I.A. No.28/2024 in COMPLAINT NO.15 OF 2024.

BEFORE TELANGANA STATE REAL ESTATE REGULATORY AUTHORITY
[Under the Real Estate (Regulation and Development) Act, 2016]
I.A. No.28/2024
in
COMPLAINT NO.15 OF 2024
19th Day of June 2024
Corum:

Dr. N. Satyanarayana, IAS (Retd.), Hon’ble Chairperson
Sri K. Srinivasa Rao, Hon’ble Member
Sri Laxmi Narayana Jannu, Hon’ble Member

1. M/s NCC Limited
2. M/s RNR Limited

…Complainants
Versus

1. M/s Mantri Developers Pvt. Ltd.
2. M/s Jubilee Hills Landmark Pvt. Ltd.
3. Indian Bank
4. Mr. Gaddam Sridhar Reddy
5. Mrs. Gaddam Radhika Reddy
6. Mr. N. Venkata Subhash
7. Mrs. Dr. N.V. Naveena
8. Dr. R. Sunil Reddy
9. Mr. Naveen Kumar Anne
10.Mrs. Divya Anne
11.Mr. Anne Venkata Satyanarayana
12.Mrs. Anne Sujatha
13.Mr. Setty Raja Gopal
14.Mrs. Setty Mallika Rani
…Respondents
The present Interlocutory Application filed by the Complainants herein
came up for hearing on 19.06.2024 before this Authority in the presence of
Counsel for Complainants, Sri Siva Acharya, and Counsel for Respondent Nos.1
and 2, Sri Anand Subramaniam and Ms. M. Geeta, none appeared for Respondent

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No.3 despite service of notice and hence being set ex-parte, and upon hearing the
arguments, this Authority passes the following ORDER:

2.

The present Application has been filed by the Complainants seeking “to

restrain the Respondent No.3 Bank from conducting the auction on 20.06.2024”.

Facts on behalf of the Complainants:
3.

Complainants filed the present complaint seeking reliefs under Section 7

and 8 of the Real Estate (Regulation & Development) Act, 2016 (hereinafter
referred to as the “Act, 2016”) read with Telangana State Real Estate (Regulation
& Development) Rules, 2017 (hereinafter referred to as the “Rules, 2017”) thereof.

4.

During the course of hearing on 12.06.2024 in the main complaint, the

Counsel for Complainants and Counsel for the Respondent Nos.1 & 2 entered
appearance, and the Complainants preferred the above-mentioned Application
seeking the relief therein. The Complainants submitted that Respondent No. 1
has availed a loan of Rs. 112,00,00,000/- (Rupees One Hundred and Twelve
Crores Only) from Allahabad Bank which is now Indian Bank i.e., Respondent
No. 3, vide Term Loan Agreement dated 19.09.2016 ("Principal Loan Amount").
The said loan was availed on security of Equitable Mortgage of the “Mantri – A”
Project property situated at Shaikpet Village and Mandal, Jubilee Hills Area,
Hyderabad. ("Project Property") to the extent of Respondent No.1's share of 50%
undivided interest in the land and 4,19,999 Sq.ft of super-built-up area,
supported by General Power of Attorney ("GPA") given by Respondent No. 2 and
the Joint Development Agreement.

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5.

That the Respondent No. I had defaulted on the Principal Loan Amount

availed from the proposed Respondent No. 3 Bank and pursuant to the same,
Respondent No. 3 Bank is taking steps under the provisions of the Securitization
and Reconstruction of Financial Assets and Enforcement of Security Interest Act,
2002, ("SARFAESI Act").

6.

Meanwhile, it came to the notice of the Complainants that the Respondent

No. 3 Bank has issued an auction sale notice for sale of the mortgaged Project
Property wherein the auction is scheduled to be conducted on 06.05.2024 for
recovery of Rs. 212,11,26,824.28/- (Rupees Two Hundred Twelve Crores Eleven
Lakh Twenty-Six Thousand Eight Hundred Twenty-Four and paisa Twenty-Eight
Only) as on 31.03.2024 with further interest, charges, and expenses due to the
proposed Respondent No. 3 Bank with a reserve price of Rs. 272,50,00,000/(Rupees Two Hundred Seventy-Two Crores Fifty Lakhs Only).

7.

It was submitted that Respondent No.3 Bank is unjustly proceeding to

auction the mortgaged Project Property for amounts higher than the Principal
Loan Amount (plus interest accrued thereon) availed by Respondent No. 1 by
jeopardizing the interests of the allottees (home buyers), and therefore
Complainants preferred I.A. No.15/2024 and after due consideration of the facts
and circumstances, this Authority allowed the said Application and directed the
Respondent No.3 Bank to create a designated bank account for the purpose of
depositing the entire auction proceeds and in the event of conducting auction on
06.05.2024 and declaration of a successful bidder thereof, the Respondent No.3
shall deposit the entire proceeds of the auction in the above-mentioned

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designated bank account and the same shall not be utilized for any purpose until
the final disposal of the present complaint.

8.

However, the Complainants submitted that there was no successful bidder

for the said auction. Subsequent to this, Respondent No.3 Bank issued another
e-auction sale notice for sale of the mortgaged Project Property to be conducted
on 20.06.2024 for recovery of Rs.2,14,66,84,950/- (Rupees Two Hundred and
Fourteen Crores Sixty-Six Lakhs Eighty-Four Thousand Nine Hundred and Fifty
only) as on 30.04.2024 with further interest and charges and expenses due to
Respondent No. 3 Bank. It was also submitted that the E-Auction Sale Notice
dated 30.05.2024 has mentioned flat number allotted to the Petitioner herein i.e.,
Flat No. F701 for the sale auction, thereby jeopardizing the interests of the
Complainants.

9.

It was submitted that Respondent No. 3 Bank has no authority to auction

the flat allotted to the Petitioner herein, while the mortgaged property is only 50%
of the Respondent No. 1's share of total land area by way of equitable mortgage,
and therefore, it was prayed to restrain the Respondent No. 3 Bank from
conducting the auction on 20.06.2024.

10.

This Authority has considered the contentions of Complainants. The

Respondent Nos.1 & 2 on the other hand, submitted orally during the course of
hearing that they have no objection to the application being allowed and that on
technical grounds, they have also issued an e-mail to the Respondent No.3 for
recalling the notice of intended sale dated 30.05.2024 and for not conducting the
auction scheduled on 20.06.2024. A Memo dated 19.06.2024 producing a copy

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of the said e-mail was filed by the Counsel for Respondent Nos.1 & 2. Further,
they mentioned that the Hon’ble High Court in W.P. No.41976/2022, after due
consideration of the facts and circumstances of the case therein, rightly directed
the Respondent No.3 Bank not to conduct auction in the interest of the allottees
till decision is made by this Authority.

11.

Similarly, Respondent No.4 to 14, the allottees of the Project – Mantri A,

impleaded in the present matter vide Order dated 12.06.2024 in I.A. No.16/2024,
submitted that they have no objection to the present Application being allowed.

12.

The Complainants filed a Proof of Service and the notice for hearing on the

present application was duly served on the Respondent No.3, however, they were
absent for the hearing. In view of the urgency in the matter that auction is to be
conducted tomorrow i.e., on 20.06.2024, the Respondent No.3 is set ex-parte and
the following directions are being issued.

Interim Directions:
13.

As has been observed in I.A. No.14/2024 and I.A. No.15/2024 in the

present complaint, the Respondent No.3 Bank has indeed had availed loan of an
amount of Rs. 112,00,00,000/- (Rupees One Hundred and Twelve Crores Only)
vide Term Loan Agreement dated 19.09.2016 with the Respondent No.1 to the
extent of his share of 50% undivided interest in the land and 4,19,999 Sq.ft of
super-built-up area, supported by General Power of Attorney ("GPA") given by
Respondent No. 2 and the Joint Development Agreement. The Complainants
submission that the Respondent No.3 Bank is proceeding to auction the
mortgaged Project Property, more specifically the Flat No.F701, the rightful owner

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of which are the Complainants, for amounts higher than the Principal Loan
Amount (plus interest accrued thereon) in view of the subsequent changes to the
Building Permission by increasing number of floors and also increase in the
square feet of area thereby, to the detriment of the allottees (home buyers)
remains un-rebutted. In view of the same, the Authority, is of the opinion that
there is force in the argument of the Complainants and no harm or adverse
interest will be accrued to Respondent No.3 should the reliefs as prayed for be
granted in favour of the Complainants.

14.

Therefore, in the peculiar facts and circumstances of the present case, in

order to protect the interests and rights of the allottees, while exercising its
powers under Section 36 and 37 of the Act, 2016, this Authority directs the
Respondent No.3 not to conduct the auction on 20.06.2024 failing which,
appropriate action under Section 63 will be initiated against the Respondent
No.3.

15.

Accordingly, in view of the above directions, I.A. No.28/2024 is allowed.

Sd/Sri K. Srinivasa Rao,
Hon'ble Member,
TS RERA

Sd/Sri Laxmi Narayana Jannu,
Hon'ble Member,
TS RERA

Sd/Dr. N. Satyanarayana, IAS (Retd.),
Hon'ble Chairperson,
TS RERA

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