Decided on April 11,2007

Bob Housing Finance Ltd. Appellant
Saeed Ur Rahman Respondents


K.Gnanaprakasam, J. (Chairperson) - (1.) AGGRIEVED by the order dated 3.11.2006, passed in ASA -57/2005, by the DRT, Bangalore, this appeal has been filed. I have heard the learned Advocates for the appellant and the respondent.
(2.) THE issue raised in this appeal is whether the mortgage executed/created by a person, who has no title to the property, acquires title to the property subsequently, would validate the mortgage. The learned Advocate for the appellant states that the loan was sanctioned on 24.2.1998, and mortgage was created on 26.3.1998. On the date of the mortgage, though there was no sale deed in favour of the respondent in respect of the mortgaged property, he had entered into an agreement with the real owner of the property to purchase the property and also purchased the property subsequently, and therefore, the mortgage executed by the defendant is valid and the said fact was not properly considered and appreciated by the Tribunal. The Tribunal is of the view that on the date of execution of the mortgage, the respondent was not the owner as he had no sale deed in his favour and mere agreement, to purchase the property by itself would not create any interest in the property, and held that there was no valid mortgage in favour of the appellant.
(3.) IT is true that the respondent did not have title to the property on the date of mortgage, but he had acquired title subsequently, by getting the sale deed on 4.6.1998. That apart, the respondent was also put in possession of the property, on the date of the agreement itself and, therefore, the respondent was in lawful possession, which created a possessory title to the property. When his possession is lawful, the mortgagors, who acquire title subsequently would render the equitable mortgage valid on the from the date when acquired title to the property.;

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