This civil appeal arises from a judgment passed by the High Court of Judicature at Bombay, which upheld an order by the Debt Recovery Appellate Tribunal (DRAT). The DRAT had affirmed an order passed by the Debt Recovery Tribunal (DRT) regarding a loan dispute between Central Bank of India (respondent) and The Cosmos Co. Operative Bank Ltd. (appellant). The core issue revolves around which bank has the first charge over a flat that served as security for the loan, considering that the original borrowers defaulted on their payments.
The original borrowers availed a loan facility from Central Bank of India (respondent no. 1), offering a flat as security based on an unregistered agreement of sale. The borrowers defaulted, leading Central Bank to initiate recovery proceedings before the DRT. The DRT initially ruled against the bank, stating that the bank failed to prove the mortgage. Central Bank appealed to the DRAT, which allowed the appeal. During the DRAT proceedings, The Cosmos Co. Operative Bank Ltd. (appellant) intervened, claiming a prior charge over the same property. The appellant bank had sanctioned a loan to the same borrowers, secured by the same flat, based on an unregistered agreement of sale and a share certificate of ownership. The High Court upheld the DRAT's decision, stating that
…Sign in to view the parties.
The High Court recorded that the flat was…
The flat in question was…
This civil appeal arises from a judgment passed by the High Court of Judicature at Bombay, which upheld an order by the Debt Recovery Appellate Tribunal (DRAT). The DRAT had affirmed an order passed by the Debt Recovery Tribunal (DRT) regarding a loan dispute between Central Bank of India (respondent) and The Cosmos Co. Operative Bank Ltd. (appellant). The core issue revolves around which bank has the first charge over a flat that served as security for the loan, considering that the original borrowers defaulted on their payments.
The original borrowers availed a loan facility from Central Bank of India (respondent no. 1), offering a flat as security based on an unregistered agreement of sale. The borrowers defaulted, leading Central Bank to initiate recovery proceedings before the DRT. The DRT initially ruled against the bank, stating that the bank failed to prove the mortgage. Central Bank appealed to the DRAT, which allowed the appeal. During the DRAT proceedings, The Cosmos Co. Operative Bank Ltd. (appellant) intervened, claiming a prior charge over the same property. The appellant bank had sanctioned a loan to the same borrowers, secured by the same flat, based on an unregistered agreement of sale and a share certificate of ownership. The High Court upheld the DRAT's decision, stating that
…The High Court recorded that the flat was…
The flat in question was…