1. On 03-Dec-2012, I appeared with EMD of INR 5,25,000/- vide AXIS Bank DD 006430 Dated 03-Dec-2012 in good faith for the purchase of residential flat in auction as per information given in advertisement dated 31-Oct-2012 and won the bid. Subsequently I requested IDBI Bank to provide full set of property documents to inspect the property from Legal and technical side of property as per bid. My request was turned down and I was asked to deposit 25% as per bid before 07-Dec-2012 to avail a copy of the documents.
2. After rigorous follow up and coordination, I got the Sale Deed, Registry Valuation report, Municipal Tax receipt of 2009, Inventory, Panchnama from IDBI Bank in instalments between 10-Dec-12 to 14-Dec-12. They asked me to sign declaration of earliest payment at every time they provided me any copy of property documents. I requested for remaining property papers viz. Sanction municipal Plan, Completion certificate, mutation certificate etc from IDBI Bank but my request went unnoticed.
3. I was somehow able to arrange sanctioned layout plan through personal effort from promoter after showing bid win confirmation letter.
4. On 17-Dec-2012 IDBI allowed technical inspection. But Sanctioned plan, Completion certificate were still not handed over to me and they did not disclose any material information on the same.
5. On 18-Dec-2012, I received technical opinion that the construction did not match with the sanctioned municipal plan i.e flat map approved in sanction plan differs with flat image filed with sale deed, broacher of property and physical flat structure. In no time I understood that why bank had not given sanctioned layout plan to me after several follow up also and did not share any information on the same. It is an irregularised property and as per Kolkata Municipal Corporation Rules no person should occupy a building erected or re-erected or altered under KMC Building Rules, 2009 in respect of which a completion certificate under rule 29 has not been issued by Municipal Corporation. So property is not legally inhabitable as per KMC Building Rules, 2009. (Highlighted in the map filed with sale deed, sale broacher and approved plan to identify the difference. Physical construction is as per MAP in sale and property broacher which is still not approved by Kolkata Municipal Corporation)
6. For the purchase of the said flat I had applied for home loan with IDBI Bank. They issued home loan sanction also of INR 51.80 without informing me on defects. As informed to me loan documents were notarized and ready for disbursement. I denied accepting disbursement after I noticed the defect in Municipal Corporation Plan with physical structure. Had I taken loan disbursement against this property it would have been violation of DBOD. No.DIR.BC.07/08.12.001/2012-13 - July 2, 2012 Master Circular – Housing Finance paragrah 9.3 which is based on High Court decision in Kalyan Sanstha Welfare Organisation against Union of India and Others (DBOD.Dir.BC.No.43/ 08.12.01/2006-07 dated November 17, 2006) (SET 4 – Home loan sanction copy
7. On 19-Dec-2012, I immediately went to recovery department and showed them encumbrance on the property. Their attitude turned negative towards me and they started ignoring the points raised by me. They must hold these information on property as valuation report by empanelled valuer captures these facts in physical inspection before creation of security/ revaluation/ valuation prior to auction of residential flat. Public Advertisement for sale of this property did not contain any information on irregularity of construction and non-availability of important property documents. Above material encumbrances were never informed to me during inspection before commencement of auction. Rule 8(6) (a) and sub rule (5) paragraph (f) of Security Interest (Enforcement) Rule, 2002 mandates the secured creditors to disclose in the terms of sale notice, any information/documents which the authorized officers consider to be material for a purchaser to know in order to judge the nature and value of the property. It should also include the encumbrance relating to the property and the intending purchaser to be intimated of the nature of encumbrance, if any, as otherwise he/she will be purchasing the property and simultaneously shouldering litigation as well. Moreover an intending purchaser might not have entered in the bid, in the event, he/she came was appraised of any such encumbrance over the property in advance.
8. They refused to accept the above information. Then I dispatched the letter dated 19-Dec-2012 through Speed post. I requested almost every linked department to interfere but no one showed interest as bank was holding my EMD and they intended to forfeit the same for which they had given letter to that effect dated 13-Feb-2013.
I want to know, what protection available to me since bank did not have minimum set of property documents and property was not constructed as per law of state.
Thank you Mr.Raju. Yes.I agree with you.
Thank you Sir, for providing the useful article. I amy add that separate registration is required for each catagory of valuers as per Wealth Tax Rules, depending on their qualifications and experience; eg, different registration for valuation of plant and machineries and for immovable properties.
Thanks a lot for preparing such an useful article on the subject.
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