PUNE: The Bombay High Court has overturned the auction held on April 29 for a 4.42-acre plot, part of the Aura City housing project at Shikrapur in Shirur taluka, due to a recovery warrant issued by MahaRERA in 2021.
On July 15, a bench comprising Justice AS Gadkari and Justice Kamal Khata instructed the developer, Bhagvati Infra (formerly M/s Jalan Maple Shelters), to reimburse 13 flat purchasers from 2012, including interest, within a fortnight. According to advocate Vikramsinh Patil, who represented the buyers, the total amount, including interest, stands at Rs 3.15 crore.
The court mandated that once the payment process is initiated, the authorities must clear any encumbrances, reverse the mutation entries, and notify the developer within a week.
The High Court also directed the state to investigate the Shirur tehsildar for “multiple irregularities and collusion” with bidders, which allegedly led to the auction being rigged. The property was auctioned for Rs 5.85 crore, and the government has six months to report any actions taken against the tehsildar.
The court highlighted various alleged irregularities, including failure to adhere to a 30-day notice period for the auction, neglecting to obtain a proper market valuation, and inaccuracies in the property description in the auction notice. It was noted that the bidders failed to provide essential GST documents and balance sheets, indicating that the tehsildar’s actions favored the auction purchaser.
The bench criticized the Pune district collector for responding to court inquiries while traveling, viewing it as a lack of respect for court proceedings. “The collector should not have acted so casually and in an undignified manner,” the High Court stated.
Flat purchasers filed grievances with MahaRERA in 2018, leading to a recovery warrant in 2021, which resulted in the property being attached and an auction pending.
The auction was postponed in 2023 as State Bank of India (SBI), a secured creditor, withheld a No Objection Certificate (NOC) due to ongoing loan recovery proceedings against the developer. The tehsildar incorrectly interpreted a letter from SBI as an NOC, despite having sought proper documentation merely months later, leaving the court unsatisfied with his explanation.
The High Court suggested that the SBI chairperson “consider conducting a thorough investigation” into the prolonged delay in selling the property, which has adversely affected the flat purchasers. The court underscored the continuous interest accumulation favoring the bank, while homebuyers await their dues from 2012.
