Supreme Court of India · 2024-02-02
THE AUTHORISED OFFICER CENTRAL BANK OF INDIA vs SHANMUGAVELU
- Citation / case number
- SC 2022/6789
- Court
- Supreme Court of India
- Petitioner
- THE AUTHORISED OFFICER CENTRAL BANK OF INDIA
- Respondent
- SHANMUGAVELU
- Author
- B. PARDIWALA
- Bench
- HON'BLE THE CHIEF JUSTICE, HON'BLE MR. JUSTICE J.B. PARDIWALA, HON'BLE MR. JUSTICE MANOJ MISRA
Judgment text excerpt
The Supreme Court addressed the issue of forfeiture of earnest money deposits under the SARFAESI Act, specifically analyzing the applicability of Sections 73 and 74 of the Indian Contract Act, 1872. The Court held that forfeiture can only be to the extent of the actual loss suffered by the secured creditor, thereby establishing that unjust enrichment cannot occur through total forfeiture. The judgment of the Madras High Court was upheld, emphasizing the need for proportionality in forfeiture.