G.SHANTHI Vs. DEEPAK CHAUDHARI & ORS.

JUDGEMENT

(1.) This Regular First Appeal is filed under Section 96 of the Code of Civil Procedure, 1908 (CPC) is filed by the defendant no.3 in the suit impugning the judgment of the trial court dated 11.12.2017 by which the trial court has decreed the suit filed by the respondent nos. 1 and 2/plaintiffs thereby subrogating the respondent nos. 1 and 2 /plaintiffs in place of the creditor/respondent nos. 3 and 4/defendant nos. 1 and 2/Vijaya Bank, and consequently on account of subrogation the respondent nos. 1 and 2/plaintiffs being given the benefit of stepping into the shoes of the mortgagee of the property mortgaged by the appellant/defendant no.3 with the respondent nos. 3 and 4/defendant nos. 1 and 2/Vijaya Bank. The mortgaged property in dispute is Flat No. 105, D Type , Laasya Block, Poojitha Estates situated as Bahtookhanguda, near ESI Hospital, Hyderabad (hereinafter referred to as 'the Hyderabad property') with respect to which the respondent nos. 1 and 2/plaintiffs have been held to be subrogees in view of Sections 140 and 141 of the Indian Contract Act, 1872 inasmuch as the respondent nos. 1 and 2/plaintiffs have been substituted in place of the mortgagee/Vijaya Bank qua this Hyderabad property (and respondent nos. 1 and 2/plaintiffs are effectively now the mortgagees of this Hyderabad property including the right to possession of the mortgaged property at Hyderabad) on account of respondent nos. 1 and 2/plaintiffs paying the dues of the creditor/Vijaya Bank/mortgagee.

(2.) The facts of the case are that admittedly the respondent no.5/defendant no.4/company was sanctioned financial limits by the respondent nos. 3 and 4/defendant nos. 1 and 2/Vijaya Bank. Respondent no.5/defendant no.4/company was in the business of trading of pesticides and fungicides and for its buniess took a loan of Rs.1crore on 13.10.2007 from the respondent nos. 3 and 4/Vijaya Bank. Loan was taken from the Hyderabad Branch of the Vijaya Bank and which is the respondent no.4/defendant no.2. Appellant/defendant no.3 was one of the guarantors and who had mortgaged the aforesaid Hyderabad property to Vijaya Bank. Vijaya Bank initiated SARFEASI proceedings against the mortgaged property and took over symbolic possession of the Hyderabad property on 25.5.2010 and actual physical possession on 3.7.2010. To complete the narration I must state that Vijaya Bank was also a mortgagee with respect to the same loan account of the respondent no.5/defendant no.4/company with respect to a property at Delhi, and with which property we are not concerned, and which belongs to the respondent nos. 1 and 2/plaintiffs, inasmuch as the respondent nos. 1 and 2/plaintiffs whereby were the mortgagers and as stated below the dues of the Vijaya Bank were cleared by the respondent nos. 1 and 2/plaintiffs whereby the Delhi property no longer stands charged/mortgaged to Vijaya Bank. As regards the Delhi property it may be noted that pursuant to the proceedings initiated by the Vijaya Bank under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act , 2002 (also known as the SARFAESI Act ) legal proceedings took place before the DRT, DRAT and finally before this Court. An agreement was arrived at between the respondent nos. 1 and 2/plaintiffs and the Vijaya Bank whereby the respondent nos. 1 and 2/plaintiffs made a total payment of Rs.127.50 lacs on 19.12.2011 to the Vijaya Bank. This payment was made in terms of the orders dated 21.9.2011 and 16.12.2011 passed by this Court in the proceedings pending in this Court. Once the loan account of the respondent no.5/defendant no.4/company was cleared, and with respect to which mortgagees were created of the Delhi property and the Hyderabad property, the respondent nos. 1 and 2/plaintiffs asked the Vijaya Bank to hand over title deeds of both the properties at Delhi and Hyderabad to the respondent nos. 1 and 2/plaintiffs. Vijaya Bank had no difficulty for giving the title deeds of the Delhi property as also possession thereof to the respondent nos.1 and 2/plaintiffs, however since disputes were raised by the appellant/defendant no.3 with respect to the Hyderabad property of which the appellant/defendant no.3 was the mortgagor, Vijaya Bank hence did not return the title deeds of the Hyderabad property to the respondent nos.1 and 2/plaintiffs and Vijaya Bank also did not hand over possession of the same to the respondent nos.1 and 2/plaintiffs. Consequently the subject suit was filed by the respondent nos.1 and 2/plaintiffs for declaration, mandatory and perpetual injunction seeking the rights of a subrogee in terms of Sections 140 and 141 of the Indian Contract Act with respect to the Hyderabad property with further directions being sought for handing over of the title deeds as also possession of the Hyderabad property (which the Vijaya Bank had) to the respondent nos.1 and 2/plaintiffs. It is in these proceedings that the impugned judgment has been passed. I may note that no oral evidence was led in the suit as parties agree that the issues in question in the suit had to be decided as per the admitted facts and documents appearing on record.

(3.) Trial court after pleadings were complete framed the following issues:-