Denial of release of title deeds without any charge is unsustainable

Mahalaxmi Textiles A Proprietorship Firm Vs Syndicate Bank Main Branch (Gujarat High Court)

Held that it is not open for the Bank to fasten indirect liability and deny release of title deeds of the property on which there is no charge

Facts-

Respondent no. 2 had availed financial assistance from respondent no. 1 Bank and while availing assistance, respondent no. 2 had mortgaged the property in question in favour of the respondent no. 1 Bank. On failure to repay the loan, the respondent no. 1 bank classified the account of respondent no. 2 as a Non-Performing Asset. The writ-applicant approached respondent No.1 bank to purchase the property in question for an amount of Rs.2.50 crores with the consent of respondent No.2.

It appears that though the respondent No.1 bank had received the entire amount of Rs.2.50 crores from the purchaser through the respondent No.2, the respondent No.1 Bank declined to issue certificate for releasing the charge over the property and also did not hand over the original title documents of the property. Accordingly, the writ applicant filed the present writ petition.

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