Urmila S. Joshi-Phalke JUDGMENT
Urmila S. Joshi-Phalke, J.
1. Heard learned counsel for the petitioner and learned counsel for the respondent.
2. RULE. Rule is made returnable forthwith.
3. By invoking the jurisdiction of writ, the question raised by the petitioner in the present writ petition is whether the respondent-Bank has right to withhold the documents of security in view of Section 171 of the Indian Contract Act, 1872 (hereinafter referred to as 'the said Act' for short) under the right of general lien especially when petitioner has fully repaid the amount of loan.
4. Brief facts are as under:
A] The petitioner was in need of financial assistance. Accordingly, he approached to the respondent-Bank. He applied for loan of Rs. 21,00,000/- (Rs. Twenty one lacs) before the respondent-Bank by way of loan application dated 13/08/2011.
B] The respondent-Bank sanctioned loan vide its sanction letter dated 06/09/2011 on condition that loan is repayable in 300 monthly installments. The petitioner is also a Director and Personal Guarantor in the Company under the name and style as 'Sunil Hitech Limited'. As the Company was in debt went in the liquidation. By an order of National Company Law Tribunal (hereinafter referred to as 'NCLT' for short), Liquidator was appointed. As per the contention of the petitioner due to financial crisis he could not pay monthly installments, therefore, he approached the respondent-Bank for seeking permission to sale the flat which was purchased by him after obtaining the loan. The Title Deeds of said flat was handed over to the Bank as security. Despite repeated requests no response received from the Bank. The petitioner issued a legal notice to the respondent with request to issue No Objection Certificate to sale the flat. But instead of giving No Objection Certificate, respondent-Bank issued notice under Section 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as 'SARFAESI Act' for short). By the said notice, loan account of the petitioner was declared as NPA and the petitioner was called upon to pay the loan amount. The respondent-Bank vide reply dated 24/03/2021 gave no objection to the petitioner to sale out the flat. The respondent-Bank further intimated the petitioner that he shall adjust the sale amount towards home loan and remaining amount is to be adjusted towards loan account of the Company. Accordingly, the petitioner closed the loan account i.e. Home Loan. After the amount was satisfied, the petitioner requested to remit the property papers to the purchaser Shri Ishwar Narsing Phunde but respondent-Bank has not paid any heed towards it.
C] Therefore, the petitioner by invoking jurisdiction under writ, made a grievance that despite repeated request the respondent-Bank has not remitted the papers. It was informed to him that due to orders by Superior Officers they are unable to remit the papers, therefore, the petitioner approached Assistant General Manager with request to remit the paper but his efforts were futile. Hence, this petition.
5. In response to the notice, respondent-Bank has filed its reply. As per the respondent-Bank the petitioner has alternate efficacious remedy before the Debt Recovery Tribunal, New Delhi and other Forum to deal, therefore, writ petition needs to be dismissed. It is further contention of the respondent-Bank that respondent-Bank has filed an application before the Debt Recovery Tribunal, New Delhi bearing Original Application No. 491/2019 against the petitioner and others for recovery of loan amount. The petitioner is a guarantor/Director/Borrower of Company name........