IMPORTANT POINT
The legal point established is that an unregistered Agreement to Sell does not confer any rights or title in a disputed property, and the need for parties to resolve disputes with lenders in cases of rival claims to security interest.

JUDGMENT

Vibhu Bakhru, J. - The petitioners have filed the present petition impugning an order dated 01.02.2023 (hereafter `the impugned order') passed by the learned Debts Recovery Appellate Tribunal, New Delhi (hereafter `the DRAT') dismissing the petitioner's appeal (Appeal No.22/2023 captioned Dalip Kumar Saluja & Anr. v. Piramal Capital and Housing Finance Ltd. & Ors.) against an order of the learned Debts Recovery Tribunal-II, Delhi (hereafter `the DRT') dated 23.01.2023. The learned DRT had rejected the petitioner's application filed under Section 17 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002 (hereafter `the SARFAESI Act') in respect of the steps taken by the respondents in respect of a property described as Plot No. M-61, Ground Floor, Village Basai Darapur, Block-M, Kirti Nagar, New Delhi-110015 (hereafter `the subject property'). It is stated that the said subject property belonged to one Sh. Satinder Singh Nijhawan (hereafter `the Borrower'). He had availed the loan from respondent no.1 against the mortgage of the subject property.

2. It is the petitioner's case that they had acquired the subject property from the Borrower in terms of an Agreement to Sell dated 07.09.2021. In terms of the said Agreement, the entire sale consideration of the property was agreed at Rs.1,00,00,000/-. The petitioners claim that they paid a sum of Rs.90,00,000/- as part consideration and were required to pay the balance. The petitioners also claim that the possession of the subject property was handed over by the Borrower in performance of the said Agreement to Sell.

3. The petitioners claim that at the material time, the Borrower had shown a No Objection Certificate (NOC) purportedly issued by respondent no.1, evidencing that the loan taken from respondent no.1 was repaid and foreclosed. However, subsequently, it transpired that the said NOC was a fabricated document. According to respondent no.1, the Borrower had not discharged the loan.

4. It is respondent no.1's case that the said loan was sanctioned and disbursed to the Borrower, in terms of the Sanction Letter dated 16.03.2018 and therefore, the security interest in respect of the subject property was created prior to the Agreement to Sell entered into by the Borrower with the petitioners.

5. There is some controversy as to whether the loan disbursed to the Borrower was in terms of the Sanction Letter dated 27.07.2018, as now asserted by respondent no.1 or in terms of the Sanction Letter dated 16.03.2018, as claimed before the learned DRT. However, there is no controversy that respondent no.1 had disbursed the loan to the Borrower against the mortgage of the subject property prior to the Agreement to Sell entered between the Borrower and the petitioners.

6. According to respondent no.1, a substantial amount was outstanding and accordingly, respondent no.1 had issued a notice under Section 13(2) of the SARFAESI Act claiming an amount of Rs.1,18,86,903/- as of, 31.03.2023. Since the said loan was not repaid by the Borrowers, respondent no.1 issued a notice under Section 13(4) of the SARFAESI Act claiming possession of the subject property. Aggrieved by the said notice, respondent no.1 also approached the learned Chief Metropolitan Magistrate, District West, Tis Hazari Courts, Delhi for taking steps for taking possession of the subject property. In terms of an order dated 22.12.2022, the learned Chief Metropolitan Magistrate appointed a Receiver to take possession of the subject property. The Receiver issued a notice intending to take possession of the subject property on 02.02.2023 at 12:00 p.m.

7. Aggrieved by the same, the petitioners had approached the learned DRT by filing an application under Section 17 of the SARFAESI Act. The learned DRT dismissed the said application as not maintainable. The learned DRT held that the petitioners had no title or interest in the property as the Agreement to Sell in terms of which the p