THE NAINITAL BANK LIMITED vs MS BODY FIT CENTRE AND ORS on 28 October 2017

1. 1. Today the case is fixed for orders on IA No. 835/2015.

**IA No. 835/2015**

1. 2. This IA has been filed on behalf of Sh. Harish Katyal under Order 1 Rule 10 read with Section 151 of CPC and Section 22 of RDDB&FI Act praying therein to allow the applicant to be impleaded as necessary and proper party as applicant is necessary for the adjudication of the right and obligations of the parties in respect of the property in question i.e. property bearing no. 289, Ambica Vihar, Paschim Vihar, New Delhi.

1. 3. It is stated in the IA that defendant no. 1 i.e. Sh. Manjeet Singh had entered into an Agreement to Sell with the applicant herein to sell the property in question bearing no. 289, measuring 252.7 sq. yards Ambica Vihar, New Delhi – 110 087, for total sale consideration to the tune of Rs. 1,15,00,000/- which was executed on 21.12.2009 but was duly registered with Sub Registrar II A, Punjabi Bagh, New Delhi on 27.1.2010 for the reason that some application for objection was filed before Registrar by one Sh. Deepak Yadav which was withdrawn on 8.1.2010, hence the Agreement to Sell got registered on 27.1.2010 (**Annexure A-1**). Further more General Power of Attorney (**Annexure A-2**) was also got registered in favour of applicant herein on 27.1.2010 by defendant no. 1 in the present OA. It is also stated that one Sh. Pawan Dhawan who was one of the accomplice of defendant no. 1 and was guarantor of defendant no. 1 in several other loan cases, SD/- had filed a connivance suit against defendant no. 1, as CS(OS) No. 2368 of 2009 and defendant no. 1, in order to cheat and deceive the applicant, made a false statement before Court and facilitate Pawan Dhawan to obtain stay in the case against transfer of property in question whereas he had deliberately concealed this fact that he had already executed the sale document of the property in question in favour of applicant herein and hence Hon'ble High Court granted stay against the defendant no. 1. In the year 2011, the Nainital Bank/applicant bank in present OA also moved an application under Order 1 Rule 10 CPC to be impleaded as necessary party in the suit and was impleaded therein and no objection was raised by Pawan Dhawan and defendant no. 1, rather they both supported the case of applicant bank. Since applicant herein had already spent huge amount and realized and came to know that defendant is fraudster and taken loan against the property in question from other banks as well, had filed an FIR against defendant no. 1 and others, as FIR No. 93 of 2012, with the EOW and charge sheet is already filed by Investing Officer in the said FIR (**Charge Sheet - Annexure A-3**). Thereafter applicant herein filed the suit seeking specific performance of the Registered Agreement to Sell before Hon'ble High Court which was registered as CS(OS) No. 1368 of 2012 and applicant bank was also made party therein by the applicant of IA and Hon'ble High Court granted stay against defendant no. 1 herein and applicant of IA herein & Nainital Bank from creating any third party interest in the suit property. It is also stated that instant OA is a deliberate attempt of the applicant bank to sell the property for which it is not entitled, knowing fully well that property in question has been sold to the applicant herein in the year 2010 by virtue of aforesaid registered SD/- agreement to sell in his favour as applicant bank is also a party to the suit. It is further stated that Investigating Officer in EOW had arrested the defendant no. 1 who died in the custody of Tihar Jail in the year 2014, and Charge Sheet in the case has already been filed and supplementary charge sheet is to be filed after due investigations and during the course of investigation, it came to the knowledge of Investing Officer that documents in possession of Nainital Bank/applicant bank and the documents in possession of the State Bank of Patiala (SBP), Branch Wazirpur Industrial Area are forged and fabricated, the signatures of the witness and other officials as well as previous owner of the property also identified their signatures on the documents which are in custody of the applicant of IA are original (previously mortgaged with UCO Bank). This fact was also known to the officers of applicant bank but the officers of applicant bank chooses not to file any complaint and / or FIR against the defendant no. 1/Sh. Manjeet Singh (its LRs) and Smt. Anju Dhanjal wife of defendant no. 1 whereas the SBP had already filed an FIR against defendant no. 1 and other accused persons including Smt. Anju Dhanjal (**copy of FIR No. 22 filed by SBP – Annexure A-4**), hence, applicant bank is neither the secured creditors in terms of the SARFAESI Act 2002, nor having a valid mortgage which entitled him to file the present OA for recovery of the alleged loan amount. It is pertinent to mention that the property in question was simultaneously mortgaged by defendant no. 1 i.e. Sh. Manjeet Singh (since deceased) with three Nationalized Banks, firstly with SBP and secondly with the UCO Bank and thirdly with PNB. Further more in the year 2007, the SBP had recorded their Charge over the property in question with the Sub Registrar Delhi and this fact that the original documents SD/

were not in possession of the applicant bank is disclosed and admitted by defendant no. 1 in his disclosure statement (**Annexure A-5**), whereby he admitted that documents in possession of the SBP and Nainital Bank are forged and fabricated and this is also within the knowledge of the officials of the applicant bank and for this reason only the officials / applicant bank, despite of full information, had not filed any complaint or FIR against defendant no. 1 and Smt. Anju Dhawan and defendants no. 2 to 5. Further applicant herein filed a criminal complaint against defendant no. 1 and applicant bank with EOW, Delhi Police and FIR No. 93/2012 was got registered against the applicant bank and defendant no. 1 and as per report received from the Government Press Nasik on 10.10.2013, it is found that documents in the custody of applicant bank herein are forged and fabricated (**Copy of Investigating Report – Annexure A-6**). Further more, applicant bank did not even bother to take due precautions before alleged loan granted to defendant no. 1 i.e. no report taken from CIBIL and report from Income Tax Department to verify the credit worthiness of the defendant no. 1 and no legal opinion was taken, no search report / index inspection report was obtained for the relevant period. Since applicant is the bonafide purchaser of the property which he had purchased in 2009, with due caution and care, and is only affected party, hence he is the necessary party to the suit / OA and issues raised in the present application and issue of mortgage of the property in question cannot be decided without hearing the applicant, hence it is prayed that this IA may be allowed.

4. Reply to this IA has been filed on behalf of applicant bank vehemently opposing the same. It is stated in the reply that admittedly the property in question was mortgaged by defendant no. 1 in favour of applicant bank on 7.2.2009 whereas applicant herein claims to have agreed to purchase the subject property vide Agreement to Sell registered on 27.1.2010, therefore, applicant herein being subsequent alleged purchaser is neither a necessary nor a proper party to the aforesaid TA. It is also stated that applicant of IA herein was counsel for defendant no. 1 in Suit CS(OS) 2368/2009 titled as Pawan Kumar Dhawan Vs. Manjeet Singh filed before Hon'ble Delhi High Court and made appearance on his behalf and as such any alleged purchase of the subject property by applicant Sh. Harish Katyal Advocate from his client is otherwise against the professional etiquettes. The defendant no. 1 Sh. Manjeet Singh filed an IA bearing no. 9152/2011 in the aforesaid Suit admitting the claim of the applicant bank and prayed for selling the aforesaid mortgaged property for liquidation of outstanding liability in his loan accounts towards the dues of the bank. Hence, defendant no. 1 admitted the claim of applicant bank before Hon'ble High Court. Further vide order dated 12.1.2010 passed by Hon'ble High Court in aforesaid Suit, the defendant no. 1 was restrained from alienating, transferring or creating any third party interest in the property in question. Moreover, applicant herein filed similar IA bearing no. 16122/2013 in aforesaid Suit and vide order dated 26.8.2014, the same was dismissed by Joint Registrar. It is stated that applicant herein was counsel for defendant no. 1 and had appeared in the above noted Suit before Hon'ble High Court and applicant knowing fully well about the restraint order passed by Hon'ble High Court of Delhi, still he went ahead to get the alleged Agreement to Sell dated 21.12.2009 registered on 27.1.2010 which is not only mala fide but also contemptuous of order dated 12.1.2010 of Hon'be High Court.

SD/-

Further more, inspite of restraint order, applicant of IA herein made payments to defendant no. 1 for the alleged purchase of subject property on various dates after 12.1.2010 i.e. on 1.2.2010, 8.3.2010, 9.3.2010, 23.3.2010, 8.4.2010, 19.4.2010, 21.4.2010, 31.5.2010, 2.6.2010, 26.7.2010, 27.7.2010, 4.10.2010 and 5.10.2010, therefore, the documents alleged by the applicant cannot be looked into. In the light of above, it has been prayed to dismiss the IA with cost.

5. Both the parties have also filed their respective written submission.

6. Heard Ld. Counsels for the parties and perused the record. I find merit in the contention of Ld. Counsel for non applicant bank. Admittedly applicant in IA is claiming his right over the property in question on the basis of Agreement to Sell registered on 27.1.2010 whereas the said property was allegedly mortgaged by defendant no. 1 in favour of applicant bank on 7.2.2009 much prior to the registered Agreement to Sell dated 27.1.2010.

7. The Hon'ble Apex Court in the matter of ICICI Bank Ltd. Vs SIDCO Leather Ltd. & Ors. on 28.04.2006 in Civil Appeal No,2332 of 2006 has held as under:- *"While enacting a statute, the Parliament cannot be presumed to have taken away a right in property. Right to property is a constitutional right. Right to recover the money lent by enforcing a mortgage would also be a right to enforce an interest in the property. The provisions of Transfer of Property Act provide for different types of charges. In terms of Section 48 of the Transfer of Property Act claim of the first charge holder shall prevail over the claim of the second charge holder and in a given case where the debts due to both, the first charge holder and the second charge holder, are to be realized from the property belonging to the mortgagor, the first charge holder will have to be repaid first. There is no dispute as regards the said legal position."*

8. Further more, Hon'ble DRAT Delhi in the matter of State Bank of India Vs Punjab & Sind Bank & Ors. I(2009) BC 80 (DRAT) has held as under:-

*"10. The fact of the matter was that the property in question was being put to auction in consequence of recovery certificate issued by DRT, Jaipur after the decree of OA No.135/98 filed by Punjab and Sindh Bank (respondent No.1 herein). The objection of State Bank of India was that this property was not liable to be auctioned for the recovery of the amount decreed in favour of Punjab & Sindh bank because it was the first charge holder for the reason of this property having been equitably mortgaged by the same guarantor Smt. Vijaya Dubey with it on 20.7.1983. It successfully demonstrated that the property had first been equitably mortgaged in its favour and the title deed handed over by the guarantor to it. Decree in favour of State Bank of India had also been passed earliest in point of time by the Civil Court. The property having been auctioned by the Recovery Officer, DRT, Jaipur at the behest of second charge holder, naturally the sale proceeds deserved to be released in favour of the first charge holder i.e. State Bank of India. The second charge holder Punjab & Sindh Bank in whose favour the recovery certificate had been issued in consequence of the decreetal of OA No.135/98, could only be entitled to the residue amount after satisfaction of the dues of State Bank of India, the first charge holder. This is the crux of the matter and is as clear as day light. There is not the slightest doubt that the Presiding Officer of the Tribunal below gravely erred in endorsing the erroneous view taken by the Recovery Officer."*

9. In the light of above discussion, it is clear that applicant bank is having prior charge over the property in question. Perusal of record also reveals that applicant bank has already given details of matters pending before Hon'ble High Court filed by Sh. Pawn Kumar Dhawan, Sh. Harish Katyal and one Sh. Ashok Kumar Oberoi against defendant no. 1 herein (as detailed in Para 5.13, 5.15 & 5.16 of OA). Further more applicant bank has also given the details of FIR No 93 dated 2.8.2012. Hence I am of the SD/- view that applicant bank has not concealed any material fact from this Tribunal.

10. So far as question of fraud committed by defendant no. 1 with the applicant in IA is concerned, applicant in IA has already filed a Suit before Hon'bel High Court of Delhi and he is always at liberty to take action against the defendant no. 1, as per law.

11. With the above said observations, I am of the opinion that this IA is liable to be dismissed and hence same hereby dismissed.

**TA**

12. Record reveals that vide order dated 27.4.2015, applicant was directed to serve defendant no. 7 through substituted service, but proof of service has not been filed as yet. Applicant bank is again directed to take steps for service of defendant no. 7, as per rules and file proof of service.

13. So far as defendants no. 1 to 6 are concerned, they were appearing their counsel but did not file their WS as yet. Record of this case also reveal that vide order dated 5.10.2016, last opportunity was allowed to the defendants to file their WS. Hence, **right of defendants no. 1 to 6 to file their WS is hereby closed** in pursuance to order dated 5.10.2016 of this Tribunal.

14. Record also reveals that applicant bank has already filed its evidence which is available on record.

15. Now case be listed before Ld. Registrar on **18.1.2018** for exhibition of documents on behalf of applicant bank and for ensuring service of defendant no. 4 and thereafter before this Tribunal on **7.3.2018** for further directions / final arguments.

SD/- (Dr. Rekhá G. Dhakar) Presiding Officer DRT-I, Delhi