Mortgage.
MANOJ HARIT
(Querist) 08 November 2012
This query is : Resolved
Respected Experts,
ABC Pvt Ltd has mortgaged its' Fixed Assets with a Bank for Term & CC Loans by way of Regd Mortgage Deed & duly registered the same with the Registrar in 2003.
In 2010 an unsecured creditor got a money decree against the Company. It has filed foe Execution of the Decree.
Now it has moved an application under O 21 R 54 for attachment of the same property.
Is it possible? If yes,
What are the option for the Company.
Thanks,
Regards.
ajay sethi
(Expert) 08 November 2012
company can afford legal fees . contact a local lawyer .
RAJU O.F.,
(Expert) 09 November 2012
You have to defend the attachment in civil court through an advocate conversant with property matters. As the regd. mortgage would be reflected in EC of the property, resist the attachment stating that the property under mortgage to bank. The credior can get the surplus if any after settling the bank dues.
MANOJ HARIT
(Querist) 10 November 2012
Thanks a lot to Mr. Sethi & Mr.Raju O.F. for the guidance. The Company is not in a position to afford any legal fees due to dire financial condition.
If possible plz advise.
Still thanx again for the reply.
ajay sethi
(Expert) 10 November 2012
you have to draw attention of the court that property has been already mortgaged to bank . even if court passes attachement order in the vent of sale bank will get first prefernce . only after payment of bank dues if there is any surplus will go to decree holder
MANOJ HARIT
(Querist) 11 November 2012
Ajay Sethi Sir,
Obliged by the response.
This plea was taken b4 the court. But the court was adamant saying that it does not affect the J.D. The court also asked how the rights of the Banks get affected in the event of attachment as they will retain the first charge. Any legal arguments which can save the attachment ?
Thanks,
Regards.
Anirudh
(Expert) 11 November 2012
The Court is absolutely right. The property can be attached against the decree. The J.D. is not affected - if at all he is affected it has to have some other defence than the one that the property already stands mortgaged! It is the bank which has the first charge that is to be concerned and not the J.D.
In any case, in case the property gets sold, first the sale proceeds will be applied to satisfy the first charge of the bank.
MANOJ HARIT
(Querist) 11 November 2012
Mr. Anirudh,
Thanks for the opinion.
The Company is in talks for settlement with the Bank. And to pay the money the assets need to be sold. Any more attachment may scuttle the process. What is the remedy?
Plz advise.
