T.G.SARAVANAN Vs. DEBT RECOVERY APPELLATE

JUDGEMENT

(1.) W .P.No.28154 of 2007 is filed by the State Bank of India against the order in M.A.No.162 of 2006 dated 08.06.2007 passed by the Debts Recovery Appellate Tribunal. The purchaser of the property has also filed W.P.No.21539 of 2007 with similar prayer. Since the facts stated in the writ petition filed by the Bank viz., in W.P.28154/2007 gives full picture about the case facts in W.P.21539/2007, it is suffice to refer the parties as stated in the writ petition filed by the Bank.

(2.) IT is seen from the averments therein that the 7th respondent herein/a private limited company availed financial facility from the petitioner-Bank as early as in the year 1989. The property situated in No.68, Bunder Street, comprised in Survey No.11151,GT, Chennai belonging to the sixth respondent was given as a collateral security by creating equitable mortgage. Under the sale deed dated 04.03.1985, the sixth respondent had purchased this property from the 5th respondent-Gopal Naidu. On account of the default committed by the 7th respondent, a suit was filed by the Bank in C.S.No.1494 of 1992 before this Court for recovery of the defaulted amount with interest and subsequently, it was transferred to the second respondent and was numbered as T.A.No.166/1997. The claim by the Bank was allowed on 30.06.1999 and recovery certificate was issued by the third respondent-Recovery Officer. Since the Recovery certificate was not satisfied, the property was brought for the sale by the 3rd respondent on 12.06.2000, 28.01.2005 and 18.02.2004. On three occasions, for want of bidder, the auction was not successful. In the mean time, the petitioner-Bank came to know i.e., in July 2005, that i) the fourth respondent/Parthasarathi Naidu and Co., filed a suit in C.S.No.344 of 1998 before this Court, for recovery of money of a sum of Rs.3,68,480.00 payable by Gopal Naidu, the 6th respondent herein; ii) it is a matter of record that pending suit there was an order of attachment made on 03.05.1988 in Application No.1534 of 1988, attaching 2nd, 3rd and 4th floors of the building iii) subsequently, the case was transferred to the City Civil Court, Chennai and taken on file as O.S.4632/96 and there was exparte decree on 18.12.1996. Thus, in respect of the decree obtained in the said suit, E.P.,proceedings were taken by the 4th respondent to bring the property for sale. Taking note of this, the Bank/the petitioner herein, filed an application in E.A.Nos.3813 and 3814 of 2005 for staying the auction and releasing the property from attachment. The petitioner pointed out that the sale of the property by the said Gopal Naidu in favour of the 6th respondent was much prior to the decree. The City Civil Court granted stay of the auction proceedings. Thus the E.P., filed in 1647 of 2001 by the decree holder on the file of IX Assistant Judge, City Civil Court, Chennai was dismissed. Subsequently, the fourth respondent/plaintiff filed W.M.P.No.34109 of 2005 in W.P.No.31120 of 2005 and obtained an order of stay of further proceedings on the sale, thus, the sale by the Bank could not go on. Subsequently, in W.A.No.2310 of 2005, this Court directed the fourth respondent /plaintiff in the suit to move the Recovery Officer/third respondent for necessary relief with appropriate application. Thus, I.A.No.1/2006 in T.A.No.166 of 1997 was filed by the fourth respondent and the Debts Recovery Tribunal passed the order dated 22.02.2006 after considering the fact that the 6th respondent had purchased the entire land and the building from the 5th respondent-Gopal Naidu and that the attachment order was subsequent to the sale; thus, the claim of the fourth respondent was rejected.

(3.) ON a consideration of the claims, the Debts Recovery Appellate Tribunal allowed the appeal of the 4th respondent, sustaining the attachment of the property in respect of 3rd and 4th floor and held that the creation of the mortgage in favour of the Bank was valid only in respect of ground, 1st and 2nd floor. Consequently, the 4th respondent was held as entitled to bring the 3rd and 4th floor of the subject property for sale, for the realisation of the amount due as per the decree obtained in C.S.344 of 1988. Aggrieved by the said order, the present writ petitions have been filed by the Bank (W.P.28154/2007) and the auction purchaser (W.P.21539/2007). The auction purchaser is the 8th respondent in the writ petition filed by the Bank.