Anurag Tyagi (Officer) 10 June 2011

Fraudulent Mortgage

Dear Sir,

I and my relatives purchased a number of adjacent plots(part of a large estate) from a certain seller.The sale deeds were legally registered in the tehsil court and the mutation was also completed. At a later date the said seller, mortaged the entire estate with a bank for a loan and has been unable to repay the EMIs. The bank has issued notices to us informing us of their intention to auction the properties. My query is , Is the bank justified in serving us the notices when the plots are already registered and mutated in our names as per the land records. The seller has obivously committed a fraud by mortgaging the entire property to the bank, when he had already sold it to us at an earlier date. Should the bank not have checked the details of the property before accepting it as collateral? What should be our further course of action.

Thanks in advance

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6 Replies

(Guest)

@Anurag Tyagi

Should the bank not have checked the details of the property before accepting it as collateral?

Yes, after you purchased the plots and registered it then before mortgage bank should have to check.

After sell you are the owner not your seller so only you have a right for applying mortgage for the purpose of taking loan.

If the seller can't make loan amount then it may possible that in future bank gave notice and this is happened in your case.

I think in your case bank is not justified.

You have to file fraud case against the seller.

I suggest you immediately consult a good lawyer who having knowledge in civil,criminal and property law.

pervez (adviser) 10 June 2011

I agree with the comments / views of Mr. Vyas. Further to add that Bsank carries out thorough investigation of title through empanelled lawyer and satisfy itself about unincumbered property. Since deeds were registered prior to mortgage, the Bank should have notice of the part of the property. In fact registration of deed amounts to "Public Notice". It is bbvious that Bank has not taken due caution before creation of mortgage.

since the sellar has defrauded you also, immediately file file FIR / compliant before the concerned police station.

regards

RAJU O.F., (Advocate) 15 June 2011

If the properties are sold to you before the martgage to the bank, then bank cannot mortgage that portion of the property and cannot sell your properties. If the bank intends to sell your property along with the entire lot, under SARFAESI Act, then you immediately file Appeal under Sec.17 of the SARFAESI Act, before the jurisdiction Debts Recovery Tribunal and can stop sale or any further proceedings by the bank. It was the duty of the bank to verify the encumbrance certificate and revenue records before mortgaging the property for extending the loan. Hence bank was negligent and you are eligible for costs and compensation also under the SARFAESI Act.

Anurag Tyagi (Officer) 20 June 2011

Dear Kushan Vyas, Pervez and Raju O.F.

Thanks to all of you for your valuable advice. I am indeed grateful to each of you for your inputs.

My next query is directed to Shri Raju O.F.

Sir, as of now, the knowledge that the land was mortgaged to the bank on a later date is based on verbal conversation between the bank manager and us. Since the bank has issued a notice informing us of their intention to sell the land, should we reply to the notice asking them to intimate in written the details of the mortgage that they have made with the seller and further based on the reply we can file an appeal with the jurisidiction Debts Recovery Tribunal?

thanks and regards

Anurag

RAJU O.F., (Advocate) 25 June 2011

You need not wait for any further, as the bank illegally issued Sale Notice of properties including your portion. Your limitation period of 45 days starts from the date of Sale Notice under SARFAESI Act or from the date of its publiction. File Securitisation Appeal before DRT immediately.