Any person aggrieved by an auction conducted by the Recovery Officer can challenge it. Appeal against an auction should be made as per procedure prescribed in Schedule-II of the IT Act it. Following any other methodology may not bear any fruit.

There could be number of grounds for challenging the auction of an asset conducted by the Recovery Officer. The aggrieved person should marshal all the grounds at one time and agitate it before the Recovery Officer himself, failing which he can file an appeal before the Presiding Officer of the DRT. Thereafter it can be taken in appeal to DRAT and so on.

Once an auction is conducted there is a cooling period as well. The auction can be confirmed in favour of the auction purchaser after the cooling period. If an appeal is filed during this period by any person claiming to be aggrieved by the auction, then the auction cannot be confirmed. The time limit available is 30 days. While filing an appeal the appellant should also deposit the price amount with the Recovery Officer. Not complying with these provisions but merely filing an appeal may not be helpful.

In one case the owner of an asset was aggrieved at the sale price of his asset. It was maintained that the market price of the asset was far more higher than at what it was sold. He filed an application before the Recovery Officer for staying the sale. The Recovery Officer rejected the application and the Presiding Officer of the DRT rejected the appeal against the orders of the Recovery Officer.

In the DRAT it was observed that the procedure for challenging the auction process was to deposit the bid amount within the period of 30 days from the date of auction. Thereafter the appeal can be heard. In this case the owner did not deposit the amount at all. The owner did not seek to deposit the amount even at the stage of appeal to DRT or the DRAT. It was clear case of non compliance with the provisions of the 2nd Schedule. Under Rules 60, 61 there is provision to set aside the sale of the immovable properties.

The property owner should be careful and alert to his rights. If he feels aggrieved he must immediately move the appropriate authority as per the procedure prescribed. The Act and Rules have by and large visualized for the redressal of every possible grievance of the parties. For any grievance not covered by the provisions an appropriate application can be moved before the DRT or DRAT.

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