Application under Section 17 of the SARFAESI Act challenging possession notice issued by Respondent No.1 for schedule property where civil court had previously cancelled the relevant sale deed used by secured creditor.
Impugned Possession Notice dt.30.08.2022 declared illegal, invalid, and set aside.
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IN THE DEBTS RECOVERY TRIBUNAL - I AT HYDERABAD DATED THIS THE 4TH DAY OF FEBRUARY, 2C)25
PRESENT: SRI GUMMADI GOPICHAND, PRESIDING OFFICER
SA.No.2 42/2C.22
Sri K.Manohar Reddy, S/o Sri K.Samba Reidy, tq.d75 years, Occ:buiiness, R/o H.No.3-4S-145, Krishnauri Colony, West Marrcdpally, Secunderabad-500026.
... Applicant
Versus
Goregaon (East), Mumbai_+OOOOS. Havlng branch office at Reliance Humsafar Buildins. D.No.8-2- 6tg / 2, 2,d floor,
loadNo.11,Banjara Hills, Hyderabad_S00034.,
Rep. by its Authorized, officer
Regd. Office at kamaia Mills compound, Jr3deWorld, B Wing, 7tr, floor, .S-8. Marg, Lower parel, Mumbai-40000 13.
Branch office at:
D.No.6-3 -344, 3.dfloor, Malik Estates, Opp.JlagamVengal Rao park,---- loadNo.1, Banjara Hills, Hyderabad-SOo 094.
dF,
Counsel for the Applicant : Sri Jakkula Srid.har. Respondents No.3 to 5 : Exparte Respondents No. j,2& 6 : P. Ramachand.ran & Associafes
ORDER
i. This Application is filed u/s.i7of the Securitization and Reconstruction of Financial Assets and Enforcement of security Interest Act, 2oo2 (SARFAESI Act, 2oo2) chalrenging the possession Notice dt.3..og. 2022 issued by the lstRespondent in respect of the schedule property and to declare the same as illegal and arbitrary.
The Applicant is Sale Deed said the in his Io4FrnTrtzs j
Iinancial crunch, he borrowed money of Rs.42,50 ,ooo /- from the Respondent No.6 herein by executing an Agreement of sale cum GpA Doc.No.ro812008 dt.23.01.200g with an understanding that after discharge of the loan, Respondent No.6 will execute Re-conveyance deed. Thereafter Respondent No.6 executed Sale deed dt.o7.og.20og in favour of Respondent No.3 in respect of the said property. But no consideration was paid by the Respondent No.3 in favour of Respondent No.6. Respondent No.3 mortgaged the schedule property in favour of Respondent No.2, originar creditor by way of deposit of titre deeds. Respondent No.4, wife of Respondent No.3 and Respondent No.3 are the directors of the Respondent No.5 company, stood as guarantors to the said loan by mortgaging the schedule property and conveying hypothecation of other immovable and movabre assets.
Respondent No.6 filed o.S.No.5s/2010 on the file of Honble chief .Iudge, city civil court, secunderabad against the Respondent No.3 and Respondent No.2 for cancellation of mortgaged sale document and for consequential direction to Respondent No.2 for return of the title deeds to him and also for possession of the schedule propert5r. subsequently, the Applicantherein was impleaded as Defendant No.3 in the aforesaid suit' The Applicant herein arso filed o.S.No. Lgsl2o13 on the file of Hon'ble chief Judge, city civil court, Secunderabad against the Respondent No.6 and Respondent No.3 for cancellation of sale Agreement cum GpA and also for cancellation of subsequent mortgage. After the full-fledged contest and trial in both the above suits, the Hon'ble civil court had decreed both the suits on29.09.201g by passing decree by cancelling the mortgaged sale deed as prayed for while refusing to cancel the Respondent No.3,s Attorney/agent document and directed the pnoS\S.2, original secured creditor to handover the []rH::ll':r apphcg{q- -iiTlfr";0ril".1t". Respondent No.2 to handover i,'$ ;) -; ir "i(..;H,uu**S#'
possession of the schedure property to Respondent No.6. so, the Applicant preferred cccA No.45g/201g before the Hon,bre High court for the state of Telangana and Andhra Pradesh at Hyderabad against the judgement and decree passed in o.S.No.ssl2010 and obtained stay of all further proceedings and the said appeal is pending. The Applicant preferred another appeal viz. cccA No.90/2019 before the Hon,bre High court against the judgement and decree passed ino.S.No .rgs/2o13 by the Hon'ble XXVII Addl. chief Judge, city civ, court, Sec.bad and the said appeal is also pending. Respondent No.2 herein having appeared in o's'No'55 /2010 before the Hon'bre xxvll Addl. chief Judge, city civil court, Sec.bad, failed to inform the civil court about the assignment of debt to the sister concern company of the Respondent No.2 i.e. Respondent No. r, Asset Reconstruction company under Deed of Assignment dt.So. 12.2016 in respect of the 10an availed by the Respondent No.3 herein. The l"t Respondent issued the impugned Possession Notice dt.30.0g.2022 in respect of the schedule property but the said possession notice was not served on the Appricant who is in possession of the schedule property. Hence the SA.
J. Respondents No.3 to s remained exparte whereas Respondents No.1,2&6 did not file any reply.
Point JVo.(if :
5' Along with the sA, the Applicant has filed certain documents for establishing his claim over the schedure propert5r. As per the said documents, it is clear that the Applicant herein filed oS.No. lgsl2o13 on the file of XXVII Addr. chief Judge, city civil court, Secunderabad against the Respondent No.3 and Respondent No.6 herein for cancellationof Agreement of Sale cum GpA dt.23.01.200g and consequently for cancelration of Sare Deed doc.No. 11561200g dt'07'08' 2OO8 executed by Respondent No.6 herein in favour of Respondent No.3. As per the juclgcment dt.29.09.201g passed in the said suit' it is clear that the said suit was partly decreed cancelling the Regd' sale Deed bearing Doc.No. t156l2oo8 dt.07.0g.200g registered in favour of Respondent No.3 herein. It is also clear that Respondent No.6 filed oS'No'SS r2oro on the file of xxvil Addr. chief Judge, city civir court, Secunderabad against Respondent No.2 to 3 and the Applicant herein for cancellation of Regd. sale Deed No. No.1156/2008 dt'07.08.2oog registered before the sub_Registrar, Bowenpaly, secunderabad and for directing the defendants to deliver the physical and vacantpossession of the schedule property and direct the Defendant No'2 to handover the original sale deed No. 1 1 s6 r2oog dt'07'08'2oo8,Agreement of Sale cum GpA dt.23.0 r.2oog, Link Sale deed dt'31.03.1999 and Sanction plandt.0g.05.1ggg to the plaintiff. As per the judgement dt'29'og.2ot8 in thesaid suit, it is clear that the said suit was decreed cancelling the registered Sare deed No. 1 1 s6 /2oog dt'07'08.2008 and directing the defendants No.1 to 3 to deliver the phv"it"l$rys]f the suit schedule property to the plaintiff within tnrrg@ ting theRespondent No.2 and Respondent No.3 ' ir - -c -l-;1- :'.'J';iJdll ;;';;.:";;;,* .i: 1 ..i ^i/l . ta ,..'..;-.*B;;q.i/ 5
passed by the city civil court, secunderabad in oS.Nos.Ss/2o10 and 18512o13, it is very clear that the Sale Deed obtained by Respondent No'3 herein which is allegedly deposited with Respondents No.1&2 was cancelled by the competent civil court and moreover a direction is also given to the Respondent No.3 to handover all the documents deposited by Respondent No.3 herein to the ptaintiff i.e. Respondent No.6 herein. So in view of the decision given by the competent civil court in the said suits' the Respondents No.1&2 are not entitled to initiate any proceedings against the schedule property since the very impugned Sale Deed dt'07'08'2008 is cancelled by the civil court. No material is placed by the Respondents No.1&2 that they preferred any appeal before the Hon'ble High Court challenging the said judgments.
6' so considering all the circumstances, I hord that the Applicant has established that the impugned Possession Notice dt.30.0g.2o22issued by the Respondent No' 1 in respect of the schedule property is not legal and valid' Accordingly, this point is answered in favour of the Applicant and against the Respondents No.1&2. Point No.(ii):-
1 1'communicate a copy of this order to the parties concerned.
(Dictated to the ,.,)., .oon"^"!bed. bg her,^c_onected., signed. and. pronounced bg r me in the open court on this the 4thdag of February, 2O2S). 'ffi\ sd/-
; o4FEBzm *ii
UE COPY 1,
9--44.:
3 issues framed by the court
Whether Applicant has established valid ground to challenge the possession notice as illegal and arbitrary under Section 17 of the SARFAESI Act.
Whether the impugned possession notice issued by Respondent No.1 is legal and valid given the civil court decrees cancelling the sale deed.
Whether the sale deed relied upon for issuing the possession notice remains valid after being cancelled by a competent civil court.
1 provisions across 1 enactments
K. Manohar Reddy
Reliance Asset Reconstruction Company Ltd.
Reliance Capital Ltd.
Sudhakar Potluri
Uma Sudhakar
Recon Industries p.Ltd.
Gummadigopichand
As recorded by the court registry
2 orders share this CNR
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