K. Chandrasekar Vs Chairman (Madras High Court)
Madras High Court held that petition is dismissed since the same was filed on the premise that bank (recovery officer) has sold entire property (included the one already sold). The said premise is incorrect. Hence, petition dismissed.
Facts- Petitioner availed a term loan of Rs.5,10,000/- on 4.3.1983 from second respondent/bank. On 6.9.1986, the loan was enhanced to Rs.5,52,700/-. Borrowers executed promissory note, agreement of hypothecation, term loan agreement, etc., on 17.9.1986. Borrowers also deposited the title deeds in respect of property to an extent of 42.24 acres as security.
As borrowers defaulted in repayment of loan, second respondent/bank filed an application before the Debts Recovery Tribunal, Chennai [DRT], for recovery of a sum of Rs.22,70,893.60. DRT issued a recovery certificate for the said sum with simple interest at 12% from the date of the said application till realisation.
While the recovery proceedings were pending, borrowers, through their power agent, Maxworth Orchards (India) Limited, had sold a portion of the mortgaged property with the consent of second respondent/bank. After the recovery certificate was issued, the purchasers of the said 14 acres, who are now shown as respondent Nos.3 to 16, had filed Miscellaneous Application before the Debts Recovery Tribunal-I stating that their property must be excluded from the sale pursuant to the recovery certificate. The Debts Recovery Tribunal-I passed an order on 6.9.2002 to the effect that the Recovery Officer shall first attempt to sell the remaining unsold portion of the mortgaged property before proceeding against the property purchased by respondent.
