Roopesh Rai Sikand v. The Federal Bank Ltd. and Ors.

1. This suit for declaration, permanent injunction and for setting aside the orders made in R.C. No. 159/ 2001 arising out of O.A. No. 151/ 1998 and for setting aside the order dated 26.02.2002 passed by the Debt Recovery Tribunal, New Delhi in Appeal No. 13/ 2002 and for quashing the order of the Recovery Officer whereby the suit property i.e. S-375, 3rd Floor, Greater Kailash-II, New Delhi had been ordered to be put up for public auction on 12.04.2002, has been filed by the Plaintiff against the Defendants alleging that the Plaintiff was a bona fide purchaser for consideration of 3rd floor flat with terrace rights of property no. S-375, 3rd Floor, Greater Kailash-II, New Delhi (suit property). It is alleged that Defendant no. 1 (The Federal Bank Limited) had provided some credit facilities to Defendant no. 2. 2014:DHC:4117 Defendants no. 3 and 4 are the Directors of Defendant no.2, whereas Defendant no. 5 is the mortgager of the suit property.

2. It is alleged that one Jai Dayal Singh purchased freehold plot of land bearing no. S-375 from M/s DLF United Limited vide a registered sale deed dated 12.03.1974. In turn, said Jai Dayal Singh sold the earlier said plot to M/s S.V. Industries through its proprietor Pawan Kumar Singhania vide registered sale deed dated 01.04.1981. M/s S.V. Industries constructed a building on the earlier said plot of land and sold one room on the second floor with construction and ownership rights of the entire 3rd floor by virtue of the sale deed Ex. PW1/ 25 to one Narender Makhija who further sold the rights of ownership of the above stated portion of the property in favour of Defendant no. 5 (the mortgager) by a registered sale deed dated 07.04.1995 Ex. P[1].

3. It is alleged that on 26.08.1998, by virtue of a registered lease deed for a period of five years commencing from 02.02.1997, Defendant no. 5 inducted the Plaintiff as a tenant in the suit property. On 22.03.1999, Defendant no. 5 through Defendants no. 3 and 4 executed a registered General Power of Attorney Ex. PW1/ 20 in favour of the Plaintiff whereby the Plaintiff acquired all the rights to deal with the suit property in any manner. Consequently, a sale deed dated 17.08.2000 Ex. PW1/ 25 was executed by Defendant no. 5 in favour of the Plaintiff duly registered in office of Sub-Registrar as Document NO. 7749 Volume no. 2012 Additional Book no. 2 at pages 88 to 91.

4. It is the case of the Plaintiff that subsequently the Plaintiff learnt that Defendant no. 1 had filed an application being O.A. No. 151/ 1998 against Defendant no. 5 and others for recovery of an amount of Rs. 19,79,310/- which was stated to have become due and outstanding against Defendants no. 2 to 5. The said O.A. was decreed by an order dated 27.05.1999 whereby Defendants no. 2 to 5 were directed to pay the decretal amount of Rs. 19,79,310/- along with costs and interest. Since Defendant no. 5 had created a mortgage in respect of the suit property towards the loan amount, the suit property was sought to be put up for public auction.

5. It is alleged that it was only on 04.10.2001 that the Plaintiff came to know about the litigation pending in respect of the suit property between Defendant no. 1 on one hand and Defendants no. 2 to 5 on the other. The Plaintiff unsuccessfully approached the Recovery Officer and ultimately filed this suit claiming that he was a bona fide purchaser of the suit property and was not bound to clear the liability of Defendant no. 5 who had already sold the property.

6. Defendant no. 1 contested the suit by way of filing a written statement and took objections about the maintainability of the suit. It was stated that Defendant no. 5 had created a mortgage in respect of the suit property by deposit of title deeds for certain facilities granted to Defendant no. 1 and for thereafter, not clearing the amount. The proceedings for recovery were taken before the Debt Recovery Tribunal. It was denied that the Plaintiff was a bona fide purchaser. On the other hand, it was stated that the Plaintiff ought to have made proper inquiries before purchasing the property. Issues were framed on 01.09.2006 and evidences of some of the witnesses were recorded. I.A. No. 12006/ 2014 was moved by the Plaintiff stating that a sum of Rs. 57 lacs has been paid by the Plaintiff to Defendant no. 1 and finally the matter was finally with Defendant no. 1 and the Plaintiff prayed for return of original title deeds to him.

7. Learned counsel for the Defendant no. 1 admits that the claim of Defendant no. 1/ Bank has been satisfied. It was also stated that the return of the documents shall be subject to the order of the Court.

8. The documents of title were deposited by Defendant no. 5 with Defendant no. 1 as a collateral security. The Plaintiff’s case is that he has purchased the suit property as a bona fide purchaser. Defendant no. 5 who is the mortgager and Defendants no. 3 and 4 who are its Directors have come forward to contest the suit. Liability of Defendant no. 5 has been cleared by the Plaintiff. Thus, the suit is dismissed as withdrawn. No Dues Certificate bearing no. 34/ 2014 has also been issued by Defendant no. 1. Original sale deed dated 07.04.1995 in respect of the suit property shall be returned by Defendant no. 1 to the Plaintiff within four weeks.

9. Pending application also stands disposed of.

JUDGE AUGUST 25, 2014 mr