Dismissed

Mani v. Cholamandalam Investment and Finance Company Ltd.

DRT29 Jan 2025SA/446/2024

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal dismissed the applicant's application challenging the validity of an equitable mortgage created by deposit of title deeds and sought to quash the possession notice issued under the SARFAESI Act for the default of the applicant's son's home loan.

What the court decided

AI extract

Mani versus Cholamandalam Investment and Finance Company Ltd. — Banking and Recovery | DRT (2025)

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Fair Order

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IN THE DEBTS RECOVERY TRIBUNAL - 1 AT ERNAKULAM

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DATED THIS 29^th DAY OF JANUARY, 2025

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PRESENT: Su. WILLYAHM, B.Sc., M.L. [DISTRICT JUDGE - Retd] PRESIDING OFFICER

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S.A No. 446 of 2024

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Between

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Mani, S/o. Nani, Chathanarimeethal, Chathanari, Oravil P.O., Kozhikode – 673 614.

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--- Applicant

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And

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Cholamandalam Investment and Finance Company Ltd., 1^st Floor, Dare House, 2, NSC, Bose Road, Chennai-600001

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Rep. by its Authorized Officer.

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Vipin Valiyavayal, S/o. Mani Chathanarimeethal, Oravil P.O., Near Ayyappa Bhajanamadam, Chathanari, Kozhikode – 673 614.

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--- Defendants

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This Securitization Application coming on 24.01.2025 for final hearing before me in the presence of Mr. C.P. Anil Raj, Counsel appearing for the Applicant and Mr. Philip T. Varghese, Advocate appearing for the 1^st defendant and 2^nd defendant having been set exparte and upon hearing arguments of learned Counsels for both the parties and upon perusing the material on records, this Tribunal delivered the following:

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SA No.446 of 2024

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O R D E R

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This Securitisation Application was filed on 05.11.2018 seeking to quash Annexure-A2 application and Annexure-A3 Advocate Commissioner notice and declare that the defendants 1 and 2 are not entitled to take physical possession of the secured asset and direct to pay the cost of this proceedings and compensation amount of Rs.10 Lakhs to the applicant.

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The counsel appearing for the applicant submitted that the applicant’s son, who is the 2^nd defendant, had availed a home loan of Rs.25,94,032/- from the 1^st defendant finance company in the year 2020 and that at that time, the applicant had been working abroad and that he was not aware of creation of security interest on his property by the 2^nd defendant until the applicant received AnnexureA1 Possession Notice.

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It is further submitted by the counsel for the applicant that the applicant did not authorize any one to mortgage his property with the 1^st defendant finance company and that applicant did not sign home loan agreement Annexure-A7 and that hence Annexure-A9 notice issued by the Advocate Commissioner pursuant to the order passed by the Chief Judicial Magistrate Court, Kozhikode for taking physical possession of his immovable property is not sustainable.

¶20

Per contra , the counsel appearing for the 1^st defendant Finance Company submitted that the applicant was aware of the order passed by the learned Chief Judicial Magistrate, Kozhikode in CMP No. 551/2024 since he himself produced the copy of the order in W.P. (C) Nos.11018/2024 and 19347/2024 before the Hon'ble High Court of Kerala and that since he failed to challenge the above order within the limitation period, he is not entitled to challenge aforesaid measures now.

¶21

It is further submitted by the counsel for the 1^st defendant Finance Company, the applicant’s son availed housing loan of Rs.25,94,032/- for construction of residential house and that as the security for the credit facility availed, the applicant created equitable mortgage of his immovable property having an extent of 8.09 Ares of land comprised in Re. Sy. No.11/3 of Balussery Village, Quilandy Taluk, Kozhikode District by depositing the title deeds of his property with the 1^st defendant Finance Corporation. The loan was sanctioned on 20.3.2020 when Covid-19 pandemic guidelines had been in force and hence the applicant and the 2^nd defendant appeared before the 1^st defendant wearing security mask and after verification of their identity cards, the loan was disbursed to them on 06.11.2020.

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Page 2 of 6

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SA No.446 of 2024

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It is further submitted that since the applicant and the 2^nd defendant defaulted in repayment of the loan outstanding loan due, the loan account of the applicant came to be classified as Nonperforming Asset and that demand notice dated 27.11.2023 issued to the applicant and the 2^nd defendant was received by them and that they did not send any reply or objection to the demand notice and that thought he applicant has alleged that the 2^nd defendant executed the loan agreement by forging the signature of the applicant , he has not filed any criminal case against the 2^nd defendant and that the above fact exposes the falsity of the allegation raised by the applicant .

¶25

The counsel appearing for the 1^st defendant further submitted that the genuineness and veracity of the relevant pages of the passport Annexure-A8 is suspicious, since it is not a complete document and that both the applicant and the 2^nd defendant colluded together to defraud the 1^st defendant Finance Company and that SA is liable to be dismissed with cost.

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The applicant has admitted the availment of housing loan to the tune of Rs.25,94,032/- by the 2^nd defendant from the 1^st defendant finance corporation. He has also not disputed the contention of the 1^st defendant Finance Company that due to default in repayment of the outstanding loan due, the loan account of the borrowers came to be classified as NPA. The 1^st defendant Finance Company has specifically averred in the written statement that demand notice dated 27.11.2023 was served to the applicant and the 2^nd defendant. But the applicant has neither refuted nor challenged the above averment of the 1^st defendant Finance Company by filing any reply or rejoinder to the written statement.

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The applicant has averred in the SA that the 1^st defendant in collusion with the 2^nd defendant executed the loan agreement by forging the signature of the applicant, when he had been abroad. If it is so, the applicant ought to have lodged a criminal complaint against the 2^nd defendant who is none other than his son. Indisputably, the applicant did not lodge any criminal complaint against the 2^nd defendant for the allegedly forging the signature of the applicant in Annexure-A7 home loan agreement. The above said omission on the part of the applicant strengthens the contention of the 1^st defendant Finance Company that both the applicant and 2^nd defendant colluded together in order to defraud the 1^st defendant by filing this S.A.

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The applicant has produced true copy of the relevant pages of his passport as Annexure-A8 in order to prove his contention that he had been abroad on 20.03.20220 when Annexure-A7 home loan agreement was executed. Pursuant to the direction given to the 1^st defendant Finance Company, the original home loan agreement dated 20.03.2020 has been produced before this Tribunal. When this

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Page 3 of 6

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SA No.446 of 2024

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Tribunal examined the signatures of the 2^nd borrower put in the home loan agreement and the signatures put by the applicant in the S.A, it was noticed that the signatures of the applicant in the SA and the signatures of the 2^nd borrower differ.

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When the applicant challenges that the signatures found in Annexure-A7 home loan agreement is not his signatures, it is his bounden duty to prove the same by producing his admitted signatures of other authenticated documents before this Tribunal so as to enable this Tribunal to compare those signatures with the disputed signatures found in Annexure-A7. Because, the signatures put by the applicant in the SA cannot be accepted as his admitted signatures since there is possibility to put the signatures in a different style by the applicant in order to take up the defence that his signatures in Annexure-A7 is not his signatures.

¶33

On perusal of true copy of Annexure-A8 passport shows that there is entry with seal for departure from India on 20.01.2020 and arrival to India on 08.09.2020. Indisputably the date of execution of Annexure-A7 loan agreement is 20.03.2020. It cannot be disputed that the period mentioned in Annexure-A8 passport is the period during which all international flights to India from foreign countries had been banned on account of Covid-19 pandemic. In the above said circumstances, the contention of the applicant that he had been abroad on 20.03.2020 cannot be accepted as true by relying on the relevant entries seen in Annexure-A8, true copy of passport.

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Since the applicant did not lodge any criminal complaint against his son who is the 2^nd defendant herein, for allegedly forging the signature of the applicant in Annexure-A7 home loan agreement, it should be presumed that the title deed pertaining to the immovable property of the applicant was deposited with the 1^st defendant Finance Com pany as the collateral security for availment of the home loan by the 2^nd defendant. Hence this Tribunal holds that there is a valid creation of security interest over the immovable property of the applicant by deposit of title deed in favour of the 1^st defendant Finance Company.

¶35

The 1^st defendant Finance Company filed application and affidavit under Section 14 of the SARFAESI Act, 2002 before the Chief Judicial Magistrate Court Kozhikode. Order came to be passed appointing Advocate Commissioner to take physical possession of the secured asset. Pursuant to the above order, Advocate Commissioner issued Annexure-A3 notice issued to the applicant and 2^nd defendant informing them that he would take physical possession of the secured asset on 22.03.2024.

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Page 4 of 6

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SA No.446 of 2024

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The applicant has not challenged the order passed by the learned Chief Judicial Magistrate, Kozhikode for taking physical possession of the secured asset. It is also not the contention of the applicant that the statutory requirement contemplated under Clause (i) to (ix) to the provisos of Section 14 (1) of the SARFAESI Act, 2002 was not complied with by the 1^st defendant in respect of filing of the affidavit. The Advocate Commissioner issued Annexure-A3 notice to the applicant and the 2^nd defendant pursuant to the direction given to him by the Chief Judicial Magistrate Court, Kozhikode in CMP No.551/2024. Hence Annexure-A3 notice cannot be challenged in any manner by the applicant.

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This Tribunal is not inclined to accept and believe the contention of the applicant that he had been abroad during the execution of Annexure-A7 home loan agreement and that he had not created security interest over his immovable property for availment of the home loan by the 2^nd defendant and that his signature had been forged by the 2^nd defendant in collusion with the 1^st defendant Finance Company.

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In view of the foregoing reasons and discussions, this Tribunal holds that the applicant is not entitled to get the reliefs sought for in the SA.

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Resultantly, S.A No.446 of 2024 stands dismissed. However, there shall be no order as to costs.

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Dictated to Steno, taken down, transcribed, typed by him, corrected and pronounced by me in the open court on this the 29^th day of January, 2025.

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(Su. WILLYAHM) PRESIDING OFFICER

Mj/

Page 5 of 6

SA No.446 of 2024

List of documents filed by the Applicant along with the S.A.

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Sl. No.	Date	Particulars
1.	02.02.2024	True copy of Sec.13(4) notice issued by the1^st defendant.	Annexure-A1
2.	---	True copy of CMP No.551/2024 filed by the 1^stdefendant before the CJM Court Kozhikode.	Annexure-A2
3.	12.03.2024	True copy of the notice issued by Advocate Commissioner	Annexure-A3
4.	20.03.2024	True copy of the judgment of the Hon'ble High Court of Kerala in W.P. (C) No.11018/2024.	Annexure-A4
5.	22.05.2024	True copy of order of Hon'ble High Court of Kerala in IA No.1/2024 in W.P. (C)No.11018/2024.	Annexure-A5
6.	21.06.2024	True copy of order of Hon'ble High Court of Kerala in W.P. (C) No.19747 of 2024.	Annexure-A6
7.	20.03.2020	True copy of the Home loan agreement	Annexure-A7
8.	---	True copy of the relevant pages of the passport ofthe applicant.	Annexure-A8
9.	04.01.2025	True copy of the notice issued by the Advocate Commissioner	Annexure-A9

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(Su. WILLYAHM) PRESIDING OFFICER

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Mj/

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Page 6 of 6

Mani v. Cholamandalam Investment and Finance Company Ltd.

Case brief

What is this about?

What the court decided

Mani v. Cholamandalam Investment and Finance Company Ltd.

Case brief

What is this about?

What the court decided

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Case details

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