Borrower can stall auction proceedings under the SARFAESI Act and restrain the secured creditor/bank from selling the property only if he deposits the entire dues

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The Supreme Court in Bank of Baroda VERSUS M/s Karwa Trading Company & Anr CIVIL APPEAL NO.363 OF 2022 held that the DRT was not justified in directing to release the mortgaged property and handover the possession along with the original title deeds to the borrower on payment of only the base price/ reserve price. Unless and until the borrower was ready to deposit/pay the entire amount payable together with all costs and expenses with the secured creditor, the borrower cannot be discharged from the entire liability outstanding. Therefore, no order could have been passed either by the DRT and/or by the High Court to discharge the borrower from the entire liability outstanding and to discharge the mortgaged property and handover the possession along with original title deeds to the borrower.

The judgement can be downloaded below