there is no court order restraining bank from auctioning property mortgaged by company A

2) charge has been created by company A without obtaining consent of bank

3) there must be clause in loan agreement between bank and A that no charge would be created without bank consent

4) bank ought to have moved court and obtain orders that charge created by A fraudelently is void and that bank be permitted to auction the property for recovery of its dues

5) although property has been auctioned by bank and you are successful bidder title is not clear and marketable

6) raise the issue with bank

1. The property has clearly been mortgaged with the Bank and there will not be any encumbrance on it,

2. Bank is entitled to initiate SARFAESI Proceeding and Civil Court has no jurisdiction to interfere in to the matter which is to be dealt with by DRT,

3. After the property has been mortgaged, any dealing with the said property by the mortgagor is illegal hence invalid,

4. The sale certificate issued can be registered by the mortgagee Bank to the buyer.

The advocate of bank from where the company C is trying to obtain loan on the property acquired through auction, has rightly opined about the encumbrance on the property created by company B in its capacity which was due to the company A's fraudulent activity of suppressing the information about its original mortgage with bank while entering into a deal with company B.

Now the question is who will answer Company B for its demands over the company A's assets under charge now.

Did the company C take physical possession of property?

If not then how did it apply for loan, just based on the papers?

In any case the company C has to submit clearance certificate in this regard to avail loan.

Company C ought to have conducted due diligence before bidding. The remedy for company C and bank is to file a suit against Company A and Company B for declaration of the court order of injunction as null and void on the ground that it was obtained by concealment of facts. Alternatively, the company C may file a suit against the bank for recovery of the bidding amount on the ground that the property was auctioned by the bank in spite of the court order.

"One ounce of practice is worth a thousand pounds of theory" Here is a quote, albeit not a legal one, but you can supplant and weave it into the draft of your case.

Its not enforceable.