Delhi Punjab Goods Carrier Pvt. Ltd. vs Bank of Baroda

M.M. Kumar, J.—The instant petition challenges notices dated 19-7-2007 (P. 5 and P. 6) issued u/s 13(4) of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for brevity ''the Act).

The petitioner has claimed that he is a tenant in the property in dispute since August, 2006 and the notices have been issued to the borrowers after recalling the huge outstanding amount of loan with interest. It is evident from the perusal of the notices that charge of the property was created much earlier to the commencement of tenancy in August, 2006. In such a situation a tenant of the present nature would not enjoy any protection as the property has already been encumberated by the charge created over it by the owner/borrowe.

These principles of law have been reiterated by Hon''ble the Supreme Court in the case of Mahabir Gope and Others Vs. Harbans Narain Singh and Others, ; Mathuralal Vs. Keshar Bai and Another, , Shah Mathuradas Maganlal and Co. Vs. Nagappa Shankarappa Malage and Others, ; Hanumant Kumar Talesara Vs. Mohan Lal, ; Carona Shoe Co. Ltd. and Another Vs. K.C. Bhaskaran Nair, ; Parameswaran Govindan Vs. Krishnan Bhaskaran and others, ; Cheriyan Sosamma and others Vs. Sundaressan Pillai Saraswathy Amma and Others, and Nirmal Chandra Vs. Vimal Chand, . These principles are fully applicable to the facts of the present case. In Parmeshwaran''s case (supra) Hon''ble the Supreme Court referred to Sections 60, 76(h) and 83 of the Transfer of Property Act, 1882 and observed as under:

A conjoint reading of Section 60, 76(h) read with Section 83 of the Transfer of Property Act would amplify that on deposit of the mortgage amount, the contractual relationship of mortgagor and mortgagee ceases. This Court in Prithi Nath Singh and Others Vs. Suraj Ahir and Others, , held that when the mortgage money is paid by the mortgagor to the mortgagee, there does not remain any debt from the mortgagor to the mortgagee and, therefore, the mortgage can no longer continue after the mortgage money is paid. Therefore, on payment of mortgage money or deposit thereof in the Court by the mortgagor, the mortgage comes to an end and the right of the mortgagee to remain in possession also. Thereafter, the mortgagee continues in unlawful possession.

From the above principles of law it is evident that tenancy has to be proved by a document or otherwise prior to the date of creation of charge of equitable mortgage. It is well settled that a mortgagee or mortgagor cannot induct a tenant without mutual agreement and confer upon a tenant any right to the prejudice of either of the parties.

In the instant case, the relationship of the petitioner as a tenant with the borrower as a landlord admittedly came into existence after the creation of charge by the borrower on the property which is under the tenancy of the petitioner and, therefore, no protection in law would be available to such a tenant and above principles laid down by Hon''ble the Supreme Court would fully apply to the facts of the instant case and it has to be held that the petitioner in his capacity as tenant does not enjoy any right qua the charge holder-respondent Bank. The writ petition is wholly misconceived and is thus liable to be dismissed.

For the reasons aforementioned, this petition fails and the same is dismissed.