Mortgage property sold

If you are bank you must have the documents of mortgage,so there cannot be any question of denial.You can start recovery process.

A mortgage is a first charge over the property. Even a subsequent sale cannot nullify the mortgage and the mortgagee (financial institution) shall have a charge over the property prior to the third party purchaser.

The third party purchaser however shall claim the status of a bonafide purchaser, which has to be countered in court and based upon the facts of each case.

After the enactment of T. P. Act, the nomenclature of EM is wrong.  It is mortgage by deposit of title deeds.  So if the mortgagor has deposited the original title deeds with your client with intent to create mortgage, then the subsequent encumbrnce created by the mortgagor is subject to your mortgage only. 

If the amount payable by the mortgagor is Rs. one lakh and above and the account has become NPA, then yourclient can invoke the provisions of the SARFAESI Act and bring the secured asset for sale without waiting for an adjudication.

snchandrasekarabharathi is perfectly correct. No more explanation is needed for the query.

I fully agree with Mr. snchandrasekarabharathi.