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Case Number

O.A No. 1721 of 1999

Judges

K.J Paratwar, Presiding Officer

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Smart Summary

Case Summary — K.J. Paratwar, Presiding Officer

Factual and Procedural Background

The applicant bank filed an Original Application (O.A.) seeking recovery of monetary dues and enforcement against mortgaged property. The monetary claim comprised Rs. 1,55,58,120/- under a cash credit facility and Rs. 32,64,671/- under an overdraft facility, with interest at 20.75% p.a. from filing of the O.A. until full realization. Defendant No. 1 (the borrower company) is in liquidation; defendants Nos. 2 and 3 are guarantors; defendant No. 4 is alleged to be an illegal occupant (and claims to be purchaser). The borrower had credit facilities since 1981, with specific facilities existent in 1994 of Rs. 80 lacs (cash credit) and Rs. 20 lacs (overdraft). Title documents (agreement of sale dated 18.3.1974) and other documents were deposited as security and the Bank alleges equitable mortgage over Unit No. 319, 3rd Floor, Kewal Industrial Estate, Lower Parel, Bombay-400 013. The borrower purportedly sought modification of the mortgage in 1995, but failed to create requisite security. Acknowledgements of indebtedness dated 4.3.1996 (or letters of acknowledgement dated 4.6.1996) are relied upon by the Bank. Defendant No. 4 asserts it bought the property in December 1990 and claims to be a bona fide purchaser for value without notice of the Bank's mortgage. The Official Liquidator of defendant No. 1 did not file a written statement. The matter proceeded on affidavits, documents and oral argument, after which the Tribunal heard and decided the O.A.

Legal Issues Presented

Whether the Original Application is barred by limitation, and if not, whether letters of acknowledgement (dated 4.6.1996) cure any limitation bar.
Whether an equitable mortgage over the specified Unit No. 319 existed and was validly created and extended to secure the borrower's liabilities to the Bank.
Whether defendant No. 4 is a bona fide purchaser for value without notice of the Bank's mortgage and whether that status can be determined by this Tribunal under the R.D.D.B. Act.
What is the correct extent of outstanding amounts due to the Bank from the borrower and guarantors (including whether penal interest or interest on penal interest is recoverable).
Whether the Bank's entitlement as secured creditor to the mortgaged property is subject to registration of the charge with the Registrar of Companies (ROC) and proof before the Official Liquidator.

Arguments of the Parties

Applicant (the Bank)

Seeks recovery of outstanding cash credit and overdraft balances with interest; relies on title deed (agreement of sale dated 18.3.1974), various letters and entries showing creation and continuance of equitable mortgage, acknowledgements and guarantee letters (including those dated 4.6.1996).
Contends that transfer to defendant No. 4 was fraudulent and that the title deeds remained with the Bank as security for the debt.
Provided account statements, demand promissory notes, letters recording creation of equitable mortgage, sanction letter for enhanced facility and other documents as evidence.

Defendant Nos. 2 and 3 (Guarantors)

Asserted that the O.A. is barred by limitation and disputed the calculations of outstanding amounts.
Denied execution of the acknowledgements of debt on the purported dates and disputed the quantum of liability.
Did not seriously dispute that they stood as guarantors, but contested the figures and some evidentiary aspects.

Defendant No. 4 (Occupant / Purchaser)

Challenged the creation and enforceability of the equitable mortgage and claimed the Bank did not clarify when title deeds were deposited or what amount was secured by them.
Argued the letters extending the mortgage required registration and therefore creation is invalid or unenforceable.
Claimed to have purchased the property for Rs. 5 lacs in December 1990, executed an agreement dated 25.12.1990, paid transfer charges to the builder (Rs. 19,375/-), gave necessary intimation to the society, and has been in possession since 25.12.1990 — thus asserting status as a bona fide purchaser for value without notice of the Bank's mortgage and seeking dismissal of the O.A.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Ranadhin (Ramadhin) Singh v. Siqram Singh, AIR 1957 Patna 64	On the point of proof of execution of a document qua signatures on blank paper (used by defendants to challenge signatures on documents).	The Tribunal found this precedent inapplicable to the facts because the defendants' signatures were not shown to have been appended on blank documents which were later filled; accordingly, the attempted reliance on that authority failed.
United Dominion Trust v. Western, 1 QB (1976) 513	Where a person signs on blank standard documents, that person takes responsibility for the blanks being filled in and cannot plead non est factum; implied authority to fill in documents exists.	The Tribunal applied this principle to reject the defendants' contention that their signatures could not be relied upon, holding that the guarantors could not avoid the letters of acknowledgement on that ground.
Margaret v. Indo Commercial Bank, (1979) 2 SCC 396 : AIR 1979 SC 102	As to limitation law applicable to guarantors: limitation against guarantors starts from the date of recall.	The Tribunal noted this rule but concluded that filing the O.A. itself can be construed as invocation of the guarantee; therefore the guarantors could not avoid liability by saying recall was not proved to have been served.
Ravindra's case (referred to as authority on interest)	Cited for the proposition that penal interest (and interest on penal interest) is not allowable.	The Tribunal relied on this authority to refuse penal interest and interest on penal interest when computing the recoverable amount, permitting only the agreed rate of interest.

Court's Reasoning and Analysis

The Tribunal proceeded through the contested issues sequentially:

Acceptance as to Defendant No. 1: The Bank's case against defendant No. 1 was accepted without much challenge because the Official Liquidator filed no written statement and the factual averments and documentary evidence were uncontroverted.
Limitation: For purposes of analysis the Tribunal treated the limitation period as three years (despite mortgage-related claims potentially attracting a 12-year period). Last credit entries pre-dated three years, but letters of acknowledgement dated 4.6.1996 (Exhs. 64 & 65) crystallized liability as of 31.3.1996 and the O.A. was filed within three years of those acknowledgements. The defendants disputed the date and authenticity of signatures, relying on the Ranadhin Singh authority, but the Tribunal held that United Dominion Trust v. Western dictated that a person who signs standard documents cannot later disown them on a non est factum plea. The Tribunal therefore upheld the validity of the acknowledgements and found the claim within limitation.
Invocation of Guarantee and Limitation vis-à-vis Guarantors: The Tribunal referred to Margaret v. Indo Commercial Bank for the proposition that limitation for guarantors runs from the date of recall. However, it concluded that filing the O.A. could itself be construed as invocation of the guarantee and that the guarantors had not shown readiness to pay; accordingly they could not insist on the Bank filing a separate suit or giving prior recall notice.
Equitable Mortgage: The Tribunal examined the title deed (agreement of sale dated 18.3.1974, Exh. 39) endorsed to defendant No. 1, entries showing defendant No. 1's name as owner, and multiple letters and memoranda (Exhs. 40–46, 47) evidencing re-deposit and reaffirmation that title deeds were held as security. It concluded that there was imposing evidence of creation and extension of an equitable mortgage to secure the indebtedness.
Defendant No. 4's Claim as Bona Fide Purchaser: Though defendant No. 4 produced voluminous material (agreement of sale dated 25.12.1990, payment evidence, possession evidence), the Tribunal determined that the question whether defendant No. 4 is a bona fide purchaser for value without notice of the Bank's mortgage falls outside the scope of the R.D.D.B. Act and must be determined by a civil court of ordinary jurisdiction. The Tribunal therefore declined to finally decide that question and left the Bank's claim over the property subject to the outcome of such suit, if filed within two months.
Extent of Outstandings: The Tribunal found Exhs. 64 and 65 to have crystallized the amount as on 31.3.1996 and rejected the private calculation produced by the guarantors. The Tribunal accepted the Bank's recalculation (Exh. 'G' in Exh. 144) of principal and interest computed at the agreed rate, but disallowed penal interest and interest on penal interest in light of the cited authority (Ravindra's case). The Tribunal thus determined the recoverable monetary amount accordingly.
Security and Registration: While holding that the outstandings were secured by the specified property, the Tribunal expressly made that declaration subject to (a) proof before the Official Liquidator that the charge over the mortgaged property had been registered with the Registrar of Companies (ROC), and (b) the result of any civil suit that defendant No. 4 may file within two months to challenge the Bank's security.
Costs: Given the facts, the Tribunal found it appropriate to award half costs against the defendants.

Holding and Implications

Holding:

DISPOSITION: The Original Application is allowed with half costs against defendant Nos. 1 to 4.

Specific Orders:

The Tribunal directed that defendant Nos. 1 to 3 do jointly and severally pay to the applicant Rs. 1,69,35,123/- (Rupees one crore sixty-nine lacs thirty-five thousand one hundred twenty-three only) with interest at 16.50% p.a. from the date of filing the Original Application until full realization.
Subject to proof before the Official Liquidator that the charge on the mortgaged property was registered with the Registrar of Companies and subject to the decision in any suit that defendant No. 4 may file within two months, the Tribunal declared that the outstandings are secured by defendant No. 1's property (Unit No. 319, 3rd Floor, Kewal Industrial Estate, Bombay-400 013).
The Tribunal directed issuance of a recovery certificate accordingly.

Implications

Direct consequences: The Bank obtains a monetary decree against the borrower and guarantors for the specified sum and rate of interest, and a declaratory finding that the indebtedness is secured by the mortgaged property, subject to two important contingencies: (i) proof of registration of the charge with the ROC before the Official Liquidator; and (ii) the outcome of any civil suit defendant No. 4 may institute within two months to determine whether he is a bona fide purchaser without notice.

Broader legal implications: The Tribunal's determination does not purport to resolve the title dispute between defendant No. 4 and the Bank; it expressly leaves that question to an ordinary civil court. The opinion does not announce the creation of any new legal precedent beyond application of cited authorities to the facts at hand.

End of summary — prepared from the opinion authored by K.J. Paratwar, Presiding Officer. No information has been added beyond what appears in the provided opinion.

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Central Bank Of India v. Official Liquidator High Court Bombay

K.J Paratwar, Presiding Officer:— This is an application for recovery of:

Rs. 1,55,58,120/- being dues under cash credit facility with interest @ 20.75% p.a from the date of filing the original application till full realization.

Rs. 32,64,671/- being dues under over draft facility with interest as above.

2. The borrower company (defendant No. 1) is in liquidation but for the sake of convenience I shall refer it as the borrower or defendant No. 1. The defendant Nos. 2 and 3 are guarantors. The defendant No. 4 is sued as illegal occupant of mortgaged property.

3. The defendant No. 1 is the applicant's constituent since July 1981 enjoying certain credit facilities which were renewed from time to time. On or about 31.8.1994, the facilities were Cash Credit (Hypothecation) facility of Rs. 80 lacs and overdraft of Rs. 20 lacs. The said facilities were subsequently renewed. The borrower and the guarantors had from time to time executed usual security documents, letters of guarantee. The further security was of Equitable Mortgage, by deposit of title deeds of Property being Unit No. 319, 3rd Floor, Kewal Industrial Estate, Senapati Bapat Marg, Lower Parel, Bombay-400 013 contained an agreement of sale dated 18.3.1974 between Kewal Builders Pvt. Ltd. and one Shardaben V. Doshi endorsed in the defendant No. 1's favour on 2.8.1978 Sometime in 1995, the defendant No. 1 sought modification of equitable mortgage by Unit No. 105, A/3, Dhanraj Industrial Estate; Lower Parel, Bombay-400 013 (registered office of defendant No. 1) owned by M/s. Asian Plast, an associate concern of life defendant No. 1, in the place of the property earlier mortgaged. The applicant was agreeable to the modification provided Equitable Mortgage of new property at Dhanraj Industrial Estate created but the defendant No. 1 failed in complying the same.

4. The defendant No. 1 had availed of the loan/credit facilities. On failure to pay the outstandings, acknowledgements of indebtedness was given on. 4.3.1996

5. Sometime in 1998, the applicant came to know that the defendant No. 4 was occupying the property. The applicant's officer therefore visited the property and was told by defendant No. 4; that in the negotiations in 1990, the defendant No. 1 had told that the property was free from encumbrance; that after negotiation the agreement for sale was executed on 25.12.1990 At the time of purchase the defendant No. 1 had written to Kewal Industrial Estate and Kewal Builders Pvt. Ltd. about the sale of the property and for transfer of the same and also of original agreement of sale in favour of defendant No. 4. The Kewal Builders Pvt. Ltd. accepted cheque of Rs. 19,375/- being transfer charges from defendant No. 4 which is why implied consent for the transfer was given. The applicant contends that the transfer was fraudulent. In the O.A reference to copious correspondence between the parties is made of which resume is unnecessary. Suffice it to say that the O.A is sought to be allowed in respect of monetary claim as also with reference to mortgaged properties.

6. The Official Liquidator of defendant No. 1 did not file written statement.

7. The defendant Nos. 1 to 3 filed common written statement at Exh. 18. Since however Official Liquidator has been appointed of defendant. No. 1, the same can be treated to be of defendant Nos. 2 and 3. The O.A is said to be barred by limitation. The defendant Nos. 2 and 3 did not seem to seriously deny that they stood as guarantors. They have however denied the calculations. The execution of acknowledgements of debt on the purported date is denied. There is no other specific defence in the lengthy written statement.

8. The defendant No. 4 in written statement at Exh. 12 have initially taken up more or less same contentions. But, his written statement so far as the transaction between the Bank and defendant Nos. 1 to 3 are concerned is relevant. This defendant has challenged creation of equitable mortgage. It has also pointed out that the Bank has not clarified as to when the title deed was deposited and what was the amount secured by it. The letters extending the mortgage, according to this defendant, required registration. The creation of the mortgage is invalid and unenforceable. This defendant has claimed to have purchased the property for Rs. 5 lacs in December, 1990. An agreement dated 25.12.1990 was signed. It is stated that before the agreement, he had by letter dated 18.12.1990 to M/s. Kewal Builders Pvt. Ltd. intimated about the same and requested to transfer the property in his favour. The defendant No. 1 by letter of even date also to Kewal Builders Pvt. Ltd. surrendered his rights. Kewal Builders charges compensation of Rs. 19,375/-. The necessary intimation to the society also was given. The defendant claims to have been put in possession on 25.12.1990 and is continuing to be in possession since then. The defendants thus claim to be bona fide purchaser for value without notice of the mortgage of the applicant's favour. On these contentions, defendant No. 4 has sought for dismissal of the original application.

9. The evidence in this case comprises of claim affidavits of Mr. S.P Yadav (Exh. 13), Mr. V.R Sivaramakrishnan (Exh. 15) and Mr. Babulal Jain (Exh. 144) and the latest documents being statement of account (Exhs. 29 and 30), demand promissory notes (Exhs. 52 and 55), title deeds (agreement of sale) dated 18.3.1974 (Exh. 39), letter recording creation of equitable mortgage in respect of unit No. 319 dated 4.7.1984 (Exh. 40), memorandum of entry of even date (Exh. 41), statement recording creation of mortgage dated 10.8.1988 (Exh. 42), memorandum of entry in respect of unit No. 310 of said date (Exh. 43), statements recording creation of equitable mortgage dated 7.8.1989 (Exhs. 44 and 46), memorandum of entry of said date (Exh. 45), resolution of defendant No. 1 company dated 7.9.1994 (Exh. 4B), letter from the applicant to Kewal Industrial Estate dated 12.9.1994 (Exh. 49), agreement of hypothecation (Exhs. 50, 53 and 56), letters of undertaking (Exhs. 58 and 60), deed of guarantee dated 4.6.1996 (Exh. 63), letters of acknowledgement dated 4.6.1996 (Exhs. 64 and 65).

10. The defendant No. 3 filed counter affidavit at Exh. 146 for himself and for defendant No. 2 while defendant No. 4 filed his counter affidavit at Exh. 16. The defendant No. 4 has filed voluminous documents at Exhs. 78 to 117, the material amongst which would be referred at the appropriate place, defendant Nos. 2 and 3 filed statement of account (Exh. 149) got privately prepared by them.

11. At the end, I have heard arguments of learned Counsel representing the rival parties.

12. The applicant's case as against defendant No. 1 is liable to be straightaway accepted since the same has gone unchallenged. There is also considerable evidence catalogued above to prove the grant and availment of the loan/credit facilities as alleged by the applicant, enhancements from time to time and execution of the documents. In fact, the written statement (Exh. 18) filed by-defendant Nos. 2 and 3 (with defendant No. 1 when it was not in liquidation), the availment of the facility and the execution of the documents in lieu thereof is not denied. The defendant Nos. 2 and 3 also have not denied to have signed the letters of guarantee and to have stood as guarantors. From the rival contentions, ¾ points appear to be in controversy. I shall now take up such issue one after another.

Limitation:

13. Neither of the parties have pointed out the provision of the Limitation Act which would apply to the Original Application and the period of the limitation. But, I shall consider the issue considering the period of limitation to be 3 years by keeping aside the fact that the outstandings are secured by mortgage for which 12 years period of limitation is prescribed. It is no doubt true that last credit entries in the cash credit account (Exh. 29) and overdraft account (Exh. 30) are beyond 3 years of filing the original application. But, there are letters of acknowledgement (Exhs. 64 and 65) both dated 4.6.1996 in respect of the outstandings on 31.3.1996 The OA has been filed within 3 years therefrom. The date of letters of acknowledgement have however seriously disputed. While pointing out that the adhesive stamps on those documents bear date 28.6.1994, Mr. Sharma has urged that the signatures were taken at or about that time (along with other documents) when Exhs. 64 and 65 were blank. Reliance has been placed on Ranadhin Singh v. Siqram Singh, AIR 1957 Patna 64, on the point of proof of execution of the document qua signatures on blank paper.

14. Mr. Rishabh Shah on the other hand has drawn my attention to the franking of the stamp duty of Rs. 2 done on 10.4.1996 Thereupon, the argument that the signatures on Exhs. 64 and 65 Gould not have been taken before 10.4.1996 will have to be endorsed; for the franking is done by the authorities concerned only when the document is not completed. Thus, the contention that the signatures were obtained in 1994 does not hold merit. The citation in the matter of Ramadhin Singh (supra) relied on behalf of the defendants is in-applicable because in that matter the question was about the signatures appended on a blank piece of paper. In cases where the person signs on blank standard documents, the legal position is laid down in United Dominion Trust v. Western, 1 QB (1976) 513, that such person takes responsibility of the blanks being filled in. The plea of non est factum is just not available to such person. Indeed the higher Courts have gone to the extent of ruling that such persons give implied authority to fill the documents at least as per the then existing position. In the light of above, the defendant Nos. 2 and 3 cannot be allowed to get away with the letters of acknowledgement as tried to be done. In fact, these defendants had on 4.6.1996 itself also executed letter of guarantee (Exh. 63) which means that the original application having been filed within 3 years therefrom is within limitation.

15. There is another aspect to the issue which is that in any case as against the guarantors, the limitation starts from the date of recall as held in Margaret v. Indo Commercial Bank, (1979) 2 SCC 396 : AIR 1979 SC 102. Upon that Mr. Sharma pointed out that, the Bank has not tendered any evidence to show that the recall notice was served on his clients. I do not think that the factuality in the submission, even if assumed to be correct, they help the guarantors; since the filing of the O.A can itself be construed to be invocation of guarantee. The consequent submission advanced on behalf of defendant Nos. 2 and 3 that this O.A itself is untenable and that the Bank should file another O.A against the guarantors is far fetched. The idea of giving notice is to enable the guarantor to tender the amount so that they are not saddled with the cost of the O.A The Guarantors herein have never shown readiness to pay any amount. Such persons cannot in my view be heard to say that the Bank should have filed another suit for recovery against them.

Equitable Mortgage:

16. The defendant Nos. 2 to 4, particularly defendant No. 4, has challenged the creation of Equitable Mortgage. The title deed namely agreement of sale by Kewal Builders in favour of Shardaben V. Doshi (admittedly the original owner) is filed by the Bank at Exh. 39 endorsed by both the parties in favour of the defendant No. 1. According to defendants it is not title deed. It may be that by mere endorsement, the title may not strictly speaking pass. At the same time, it is to be noted that in all the records the defendant No. 1's name has been entered as owner of the property on the basis of said title deed. That apart, defendant No. 4 does not come out with a case that defendant No. 1 became the owner of the property by some other document of title and not by Exh. 39. Above all the defendant No. 4 itself claims to have purchased the property from defendant No. 1. Therefore, the defendant No. 4 is in my view estopped from challenging the defect in the title of the defendant No. 1. In the circumstances, I do not think that the finer aspects and the niceties in the title can be gone into or Exh. 39 can be held to be not a document of title.

17. The fact that Exh. 39 is with the applicant Bank coupled with the fact that there is existing debt can be construed to mean that the title deeds are with the Bank as security for the outstandings. That apart, there is also evidence about creation of equitable mortgage comprising of the defendant No. 1's letter dated 4.7.1984 (Exh. 40) to the Bank stating that the title deeds were re-deposited with contention to secure the renewed facilities. There is another letter by defendant No. 2 on stamp folio of Rs. 5,000/- dated 10.8.1988 written pursuant to the resolution of the company dated 5.8.1988 declaring and re-affirming that the Bank shall continue to held the title deed as security for the enhanced facility. One more letter dated 7.8.1989 by the company to the above effect is also on the record at Exh. 46. The Bank's sanction letter dated 13.8.1994 (Exh. 47) shows that the existing mortgage was to continue for the enhanced facility of Rs. 80 + 20 lacs. This imposing evidence is in my view more than sufficient for holding that the equitable mortgage was created and extended for securing the outstandings.

The defendant No. 4 being purchaser for value without notice of the mortgage:

18. The defendant No. 4, it may be reiterated, has come up with a plea of having purchased the property for valuable consideration without notice of the mortgage. The contention is that negotiations about the same which took place in 1990 culminated with execution of agreement of sale dated 25.12.1990 (Exh. 78). Voluminous evidence has been placed on record in order to show that at the time of purchase, defendant No. 4 had written to the builder as also the co-operative society; that the builder accepted certain money from it; that the electricity and other connections are standing in its name etc. In my opinion, however, the question raised by defendant No. 4 cannot be decided by this Tribunal. As to whether he is a bona fide purchaser for value without notice of the mortgage in favour of the applicant is a question which does not fall within the scope of R.D.D.B Act. That is a question to be decided by Court having ordinary civil jurisdiction. The defendant No. 4 may, if so advised, therefore file suit in the appropriate Court. The conclusion that the outstandings are secured by mortgage would be subject to the decision in such suit, if filed within two months.

Extent of outstandings:

19. The defendant Nos. 2 and 3 in particular have seriously disputed the extent of outstandings. In my view, however, it is not open from them to question the extent of outstandings as before 31.3.1996 since by Exhs. 64 and 65, they have admitted the liability as mentioned in the documents. The defendant Nos. 2 and 3 had taken couple of applications in that regard. Pursuant to the order of this Tribunal, the applicant Bank re-calculated the outstandings by levying agreed rate of interest and separately showing penal interest and interest on penal interest. The summary of the outstandings in Exh. ‘G’ to the statement of account annexed to affidavit of Mr. Babulal Jain (Exh. 144) shows interest amount in cash credit, account of Rs. 57,17,361/- and in overdraft account to the tune of Rs. 12,17,762/-. The summary also gives amount of penal interest and interest on penal interest which is in the aggregate of Rs. 8,72,964/-. Since however no foundation has been laid for granting penal interest, the sale cannot be allowed, interest thereupon anyway being not allowable as per the Ravindra's case. In other words the interest of Rs. 69,35,123/- having been calculated as per the agreed rate of interest apart from principal amount of Rs. one crore will have to be allowed. The defendant Nos. 2 and 3 have filed on record the statement of account got prepared from M/s. H.G Salvaiya and Co. (Chartered Accountant) showing that the correct outstandings would be Rs. 1.27 crores (approximately). I do not think that such private calculation of interest can be given any importance moreso when the interest appears to have been calculated from 1987 while I have earlier indicated that in view of the acknowledgement Exhs. 64 and 65, the extent of amount standing were crystallized as on 31.3.1996 Thus, I find no merit in this defence

20. The applicant has thus proved its case. The Bank therefore is entitled to monetary claim as also in respect of mortgaged property. But, since the Bank has not shown that the charge of the mortgaged property has been registered with ROC (Exhs. 61 and 62 not showing that it is in respect of mortgaged property), its entitlement thereto as secured creditor would be subject to the proof of the same before the Official Liquidator. As said earlier, relief with, reference to mortgaged property shall also be subject to the civil suit that may be filed by defendant No. 4.

21. Having regard to the facts, it-may be proper to award half costs.

(A) The original application is allowed with half costs against the defendant Nos. 1 to 4.

(B) The defendant Nos. 1 to 3 do jointly and severally pay to the applicant Rs. 1,69,35,123/- (Rs. one crores sixty-nine lacs thirty-five thousand one hundred twenty-three only) with interest @ 16.50% p.a from the date of filing Original Application till full realisation.

(C) Subject to the proof before Official Liquidator about the registration of the charge with ROC and subject to the decision in the suit that may be filed by defendant No. 4 within 2 months, it is declared that the outstandings are secured by the defendant No. 1's property being Unit No. 319, 3rd Floor, Kewal Industrial Estate, Senapati Bapat Marg, Lower Parel, Bombay-400 013.

(D) Issue recovery certificate accordingly.

O.A allowed with half costs against defendant Nos. 1 to 4.

Central Bank Of India v. Official Liquidator High Court Bombay

Case Summary — K.J. Paratwar, Presiding Officer

Factual and Procedural Background

Legal Issues Presented

Arguments of the Parties

Applicant (the Bank)

Defendant Nos. 2 and 3 (Guarantors)

Defendant No. 4 (Occupant / Purchaser)

Table of Precedents Cited

Court's Reasoning and Analysis

Holding and Implications

Implications

Central Bank Of India v. Official Liquidator High Court Bombay

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