PNP 1 WP5515-25.7.sxw IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO.5515 OF 2011 Ganesh Hanuman Doiphode and another ..Petitioners. versus Indiabulls Housing Finance Limited and others ..Respondents. ..... Mr. V.V. Pai for the Petitioners. Mr. Anoop Khaitan for Respondent No.1. Mr. S.N. Patil, AGP Respondents 4 and 5. ...... CORAM : DR.D.Y.CHANDRACHUD & ANOOP V. MOHTA, JJ. 25 July 2011. P.C. : 1. The Petition is directed against a order of the Debts Recovery Appellate Tribunal. 2. The First Respondent had granted a housing loan and which was topped up against a mortgage by deposit of title deeds in “ ” respect of a residential flat. A notice was issued under Section 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 on 26 December 2008 to the principal borrowers (the Second and Third Respondents). The notice was published on 9 January 2009. A notice for taking a measure under Section 13(4) was issued on 10 March 2009. Symbolic possession of the residential flat was taken on 13 March 2009. On 18 March 2009 an agreement to sell was entered into by the Petitioners PNP 2 WP5515-25.7.sxw with the borrower. Admittedly, the original documents of title in respect of the residential flat were with the First Respondent and the Petitioners purportedly relied upon an attested true copy issued by the Sub-Registrar s office of the title document without the ’ production of the originals. Be that as it may, Section 13(13) of the Securitisation Act provides that no borrower shall after receipt of a notice under sub section (2) of Section 13, transfer by way of sale, lease or otherwise, (other than in ordinary course of his business) any of his secured assets referred to in the notice, without the prior written consent of the secured creditor. The Petitioners have been held not to be a bonafide purchaser for value without notice. The Petitioners sought to place reliance on a certificate issued by the concerned police station on 19 April 2009 to the effect that the borrower had lost the title documents of the flat. The Tribunal was justified in coming to the conclusion that having regard to the provisions of Section 13(13), no valid right, title or interest would enure to the benefit of the Petitioners. The First Respondent has a valid pre-existing claim based on a mortgage by deposit of title deeds against credit facilities granted to the borrower. 3. For these reasons, we do not find any reason or justification to interfere in our extra-ordinary jurisdiction under Article 226 of the Constitution. 4. During the course of the hearing, Counsel appearing on behalf of the Petitioners and the First Respondent had attempted to explore the possibility of an amicable resolution of the dispute in the event that the Petitioners were ready and willing to pay the outstanding PNP 3 WP5515-25.7.sxw dues of the First Respondent. Counsel appearing on behalf of the First Respondent has stated before the Court that the First Respondent is ready and willing to furnish a concession to the Petitioners to the extent that the First Respondent shall compute simple interest at the contractual rate of 19.5% from the date of the issuance of the notice under Section 13(3) and in the event, the Petitioners clear the outstanding dues on that basis, the bank would put an end to the entire dispute. The Petition is accordingly disposed of with no order as to costs. 5. Counsel appearing on behalf of the First Respondent states that in order to enable the Petitioners to come forth with a reasonable offer for settlement on the aforesaid terms as suggested by the First Respondent, the First Respondent shall not take any coercive steps in respect of the secured assets for a period of four weeks. (Dr. D.Y. Chandrachud, J.) (Anoop V. Mohta J.)