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Bank can sell vehicle seized due to default through public auction with prior written notice to the debtor

In ICICI BANK vs AMIT KURI, appeal was filed before the Delhi High Court by the Petitioner aggrieved by the order of the Trial Court in simplicitor adjourning the proceedings and not granting permission under Order XXXIX Rule 6 CPC for sale of the vehicle which has been taken into custody by the receiver appointed by the Court.

The Petitioner contended that the respondent defaulted in making the payment of the instalments and accordingly the subject suit for recovery was filed against the respondent and application was moved to the concerned Trial Court for appointment of a receiver to take over possession of the subject vehicle. The possession of the vehicle was taken over on 02.04.2018. Application under Order XXXIX Rule 6 CPC was filed on 14.08.2018 seeking permission to sell the vehicle. The application is stated to be pending and no order on the application has been passed despite passage of substantial period.

Order XXXIX Rule 6 of the Code of Civil Procedure deals with interim sale of movable property and states that the Court may, on the application of any party to a suit, order the sale, by any person named in such order, and in such manner and on such terms as it thinks fit, of any movable property, being the subject-matter of such suit, on attached before judgment in such suit, which is subject to speedy and natural decay, or which for any other just and sufficient cause it may be desirable to have sold at once.

The Petitioner referred to the judgment of the Delhi High Court in M/s. ICICI Bank Ltd vs. Kamal Kumar Garewal, which had laid down the process for interim sale on application under Order XXXIX Rule 6  of the Code of Civil Procedure and also contended that delay in sale of the repossessed vehicle substantially diminishes the realisable market value of the vehicle causing loss to the bank.

The Delhi High Court accepted the argument of the Petitioner and allowed the appeal.

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