Dismissed

Umamaheswari a M H v. Union Bank of India

DRAT20 Mar 2025REGULAR APPEAL/47/2023

Case brief

AI extract

What is this about?

The Debt Recovery Appellate Tribunal affirmed the lower court's dismissal of an appeal filed by a mortgagee against a bank's enforcement action. The Tribunal found the mortgaged and sold properties were distinct, rejecting arguments of mortgagee's right in the property. The relief claimed by the appellant was denied as the errors in the mortgage deed description did not establish title over the pr

What did the court decide?

The appeal was dismissed with costs awarded to respondents 1 and 2.

Umamaheswari a M H versus Union Bank of India — Property and Title | DRAT (2025)

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IN THE DEBT RECOVERY APPELLATE TRIBUNAL AT CHENNAI

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Dated the 20^th day of March, 2025

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PRESENT: HON’BLE MR. JUSTICE G. CHANDRASEKHARAN

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CHAIRPERSON

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RA (SA) 47/2023

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(Arising out of TSA 66/2023 on the file of DRT - III, Chennai)

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Between

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Mrs. A.M.H. Umamaheswari, W/o. A.M.O. Harihareswara Rao, Plot No.26, 1^st Floor, Classic Enclave 1^st Street, Injambakkam, ECR, Chennai 600 115 …..Appellant

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And

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1. The Chief Manager, Union Bank of India, (Erstwhile Andhra Bank), Mogappair Branch, 12C, E.B. Office Road Mogappair East, Chennai - 600037

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2. The Chief Manager, Union Bank of India (Erstwhile Andhra Bank), Regional Office, Chennai North, 2^nd Floor, 139, Broadway, Chennai - 600 108.

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3. Mr. B.S. Rao,

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No.99, 3^rd Cross Street, Gill Nagar, Choolaimedu, Chennai - 600 094.

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4. M/s. Akshayam Abodes

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Rep. by its Proprietor. V.P. Sathish Kumar, Ground Floor, Plot 19-B, First Main Road, Vijaya Nagar, Velachery, Chennai 600 042.

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5. Mr. K. Balaji,

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No.63, Kandigai Street, T.V.S. Nagar, Korattur North, Chennai 600 076.

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6. M/s. Teak N Oak Rep. by its Managing Partner K.Balaji, 2134, L Block, 12^th Main Road, Anna Nagar West, Chennai - 600040. …..Respondents

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Counsel for Appellant : Mr. R.Desamani Counsel for R1 & R2 : Mr. S.Parthasarathy Counsel for R4 : Mr.R.Subabi

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R3, R5 & R6 were called absent and set ex-parte on 14.03.2024.

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ORDER

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This appeal is filed under Sec.18 of the SARFAESI Act, to set aside the final order passed in TSA 66/2023 on 22.06.2023 by the Ld. Presiding Officer, DRT – III, Chennai.

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Appellant filed SA 308/2021 which was later re-numbered as TSA 66/2023 seeking relief for declaring that mortgage dated 22.02.2016, registered as Document No. 2040/2016 in favour of the appellant over the schedule mentioned property, has priority over the mortgage dated 27.10.2017 registered as Document No. 11089/2017 created in favour of the 1^st respondent bank and for other reliefs. After contest this TSA 66/2023 was dismissed mainly on the ground that the property mortgaged in favour of the appellant is different from the property mortgaged by the borrower namely, the 5^th respondent in favour of the bank. Challenging the order of dismissal, this appeal is filed.

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Ld. counsel for appellant submitted that the 3^rd respondent is the owner of the land. 4^th respondent is the promoter. 3^rd respondent had executed a General Power of Attorney dated 06.06.2012 in favour of 4^th respondent to

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deal with his property with the power of mortgage and sale. In terms of this Power of Attorney Deed, 4^th respondent executed a simple mortgage deed in favour of the appellant on 22.06.2016, in respect of Flat No. F-1 at Second Floor having a built-up area of 900 Sq.ft with 328 Sq.ft, of Undivided Share of Land in a total of 3,374 Sq.ft of land comprised in Plot No.14 and Plot No.14 situated at Ponnu Green Farms in No.43 Padur Village, Chinglepet Taluk, Kancheepuram District comprised in S.Nos.528/1-B part, 528/2-A part, 528/3 part, New S.No.528/1A1 part & 528/3A part of Padur Village situated within the Registration District of Chinglepet and Sub-Registration District of Thiruporur.

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It appears that respondents 3 and 4 had sold the same property to the 5^th respondent through a Sale Deed dated 03.10.2017. There was also a construction agreement entered into between the respondents 4 and 5 on 04.10.2017. This property was subsequently mortgaged by the 5th respondent by execution of Memorandum of Deposit of Title Deeds dated 27.10.2017 with the 1^st respondent bank. The bank proceeded under SARFAESI Act against the 5^th respondent on his default in payment of the loan. In the said circumstances, appellant filed TSA 66/2023. Without considering the simple mortgage deed in favour of the appellant, which is valid and enforceable in law, the Ld. Presiding Officer, dismissed the TSA 66/2023.

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In reply to this submission, Ld. counsel for the 1^st & 2^nd respondent submitted that as rightly found by the Ld. Presiding Officer, DRT – III, Chennai, the property concerned in the simple mortgage deed in favour of the appellant and the sale deed, construction agreement executed among respondents 3 to 5 and the mortgage deed executed by the 5^th respondent in favour of the bank, are totally different properties. In fact, it is the submission of Ld. counsel that there is no express power given to the power agent for mortgaging the property and therefore, the mortgage created in favour of the appellant is

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illegal. He supported the order of the Ld. Presiding Officer and prays for confirmation of the order and for dismissal of this appeal.

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R3, R5 and R6 were already set ex-parte on 14.03.2024.

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Ld. counsel for R4 submitted that 4^th respondent is the developer of the flat. The property mortgaged to the appellant was again sold to the 5^th respondent. The mistaken reference in the mortgage deed in favour of the appellant that Flat No.F-1 is situated in second floor is by oversight and pure mistake. In fact the property mortgaged to the appellant is in first floor.

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Considered the rival submissions and perused the records.

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As mentioned earlier, the Ld. Presiding Officer, DRT – III, Chennai, dismissed the TSA primarily on the ground that the property mortgaged in favour of the appellant and property sold in favour of the 5^th respondent are two different properties. When the matter was previously heard, Ld. counsel for the appellant and Ld. counsel for 4^th respondent made submissions that the property mortgaged in favour of the appellant i.e., Flat No. F1 is situated in first floor, but it was wrongly mentioned in the mortgage deed as second floor. Therefore, this Tribunal appointed an Advocate Commissioner to make a physical inspection of the property and file a report. Accordingly, report is also filed. Before dealing with the Commissioner's report, it is relevant to find out what was the property mortgaged to the appellant and what was the property sold to the 5^th respondent.

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The description of property in the mortgage deed in favour of the appellant dated 22.02.2016 reads as follows: “ Flat No. F-1 at Second Floor having a builtup area of 900 Sq.ft with 328 Sq.ft, of Undivided Share of Land in a total of 3,374 Sq.ft of land comprised in Plot No.13 and Plot No.14 situated at Ponnu Green Farms in No.43 Padur Village, Chinglepet Taluk, Kancheepuram District comprised in S.Nos.528/1-B part, 528/2-A part, 528/3 part, New S.No.528/1A1

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part & 528/3A part of Padur Village situated within the Registration District of Chinglepet and Sub-Registration District of Thiruporur.” The property sold in favour of the 5^th respondent through Sale Deed dated 03.10.2017 reads as follows in Schedule C property: “An undivided share of land, interest being 310 Sq.ft, out of 1996 Sq.ft, of the Schedule B property.” There is also a construction agreement executed between respondents 4 and 5 on 04.10.2017 wherein the description of the property is given as follows: “Flat No.F-1, in First Floor, Plot No. 13 and Plot No.14 comprised in S.No.528/1B (Part), S.No.528/2A (Part) & S.No.528/3A (Part), situated at No.43, Padur Village, Kancheepuram District. With a built-up area of 940 Sq.ft, inclusive of common area, and 310 Sq.ft. Undivided share out of 3374 Sq.ft.”

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It is pertinent to point out here that in the mortgage deed in favour of the appellant, the property was described as Flat No. F-1 at second floor having a built up area of 900 sq.ft with 328 sq.ft of undivided share of land in total of 3,374 sq.ft of land comprised in Plot No.13 and Plot No.14 situated at Ponnu Green Farms in No.43 Padur Village, Chinglepet Taluk, Kancheepuram District comprised in S.Nos.528/1-B part, 528/2-A part, 528/3 part, New S.No.528/1A1 part & 528/3A part of Padur Village. In the Sale deed in favour of the 5^th respondent, Survey Nos.528/1-B(part), 528/2-A(part), 528/3(part), New S.No.528/1A1(part) & 528/3A(part) in Plot No.13 and 14, an extent of undivided share of the land, interest being 310 Sq.ft, out of 1996 Sq.ft, of the Schedule B property, was sold as Schedule C Property. This Sale deed was executed by respondents 3 and 4. The construction agreement dated 04.10.2017, executed by 4^th respondent in favour of the 5^th respondent, shows that the following property had to be constructed: Flat No.F-1, in First Floor, Plot No. 13 and Plot No.14 comprised in S.No.528/1B (Part), S.No.528/2A (Part) & S.No.528/3A (Part), situated at No.43, Padur Village, Kancheepuram District, with a built-up area of 940 Sq.ft, inclusive of common area, and 310 Sq.ft. Undivided share out of 3374 Sq.ft.

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Thus, it is clear from the recitals and submissions of the counsel appearing for the parties that the appellant and 5^th respondent claims the title in respect of Flat No. F1. In the mortgage deed in favour of the appellant, Flat No.F1 is said to be situated at second floor. The Advocate Commissioner report shows that Flat No F1 is situated in first floor. When it is specifically stated in the mortgage deed in favour of the appellant that Flat No F1 is situated in second floor, it is not known how the appellant claims the right of mortgage in respect of Flat No F1 in first floor. It is now informed by the Ld. counsel for 4^th respondent that the reference as second floor in the mortgage deed was by mistake. If really that was a mistake, why no steps had been taken for correcting the mistake by executing a rectification deed? No answer from both the appellant and the 4^th respondent. Ld. counsel for 4^th respondent was bold enough to make a submission that after executing a Registered Mortgage in favour of the appellant, the same property was sold to the 5^th respondent without any indication of subsistence of a mortgage in favour of the appellant. This is nothing but cheating and fraud, inviting criminal action. However, it is open to the 5^th respondent and the bank to decide on initiating criminal action.

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From the records made available and the submissions of the counsel appearing for the parties, it is made absolutely clear that the property mortgaged to the appellant, sold to the 5^th respondent, which was mortgaged by 5^th respondent in favour of the 1^st respondent, are totally different properties. Therefore this Tribunal finds that the Ld. Presiding Officer, DRT – III, Chennai rightly denied the relief claimed by the appellant and this finding does not call for any interference of this Tribunal.

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In the result, the order dated 22.06.2023 passed by the Ld. Presiding Officer, DRT – III, Chennai in TSA 66/2023 is hereby confirmed and this Appeal RA (SA) 47/2023 is dismissed with costs of the respondents 1 and 2. Pending IAs, if any, stand closed.

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[Dictated to Steno (DD), transcribed by her, corrected, signed and pronounced by me in open court, this 20^th March, 2025)

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Sd/-

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(JUSTICE G. CHANDRASEKHARAN) CHAIRPERSON

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Umamaheswari a M H v. Union Bank of India

Case brief

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Umamaheswari a M H v. Union Bank of India

Case brief

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