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Judgment
S.N.H. Zaidi, J
This appeal impugns the order dated 9.5.2012 of the Presiding Officer of DRT-II, Delhi dismissing application MA No. 244/2011 filed by the appellant in S.A. No. 17/2011. The facts of the case indicate that as the appellant defaulted in repayment of the loan facilities sanctioned by respondent No. 1 FI, a demand notice dated 8.1.2011, under Section 13(2) of the SARFAESI Act, was issued calling upon it to pay the outstanding amount within 60 days and when the payment was not made, a notice for taking the possession over the secured assets was issued on 15.3.2011. Feeling aggrieved with that action, the appellant filed an application under Section 17(1) of the SARFAESI Act (S.A. No. 17/2011) before the Tribunal below. During the pendency of the S.A., the appellant offered to pay the entire outstanding dues to the respondent FI, whereupon the S.A. was disposed of by the DRT by a consent order dated 27.5.2011 directing the S.A. applicant to pay the entire balance amount of Rs. 5,45,15,061/- by 31.5.2011 and the respondent FI was directed to release the original title deeds of the secured assets within 48 hours from the date of receipt of the entire amount. The appellant paid the aforesaid amount and asked the respondent FI to release the title deeds of three properties mortgaged with it. The respondent No. 1, however, released the title deed in respect of only one property and retained the title deeds of the remaining two properties. The appellant, thereafter, filed application (MA No. 244/2011) seeking direction to the respondent FI to release the remaining title deeds and also to initiate contempt proceedings against it. The said application has been dismissed by the Tribunal below by the order impugned, against which this appeal has been filed.
I have heard Mr. B.S. Nagar, learned Counsel appearing for the appellant and Mr. R.K. Dhawan, learned Counsel for the respondent No. 1.
Mr. Nagar has contended that while dismissing the application, the teamed Tribunal below had erred in observing that the appellant had concealed vital facts regarding its liability towards individual borrowers of housing loan as, according to him, the appellant was not required to off-load the liability of the individual persons to whom housing loans were sanctioned by the respondent FI, against the security of their respective flats. He also pointed out that the learned DRT had failed to notice that the loan accounts of those individual persons were not classified as NPA and as such the title deeds of the appellant's properties should not have been retained by the respondent for the recovery of the housing loans of the said persons. Mr. Nagar further contended that the order dated 27.5.2011 was passed by the DRT with the consent of the parties as the respondent FI had agreed to release the title deeds within 48 hours of receiving the entire amount due on the appellant, which was accordingly paid to it. He also contended that for the payment of the instalments of the individual borrowers of housing loans, the developer cannot be held liable.
Mr. Dhawan, on the other hand, contended that the application (MA No. 244/2011) was misconceived as the appellant itself was making the payment of six loan accounts pertaining to six persons, namely, Lalit Khurana, Prashant Mittal, Vineeta Garg, Gaurav Nagar, Kiran Malhotra and Jitender Doodhi and had paid an amount of Rs. 4,94,367/- towards their EMIs vide its letter dated 29.9.2011 and when the respondent came to know of the said fact, it did not release the title deeds of the secured assets of the appellant in order to secure the repayment of the outstanding amount qua the said borrowers. He also submitted that after the order dated 27.5.2011 was passed, the appellant had undertaken on 29.9.2011 to pay EMIs qua the said six loan accounts and had also made payment of EMIs but in order to coerce the respondent, it had filed the said application, which has rightly been dismissed by the Tribunal below.
I have considered the submissions of the parties' Counsel and perused the record. The learned Tribunal below has observed in the order impugned that the applicant was making the payment of EMIs and had admitted its liability vide letter dated 29.9.2011 in respect of the said six loan accounts and the total liability qua those accounts was Rs. 1,75,03,330/- besides the pendent lite and future interest. The learned DRT while observing that these facts, which were very material in nature, were not disclosed by the applicant and by suppressing the said material facts, it had obtained the order, dismissed the application (M.A. 244/2011).
I have, however, failed to find any document on record wherein the appellant would have admitted its liability to repay the loan sanctioned by the respondent FI to the individual borrowers of the housing loan in the complex being built by it. It appears that a tripartite agreement was entered into amongst the borrower of the housing loan on the first part, the builder of the housing complex on the second part and the creditor FI on the third part, wherein only Clause 10 shows that the builder had agreed that in the event of the default of instalment by the borrower, it shall be bound to refund the entire amount deposited with it by the creditor company, without any reference to the borrower. The builder has nowhere admitted that he would pay the instalments on behalf of the borrower. There is also nothing on record which could show that any of the house loans sanctioned by the respondent FI to the said six borrowers had ever been classified as NPA or any default in the payment of the EMIs had been committed by those borrowers. Even the letter dated 29.9.2011 sent by the appellant to the respondent FI does not show that the appellant had admitted the liability of payment of EMIs on behalf of the borrowers named therein qua their housing loan accounts. In my opinion, merely by once making payment of EMIs to the respondent FI on behalf of six house loan borrowers, through the letter dated 29.9.2011, does not make the appellant liable for payment of the remaining EMIs on behalf of such persons.
A perusal of the order dated 27.5.2011 passed by the Tribunal below, however, shows that respondent No. 2 M/s. Saurabh Furnishing P. Ltd. had agreed to make payment to respondent FI on behalf of the applicant/appellant to which the respondent FI did not have any objection and agreed to release the title deeds to the mortgagor/borrower and on the consent of the parties the order was came to be passed, finally disposing of the SA, with the direction inter alia that upon receiving Rs. 5,45,15,061/- by 31.5.2011 the respondent FI would not charge further interest amounting to Rs. 17,60,380/- as shown in the chart annexed with the reply and upon receiving the entire dues in the above manner, the respondent FI was directed to release the title deeds within 48 hours. In my opinion, once the said order was passed with the consent of the respondent FI and in pursuance thereof the amount was deposited with it the respondent FI was obliged to honour its words and to release all the title deeds of the mortgaged properties. The respondent FI has already released one title deed in pursuance of the said order but has wrongly retained the title deeds of the remaining two properties. In view of these circumstances, I am of the considered view that since the respondent FI had indisputably received the entire amount as directed by the DRT, it should have complied with the order dated 27.5.2011, which was passed with its consent and should have released the title deeds of all the mortgaged properties to the mortgagor as agreed. I am also of the view that the appellant had not concealed any material fact on 27.5.2011 when the said order was made and the appellant was under no legal obligation to pay the EMU of the individual borrowers and as such the respondent FI should not have refused to release the remaining two title deeds.
Consequently, this appeal succeeds. The order dated 9.5.2012 is set aside and the respondent No. 1 is directed to release the remaining two title deeds of the mortgaged properties to its mortgagors within a month from today. The parties shall bear their own cost of this appeal. Copy of this order be furnished to the parties as per law.