Shivani Gadhavi
Published On: February 07, 2022 at 17:02 IST
The Supreme Court of India on January 31, 2022 agreed to hear Petition which raised a question that whether auction purchasers in pursuance of a decree will have a preferential right qua the mortgage property or not.
The Supreme Court Bench of Justices Hemant Gupta and V Ramasubramanian was hearing a Special Leave Petition filed by the Counsel for the Petitioner, within which they were challenging an order of the Madras High Court.
Earlier the Petitioner had approached a Trial Court, which had dismissed their Petition. The Petitioner then approached the Madras High Court challenging the dismissal order of the Trial Court.
The Counsel for the Petitioner, Senior Advocate K V Viswanathan, had stated in the Plea to the High Court that the Trial Court “erred in appreciating the evidence properly. The trial Court failed to consider that the suit property was mortgaged with M/s Allahabad Bank as security for the loan amount borrowed by the second respondent.”
The Petition furthermore read that, “The Court below erred in holding that the appellant LLP does not have any right to purchase property, since the LLP has not been incorporated on the date of purchase by overlooking the fact that the sale deed was executed only after the incorporation.”
The Madras High Court, in regards with contentions of the Petitioner observed that, “Having failed before the Execution Court, the petition is filed for introduction of documents and new facts which never pleaded. A prima facie scrutiny of those documents only adds proof of embellishment of facts and records.”
The Madras High Court Bench of Justice Dr G Jayachandran J dismissed the plea of the Petitioner while confirming with the order of the Principal District Judge, Krishnagiri. Therefore, the Petitioner moved to the Supreme Court of India challenging the dismissal order of the Madras High Court.
The Supreme Court in light of all the facts and observations, put a stay on the impugned order of the Madras High Court, while stating that “Issue notice. In the meantime, operation of the impugned order shall remain stayed and the parties shall maintain status quo regarding possession.”