Application No. 21 of 2008. Case: Uttam Galva Steels Ltd. Vs Bank of India and Ors.. Mumbai Debt Recovery Tribunals

Judgment:

K.J. Paratwar, Presiding Officer

1. The Intervener seeks to recall the declaration made by this tribunal in judgement Dt. 27.09.2004 while allowing Original Application [O.A.] No. 235 of 01 [High Court suit No. 2169 of 1992] and the Recovery Certificate [R.C.] issued pursuant thereto that the outstandings are secured by valid Equitable Mortgage of land bearing Survey No. 48 Hissa No. 2, Survey No. 45 Hissa No. 3, Survey No. 48 Hissa No. 3, Survey No. 48 Hissa No. IB-1 and Survey No. 45 Hissa No. 4, situated at Village Dahiwali, Taluka Khalapur, District Raigad. Consequent relief of lifting of the attachment of the Flat by the learned Recovery Officer [R.O.] levied in Recovery Proceeding [R.P.] No. 525 of 2004 is also sought. The above mentioned O.A. filed by Respondent No. 1 against Respondent Nos. 2 to 9 was allowed by this Tribunal for Rs. 70,98,211.61 with interest @12% p.a. with quarterly rest. This Tribunal had declared that the aforesaid amount is secured by Equitable Mortgage of the Respondent No. 7's properties in question. The Respondent No. 10 having been arrayed during the pendency of the M.A. is auction purchaser of the properties. The learned R.O. has confirmed the sale in his order in his favour and issued Sale Certificate on 16.04.2008. The said sale held on 01.02.2008 and confirmed as above is now sought to be declared as null and void since it infringes the Applicant's rights as bonafide purchaser for value without notice of the properties.

2. The Applicant's case is that it is bonafide purchaser in possession of the property where its steel plant is running. It has purchased the property from Respondent No. 7 and Chemicals Pvt. Ltd. as vendors and M/s. Papriwal Property Developers as consenting party by two Sale Deeds both Dt. 31.08.1996. It is contended that the entire consideration was paid of the properties which were sold on 'as as where is basis'. The Applicant claims that it has made thorough search of title of the properties before purchasing the same and found that the vendors were the owners. After the purchase, the Applicant availed certain Credit Facilities in August 1998 from consortium of Financial Institutions led by I.C.I.C.I. against security of Equitable Mortgage, by Deposit of Title Deeds of the properties in question. Therefore, the attachment of the property by the learned R.O. is said to be illegal. Since attachment was made pursuant to the declaration given by this Tribunal that there was Equitable Mortgage, relief quashing the declaration is sought.

3. During the pendency of the application, the property has been sold by public auction to Respondent No. 10. An amendment therefore was carried out introducing grounds for setting aside the sale. In the application, it is stated that the Applicant had filed application before the learned R.O. for lifting the attachment...