2015 (1) TMI 1503 - HC - Indian Laws

Requirement on the part of bank for demarcation of property before the execution of the sale deed - bids invited on as is whereas basis - HELD THAT - The condition as is whereas basis does not mean that property may not be in existence at all. It only means whatever the condition of the property on the spot is same shall be sold in the same condition. However, if property is not at all in existence on the spot or is not identifiable/can be located on the spot, then neither sale deed can be executed of the non existing property nor purchaser can be handed over possession thereof. Not only this, Bank itself has made several requests to the Collector to demarcate the property auctioned, therefore, Bank ought to have persuaded the Collector to undertake the demarcation proceedings at the earliest. Petitioner should not be allowed to suffer adversely for the lapses on the part of the Revenue Authorities or the Bank. Present petition was preferred in the year 2008 and vide order dated 23.10.2008 Bank was directed not to create any third party interest meanwhile. Keeping in mind the principle of equity, a mandamus can be issued in favour of the petitioner against the Bank to get the property demarcated preferably within eight weeks from today and to execute the sale deed of the auctioned property within next four weeks having received the balance of the consideration alongwith interest @ 10% p.a from the petitioner w.e.f 1 May, 2008 till the date of actual payment by the petitioner. Petitioner is directed to deposit balance amount with the Bank alongwith interest @ 10% p.a w.e.f 1 May, 2008 within four weeks from today positively - Petition allowed.

Summary

Issues:
1. Bank's failure to demarcate auctioned properties.
2. Petitioner's request for execution of sale deed.
3. Bank's demand for balance amount.
4. Principle of equity regarding lapses by Revenue Authorities and Bank.

Analysis:
1. The judgment addresses the issue of the Bank's failure to demarcate the properties auctioned, despite multiple requests made by both the petitioner and the Bank to the Revenue Authorities. The Court notes that the Bank should have actively pursued the demarcation proceedings with the Collector to ensure the sale deed could be executed and possession handed over to the petitioner. The Court emphasizes that the petitioner should not suffer due to the lapses of the Revenue Authorities or the Bank in this regard.

2. The petitioner requested the Bank to demarcate the properties so that the sale deed could be executed in their favor after paying the balance amount. The Court observes that the condition "as is whereas basis" does not absolve the Bank from ensuring the property's existence and identifiability. The Court directs the Bank to get the property demarcated within eight weeks and execute the sale deed within four weeks of receiving the balance consideration along with interest from the petitioner.

3. The Bank demanded the petitioner to pay the balance amount within a specified time frame, failing which the amount already deposited would stand forfeited. The Court, considering the principle of equity, directs the petitioner to deposit the balance amount with interest within four weeks. If the petitioner fails to comply, they lose the right to request the sale deed execution, and the amount deposited would be forfeited in favor of the Bank.

4. In light of the lapses by the Revenue Authorities and the Bank, the Court invokes the principle of equity to ensure that the petitioner is not unduly prejudiced. The Court issues a mandamus in favor of the petitioner, directing the Bank to complete the demarcation and sale deed execution within a specified timeframe, failing which the petitioner would be entitled to a refund of the amount deposited with interest. The judgment aims to balance the interests of both parties while upholding the principles of justice and fairness.