JUDGMENT

MANMOHAN, ACJ: (ORAL)

CM APPL. 32561/2024(for exemption)

1. Allowed, subject to all just exceptions.

2. Accordingly, the present application stands disposed of.

W.P.(C) 7860/2024

3. Present writ petition has been filed under Articles 226 and 227 of the Constitution seeking setting aside of the order dated 24th May, 2024 passed by Debt Recovery Appellate Tribunal (‘DRAT’) in Misc. Appeal No. 174/2024 as well as the order dated 17th May, 2024, passed by Debt Recovery Tribunal-II, Delhi (‘DRT’) in S.A. No. 174/2024, whereby both the tribunals vide their respective orders refused to grant stay of the possession notice dated 16th March, 2024 and auction notice dated 23rd April, 2024 issued by Respondent No.1 – SMFG India Home Finance Company Ltd.

4. Learned counsel for the Petitioner states that the Petitioner herein is in possession of property bearing Plot No. 80 and 80A, Khasra No. 60/7, Mohan Garden, Dwarka (‘subject property’), admeasuring 200 sq. yds., for past 12 years. He states that the Petitioner purchased the subject property vide unregistered Agreement to Sell (‘ATS’) and unregistered General Power of Attorney (‘GPA’), both dated 07th July, 2012. He states that the subject property was purchased for a sum of Rs. 10 lakhs and relies upon a cash receipt as the evidence of the payment. He states that in view of the law laid down by the Supreme Court in its decision in Ghanshyam v. Yogendra Rathi1, the Petitioner has a possessory title in the subject property and the same cannot be put to auction.

4.1. He states that the Respondent No. 1 claims that the subject property had been mortgaged by way of deposit of the title documents and has relied upon a registered sale deed dated 28th May, 1984 purported to have been executed in favour of Respondent No.2 - Sh. Satbir Singh and registered sale deed dated 14th September, 2022, executed by Respondent No.2 - Sh. Satbir Singh in favour of Respondent No. 3 – Sh. Vishab Singh Bharti (i.e., the borrower). He states that upon verification of the record maintained by the concerned Sub-Registrar, the Petitioner has learnt that the copy of the sale

1 (2023) 7 SCC 361 deed dated 28th May, 1984 deposited with Respondent No. 1 is fake.

5. Learned counsel for Respondent No.1 states that Respondent No.1 had advanced loans to Respondent No. 3 and the subject property had been mortgaged by Respondent No. 3 with Respondent No. 1 as collateral. He states that the loan account was classified as Non-Performing Assets (‘NPA’) on 05th September, 2023 as Respondent No. 3 defaulted in making payments of the loan.

6. He states that the present petition has become infructuous as the auction stands concluded.

7. He states that the Court of the learned CMM and the Tribunals below have satisfied themselves with respect to the mortgage created in favour of Respondent No. 3. He states that the mortgage had been created on the basis of the registered sale deed dated 14th September, 2022 standing in favour of the Respondent No. 3 (i.e., the borrower). He states that in view of the judgment of the Supreme Court in Shakeel Ahmed v. Syed Akhlaq Hussain2, no right, title or interest vests in the Petitioner in pursuance to an unregistered GPA and ATS.

8. We have heard the learned counsel for the parties and perused the record.

9. The Petitioner before us is neither the borrower nor the guarantor. The Petitioner however, opposes the sale of the subject property on the basis of an unregistered ATS and unregistered GPA purportedly standing in his name. The Petitioner claims to have purchased the subject property for a consideration of Rs. 10 lakhs presumably paid in cash.

2 (2023) SCC OnLine SC 1526 (Paragraph nos. 9 to 14)

10. On the other hand, the Respondent No. 1 has relied upon a registered sale deed dated 14th September, 2022 executed by Respondent No.2 - Sh. Satbir Singh in favour of Respondent No. 3 (i.e., the borrower) as the proof of equitable mortgage created by deposit of title deeds. Respondent No. 1 has also rel