In the High Court of Bombay at Aurangabad
T.V. NALAWADE, J.
The Bank of Rajasthan Limited
Versus
Dr. Suryakant Sukhdeo Gite & Others
Civil Revision Application No. 146 of 2011
Decided on : 05-05-2014
1. Admit. Notice after admission made returnable forthwith by consent. Heard both the sides for final disposal.
2. The proceeding is filed to challenge the order made by 5th Jt. Civil Judge, Junior Division, Aurangabad on Exh. 41 filed in R.C.S. No. 432/2007. The revision applicant/Bank of Rajasthan had filed application at Exh. 41 as defendant under the provisions of Order 7, Rule 11 (d) of C.P.C. and had requested to reject the plaint. It is the case of Bank that there is bar of provision of section 34 of Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as 'SARFAESI Act' for short). The application was opposed by the other side/plaintiffs.
3. It is the case of bank that it had advanced loan of Rs. five lakh to respondent No. 3 -Vinod Punjabi for purchasing flat No. A-3 from the developer, respondent No. 2. It is contended that on 29.4.2002 there was the agreement of sale between respondent No. 2 and respondent No. 3 and after sanction of loan by the Bank, the property was sold by respondent No. 2 to respondent No. 3 in the year 2002 itself. It is contended that the Bank had given the loan, sanctioned by way of cheque, directly to respondent No. 2 and so, he had the knowledge that bank was involved and the flat was mortgaged with the Bank by the respondent No. 3. It is contended that behind the back of bank, the builder, respondent No. 2 sold the flat to plaintiff under sale deed dated 5.4.2004. It is contended that as the flat was already sold to respondent No. 3 by builder, it was not possible for the builder to sell the same flat to respondent No. 1. It is contended that notice under section 13 (2) of the SARFAESI Act was issued by the Bank on 14.7.2004.
4. It is contended that when the borrower became defaulter and they visited the flat and then they realized that the same flat was sold to present by the builder, developer. It is contended that as notice was issued under section 13 (2) of SARFAESI Act on 14.7.2004, there was no possibility of selling the flat even by the borrower to the respondent No.1 after that day. It is contended that on 28.2.2005 by joining hands, the builder and borrower made correction deed. It is contended that as prior to date of correction deed, the notice was issued under the SARFAESI Act and as the said correction is not binding on the Bank, in view of the transaction already made with the Bank, the respondent No. 1 cannot get any right under the sale deed executed in his favour. The Bank contended that in view of the provisions of the Act and particularly section 34, Civil Court's jurisdiction is barred. The application is rejected by the Trial Court by holding that respondent No. 1 is not the borrower of the bank and in view of nature of relief claimed by the plaintiffs, the suit is tenable in Civil Court.
5. The submissions made and the record show that Flat No. A-3 was sold to borrower, respondent No. 3 by respondent No. 2, builder in the year 2002 and it was within the knowledge of the builder that this flat was mortgaged with the bank as the bank had directly made the payment to the builder. In view of the facts and circumstances, it can be said that it was not possible for the builder to sell the same flat to respondent No. 1. After selling the same flat to respondent No. 1, the correction document was made by builder and the borrower. These transactions cannot bind the Bank. In any case, when notice under section 13 (2) was issued by the Bank, no such step could have been taken in respect of flat No. 3A by the borrower. The purchaser can stand in the shoes of borrower only.
6. In the case reported as 2011 (2) Mh.L.J. 342 [State Bank of India Vs. Jigishaben B. Sanghavi and Ors.], this Court has discussed the provision of section 34 of the SARFAESI Act. It is observed that expression 'any person' used in section 17 includes not only the borrower, but any person who is aggrieved by the measure taken
Login now and unlock free premium legal research
Login to SupremeToday AI and access free legal analysis, AI highlights, and smart tools.
Login
now!
India’s Legal research and Law Firm App, Download now!
Copyright © 2023 Vikas Info Solution Pvt Ltd. All Rights Reserved.