Dismissed

Nilanchal Kasinath Panigrahy v. Gic Housing Finance Ltd.

DRT4 Aug 2022SA/166/2022

Case brief

AI extract

What is this about?

On appeal, the Tribunal rejected the applicant's claim to be a bonaide purchaser of an encumbered flat under SARFAESI Act and dismissed the application seeking to restrain the secured creditor and revoking a notice to take physical possession.

What did the court decide?

The Special Appeal and Interior Application are dismissed; the notice to take physical possession is upheld.

Nilanchal Kasinath Panigrahy versus Gic Housing Finance Ltd. — Banking and Recovery | DRT (2022)

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Before Arun Kumar Singal, Presiding Officer DRT - III, Vashi, Navi Mumbai.

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I.A. No. 1485 of 2022

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S.A. No. 166 of 2022

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S.A. Instituted on 27.07.2022 I.A. Instituted on 29.07.2022 Decided on 04.08.2022

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Mr. Nilanchal Kashinath Panigrahy & Anrs.

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.A Plieants

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GIC Finance Ltd. Borivali Branch & Ors.

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..Respondents

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Argued By

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Mr. Vijay Dighe, counsel for Applicants.

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Mr. Nikhil Salvi arguing counsel for Mr. Sanjay Anabhawane, for the Respondents.

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ORDER

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This order of mine shall dispose of the I.A. No. 1485 of 2022 as well S.A. No. 166 of 2022 as relief claimed in both applications is the same.

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Through this S.A., the Applicant has alleged that he purchased Flat bearing No. 104 admeasuring area of

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)c; ,A,v, 122.35 Sq. Mtr. Built up under new Survey No. 2 Hissa

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0 \A i,- -2 L' 2 2-- No. 1/3 Achole in the society name as Yashwant Vihar Co-Op Housing Society Limited, Achole New Link Road,

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Nalasopara (E) District-Palghar- 401209 (hereinafter called suit property) from Respondent No. 2 and 3 and he is third party bonafide purchaser and the Applicants are in possession of the suit property since 29.10.2016 as a tenant and subsequent purchase through registered agreement for sale dt. 31.01.2019 registered at Sub-Registrar ffice, Vasai-3 and Applicants paid a total consideiatIon> of Rs.65,85,000/- so, they cannot be dispossessed a and the order of District Magistrate, Palghar d 30.09.2019 appointing Tehsildar, Vasai totake physical possession of the secured asset of the suit property and the impugned notice dt. 15.06.2022 issued and pasted 27.06.2022 at Applicant residents Flat for taking possession be set aside and Respondents as well as Tehsildar, Vasai be restrained from taking any coercive action of taking physical possession of suit property under the provisions of SARFAESI Act.

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The application of the Applicants has been opposed tooth and nail by the Respondent No. 1 and Ld. Counsel for Respondent No. 1 has submitted that the Respondent No. c? 21 1 is taking action as per provisions of SARFAESI Act and measures taken by the Respondent under Sec. 13(4) cannot

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be stayed and accordingly counsel for Respondents has prayed for dismissal of S.A. as well as I.A.

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This Tribunal has given due consideration to the arguments advanced by respective counsel for the parties and has perused the documents brought on record.

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The Applicant has claimed themselvek„ bonafide purchaser for consideration and acCording,to them they are in possession of the suit property since '29.10.2016 by virtue of registered Leave and License Agreement dt. 28.10.2016 and thereafter. they 'purchased this Flat from Respondent No. 2 and 3 who was their family friend and to whom they knew for the last so many years but this plea of the Applicant of the bonafide purchaser is not available to the Applicants.

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Earlier the Applicants had entered in the agreement for sale dt. 17.10.2016 which is duly attested by notary and in that agreement for sale "Annexure B", it is clearly mentioned that the vendor had obtained Housing Loan

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\ 2 3 '2- from GIC Finance Ltd. Borivali Branch by mortgaging the suit property and had agreed to repay Housing Loan to the GIC Finance Ltd. Borivali Branch alongwith all dues

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pertaining to suit property on or before handing over possession to the purchaser but despite knowledge of charge on the flat, the Applicants purchased the suit property vide registered agreement for sale dt. 31.01.2019 Annexure C without obtaining No Dues Ceqificate or written consent from the Respondent No. 1.

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It is a plea of the Respondents that the charge -"0 the Respondent No. 1 is much prior the ,,documents executed in the case of Applicants, qn4 the Applicants • . have purchased the Secured Asset without any due diligence on his part for checking the encumbrances and subject to the charge of the who had valid original deposit of title deeds in respect of the secured asset. Thus, Applicant cannot be held to be bonafide purchaser, even the Applicants could have produced original title deed of Respondent No. 2 and 3 which are still with Respondent No. 1.

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Even otherwise also account of Respondent No. 2 and 3 was declared NPA on 01.06.2017 and thereafter demand crv, t-,a-2-0 2_ 2_ notice under Sec. 13(2) of SARFAESI Act was issued to Respondent No. 2 and 3 by Registered Post A. D. for repaying the outstanding amount of Rs. 58,93,167/- but

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since service could not be effected through Registered Post, the Respondent No. 1 issued notice by way of publication in newspaper namely "Free Press Journal" and "Nayshakti" on 29.03.2018. Thus, loan taken by the Respondent No. 2 and 3 in the year 2015 videLoan Agreement dt. 29.07.2015 and Demand Promissoote dt. 29.07.2015 was turned into the bad 16arl,, and Was declared NPA and demand notice wasissued,milch prior to the purchase of flat by the Applicant which they purchased by registered agreement= for sale dt. 31.01.2019,

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Even, after issuing notice under Sec. 13(2) of the SARFAESI Act, the Respondent No. 2 and 3 were barred from selling the registered suit property by virtue of SubSec. 13 of Sec. 13 of the SARFAESI Act and Sec. 13(13) is reproduced as under :

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"Sec 13(13) in the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002

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L^{v.VV\e'l .} (13) No borrower shall, after receipt of notice referred to in sub-section (2) transfer by way of sale, lease or otherwise (other than in the ordinary course of his business) any of

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his secured assets referred to in the notice, without prior written consent of the secured creditor."

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So, Respondent No. 2 and 3 were not empowered to executed sale deed in favour Applicants, thus, the plea of the bonafide purchaser for consideration i not, ,available to the Applicants. The Respondent No, 1. is akingNac on under the provisions of SARFAESI Act and. the action taken by the Respondent No. 1 cannot be said to beillegal.

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So far as, the plea of the Applicants is concerned that in the notice dt. 15.06.2022 issued byTehsildar and Executive Magistrate, Vasai, it is mentioned that possession be taken through Board Officer, Vasai on 04.08.2022 and that Tehsildar cannot sub-delegate the power to Board Officer is concerned, it is made clear that possession shall be taken by Tehsildar only who has been authorized by District Magistrate in his order dt. 30.09.2019 to take possession of secured asset. So, it is for Tehsildar to ensure that possession shall be obtained by him and not through

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01 -Z3 2Z ) 2 2_ any other subordinate officer. However, he can take the help of any of his subordinates or any other person including Board Officer, Vasai or Mandal Adhikari etc.

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This Tribunal does not find any merits in the contentions of Ld. Counsel for Applicants. No prima facie case is made out in favour of Applicants. Balance of convenience tilts in favour of Respondent No. 1. It is Respondent No. 1 who would suffer an irreparable loss in case tay is granted. The Applicants are not entitled to relief as prayed for and accordingly, S.A. No. 166 of 2022 and I.A.INof 1485 of 2022 are hereby dismissed.

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P.O. DRT- III

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Nilanchal Kasinath Panigrahy v. Gic Housing Finance Ltd.

Case brief

What is this about?

What did the court decide?

Nilanchal Kasinath Panigrahy v. Gic Housing Finance Ltd.

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

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