Ravi Shankar Mukhdev Prasad Bank of India

Factual and Procedural Background

The applicant, Ravi Shankar Mukhdev Prasad, filed Interim Application No. 200/2018 in Securitisation Application No. 73/2018 against Bank of India and others. The applicant sought to restrain the respondent bank from forcibly dispossessing him and his family from the suit property, Flat No. 502, Charkop Royal CHS Ltd., Mumbai, pursuant to a Writ of Commission dated 16.01.2018 issued by the Chief Metropolitan Magistrate, Esplanade, Mumbai. The applicant claimed occupation of the flat under a registered Leave and License Agreement dated 07.07.2016 executed by the borrowers and mortgagors in his favor. The respondent bank opposed the application, contending that the Leave and License Agreement did not confer any right to the applicant and that the bank was entitled to evict him under the SARFAESI Act, as the mortgage predated the License Agreement. The bank had obtained an order dated 22.12.2017 under Section 14 of the SARFAESI Act, and a Court Commissioner issued a notice for physical possession of the property on 07.02.2018. The demand notice to the borrowers was issued on 24.04.2016.

Legal Issues Presented

1. Whether the applicant, as a licensee under the Leave and License Agreement, has any right to continue occupation of the suit property against the respondent bank's claim under the SARFAESI Act.
2. Whether the interim relief restraining the respondent bank from dispossessing the applicant and his family from the suit property should be granted pending final disposal of the securitisation application.

Arguments of the Parties

Applicant's Arguments

• The applicant is residing in the suit flat under a registered Leave and License Agreement dated 07.07.2016 along with his family, including school-going children.
• The Leave and License Agreement was executed by the borrowers and mortgagors in favor of the applicant.
• The applicant requested to be allowed to continue occupation of the flat pending the final hearing.

Respondent Bank's Arguments

• The Leave and License Agreement does not create any right in the suit property for the applicant.
• The applicant can be evicted under the SARFAESI Act as the mortgage was created prior to the License Agreement.
• The mortgage was created on 27.12.2006, before the License Agreement dated 07.07.2016.
• The plea of the applicant to continue possession as a licensee is not maintainable.

Table of Precedents Cited

No precedents were cited in the provided opinion.

Court's Reasoning and Analysis

The court noted that the respondent bank had obtained an order dated 22.12.2017 under Section 14 of the SARFAESI Act from the Chief Metropolitan Magistrate and that a Court Commissioner had issued a notice for physical possession of the property. The bank had issued a demand notice to the borrowers on 24.04.2016. The court analyzed that since the applicant's Leave and License Agreement was executed after the mortgage was created, the applicant could not claim any right to enjoy the suit property. Consequently, the applicant was not protected against removal from the premises. Therefore, the court rejected the applicant's prayer to continue occupation as a licensee.

Holding and Implications

The court rejected Interim Application No. 200/2018 and dismissed the Securitisation Application No. 73/2018. The applicant was not entitled to continue occupation of the suit property as a licensee against the respondent bank's claim under the SARFAESI Act. The direct effect is that the respondent bank is entitled to take possession of the property. No new precedent was established by this decision.