Physical possession
Durgesh Jaiswal
(Querist) 25 August 2013
This query is : Resolved
Respected Sir,
I have purchased a property(land)through Bank e-auction. i have paid full amount to the bank as mentioned and has recieved the sale certificate from the bank. But i didn't get the physical possession of the property as the borrower has settled an authorised tenant in the plot after taking the loan from bank.
i have given a request letter to bank for the physical possession u/s 14 of sarfaesi act 2002.
but bank said that after selling the property "We cannot ask the DM for physical possession".They said me that I should give request to the DM for physical possession and alongwith my request bank will give a letter to DM that my request is truthful and verified by bank and consider my petition for physical possession for further proceedings.
My question is
1." Is it true that after selling the property bank cannot ask for possession to DM directly against the purchaser of land(Me)"?
2.If it possible for the bank to ask physical possession after selling then under which section of sarfaesi act it can be done?
3.What would you suggest me regarding my case?
kindly give some solution regarding my issue.
Devajyoti Barman
(Expert) 25 August 2013
Bank is not right. It is the duty of the Authorised Officer to give Sale Certificate and to hand over the physical possession to you.
Apply to the DRT fast.
ajay sethi
(Expert) 25 August 2013
you must have taken inspection of the premises before purchasing the property . you ought to have been aware that tenant is in occupation of premises . you purchased the property on as is where is basis . you have to follow due process of law for eviction of tenant
prabhakar singh
(Expert) 25 August 2013
You are stucked on in the deal.
D.M. has no jurisdiction to entertain your application.
A premises with tenant can also be transferred.
You have no option except to serve one month notice of determination of his tenancy on him asking for vacant possession,failing which suit you would need to file unless bank acts it self for possession which it is wrongly denying,courts would not provide you any relief against bank.
K.K.Ganguly
(Expert) 25 August 2013
It is now well settled that the Bank can file application to the DM u/s14 of SARFAESI Act,2002 for taking physical possession of its mortgaged property with the help of police, even after conducting its sale.
prabhakar singh
(Expert) 25 August 2013
HIGH COURT OF JUDICATURE AT ALLAHABAD
?Court No. - 29
Case :- WRIT - C No. - 25593 of 2013
Petitioner :- Alok Kumar Maurya
Respondent :- State Of U.P. Thru Secy. And 5 Others
Petitioner Counsel :- K.K. Tiwari
Respondent Counsel :- C.S.C.,P.N. Tripathi
Hon'ble Sunil Ambwani,J.
Hon'ble Bharat Bhushan,J.
1. We have heard learned counsel appearing for the petitioner.� Shri P.N. Tripathi appears for Allahabad Bank, Civil Lines Branch, Allahabad and Authorised Officer, Allahabad Bank. Learned Standing Counsel appears for the State respondents.
2. The petitioner purchased a property in an auction from Allahabad Bank under SARFAESI Act, 2002 and the Rules 13 (12) and 9 (6) of SARFAESI Security Interest (Enforcement) Rules, 2002, bearing a description in the sale certificate "all the part and parcel of the house built on Arazi No.424 Mauza Buxi Uparhar, Allahabad area 65.52 sq. meter" bounded on the North by house of Hori Lal; on the South by house of Vendee; on the East by Kachcha Rasta and on the West by land of Hari Lal. The sale certificate dated 21.10.2011 describes the property as above, clearly mentions that the petitioner has paid the price in full and was handed over the delivery of possession of the scheduled property. The petitioner signed the sale certificate. He has prayed for return of sale consideration or a direction to the Bank to hand over the vacant physical possession of the property to him.
3. The petitioner has relied upon an application made by the bank to the District Magistrate under Section 14 of the SARFAESI Act, by which the bank had requested the District Magistrate to provide police help to get the property vacated. The then District Magistrate, Allahabad passed an order on 31.12.2011 directing the Deputy Inspector General of Police, Allahabad and the Additional City Magistrate (First), Allahabad to provide the police help for handing over the vacant possession of the property to the bank.
4. It is stated that the bank did not get the possession of the property and has sold it free from all encumbrances. It is under legal obligation as a condition of sale to give physical possession or to return sale consideration.
5. We do not find any provision in the SARFAESI Act, 2002� or the Rules to cast a legal obligation on the bank to hand over vacant possession of the property, which was sold with recital in the sale certificate that the possession of the property has been delivered to the petitioner. There is no provision in the SARFAESI Act or the Rules which gives right to the petitioner to apply to the bank to give vacant possession after petitioner has signed on the sale certificate with a clear stipulation that he has taken possession of the property.
6. The banks and financial institutions have been given special rights under the SARFAESI Act, 2002 to sell the mortgaged properties after giving notice to the mortgager in accordance with the provisions of the SARFAESI Act and Rules without aid and assistance of the Court. After due notice and opportunity to the borrower the mortgaged property can be advertised and sold for securitisation of debt. Any person, who purchased the property,� must take sufficient precautions� both with regard to ownership and its occupation.
7. There can be variety of rights vested in the mortgaged property which cannot be sold. These rights may include the right of tenant, co-sharer� or any court decree for maintenance etc. The bank does not have any obligation to hand over vacant physical possession. It may deliver symbolic possession� to the purchaser at his risk.
8. It appears that the petitioner purchased the property as an investor and did not carry out due diligence in finding out whether the property was in occupation of the mortgagor or any other person, who may have any right, in the mortgaged property. It is always open to the petitioner to file a civil suit to recover the possession of the property independent of the provisions of SARFAESI Act and Rules. If such a suit is filed, the Civil Court may adjudicate the rights of the occupier before directing that the possession be handed over to the purchaser.
9. The writ petition is dismissed.
Order Date :- 7.5.2013
IF para 7 of above judgement is read:
"7. There can be variety of rights vested in the mortgaged property which cannot be sold. These rights may include the right of tenant, co-sharer� or any court decree for maintenance etc. The bank does not have any obligation to hand over vacant physical possession. It may deliver symbolic possession� to the purchaser at his risk."
Held on 07/05/13 then where is the 'now well settled 'Mr. K.K.Ganguly should keep us informed just for update of us.
And my advice given here before is supported by para 8 of this judgement.
"8. It appears that the petitioner purchased the property as an investor and did not carry out due diligence in finding out whether the property was in occupation of the mortgagor or any other person, who may have any right, in the mortgaged property. It is always open to the petitioner to file a civil suit to recover the possession of the property independent of the provisions of SARFAESI Act and Rules. If such a suit is filed, the Civil Court may adjudicate the rights of the occupier before directing that the possession be handed over to the purchaser. "
Only What Mr. Sethi opined can be subscribed and that i did with telling remedy also.
Rajendra K Goyal
(Expert) 25 August 2013
Well advised by the expert prabhakar singh ji, nothing more to add.
K.K.Ganguly
(Expert) 25 August 2013
While hearing S.A.615 of 2013 between Sanjay Dutta Vs. Allahabad Bank, the Ld. P.O. of DRT-II, Kolkata opined on 19.08.2013 that "It is well settled that the Bank can apply u/s14 of SARFAESI Act,2002 for taking physical possession of the mortgaged property to hand over the same to the buyer, even after issuing Sale Certificate to the buyer".
R.K Nanda
(Expert) 25 August 2013
nothing to add more.
prabhakar singh
(Expert) 25 August 2013
But in this case Mr.Ganguly if you read the query Bank is not ready to move to DM and persuading the buyer to move to DM u/s 14
of SARFAESI Act,2002 ,AND CERTAINLY DM IS NOT CLOTHED WITH JURISDICTION TO ENTERTAIN SUCH AN APPLICATION FROM ANYONE OTHER THAN the BANK FOR ANY PURPOSE so buyer is STUCKED ON I said as he can not force bank to do so.Nor can have relief against the bank through court is the situation while you are talking of a situation where bank would have right to move DM while bank is reluctant and denying to do so in the instant query.Moreover view of a PO of a DRT is not a citation to be cited as ruling.
We need to answer in the light of facts and circumstances of a query.
Raj Kumar Makkad
(Expert) 25 August 2013
Well advised by experts so no more to add.
K.K.Ganguly
(Expert) 26 August 2013
Prabhakar Singh Sab is right. Probably we both are saying the same thing but in different ways.
I answered the following statement of the querist:
"but bank said that after selling the property "We cannot ask the DM for physical possession"."
My point was that the Bank can very well apply to the DM for taking physical possession of the mortgaged flat u/s14 of SARFAESI Act,2002 after selling the Flat.
P.O's observation was based on some citation which I shall collect shortly.
However, it is clear that the Bank is illegally shrugging of its responsibility to give vacant possession of the mortgaged Flat. The buyer can write to the Banking Ombudsman to start with before taking any legal step against the Bank.
Raj Kumar Makkad
(Expert) 27 August 2013
The discussion over the subject by Ganguly and Mr. Singh is almost same and there is no material change in their opinion.
RAJU O.F.,
(Expert) 30 August 2013
The purchaser may issue a lawyer notice requesting the bank to provide physical possession within a reasonable period. If they failed to take steps for that, prefer an SA under Sec.17 of the SARFAESI Act before jurisdiction DRT, making the tenent and bank as Respondents, praying relief of physical possession through bank.
