Chander pal singh vs Indiabulls Housing Finance limited and anr. on 1 October 2026

1. The appellant filed S.A. bearing T.A.A. no.42/2023 titled as **Chander Pal Singh V. Indiabulls Housing Finance Limited & others** which is stated to be pending before DRT-II, Delhi. DRT-II, Delhi vide the impugned order dated 04.10.2023 has observed that there is no illegality or irregularity in the action taken by the respondent no.1 FI under the SARFAESI Act and accordingly rejected the interim prayer of the appellant. The relevant portion of the order dated 04.10.2023 is reproduced as under:-

5. The main contention of the Ld. counsel of the applicant is that the mortgage has not been registered with the CERSAI and therefore no action can be taken against the applicant. The Ld. counsel of the respondent FI has submitted that certificate showing that the mortgage has been registered on 167.11.2018 under the CERSAI and the same is available on the website. Therefore, the contention of the applicant that the mortgage has not been registered with CERSAI is against the fact. From perusal of the record it is also clear that the applicant has purchased the subject property on 10.03.2022 whereas the mortgage has been created in favour of respondent FI in the year 2018. Therefore, the applicant is subsequent purchaser and will be bound by the mortgage. If the respondent no.3 has made any misrepresentation regarding the execution of the mortgage the applicant can take appropriate action against the respondent no.3 as provided in the law. But on this ground respondent FI cannot be restrained from taking action under the SARFAESI Act in respect of the mortgaged property. The applicant is not the borrower nor the guarantor. From perusal of the record it is clear that a notice under Section 13(2) has not been issued to the applicant but it has been issued to respondent no.2 & 3, therefore, the applicant has no right to file any objection under Section 13(2). The order under Section 14 has also been issued against respondent no.2 & 3. It has been submitted by the Ld. counsel of the respondent that the objection raised by the applicant has been decided by the respondent FI and the communication has been sent to the Ld. counsel of the applicant. The Ld. counsel of the applicant submitted that he has not received any such communication. From perusal of the record it appears that the objections of the applicant have been decided by the respondent FI and communicated to the applicant, though it was not necessary.

6. The Ld. counsel of the applicant has submitted that the Section 41, 42, 53 & 56 of TPA Act debars the respondent FI from taking any action under the SARFAESI Act. I have gone through the above provisions. Section 14 of the TPA deals with the transfer by ostensible owner whereas the Section 42 deals with transfer by person having authority to revoke former transfer. These provisions cannot be attracted in the present case. The section 53 relates to fraudulent transfer and Section 56 deals with the marshalling of subsequent purchaser. These provisions are also not applicable in the present case. In the present case the only question is whether the appellant will be bound by the mortgage which has been created in favour of the respondent FI prior to the purchase of the subject property. The answer is that the mortgage is prior to the sale and therefore, the mortgage will prevail and the respondent FI can take action under the SARFAESI Act against the mortgaged property. I have also gone through the judgment passed by the Hon'ble Karnataka High Court. The facts of the case are entirely different and the same is not applicable on the present case and therefore the applicant cannot get any benefit from the above judgment.

7. Therefore, there is no irregularity or illegality in action taken by the respondent FI under the SARFAESI Act. Therefore, the interim prayer of the applicant is liable to be rejected.

2. Sh. Amit Kumar, Advocate for the appellant referred grounds of appeal and argued that the appellant had sent representations / objection dated 08.12.2022 and 10.04.2023 which were not considered by the respondent no.1 in terms of 13(3-A) of the SARFAESI Act. Thereafter no communication was sent to the appellant within 15 days from the date of receipt of the representations/objection giving reasons for non-acceptance of the representation/objection. It is also stated that the taking of forceful possession of the subject property by the Receiver under the SARFAESI Act was unjustified and illegal. The counsel for the appellant/applicant also referred para 5 of the impugned order dated 04.10.2023 and stated that it was based on false submission made on behalf of the respondent no.1. It is prayed that the impugned order be set aside.

3. Ms. Sangeeta Sondhi, Advocate for the respondent no.1 stated that the property has already been put to auction and sold and the auction purchaser is in physical possession of the subject property. It is further stated that the appellant is claiming his right on the subject property on the basis of documents executed on 10.03.2022 while the property was mortgaged and registered with CERSAI under the SARFAESI Act on 16.11.2018. It is accordingly prayed that the present appeal be dismissed.

5. The perusal of the impugned order reflects that the mortgage in respect of the subject property was created by the seller Shanandi Devi in the year 2018 while the appellant is claiming ownership of the subject property on the basis of sale deed stated to have been executed on 10.03.2022. The appellant has also registered the mortgage with CERSAI. This was also observed in the impugned order dated 04.10.2023. The appellant has purchased the subject property after the creation of mortgage with the respondent no.1. The possession of the subject property already stands taken by the respondent no.1 and delivered to the auction purchaser. There is no illegality or irregularity in the impugned order dated 04.10.2023 which warrants any interference from this Tribunal. Accordingly, the appeal is dismissed. However, the appellant shall be at liberty to take all pleas and contentions available to him under law before DRT during the trial of the T.S.A. bearing no.42/2023. It is made clear that DRT-II, Delhi shall not be influenced by any observation made in the impugned order dated 04.10.2023 being interlocutory in nature, while passing the final order in the S.A. bearing T.S.A. no.42/2023.

Sd-

(Dr. Justice Sudhir Kumar Jain) Chairperson

-pk\$