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Registration of Prohibited property
8 months ago
I have purchased bank auction property and sale certificate was issued. But Registration authorities declined to to register the sale certificate as the property is in prohibited list.The reason for prohibition is court order regarding loan from private individual. Bank authorities are telling as they have first charge registration can't be denied. But Registration authorities are ready to register if we are accept to keep the documents pending with them until clearance from Director general of Registration.
What to do sir
Please advise
A.Dear Client,
Once a Sale Certificate is issued by the Bank post-auction of the property on receipt of 100% payment, the Bank is duty-bound to get the sale deed registered in your favour by the Registering Authority under Sec.17 of the Registration Act, 1908. In this context, the Supreme Court has held in the case of Esjaypee Impex Private Limited Vs. Assistant General Manager and Authorised Officer, Canara Bank: (Para-16 of the judgment) ".We are of the view that the mandate of law in terms of Section 17(2)(xii) read with Section 89(4) of the Registration Act, 1908 only required the authorised officer of the Bank under the SARFAESI Act to hand over the duly validated sale certificate to the auction-purchaser with a copy forwarded to the registering authorities to be filed in Book I as per Section 89 of the Registration Act.” In view of the above clarification of Apex Court, if the Registering Authority denies the registration of an auctioned property in f/o purchaser on the ground of complex question of law involved in the matter, then the Bank has to refund the entire value collected in r/o said auctioned property to the Purchaser for the dereliction and deficiency on the part of the Bank. So, you need to wait for the clearance sought on the subject from the Director General of Registration and decide the next course of action on receipt of clearance of DGR.
Once a Sale Certificate is issued by the Bank post-auction of the property on receipt of 100% payment, the Bank is duty-bound to get the sale deed registered in your favour by the Registering Authority under Sec.17 of the Registration Act, 1908. In this context, the Supreme Court has held in the case of Esjaypee Impex Private Limited Vs. Assistant General Manager and Authorised Officer, Canara Bank: (Para-16 of the judgment) ".We are of the view that the mandate of law in terms of Section 17(2)(xii) read with Section 89(4) of the Registration Act, 1908 only required the authorised officer of the Bank under the SARFAESI Act to hand over the duly validated sale certificate to the auction-purchaser with a copy forwarded to the registering authorities to be filed in Book I as per Section 89 of the Registration Act.” In view of the above clarification of Apex Court, if the Registering Authority denies the registration of an auctioned property in f/o purchaser on the ground of complex question of law involved in the matter, then the Bank has to refund the entire value collected in r/o said auctioned property to the Purchaser for the dereliction and deficiency on the part of the Bank. So, you need to wait for the clearance sought on the subject from the Director General of Registration and decide the next course of action on receipt of clearance of DGR.
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A.Dear Client,
In a situation like this, where you have purchased a bank auction property, obtained a sale certificate, but face issues with property registration due to a prohibition order related to a court order, it's important to consider legal options to address the matter. Here are steps you might consider:
Review Sale Certificate and Documents:
Thoroughly review the sale certificate, auction terms, and any other documents related to the property purchase. Ensure that the sale certificate clearly mentions the property's condition and any encumbrances.
Understanding the Prohibition Order:
Understand the nature of the court order that led to the prohibition on the property. It's important to know the details of the order, the parties involved, and the impact it has on the property's transfer.
Negotiation with Bank Authorities:
Communicate with the bank authorities who conducted the auction. Discuss the situation with them, including the prohibition order, and seek their assistance in resolving the registration issue.
Legal Opinion on First Charge:
Get a legal opinion on the bank's claim of having the first charge on the property. This will help you understand the extent of the bank's rights and whether they can override the prohibition order.
DG Registration Clearance:
Consider accepting the Registration authorities' proposal to keep the documents pending with them until clearance is obtained from the Director General of Registration. This might be a temporary solution while awaiting resolution.
Court Intervention:
If the prohibition order arises from a court order, you might consider approaching the same court to seek clarification or modification of the order to enable the property registration.
Title Investigation:
Conduct a thorough title investigation to ensure that there are no other encumbrances or legal issues affecting the property.
Litigation:
If all other options fail, you might need to consider filing a legal suit to address the prohibition order and seek a court's intervention to enable the property's registration.
Thanks
In a situation like this, where you have purchased a bank auction property, obtained a sale certificate, but face issues with property registration due to a prohibition order related to a court order, it's important to consider legal options to address the matter. Here are steps you might consider:
Review Sale Certificate and Documents:
Thoroughly review the sale certificate, auction terms, and any other documents related to the property purchase. Ensure that the sale certificate clearly mentions the property's condition and any encumbrances.
Understanding the Prohibition Order:
Understand the nature of the court order that led to the prohibition on the property. It's important to know the details of the order, the parties involved, and the impact it has on the property's transfer.
Negotiation with Bank Authorities:
Communicate with the bank authorities who conducted the auction. Discuss the situation with them, including the prohibition order, and seek their assistance in resolving the registration issue.
Legal Opinion on First Charge:
Get a legal opinion on the bank's claim of having the first charge on the property. This will help you understand the extent of the bank's rights and whether they can override the prohibition order.
DG Registration Clearance:
Consider accepting the Registration authorities' proposal to keep the documents pending with them until clearance is obtained from the Director General of Registration. This might be a temporary solution while awaiting resolution.
Court Intervention:
If the prohibition order arises from a court order, you might consider approaching the same court to seek clarification or modification of the order to enable the property registration.
Title Investigation:
Conduct a thorough title investigation to ensure that there are no other encumbrances or legal issues affecting the property.
Litigation:
If all other options fail, you might need to consider filing a legal suit to address the prohibition order and seek a court's intervention to enable the property's registration.
Thanks
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