STATE BANK OF HYDERABAD Vs. SIDDAMSETTY RAMESH
LAWS(DR)-2003-7-7
DEBTS RECOVERY APPELLATE TRIBUNAL
Decided on July 10,2003

Appellant
VERSUS
Respondents

JUDGEMENT

A.Subbulakshmy, - (1.)THE 3rd defendant in the OA is the
subsequent purchaser of the property after the mortgage was created to the Bank. THE PO, DRT, Hyderabad has passed order holding that the defendants 1 and 2 alone are liable for the suit claim. It has been observed by the PO that "the 3rd defendant is neither a borrower nor a guarantor for the liability of the 1st defendant and in the absence of any documents to establish the creditor-borrower relationship between the 3rd defendant and the applicant Bank, it has to be said that 3rd defendant has no 'debt' as defined under the RDB Act which he is liable to pay to the applicant" and accordingly dismissed the O.A. as against the 3rd defendant. Aggrieved against this order, the appellant Bank has come forward with this appeal.

(2.)The Counsel for the appellant Bank submits that the 3rd defendant is the subsequent purchaser of the mortgaged property and the 3rd defendant is also liable for the suit claim to the extent of the mortgaged property in his hands. The Counsel for the respondents submits that the mortgage was created subsequent to the purchase by the 3rd defendant and so the 3rd defendant is not liable. The Counsel for the appellant Bank submits that the mortgage was much earlier to the purchase by 3rd defendant and the 3rd defendant has purchased the property subject to the mortgage created in favour of the Bank and the 3rd defendant is liable to the extent of the property in his hands.
The mortgage documents Exs. A23 and A24 clearly establish that the mortgage was created on 15.3.95. Even when the loan was subsequently enhanced in the year 1997, even at the time of creating the documents, it has been specifically mentioned by the defendants that the defendants 1 and 2 have created the mortgage by deposit of title deeds on the property on 15.3.95 and they have deposited the title deeds with the Bank on 15.3.95. So, it is crystal clear from these documents that the mortgage was created on 15.3.95. The 3rd defendant has purchased the property on 30.7.96. Only subsequent to the mortgage created in favour of the Bank, the 3rd defendant has purchased this property. The 3rd defendant has purchased the property subject to the mortgage created in favour of the Bank. Since the 3rd defendant has purchased the mortgaged property, the 3rd defendant is also liable for the suit claim to the extent of the property in his hands, which he has purchased from D1 and D2.

(3.)HENCE, I find that the order passed by the PO, DRT, Hyderabad holding D3 not liable for the suit claim is liable to be set aside and it is set aside to that extent so far as D3 is concerned and the order of PO is modified and it is declared that D3 is also liable for the suit claim to the extent of the mortgaged property in his hands, which was purchase by him from D1 and D2.


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