In M/s ASJ Finsolutions Pvt. Ltd. v. Vikram Bajaj, the Supreme Court considered whether a successful bidder in an Insolvency and Bankruptcy Code (IBC) liquidation auction could recover money already deposited after failing to pay the balance sale consideration within the stipulated period.
What the Court decided
The e-auction notice expressly stated that the amount paid by a successful bidder, including the earnest money deposit (EMD), could be forfeited if the remaining sale consideration was not paid according to the auction terms. The Court upheld the forfeiture and declined to order a refund in the circumstances of this case.
Why the auction terms mattered
The decision turned on the terms notified before the auction and the bidder's failure to complete payment within the required time. It does not mean that every missed auction payment automatically results in forfeiture; the applicable notice, regulations and facts must be considered.
Practical point
Participants in liquidation auctions should review the payment schedule, extension provisions and consequences of default before bidding. This update describes a court decision for general awareness and is not advice about any particular auction or dispute.