The rights of a mortgagee are limited to the recovery of the mortgaged amount, and the court may dismiss an application for injunction if the defendants offer to deposit the amount without prejudice to their rights.

I.A.11750/2016 (O 39 R 1 & 2 by plaintiff) & I.A. 12871/2016 (O 7 R 11 by D-6)

1. The case is taken up on the direction of Division Bench in FAO No. 31/2017.

2. Arguments on the application under Order 7 Rule 11 of CPC was heard at length. During the course of the arguments, the Court was of the opinion that since the facts pleaded are not clear enough to disclose when actually the cause of action arose and since the plaintiff had claimed that their knowledge was from the date of the report of Economic Offences Wing (EOW), while the defendants contend that the plaintiff had the knowledge from the earlier dates when the property in dispute as per the report of EOW was demolished in the year 1997 and, therefore, the suit is barred. The defendants have also raised an issue of limitation in their written statement. While disposing of the application under Order 7 Rule 11, the Courts are required to confine its findings only on the averments in the plaint and the contentions raised in the written statements and the documents filed by the defendants cannot be considered. In view of the limited jurisdiction of the Court under this provision of law, the Court is of the opinion that the applications stands disposed of with direction that the issue framed regarding limitation shall be treated as a preliminary issue.

3. Arguments of the parties are also heard on the application under Order 39 Rule 1 & 2.

4. The contentions of the plaintiff is that defendant no. 1 had purchased this property in a court auction and thereafter defendant no. 1 had mortgaged the part of the property to the plaintiff for a sum of Rs. 65 lacs on 19.05.1997 and also handed over the title deeds of the suit property. Mr. R.K. Nanda (Defendant no. 5) also executed a possession letter on 19.05.1997. It is also contended by the plaintiff that Mr. R.K. Nanda and his wife had entered into a shareholder agreement with the set of shareholders to sell their shares to them but a dispute arose between the plaintiff and Mr. R.K. Nanda qua this agreement and the matter went before Company Law Board who gave its finding on 11.03.2014 whereby declaring that the shareholder agreement was valid and thereafter the plaintiff had started to sue the various parties for the wrong doing of Mr. R.K. Nanda, the earlier shareholder of plaintiff company. The plaintiff learnt that the suit property was transferred by Mr. R.K. Nanda through various defendants and finally to defendant no. 6. It is submitted that Mr. Arun Mehra, the Director and shareholder of plaintiff company, learnt that the part of the suit property i.e. top floor and the basement were secured to plaintiff company in the year 1997 at the time when plaintiff company was owned by Mr. R.K. Nanda and others against the mortgage amount and the possession of these floors was also handed over to the plaintiff company. The original sale deed of the suit property was also found in possession of the plaintiff company. It is stated that now he has learnt that the defendants, in connivance with Mr. R.K. Nanda and each other are in the process of demolishing the suit property including the portion of the property secured to the plaintiff. It is prayed that the plaintiff has prima facie case in his favour since the portion of this property is a security against the mortgaged amount, in possession of the plaintiff and that the balance of convenience also lies in his favour and that he shall suffer irreparable loss and injury. It is contended that defendant Nos. 2, 3 and 6 and their employees, representatives, agents, etc be restrained by way of ad-interim injunction from selling, transferring, alienating, altering or parting with possession of property Plot No.11, Ring Road, Lajpat Nagar-IV, New Delhi - 110024 in any manner whatsoever to any person. Learned counsel for the plaintiff has relied during the course of the arguments on Section 68 of the Transfer of Property Act and alleged that the property which was a security is neede