Summary
The Court restored the tribunal’s order upholding a secured-asset auction. Through repeated restructuring requests, assurances and benefits obtained from deferred enforcement, the borrower had waived and was estopped from invoking the alleged failure to answer its representation. This was based on deliberate conduct, rather than mere inaction. The valuation separately covered machinery, and the successful bid exceeded fair market value. The Court left open both the alleged statutory breach and the continuing-cause-of-action limitation question.
Issues
- Whether the borrower’s conduct barred its challenge based on an alleged failure to respond to its representation.
- Whether the valuation and composite sale of land, building and machinery justified setting aside the auction.
Provisions considered
- Section 13(3A), Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002The borrower’s conduct established waiver and estoppel against challenging the alleged violation; whether a violation occurred was not decided. (¶¶ 12, 13, 14, 18)
Held
- Waiver requires intentional relinquishment of a known right and is not inferred merely from failure to act. The borrower repeatedly sought restructuring, induced deferment and received opportunities while failing to fulfil its assurances. Once third-party interests arose, that deliberate conduct barred its challenge based on the alleged failure to respond. (¶¶ 14, 18)
- A statutory protection conferred solely for a person’s private benefit may be waived. This does not extend to a waiver prohibited by statute, contrary to public policy or affecting another person’s rights. Waiver and estoppel depend on the facts and apply in tribunal proceedings as well as equitable writ proceedings. (¶¶ 13, 15, 16)
- The Court did not decide whether Section 13(3A) had been violated, or whether an application against later enforcement measures could also challenge earlier steps outside the forty-five-day period on a continuing-cause-of-action theory. (¶¶ 12, 18)
- The valuation separately identified the land, building and fifty-five machinery items. Separate auction of the machinery was not required on these facts, and prejudice was not shown. Earlier auctions failed; the eventual bid exceeded both the reduced reserve and the report’s fair market valuation. These grounds did not invalidate the sale. (¶¶ 19, 20)
Result
Appeals allowed. The High Court judgment was set aside, the writ petition treated as dismissed, and the tribunal’s order upholding the enforcement procedure and sale restored; no costs.