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2020 Supreme(Del) 313
IN THE HIGH COURT OF DELHI AT NEW DELHI
PRATHIBA M. SINGH, J.
Madan Lal Chawla & Anr. - Petitioners
Versus
Allahabad Bank & Ors. - Respondents
CM(M) 157 of 2020, CM APPLs. 5131 of 2020 & 8447 of 2020
Decided On : 03-03-2020
For the Petitioner:Mr. A. Maitri, Ms. Radhika and Mr. Sekhar, Advocates
For the Respondent:Mr. Anil Kumar Singh, Advocate for Mr. Sonal Anand and Mr. Aayush Sai, Advocate.
The DRT's decision on objections under the SARFAESI Act is conclusive, and the High Court should refrain from intervening in such matters.
Headnote:
SARFAESI Act - Property Dispute - Section 14
Fact of the Case:
The case involved a property dispute where the borrowers had mortgaged the property with a bank, leading to proceedings before the Debts Recovery Tribunal (DRT). The petitioners, subsequent purchasers of the property, filed objections before the DRT, claiming ownership and seeking to prevent further action under the SARFAESI Act. The DRT dismissed the objections, and the bank sought assistance from the Chief Metropolitan Magistrate (CMM) to take possession of the property.
Finding of the Court:
The CMM permitted the bank to take possession of the property, citing the DRT's decision in favor of the borrowers and the bank. The court observed that the petitioners had no right in law and that the bank was entitled to proceed with the auction of the property. The court also emphasized that any objections to the order could be entertained before the DRT.
Issues: The main issue was whether the CMM had the jurisdiction to direct possession of the property and whether the petitioners had any legal standing in the matter.
Ratio Decidendi: The court held that the DRT's decision dismissing the petitioners' objections was conclusive, and the CMM was merely implementing the DRT's order. The court emphasized that the SARFAESI Act did not permit intervention by the High Court and that any grievances should be addressed before the DRT.
Final Decision: The court disposed of the petition and all pending applications, leaving the petitioners with the option to seek remedies before the DRT or the DRAT under the SARFAESI Act.
JUDGMENT :
Prathiba M. Singh, J.
1. The present petition has been filed challenging the impugned order dated 12th September, 2019 passed by the Chief Metropolitan Magistrate (CMM) giving effect to orders passed by the Debts Recovery Tribunal (DRT) under Section 14 of the SARFAESI Act, 2002 seeking assistance of the Court for taking possession of the secured asset.
2. The brief background is that the property bearing No. 842-843 (Old), New No. 580-581 situated at Chatta Chah Shirin Farashkhana, Shradhananad Market, Delhi was sold to Respondent Nos. 3 and 4 - Mr. Sanjay Kapoor and Mr. Nitin Chawla who are partners in Respondent No. 2 firm - M/s Sai Sales Corporation (hereinafter collectively referred to as „borrowers”). The title of the property was transferred by a registered sale deed dated 21st December, 2012, executed by one Mr. Inder Arora, in favour of Respondent No.3 and 4.
3. Subsequent to the sale, the borrowers had mortgaged the property with M/s. Allahabad Bank. There was a default in the loan and the same resulted in proceedings before the DRT. In the proceedings before the DRT the Petitioners i.e., Mr. Madan Lal Chawla and Ms. Raj Rani Chawla, filed an application on the ground that they are subsequent purchasers of the property from the same seller i.e., Mr. Inder Arora who had sold the property to Respondent Nos. 3 and 4. They thus, sought impleadment and filed objections from the property being proceeded further under the provisions of the SARFAESI Act. The said application/objections filed by the Petitioners herein was decided by the DRT on 17th September, 2018. Vide the said order, the DRT considered the entire matter including the fact that the subsequent sale by a sale deed dated 26th September, 2017 in favour of the Petitioners herein was contrary to law inasmuch as the first sale which had taken place in 2012, had vested the property with the borrowers. The DRT arrived at the conclusion that the Petitioners herein/Objectors therein were not the bona fide owners of the property and that there was no illegality or irregularity in the actions/ measures taken by the bank in respect of the property. The findings of the DRT in the said order dated 17th September, 2018 are as under:
“9. Apparently, the sale deed 21.12.2012 was duly executed by Inder Arora in favour of Sanjay Kapoor & Nitin Chawla with respect to the same property in question for which the applicants are claiming themselves to be owners & in possession by virtue of sale deed dated 26.09.2017. The contention of the applicant is that the possession of the said property was never delivered to Sanjay Kapoor & Nitin Chawla as they filed a civil suit before the Ld. ADJ Central, Tis Hazari, Delhi, hence, Sanjay Kapoor & Nitin Chawla were not entitled having any right and interest in the property in question to mortgage the property in favor of the respondent no.1 bank. Whereas the title documents i.e. sale deed dated 21.12.2012 clearly reflects that vacant & peaceful possession of the said property has been given to vendees by the vendor, who have occupied the same. Merely, filing civil suit does not show that the sale deed dated 21.12.2012 was not executed in favour of Sanjay Kapoor & Nitin Chawla with respect to the property in question. Apparently, the signature therein of Inder Arora are similar in both the sale deeds therefore, it could not be said that earlier sale deed dated 21.12.2012 executed by Inder Kapoor in favour of Sanjay Kapoor & Nitin Chawla was forged and fabricated one.
10. On behalf of the applicant, a copy of FIR no.0220 dated 16.12.2017, has been placed on record, which was lodged by Sanjay Kapoor against Inder Arora and his wife-Kanchan Arora and It is being contended that it was well within the knowledge of Sanjay Kapoor that, property was mortgaged with Punjab National Bank and the dues of the said bank have been paid by the applicant, accordingly, Sanjay Kapoor & Nitin Chawla were not having right and interest in the property in questi
