Ajay Amritlal Soni vs CENTRAL BANK OF INDIA on 25 May 2026

O R D E R

1. The Applicants preferred this Misc. Application mainly for setting aside order dated 28.01.2011 and the Recovery Certificate dated 01.02.2011 passed by the DRT-II in O.A. No.61 of 2010 to the extent of effecting the rights of the Applicants over the Flat No-301, admeasuring 658 sq. feet, 3rd floor, Shivam Apartments, Plot No-D-5, Sector 9, Airoli, Navi Mumbai (for short “the said flat”).

2. Ld. Advocate for the Applicants submitted that the physical possession of the said flat was taken on 28.06.2019 and this

Miscellaneous Application was filed on 19.07.2019. On 28.06.2019, physical possession was taken. Applicant Nos.1 and 2 are the husband and wife and Applicant No.1 is the owner of the said flat. The Applicants are neither borrowers, guarantors nor mortgagors and they had not availed any loan from the Respondent No.1 Bank. They were not parties to the Original Application No.61 of 2010 filed by the Respondent No.1. The Applicant No.1 purchased the said flat from the Builder namely M/s. Shivam Builders and Developers being Respondent No.5 vide Agreement for Sale dated 14.01.2005 for an amount of Rs.6.10 lakhs. The Builder had given physical possession of the said flat to the Applicants on 25.03.2005 and issued possession letter on the same date.

3. That the Applicant No.1 obtained housing loan from Bank of India and as a security thereof mortgaged the said flat in favour of that Bank. Thereafter, the Applicant No.1 thereafter repaid the loan and closed the loan account on 27.03.2018 and that Bank issued letter for closure of loan account on 16.04.2018. The Applicants have been paying electricity bills regularly till date. It was also submitted that after purchasing the flat, the Applicants did not occupy the flat but gave the same on leave and license.

4. That on 28.06.2019, the Authorised officer of the Respondent No.1 along-with the Court Receiver came to the said flat and took physical possession of the said flat. The Applicants were totally unaware of the O.A. No.61 of 2010. The Applicants submitted that in O.A. No.61 of 2010, Defendant Nos.1 and 2 were direct recipient and beneficiaries of the said term loan which was disbursed by the Respondent No.1 Bank and they are only liable to repay the same to the Bank. The Respondent No.5 of this M.A. has committed fraud and cheated the Bank. The Respondent Nos.2 to 4 are jointly and severally liable to repay the loan amount which was availed by Respondent Nos.2 and 3 from the Respondent No.1 Bank.

5. Ld. Advocate for the Applicants also submitted that the borrower in O.A. No.61 of 2010 who had availed the loan from Respondent No.1 Bank on 16.04.2005 by mortgaging the said flat had no lawful title in the said flat at the time of creation of mortgage in favour of Central Bank of India and therefore, subsequent mortgage cannot bind the Applicants who received possession on 25.03.2025 i.e. prior to creation of mortgage in favour of Respondent No.1. Hence, prayer should be allowed.

6. On the contrary, Ld. Advocate for the Respondent Bank strongly opposed and submitted that Recovery Proceedings took place pursuant to the mortgage created in its favour. The mortgage Bank also submitted that this Miscellaneous Application has been filed after inordinate delay without legal grounds and deserves to be rejected.

7. Heard the Ld. Advocate for the parties, considered their arguments and perused the record.

8. The material available on record prima facie reveals that the Applicant’s Agreement to Sale is dated 14.01.2005 and Possession Letter relied upon by the Applicant is dated 25.03.2005. The subsequent mortgage in favour of Central Bank of India is stated to have been created on 20.04.2005 in regard to the flat purchased by Respondent Nos.2 and 3 from Respondent No.5 as per subsequent Agreement to Sale dated 10.03.2005.

9. The Applicant has specifically contended that prior to the said mortgage, the subject property already stood mortgaged with Bank of India and the said mortgage was subsisting at the relevant time. This aspect assumes significance because the subsequent mortgage claimed by Central Bank of India is alleged to have been created during subsistence of the earlier mortgage created by the Applicant in favour of Bank of India.

10. The record further does not prima facie demonstrate how the borrower in O.A. No.61 of 2010 derived lawful interest to create mortgage in the subject property during the subsistence of the mortgage already created in favour of Bank of India.

11. At this stage, this Tribunal is not required to conclusively adjudicate title. However, the Applicant has raised substantial and arguable challenge to the very foundation of the mortgage claimed by Respondent Bank. The chronology of events placed on record prima facie indicates that the Applicant’s Agreement to Sale is prior to the subsequent mortgage, possession is claimed to have been handed over to the Applicant prior to creation of subsequent mortgage, and the subsequent mortgage is alleged to have been created during subsistence of the earlier mortgage with Bank of India as discussed above.

12. The Applicant has also placed on record electricity bill of the year 2019 in support of possession. Though the same may not conclusively establish title but it cannot be completely ignored at this stage while examining the surrounding circumstances.

13. It is also significant that the observation recorded in the final order in OA No. 61 of 2010 that “since the purchaser is not in possession of the property” also reflects that possession of the subject property with the borrower was itself disputed.

14. In view of the Appreciation of documentary evidence of the parties, this Tribunal is of considered view that the Applicants, having allegedly acquired rights prior to the subsequent mortgage and having discharged his own loan obligations with Bank of India, cannot prima facie be made to suffer for a subsequent transaction allegedly undertaken by another person lacking lawful title or interest in the property.

15. Therefore, this Tribunal finds that the Applicants have made out sufficient grounds warranting interference with the attachment and possession proceedings insofar as they relate to the subject property i.e., the said flat.

ORDER

A. Resultantly, this Miscellaneous Application No.27 of 2021 is hereby Allowed. B. The steps taken in respect of the subject property for executing the Recovery Certificate are hereby set aside insofar as they relate to the Applicant’s property i.e., the said flat in question. C. No order as to costs.

Sd/- (HARISH KUMAR KAUSHIK) PRESIDING OFFICER DRT-II, MUMBAI Srishti

25.05.2026 Exh. Roznama-MDRT-II M.A. No.27 of 2021 Next date

su - 13

Mr Pankaj Vijayan i/b M/s. Intralegal, Advocate for the Applicant. Mr R.J. Singh, Advocate for the Respondent.

Order in M.A. No.27 of 2021 passed separately. File be consigned to the Record Room after due compliance. Sd.- P.O. DRT-II

Closed