Pune: The Bombay high court has set aside an April 29 auction of a 4.42acre land, a part of Aura City housing project at Shikrapur in Shirur taluka, against a recovery warrant issued in 2021 by the MahaRERA.The bench of Justice AS Gadkari and Justice Kamal Khata on July 15 directed the project developer, Bhagvati Infra (formerly M/s Jalan Maple Shelters), to refund monies paid by 13 flat purchasers in 2012, along with interest, within two weeks. “The amount, with interest so far, works out to Rs3.15 crore,” advocate Vikramsinh Patil, who represented the homebuyers before the MahaRERA, told TOI.Post-intimation of such payment to the purchasers, the authorities concerned “shall remove the encumbrances, reverse the mutation entries and give an intimation to the developer within a week therefrom,” the bench said.The high court (HC) directed the state to take action, including suspension, against Shirur tehsildar for “multiple irregularities and collusion with bidders to rig the auction in favour of the bidder”, who bought the property for Rs5.85 crore. It gave six months to the govt to file an affidavit on action taken against the tehsildar.The alleged irregularities include not adhering to a 30-day window from the date of auction notice (in this case, first on April 7, 2026, for the auction scheduled for April 20, 2026, and second on April 27, 2026, for the auction that was rescheduled and conducted on April 29, 2026) — as mandated by the Maharashtra Land Revenue Code.Besides, failure to obtain valuation report from govt-approved valuer to ascertain the market value, relying on ready reckoner value, refusal to accept demand draft from the developer towards 50% payment of dues prior to the auction; incorrect description of property in the auction notice, non-compliance of bidding terms and conditions by the auction purchaser. The bench noted that the bidders did not furnish the GST documents, an essential requisite, nor did they furnish the balance sheet. “It is thus apparent that the tehsildar conducted the auction on April 29, 2026, only to benefit the auction purchaser,” the HC said.The bench criticised Pune district collector for appearing online while travelling in a car to respond to its queries regarding the tehsildar’s actions. “This clearly shows scant respect towards the court and its proceedings. We do not appreciate the conduct of the collector of Pune on that behalf. The collector ought not have behaved so casually and in such an undignified manner,” the HC.The flat purchasers filed individual pleas before the MahaRERA in 2018. The regulatory authority issued a warrant in 2021, against which the collector attached the subject property and an auction for recovery of dues was pending.The auction had to be postponed in 2023 as State Bank of India (SBI), as a secured creditor, refused to give an NOC, citing loan recovery proceedings against the developer under the SARFAESI Act, 2002. The tehsildar sought to justify his actions by construing an SBI letter of Oct 16, 2025, as an “NOC”. However, he wrote to the SBI on Feb 4, 2026, seeking an NOC. The bench observed that the tehsildar had no satisfactory explanation to this aspect.The HC said the SBI chairperson “may consider conducting an in-depth inquiry and investigation” in the delay of sale of the subject property for over eight years despite having obtained an order from the court in 2019. The cascading effect of such delay had also prejudiced the interest of the flat purchasers, who await the sale of the property and recovery of their money, the court said, citing the (bank’s) tendency to derive benefits as the interest on the principal keeps mounting on a monthly/yearly basis, whereas the homebuyers who have paid money to the developer in 2012 are awaiting the recovery of the monies.
