Dismissed

Raju Danial v. The Recovery Officer- 2, Drt Pune and others

DRT20 Apr 2024APPEAL/4/2023

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal at Pune dismissed an appeal filed by a third-party purchaser challenging the attachment of property in a recovery proceeding. The court held the appellant lacked locus standi and that an Agreement to Sale and civil injunction did not create title prejudicing the DRT proceeding, relying on the overriding effect of the Securitisation Act.

What the court decided

AI extract

Raju Danial versus The Recovery Officer- 2, Drt… — Contract and Commercial Disputes | DRT (2024)

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Presented on: 29.04.2023 Registered on: 09.05.2023 Decided on: 20.04.2024 Duration: Y M D

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11 22

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IN THE DEBTS RECOVERY TRIBUNAL AT PUNE (Before Shri Dilip G Murumkar, Presiding Officer)

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APPEAL No.4/2023

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Mr. Raju Danial

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Age – 63 years, Occ: Business Address at – Flat No.318, J-Block, MIDC, Bhosari, Pune – 411 026 and Also at – Flat No.305, Sector No.1 Indrayani Nagar, Maharashtra Colony Bhosari, Pune – 411 026.

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… Appellant

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Versus

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The Recovery Officer -2, Debts Recovery Tribunal, Pune Office No.307 to 310, Third Floor, Kakade Bizz Icon, Opposite to the Fern Hotel, Pune University Road, Shivaji Nagar, Pune – 411 004.

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The Catholic Syrian Bank Ltd., (CSB Bank Ltd.,)

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A Banking Company established & incorporated under Indian Companies Act, having Branch Office at – Sterling Centre Melodina Road, MG Road, Pune – 411 001.

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The Authorised Officer The Catholic Syrian Bank Ltd., (CSB

(Appeal No.4/2023)

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[KAUR]

Bank Ltd.,)

A Banking Company established & incorporated under Indian Companies Act, having Branch Office at – Sterling Centre Melodina Road, MG Road, Pune – 411 001.

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Mr. Subodha Chandra Mishra, Assistant General Manager, CSB Bank Ltd., Zonal Office – Mafatlal House, Ground Floor, Backbay Reclamation, H.T. Parekh Marg, Churchgate, Mumbai – 400 020. (As a Court Commissioner)

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Mr. B. Chandavan Pillai Age – Adult, Occupation – Business R/at – House No.27A, Ward No.3 Pariyaram Mukundapuram Chalakudi, District – Trichur State Kerala – 680 721. (Original Certificate Debtor No.1)

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Mr. Kalluveettil Johnny (K.M. Johny) Age – 78 years, Occupation: Business R/at – 2272, Maruti Complex, Pimpri Colony, Pimpri, Pune – 411 017 Also at – Dwara Suryakant Patekar Flat No.85, Sector No.2 Min I Mart Jawad, Indrayani Nagar Bhosari, Pune – 411 039. (Certificate Debtor No.2)

... Respondents

(Appeal No.4/2023)

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[KAUR]

APPEARANCES For the Appellant For respondent No.2

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Mr. V.B. Shitole - Advocate Mr. Sriniwas Y – Advocate

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JUDGEMENT

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(Delivered on 20^th April, 2024)

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The third party appellant has filed this Appeal challenging the impugned order dated 17^th March, 2023 passed by the Recovery Officer in Recovery Proceeding (RP) No.146/2005 thereby appointing Court Commissioner for physical attachment of mortgaged immovable property i.e. Plot No.J318 admeasuring 1500 sq.mtrs situated at MIDC Industrial area, Bhosari, District Pune (“suit property” for short) of Certificate Debtor No.2, Mr. K.M. Johny and has also challenged charge of Certificate Holder bank, the Catholic Syrian Bank Ltd., on the said disputed mortgaged suit property on the following grounds:-

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(i) The suit property was not mortgaged to loan account pertaining to RP No.146/2005 arising out of Recovery Certificate issued in OA No.55/2005 but it was mortgaged to loan account pertaining to RP No.133/2005.

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(ii) Charge of Certificate Holder on mortgaged suit

(Appeal No.4/2023)

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[KAUR]

property in RP No.133/2005 has been removed as that RP No.133/2005 is fully satisfied and third party appellant herein has paid Rs.42 lakhs on behalf of Certificate Debtors.

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(iii) After the loan account in respect of RP No.133/2005 is closed, the present third party appellant has purchased the suit property for Rs.4,20,00,000/- from Certificate Debtor No.2, Mr. K.M. Johny and Agreement to Sale dated 10^th July, 2020 has been prepared and notarized the same. So also, the Memorandum of Understanding for the same transaction was executed by parties on 20^th May, 2019. Thus, he has right and interest in the suit property.

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(iv) The third party appellant has paid to Certificate Debtor No.2, Mr. K.M. Johny Rs.2,05,55,000/- in advance apart from depositing Rs.42,00,000/- in RP No.133/2005.

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(v) Since Certificate Debtor No.2, Mr. K.M. Johny failed to execute Sale Deed, the third party appellant herein filed Civil Suit No.838/2021 in Pune Court in which he has deposited Rs.1,64,95,000/- as per Order of Civil

(Appeal No.4/2023)

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[KAUR]

Court. The Civil Court has granted temporary injunction against respondents herein.

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(vi) Since suit property was not mortgaged to loan account in respect of RP No.146/2005 arising out of OA No.55/2005, the Certificate Holder has no charge, right or title interest in respect of the suit property.

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(vii) The property of Certificate Debtors situated in Kerala state has been mortgaged to loan account relating to RP No.146/2005. Even then, the Recovery Officer issued Demand Notice and passed impugned order of physical attachment of suit property through Court Commissioner which is illegal.

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Therefore, the third party appellant has claimed the following reliefs:

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(a) That the impugned Order dated 17^th March, 2023 (On the basis of order of Attachment of Immovable Property dated 11^th October, 2019 at Exhibit-31 for physical attachment of immovable property in the name of C.D. No.2) passed by the Recovery Officer for appointment of Court Commissioner may kindly be vacated, quashed and set aside.

(Appeal No.4/2023)

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[KAUR]

(b) That the Hon’ble Court may be pleased to pass the order to vacate charge of The Catholic Syrian Bank Ltd., on the suit property i.e. All the piece and parcel of land situated within Registration District of SubDistrict within the jurisdiction of Pimpri Chinchwad Municipal Corporation, at Village Bhosari – Plot No.J-318, out of MIDC Industrial area admeasuring about 1500 Sq.Mtrs and stay the further proceeding by permanent injunction and operation of impugned order.

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(c) That the Hon’ble Court may be pleased to pass appropriate orders thereby restraining the Certificate Holder herein from taking any action in respect of the suit property till the final disposal of the Appeal.

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(d) That the Hon’ble Court may be pleased to call for record and proceedings of Recovery Proceeding No.146/2005 by passing an order to that effect.

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(e) That the Hon’ble Court may be pleased to pass appropriate orders, for recovery dues from Mr. Chandran Pillai, by selling property in the name

(Appeal No.4/2023)

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[KAUR]

Principal Borrower i.e. Immovable Property bearing No.S.No.528/5 AR 7.41 along with constructed House No.II/27/A at Village-Pariyaram TalukaMukundapuram Sub-District-Chalakudy DistrictThrisuur in Kerala state.

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(f) That the Hon’ble Court may be pleased to pass appropriate orders, in respect of Payment deposited by appellant before the DRT Pune Rs.42 Lakhs in RP No.133/2005 and Rs.1,64,95,000/- before Civil Court in the Civil Suit No.838/2021 and pass appropriate orders to vacate the charge of The Catholic Syrian Bank Ltd. on the suit property.

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The learned Advocate appearing for respondent No.2 The Catholic Syrian Bank Ltd., orally contested the application.

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The following points arise for my determination and I record my findings thereon as under:

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(1) Whether third party appellant has locus standi to file this Appeal?

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(2) Whether third party appellant is entitled for reliefs claimed in the Appeal?

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(3) What order?

(Appeal No.4/2023)

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[KAUR]

Findings:

Point No.1 – In the negative.

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Point No.2 – Does not survive.

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Point No.3 – As per final order

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REASONS

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Heard both the parties. Apart from oral arguments, the learned Advocates appearing for third party appellant and respondent bank have filed Written Notes of Arguments (Exhibit-11) and (Exhibit-12), respectively. They have also relied on the documents produced by them.

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As to Point Nos.1 to 3

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First ground challenging the impugned order of Recovery Officer passed in RP No.146/2005 taken by third party appellant herein is that the suit property i.e. Plot No.J-318 situated at MIDC, Bhosari, Pune was not mortgaged to loan account in respect of RP No.146/20005 arising out of OA No.55/2005. However, on perusal of Judgment passed in OA No.55/2005 and documents produced in RP No.146/2005 it glaringly appears that suit property has been mortgaged for said loan. Therefore, I find that this allegation of third party appellant is meritless.

(Appeal No.4/2023)

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[KAUR]

Second ground of challenging the impugned order of Recovery Officer passed in RP No.146/2005 is that suit property was mortgaged in RP No.133/2005 and appellant has paid Rs.42,00,000/- for and on behalf of Certificate Debtors and closed the same. Thereafter, he purchased the suit property from Certificate Debtors and for that Agreement to Sale was prepared and notarized. So also, Memorandum of Understanding was executed. The Agreement to Sale which is not even registered does not create and pass on right in favour of the third party appellant in respect of the suit property.

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Though third party appellant has filed Suit for Specific Performance in Civil Court, Pune and temporary injunction has been granted by Civil Court in that proceeding, it would not affect recovery proceeding pending in DRT as Securitisation Act and RDB Act have overriding effect over other Acts.

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It is to be noted that during pendency of litigation in DRT the third party appellant purchased the suit property from Certificate Debtors without written consent of Certificate Holder bank or MIDC, original lessor of Certificate Debtor

(Appeal No.4/2023)

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[KAUR]

No.2 Mr. Johny which is not acceptable to law.

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Most pertinent is that the third party appellant was not party to OA No.55/2005 or RP No.146/2005 or concerned in any way to the said proceedings. At present he has no right, title and interest in respect of the suit property. Therefore, he has no locus standi to challenge the impugned order passed by the Recovery Officer in RP No.146/2005, ipso facto he is not entitled for reliefs as claimed in the Appeal. At the most he can participate in auction of the suit property to be conducted in recovery proceeding.

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In view of these observations, I hold that this Appeal is liable for dismissal.

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Therefore, by answering all the points, I pass the following order: ORDER

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A. Appeal No.4/2023 is hereby dismissed with costs. B. All pending Interlocutory Applications shall be treated to be disposed of.

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Pronounced in open Court.

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Sd/(Dilip G. Murumkar) Place : Pune Presiding Officer Date: 20.04.2024 Debts Recovery Tribunal, Pune

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(Appeal No.4/2023)

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[KAUR]

Raju Danial v. The Recovery Officer- 2, Drt Pune and others

Case brief

What is this about?

What the court decided

Raju Danial v. The Recovery Officer- 2, Drt Pune and others

Case brief

What is this about?

What the court decided

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Statutes considered

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