD of ₹21,15,000/-, resulting in a shortfall of ₹35,000/. Their bid of ₹2,17,40,000/- was the highest. On the date of auction, they deposited a further amount which brought the total deposit to 25% of the bid amount, as required by Rule 9(3). The balance consideration was subsequently deposited and a sale certificate was issued and registered.
