Ashok Menon, Chairperson
1. The applicant in Securitisation Application (S.A.) No. 304 of 2019 on the files of the Debts Recovery Tribunal-II, Mumbai (D.R.T.) is in appeal under Sec. 18 of the Securitisation & Reconstruction of Financial Assets & Enforcement of Security Interest Act, 2002 (“SARFAESI Act”, for short) aggrieved with the dismissal of the S.A. by the impugned judgment and order dated 10/01/2023.
2. The appellant had filed the S.A. aggrieved by the Sarfaesi measures initiated by the first respondent financial institution (FI) to recover the debt allegedly due from respondents Nos. 4 and 5 who have allegedly created a security interest over the mortgaged property which is Flat No. 802, 8th floor, Shanta Shivam CHS Ltd., Babulnath Road, Mumbai 400007 (subject flat). The appellant is engaged in the business activity of development and redevelopment of various properties in and around Mumbai. “Mazda Construction Company”, the second respondent, is a Company in which the appellant and one Shri Harresh N. Mehta had acquired 25% shares each. The third respondent Pujit Aggarwal is also a 50% shareholder in that company, and he too is into the business of development and redevelopment of properties. A property along with the structure thereon situated on C.S. No. 639 corresponding to survey No. 1/A/7057 (new) at Malabar and Cumballa division was acquired by the 2nd respondent company for a redevelopment project. Since the company was involved in some other projects as well, the aforesaid project of redevelopment could not be completed on time. The 4th respondent “Orbit Corporation Ltd.” is a company which has gone into liquidation and is represented by the official liquidator appointed by the Hon’ble High Court of Bombay in Company Petition No. 593 of 2015. “Orbit Residency Pvt. Ltd.” the fifth respondent, is a subsidiary of the fourth respondent company. The subject flat belongs to the fifth respondent and a mortgage was created to secure a loan that was allegedly availed by that company from the first respondent FI. The 3rd respondent was also the Managing Director and Chief Executive Officer of the 4th respondent company. The appellant anticipated the redevelopment project undertaken by the 2nd respondent company to be completed on time so that he could acquire a residential flat therein. However, as already stated, the redevelopment project got delayed. The appellant needed accommodation and hence, persuaded the 3rd respondent and the other shareholder Harresh N. Mehta to complete the project hastely. On being pressurised by the appellant to complete the redevelopment project, he was offered the subject flat by the 3rd respondent to be occupied till completion of the above-mentioned redevelopment project. Thus, the subject flat was put in possession of the appellant by the third respondent in the year 2005, and since then, he has been in uninterrupted and peaceful possession of that flat. The busy schedule of the third respondent prevented him from completing the redevelopment project on time. In 2009, the appellant and Harresh N. Mehta offered to sell their respective shares in the 2nd respondent company to the 3rd respondent, and he agreed to purchase those shares for ₹5.40 crores and agreed to pay the amount within 15 days. He also undertook to provide a flat admeasuring 4000 ft² in the redevelopment project as and when it was completed. It was further agreed by the 3rd respondent that another flat admeasuring 4700 ft² in the proposed “Orbit Heaven” in Nepeansea Road, would also be given to the appellant, as and when constructed. The appellant and Harresh N Mehta entered into a Memorandum of Understanding (MOU) on 16/07/2009 with the 3rd respondent incorporating the aforesaid terms and conditions agreed upon between the parties. Accordingly, the appellant and Harresh N Mehta transferred their shares in the 2nd respondent company to the 3rd respondent on 06/08/2009 and the 3rd respondent paid the consideration of ₹5.40 crores.
3. The fourth respondent company went into financial trouble and liquidation as a result of which, the redevelopment project was never got completed. The 3rd respondent could not deliver the two flats as agreed. However, he assured that the subject flat in the possession of the appellant could be treated as his own and agreed to transfer the said flat to the appellant and in the alternative, provide another residential accommodation to him. Assurance was given to the appellant that till an alternative accommodation was provided to him, he could continue to occupy the subject flat. The appellant has thus been in continuous occupation of the subject flat since 2005. He has a telephone connection and a gas connection in his name indicating his address at the subject flat. The appellant is also paying the dues to the society towards maintenance.
4. On 15/07/2019, a court receiver came to the subject flat and informed the appellant’s wife, who was present in the flat, about the mortgage created in favour of the 1st respondent and the intention to take possession of the subject flat for recovery of the debt allegedly dues from respondents Nos. 4 and 5. The appellant filed a civil suit before the Hon’ble High Court of Bombay as No. 906 of 2009 seeking specific performance of the MOU. No interim orders were passed in favour of the appellant and he was directed by the Hon’ble High Court to approach the D.R.T. for suitable relief. The 3rd respondent had created the mortgage in favour of the FI despite handing over possession of the subject flat to the appellant in the year 2005. The mortgage was created although the company petition was pending before the Hon’ble High Court and the FI knew of such liquidation proceedings against the 4th respondent.
5. The appellant contends that the Sarfaesi measures are not sustainable as the notice under Sec. 13 (4) was issued not to the borrower but to the official liquidator. Aggrieved by the notice issued under Sec. 13 (4), dated 13/11/2018, and the order dated 05/07/2019 obtained by the FI from the Chief Metropolitan Magistrate under Sec. 14 of the SARFAESI Act, and following the issuance of notice dated 19/8/2019 by the court commissioner intending to take possession of the subject flat, the appellant approached the D.R.T. with the S.A. filed under Sec. 17 of the SARFAESI Act to protect his possession. It was understood that a mortgage was created by respondent Nos. 3 and 5 sometime in 2017 in favour of the 1st respondent to secure a loan of ₹1.10 crore. According to the appellant, the said mortgage deed is a sham transaction created in collusion between respondent Nos. 1 and 3 without the knowledge or consent of the appellant who was in actual possession of the subject flat since 2005.
6. The appellant had offered to pay the entire amount of debt due demanded in the notice under Sec. 13 (2) dated 13/11/2008 together with interest amounting to ₹1.35 crores. The 1st respondent refused to accept that amount. The appellant sought interim protection from the D.R.T., but that was refused vide order dated 11/09/2019. Misc. Appeal No. 68 of 2019 was preferred by the appellant before this Tribunal. On 24/09/2019, the appellant addressed the FI, offering to pay the entire outstanding dues and redeem the subject flat under Sec 13(8) of the SARFAESI Act. An application was filed by the appellant before this Tribunal as MA No. 670 of 2019, offering to deposit the entire outstanding dues. Vide order dated 24/09/2019, this Tribunal directed the appellant to deposit ₹1,35,15,191/-, the outstanding dues as of 01/03/2019. The Misc. Appeal was thereafter remanded to the D.R.T. vide order dated 14/07/2023 directing expeditious disposal of the S.A. The amount deposited by the appellant was transferred to the D.R.T. The status quo was directed to be maintained. The amount deposited by the appellant is still lying with the D.R.T. The S.A. was dismissed vide the impugned order dated 10/01/2024. The appellant is aggrieved, hence this appeal.
7. The memorandum of appeal was amended vide order in I.A. No. 419/2004 by the appellant incorporating a prayer that the mortgage deed purportedly executed between the 1st respondent and the 3rd respondent on 28/11/2017 is not valid since the execution of the deed is not attested by two witnesses as required under Sec. 59 of the Transfer of Property Act. Another prayer that was incorporated in the memorandum of appeal was that the mortgage is not registered with the CERSAI as required under Sec. 26D of the SARFAESI Act. The amendment was allowed by this Tribunal keeping open the contentions of the parties to be decided in the appeal.
8. The 1st respondent alone has appeared to contest this appeal. It is contended that the appellant has no locus standi to file the S.A. or this appeal. He is neither a borrower nor a mortgagor or a guarantor. The appellant is a third party and a rank trespasser who has no existing right, title, or interest over the subject flat. It is also pointed out that none of the other respondents have challenged the Sarfaesi measures initiated by the 1st respondent against the subject flat. The averments made by the appellant in the S.A. and the memorandum of appeal are unbelievable. He relies on an oral arrangement between him and the 3rd respondent allegedly entrusting possession of the subject flat to him in 2005 and thereafter, executing an unregistered MOU on 16/07/2009. It is pointed out that the subject flat was owned by M/s Ramesh Sekseria, Pawan Sekseria, Vishal Sekseria and Ms Sunita Sekseria (of the “Sekseria family”). The 5th respondent company had purchased the subject flat from the aforesaid Sekseria family vide registered sale deed only on 24/12/2009. The purported MOU is executed in favour of the appellant by respondent Nos. 3 and 4, none of whom are the true owners of the subject flat. The 5th respondent company which is the owner of the property under a registered sale deed is not a party to the MOU relied upon by the appellant. It is pointed out that the falsity of the appellant’s claim over the property is explicit. In the suit for specific performance filed by the appellant before the Hon’ble High Court of Bombay, no interim reliefs were granted in favour of the appellant protecting him from the Sarfaesi measures initiated by the FI.
9. The 4th respondent company (under liquidation), and its subsidiary company, the 5th respondent were granted a term loan of ₹1.10 crore for meeting their corporate needs. The subject flat was mortgaged in favour of the FI on 28/11/2017. The borrowers had also created other liabilities from other entities. The borrowers defaulted in repayment and the account was classified as a non-performing asset (NPA), on 31/07/2018. Thereafter, a demand notice was issued under Sec. 13 (2) of the SARFAESI Act demanding a sum of ₹1,23,25,869/-together with interest. The debtors failed to pay the amount and consequently, an order was obtained from the Chief Metropolitan Magistrate under Sec. 14 of the SARFAESI Act on 15/07/2019. The appellant has been persistently attempting to thwart the taking over of possession of the subject flat by raising untenable contentions. The appellant has no right, title or interest over the subject flat. Being a stranger, the right of redemption which is provided to the debtor under Sec. 13(8) of the SARFAESI Act can also not be invoked by the appellant, that too without the consent of the mortgagor. The impugned order of the D.R.T. is well-reasoned and cannot be found fault with on any grounds. Hence, the 1st respondent seeks a dismissal of the appeal.
10. Heard Mr Umesh Shetty, the Ld. Senior Counsel appearing for the appellant and Shri Dinesh Purandare, the Ld. Counsel appearing for the 1st respondent. Records perused.
11. Mr Shetty argues that the appellant has been in continuous settled possession of the subject flat since 2005. Being in settled possession of the flat without any objection raised by the owner of the property, the appellant is entitled to continue in possession and protect himself from being dispossessed from the subject flat by the 1st respondent under the provisions of the SARFAESI Act. To prove his absolute possession in respect of the subject flat, he relies on telephone bills, gas bills and maintenance bills. Mr Shetty also points to the affidavit filed by the 3rd respondent Pujit Aggarwal filed in Appeal No. 68 of 2019 before this Tribunal in which it is stated thus:
“I deny that I informed the appellant that the appellant can use and occupy the suit flat till the redevelopment of property owned by respondent No. 2 get completed as alleged or at all. I say that the applicant Harish Mehta was not only a family friend of the Aggarwals but also used to assess the Aggarwals in their business in formulation of regulatory strategies. I say that when Orbit Residency Private Limited was wholly owned subsidiary of Orbit Corporation Limited, as it was then, being the holding company of Orbit Residency Private Limited allowed the applicant to occupy the said flat as gratuitous licensee.” (Sic)
12. Mr Shetty submits that the 3rd respondent has admitted that the appellant was handed over possession as a ‘gratuitous licensee’. Hence, the subject flat was already encumbered to the appellant much before the execution of the mortgagor deed. Since the appellant has established his settled possession over the subject flat, he can be evicted from the premises only by due process of law. The Ld. Sr. Counsel relies on the decision of the Hon’ble Supreme Court in Rame Gowda (dead) by LRS vs. M. Varadappa Naidu (dead) by LRS (2004) 1 SCC 769 wherein it is held thus:
“8. It is thus clear that so far as the Indian law is concerned, the person in peaceful possession is entitled to retain his possession and in order to protect such possession he may even use reasonable force to keep order trespasser. A rightful owner who has been wrongfully dispossessed of land may retake possession if he can do so peacefully and without the use of unreasonable force. If the trespasser is in settled possession of the property belonging to the rightful owner, the rightful owner shall have to take recourse to law; he cannot take the law in his own hands and having the trespasser or interfere with his possession. The law will come to the aid of a person in peaceful and settled possession by enchanting even a rightful owner from using force or taking the law in his own hands, and also by restoring him a possession even from the rightful owner (of course subject to the law of limitation), in the latter has dispossessed the prior possession by use of force. In the absence of proof of better title, possession or prior peaceful settled the possession is itself evidence of title. Law presumes the possession to go with the title unless reported. The owner of any property may prevent even by using reasonable force a trespasser from an attempted trespass, when it is in the process of being committed, or is of a flimsy character, or recurring, intermittent, stray or casually nature, or has just been committed, while the rightful owner did not have enough time to have recourse to law. In the last of the cases, the possession of the trespasser, just entered into would not be called as one acquiesced to buy the true owner.”
13. Relying on the above decision, Mr Shetty would argue that even the 3rd respondent has admitted in the affidavit filed by him that the appellant was in possession of the subject flat, though as a gratuitous licensee. Hence, the appellant cannot be evicted by the 1st respondent by resorting to the provisions of the SARFAESI Act.
14. In an earlier decision of Puran Singh & Anr. vs. State of Punjab (1975) 4 SCC 518, the Hon’ble Supreme Court has clarified that it is difficult to lay down any hard and fast rule as to when the possession of a trespasser can mature into settled possession. The “settled possession” must be (i) effective, (ii) undisturbed, and (iii) to the knowledge of the owner or without any attempt at concealment by the trespasser. The phrase “settled possession” does not carry any special charm or magic in it; nor is it a ritualistic formula which can be confined in a straitjacket. An occupation of the property by a person as an agent or a servant acting at the instance of the owner will not amount to actual physical possession.
15. In light of the above precedents, it will have to be decided whether the appellant can defend his possession against the measures taken by the 1st respondent under the provisions of Sec. 13 of the SARFAESI Act. The appellant contends that he was handed over possession of the subject flat sometime in 2005 by the 3rd respondent. Apart from certain utility bills, there is no evidence as to whether the appellant was in possession of the subject flat since 2005 under the 3rd respondent. The fact that the 5th respondent got title over the subject flat from the Sekseria family vide registered sale deed only on 24/12/2009 would militate against the appellant’s case that he was entrusted possession of the property by the 3rd respondent representing the 5th respondent in the year 2005. He has no case that the Sekseria family had entrusted the subject flat to him. The sale deed executed by the Sekseria family to the fifth respondent does not state the possession of the flat by the appellant. It is also pertinent to note that nothing has been mentioned in the MOU about the subject flat being handed over to the appellant. The MOU is regarding the transfer of the shares held by the appellant and Harresh N Mehta to the 3rd respondent and the payment to be made by the 3rd respondent to them in consideration of the transfer of shares. It also states about the transfer of two flats under construction to the appellant. It is very difficult to interpret the MOU as an agreement to sell the subject flat. It is drawn on a stamp paper of only rupees hundred and it is not even registered. Sec. 17 of the Registration Act makes it mandatory for a document purporting to assign a right of the property valued at more than rupees hundred to be compulsorily registered. Moreover, Sec. 17 (1A) reads thus:
“(1A) The documents containing contracts to transfer for consideration, any immovable property for the purpose of section 53A of the Transfer of Property Act, 1882 (4 of 1882) shall be registered if they have been executed on or after the commencement of the Registration and other related laws (Amendment) Act, 2001 (48 of 2001) and if such documents are not registered on or after such commencement, then, they shall have no effect for the purposes of the said section 53A.”
16. It would, therefore, be difficult for the appellant to defend his possession under part-performance of an alleged agreement to sell. Hence it would be fallacious to hold that the appellant was in “settled possession” of the subject flat. In the affidavit filed by the 3rd respondent in the earlier miscellaneous appeal between the parties which is relied upon by the appellant, it is only stated that the appellant had the property in his possession as a ‘gratuitous licensee’. In the case of Associated Hotels of India Ltd. v. R.N. Kapoor, AIR 1959 SC 1262, the Hon’ble Supreme Court observed thus:
“… if a document gives only a right to use the property in a particular way or under certain terms while it remains in possession and control of the owner thereof, it will be a licence. The legal possession, therefore, continues to be with the owner of the property, but the licensee is permitted to make use of the premises for a particular purpose. But for the permission, his occupation would be unlawful.” (Emphasis supplied)
17. The appellant is relying on an unregistered MoU written on an insufficiently stamped document. The Hon’ble Supreme Court has in Suraj Lamp & Industries Pvt. Ltd. through Director vs State of Haryana & Ano. (2012)1 SCC 656 held that an immovable property can be transferred/ conveyed only by a deed of conveyance (sale deed) duly stamped and registered as required by law. Any contract of sale (agreement to sell) which is not a registered deed of conveyance (sale deed) would fall short of the requirement of sections 54 and 55 of the Transfer of Property Act and will not confer any title nor transfer any interest in an immovable property (except to the limited right granted under Sec. 53A of the T.P. Act). According to the T.P. Act, an agreement for sale, whether with possession or without possession, is not a conveyance. In the instant case, the MoU does not even mention the intention of the third respondent to sell the subject flat to the appellant.
18. Mr Umesh Shetty argues that despite the appellant not being a borrower, he is at liberty to invoke the provisions of Sec. 13(8) of the SARFAESI Act. The sub-section reads thus:
“ (8) Where the amount of dues of the secured creditor together with all costs, charges and expenses incurred by him is tendered to the secured creditor at any time before the date of publication of notice for public auction or inviting quotations or tender from public or private treaty for transfer by way of lease, assignment or sale of the secured assets,-
(i) the secured assets shall not be transferred by way of lease, assignment or sale by the secured creditor; and
(ii) in case, any step has been taken by the secured creditor for transfer by way of lease or assignment or sale of the assets before tendering of such amount under this sub-section, no further step shall be taken by such secured creditor for transfer by way of lease or assignment or sale of such secured assets.”
19. The Ld. Senior Counsel submits that the right of redemption granted under Sec. 13(8) of the SARFAESI Act is not akin to the right of the mortgagor to redeem as stipulated under Sec. 60 of the Transfer of the Property Act. Sec. 60 specifically confines this right of redemption to the mortgagor alone but there is no such limitation in Sec. 13(8) of the SARFAESI Act.
20. This argument of the Ld. Senior Counsel appears to be very attractive but does not seem to stand to reason. Redemption is a right provided to a mortgagor. A transferee of the mortgagor’s right who steps into the shoes of the mortgagor may also to a certain extent exercise this right of redemption available to the mortgagor. In the instant case, the appellant is not an assignee of the mortgagor’s right to the property. As discussed above, the appellant does not get any proprietary right over the subject flat by virtue of the oral entrustment or the MoU. It is also pertinent to note that such entrustment was not by the fifth respondent company which is the real owner of the property. The third respondent was not acting as representative of the fifth respondent company even if it is to be believed that he had entrusted the subject flat to the appellant. There was no resolution by the company authorising the third respondent to entrust the property to the appellant. The Ld. Senior Counsel has relied upon the decisions in Sree Anandkumar Mills Ltd. vs. Indian Overseas Bank & Ors. (2019) 14 SCC 788 and United Bank of India vs. Satyawati Tondon & Ors. (2010) 8 SCC 110 to argue that the remedy under Sec. 17 of the SARFAESI Act is available to any person who is aggrieved and therefore, the appellant can also challenge the provisions under the SARFAESI Act initiated against the borrowers. since he is the person who is going to be affected by the Sarfaesi measures.
21. Even if the appellant is in possession of the subject flat, it cannot be termed as a ‘settled possession’ entitling him to defend it, particularly against an action contemplated by law under the provisions of the SARFAESI Act. Of course, there is no embargo on the appellant participating in an auction sale of the subject flat. He cannot insist on accepting the amount deposited by him to be adjusted towards the debt due and clear the subject flat of the encumbrance of the mortgage. The amount indeed deposited by the appellant before this Tribunal was transferred to the D.R.T. and kept the contentions regarding redemption open to be decided by the D.R.T. while disposing of Appeal No. 68 of 2019. The D.R.T. has not however entered any finding regarding the appellant’s right of redemption. The Ld. Senior Counsel submits that the matter has to be remanded to the D.R.T. for a finding on this issue raised by the appellant. I am not in agreement with the Ld. Senior Counsel on this point. A remand would only protract the litigation further.
22. The Ld. Senior Counsel has also raised an issue of non-registration of the mortgage by the first respondent under CERSAI as contemplated under Sec. 26 D of the SARFAESI Act. Though a specific ground has not been raised by the appellant in the S.A., it was incorporated in the Memorandum of Appeal by way of amendment contending that it is a question of law. Though the appellant had raised an issue of non-registration under CERSAI in the S.A., it was submitted that this question of law was argued before the D.R.T. but that was not considered by the Ld. Presiding Officer in the impugned order, neither is it mentioned that such a contention was raised during the arguments. A remand of the matter is raised on this ground as well.
23. Sec. 26 D of the SARFAESI Act was incorporated into the statute but it came into effect only from 24.01.2020 and the S.A. was filed on 14.08.2019 consequent to the order under Sec. 14 of the SARFAESI Act by the CMM on 05.07.2019. Hence, there could have been a registration of the mortgage under CERSAI before the provision came into effect. The Ld. Senior Counsel Mr Shetty fervently argues that after the provision came into effect, further action under the SARFAESI Act cannot be proceeded without a registration under CERSAI. I am not in agreement with the Ld. Senior Counsel on this point. The Sarfaesi measures were initiated at a time when the provisions under Sec. 26D had not come into effect. Hence, the non-registration of the mortgage as a consequence of the implementation of the section will not affect the Sarfaesi measures.
24. The next point that is argued by the Ld. Senior Counsel for the appellant is regarding the invalidity of the mortgage deed purportedly executed by respondents 1 and 3 for want of attestation by two attesting witnesses as required under Sec. 59 of the Transfer of Property Act.
25. The appellant had not specifically pleaded in the S.A. about the mortgaged date being invalid for want of attestation by two witnesses. It was also not argued before the D.R.T. However, being a question of law, the appellant was allowed to amend the memorandum of appeal and take this point as a plea in the appeal. To decide this point, it will be necessary to peruse Sec. 59 of the T.P. Act, which reads thus:
“59. Mortgage when to be by assurance. —Where the principal money secured is one hundred rupees or upwards, a mortgage [other than a mortgage by deposit of title-deeds] can be effected only by a registered instrument signed by the mortgagor and attested by at least two witnesses.
Where the principal money secured is less than one hundred rupees, a mortgage may be effected either by [a registered instrument] signed and attested as aforesaid, or (except in the case of a simple mortgage) by delivery of the property.”
26. This provision has to be read along with Sec. 68 of the Evidence Act, which reads thus:
“68. Proof of execution of document required by law to be attested.–– If a document is required by law to be attested, it shall not be used as evidence until one attesting witness at least has been called for the purpose of proving its execution, if there be an attesting witness alive, and subject to the process of the Court and capable of giving evidence:
[Provided that it shall not be necessary to call an attesting witness in proof of the execution of any document, not being a will, which has been registered in accordance with the provisions of the Indian Registration Act, 1908 (16 of 1908), unless its execution by the person by whom it purports to have been executed is specifically denied.]”
27. It is pertinent to note that the mortgagor in this case has not disputed the execution of the mortgage deed. In the affidavit filed by the 3rd respondent which is relied upon by the appellant, it is admitted that the mortgage deed was executed. The proviso to Sec. 68 of the Evidence Act would be relevant here. The examination of an attesting witness in a document, which requires compulsorily attestation by two witnesses may not be necessary in case of any other document acceptable when the execution by the person by whom it purports to have been executed is admitted by him. Since respondents 3, 4, and 5 have not denied the execution of the mortgage specifically, the examination of the attesting witnesses to prove the execution of the mortgage deed may not be necessary in this case.
28. It will now have to be examined whether the document of mortgage deed relied upon by the 1st respondent has the signature of two attesting witnesses or not. The Ld. Counsel for the 1st respondent Mr Purandare points out that the last two pages of the mortgage deed do contain the signatures of two attesting witnesses. Hence the allegation that it is not as by two witnesses is not true. On perusal of the mortgage deed, it is seen that two persons namely Mohammad Kalim Rain and Khushboo Bhayani have subscribed their signatures to the mortgage deed as attesting witnesses. Mr Shetty submits that the signatures are not put in immediately after the mortgagor and mortgagee have put their signatures. Mr Shetty relies on the decisions of the Hon’ble Bombay High Court in Dalichand Shivaram Marwadi vs. Lotu Sakharam Pardhi ILR XLIV Bombay series 405 and Ranu Bin Shivji Barate vs. Laxmanrao Krishna Limaye & Anr. ILR XXXIII Bom 44 in support of his argument regarding the non-attestation of the mortgage deed.
29. A mortgage deed is not rendered invalid for want of attestation because the attesting witnesses have not placed their signatures opposite the mortgagor's signature at the foot of the mortgage deed, but have placed their signatures opposite the mortgagor's signature below the receipt clause if they have seen the mortgagor sign the document at both the places and have themselves signed it in his presence. (See Kaderbhai Ismailji Poonawalla vs Fatmabai Goolamhusein Kabira and others 1943 SCC OnLine Bom 11: ILR 1944 Bom 388). It is not the appellant who can state about such attestation as long as the mortgagor has not disputed the attestation.
30. The word “attested” has been defined in Section 3 of the Transfer of Property Act thus:
“ 3. ‘attested’ in relation to an instrument means and shall be deemed always to have meant attested by two or more witnesses each of whom has seen the executant sign or affix his mark to the instrument, or has seen some other person sign the instrument in the presence and by the direction of the executant, or has received from the executant a personal acknowledgment of his signature or mark or of the signature of such other person, and each of whom has signed the instrument in the presence of the executant; but it shall not be necessary that more than one of such witnesses shall have been present at the same time, and no particular form of attestation shall be necessary”.
31. The object of attestation is to protect the executant from being required to execute a document by the other party thereto by force, fraud or undue influence. In the case in hand, the mortgagor has admitted the execution of the mortgage deed, and has not disputed the fact of attestation, and therefore, examination of the attesting witnesses or further proof regarding their attestation may not be necessary (See Kumar Harish Chandra Singh Deo & Ano vs. Banisdhar Mohanty & Ors1965 SCC OnLine SC 290). Hence, it is doubtful whether the appellant was a third party and the stranger to the mortgagor deed would have the locus to challenge the validity of the mortgagor deed.
For the foregoing reasons, I find that the appellant has not made a case to establish that he would fall within the definition of an “aggrieved person” under Sec. 17 (1) of the SARFAESI Act. The findings of the D.R.T. do not require any interference.
The appeal is meritless and is, therefore, dismissed. Mr Shetty requested for an extension of protection granted to the appellant. As there is not even a prima facie case in his favour, and no irreparable injury would be caused to the appellant, and the balance of convenience is also not in his favour the interim order of stay granted to the appellant protecting him from being disposed after the appeal was heard, pending the disposal of the appeal, stands vacated.
