Indian Bank Sold Property by Fraud Through Auction under Sarfaesi Act, Bengaluru

[nansurabhi]

Indian bank came up with an Auction notice in leading newspaper on 29th of October 2010. so I decided to buy the property. After making the full payment to the bank they issued me SALE CERTIFICATE and asked me to complete the registration process. I asked them about the other documents for which they informed me that I just need sale certificate to complete the registration. I went through the registration procedure successfully. I got the bid from Indian Bank for 6,87,000.00 and I paid approximately 54,000.00 towards registration.
After 6 months of purchase at the time of Income tax assessment my C.A. asked me about paying property tax and he asked me about conversion of KHATA on my name. I had no idea about all these things. Then he explained me about the KHATA transfer process and for this I need all the documents and also tax receipt of earlier payments and KHATA copy of earlier holder. I approached bank again in and asked them to provide me all the original documents of the land so that I can complete the formalities. Even after visiting the branch several times for the original documents, bank was not in a position to provide me any of those.
I got suspicious and went through my own investigation. I went to BBMP office and took the Encumbrance Certificate (EC) of the plot which bank sold to me. I was shocked and horrified when I looked at the EC. In the Newspaper notice bank mentioned the name of the property owner and bank had told me the person pledged in the bank in 2006. Bank sold me the property in 2010 but there were two more sale transactions in between 2007 and 2009 for the same property. How is that possible when the property is pledged in the bank?
I visited the branch again and asked them in writing to provide me all the documents. To my surprise bank gave me Xerox copy sale deed which was sold to other party in 2007 by the person who pledged the property in bank. This clearly proves that bank are aware of this fraud, still they came up with public auction and sold the property.
My original amount along with expenses and interest comes to nearly 11 lakhs.
Present market value of the property is approximately between 17-20 Lakhs.
I request people to advise me what I should do further. Can I claim my amount from bank as on market value and also compensation for mental agony? If yes, how much can I claim?
What is the entire procedure? Should I hire advocate? Can anyone help me out here or fight my case?

 

[expert]

RE: Indian Bank cheated through Auction under Sarfaesi Act

Don't hire advocate at this time unless everything is clear to you. In my city court it is littered with such property cases.

There are two things:

• The original owner pledged his property with bank first and then sold it two times later. In that case you only will be the legal owner. You should also meet the other people who have been defrauded and intimate them about it.
• The original owner pledged his property which was not his legally(may be because he had already sold it to someone else). In this case it is bank's fault and banks don't do such mistakes unless someone is taking bribe in the bank. Even after taking bribe they will not do such a mistake as this can cost their job.

Don't think of advocate or court. It'd take 10 years to get justice and in the mean time you'd have paid the advocate may be 2-3 lacs.

 

[nansurabhi]

RE: Indian Bank cheated through Auction under Sarfaesi Act

Thanks bro for replying and advising me. i wanted to know one more thing, according to Sarfaesi act section 8(6)(f) it is the duty of the bank or financial institution to check thoroughly if there are any litigation or objections against the property, its their duty to inform the buyer about it so that it will help the buyer in analyzing whether to buy or not. Any they have made it mandatory to to show the encumbrance of the property. So it clearly proves bank had done an illegal auction process or the process not according to RBI guidelines. According to EC owner of the property is someone else then how can bank auction the property? Without going to consumer court or civil court do i have any other alternative?

 

[expert]

RE: Indian Bank cheated through Auction under Sarfaesi Act

Whether or not it falls in Sarfaesi, defrauding buyers in any way not allowed. Selling you by deceit should be illegal. First go and meet the advocate on panel of the bank who has approved mortgage of this property and ask the reason of it. Get all the mortgage papers(use RTI if necessary) and then visit him. It is unlikely that they have done mistake.

I also suggest you file a complaint with Bank Manager, get a signed copy of complaint. Also complaint to senior authorities and then visit then Banking Ombudsman appointed by RBI in your area.

After this you can meet a competent lawyer. It wouldn't be consumer court case since you're on a consumer in this process. Let us see what comes out before you think of going to court.

 

[nansurabhi]

RE: Indian Bank cheated through Auction under Sarfaesi Act

Thanks again bro, as mentioned i have completed all the steps. i.e. requesting the bank for all the details and wrote a written letter to branch manager, later wrote to nodal officer . Now i think next step would be to proceed with ombudsman. We have rbi ombudsman department in bangalore so that will be my next step now. thanks for the prompt reply bro. will update u the proceedings.

 

[expert]

RE: Indian Bank cheated through Auction under Sarfaesi Act

If you think it is clear case of cheating then you can file FIR also in police station. Go and threaten bank officials about the FIR. If you file FIR then they will be forced to internal investigation and disciplinary action against those who have willfully sold you the property.

Also try to inform the print media about this fraud. This is indeed full fledged fraud.

 

[nansurabhi]

RE: Indian Bank cheated through Auction under Sarfaesi Act

If you think it is clear case of cheating then you can file FIR also in police station. Go and threaten bank officials about the FIR. If you file FIR then they will be forced to internal investigation and disciplinary action against those who have willfully sold you the property.

Also try to inform the print media about this fraud. This is indeed full fledged fraud.

Hi Bro,

I lodged complaint in banking ombudsman and they called me for hearing next week. i will let u know the proceedings and will require your valuable advise on this.

 

[sunainaachadha]

RE: Indian Bank cheated through Auction under Sarfaesi Act

Hi,
I am a journalist and was appalled after reading your plight.
Is there any way I can get in touch with you and highlight this issue for our readers. It will all be confidential off course.
But such a grave fraud by banks is just not excusable.
Pls let me know if we could speak.
Regards
Sunainaa

 

[rimple75]

Hi,

Just wantedto ask u whether ur problem is resolved. Can u please tell me, if yes, because we are also facing same kind of problem.

Thanks

 

[nansurabhi]

Hi,

Just wantedto ask u whether ur problem is resolved. Can u please tell me, if yes, because we are also facing same kind of problem.

Thanks

Yes my problem is solved. I lodged a complaint in Banking Ombudsman. after 1 month they called me for hearing and instructed bank to refund my amount along with registration fee and official legal expenses. without spending any amount i got my money back from bank in 3 months. Thanks to Banking Ombudsman, Bangalore. Let me know ur problem. pm me i will try and help you out. got little experience fighting this case. Hope it will help you.

 

[expert]

Thanks @nansurabhi that's extremely valuable information. I too suggested you to go for Ambudsman . Your case can become guiding light to customers in trouble due to these malicious PSU banks.

Will it be possible for you to scan and upload your request and decision from Banking Ombudsman?

 

[rimple75]

Hi,

We have bought a property in an apartment through bank auction. That property was built in the parking area as per the building plan but every resident in the apartment has sufficient parking space. We have also got the property registered. This property comes under Secunderabad Cantonment area. Now, after buying this property, all the other owners have complained against us in the secunderabad cantonment that this is an illegaly constructed property.

Please advise us what to do as we have spent a lot of money in buying this property along with the registration. Is it our fault or banks fault.

 

[nansurabhi]

Thanks @nansurabhi that's extremely valuable information. I too suggested you to go for Ambudsman . Your case can become guiding light to customers in trouble due to these malicious PSU banks.

Will it be possible for you to scan and upload your request and decision from Banking Ombudsman?

Yea bro (admin). after reading your reply i changed my mind and finally decided to move with banking ombudsman. I advise all the members and people reading in this forum to first move with banking ombudsman for all kind of banking claims. you do not have to spend anything not even a single penny. And from my experience i can tell assure you that Banking Ombudsman staff treat you with respect and they solve the case in time. (Atleast Bangalore Ombudsman as i have faced it. so i can assure it) Make sure you are not at fault. You just have to visit office only if required for hearing or else you will get your reply through mail and post. You can submit the complaint online. Its the best part. I just went 2 times and got my money back.

Admin i really thank you for your advise. [hr]

Hi,

We have bought a property in an apartment through bank auction. That property was built in the parking area as per the building plan but every resident in the apartment has sufficient parking space. We have also got the property registered. This property comes under Secunderabad Cantonment area. Now, after buying this property, all the other owners have complained against us in the secunderabad cantonment that this is an illegaly constructed property.

Please advise us what to do as we have spent a lot of money in buying this property along with the registration. Is it our fault or banks fault.

To get into any conclusion i need to check the paper advertisement given by bank for sale of property and your agreement copy with bank.

 

[skbt78]

hi all,

I purchased a property from citibank but after registration i came to know that i have been cheated by citi bank.

Series of events

A sold site 23 measuring 30x50 to B
A sold site 23 measuring 30x40 to C
C sold to D
D to Citi Bank
Citibank to myself through action.
Now B is not allowing me to take possession.

All above transactions are registered in sub registrar office. My question is how can citibank sell the property which belongs to B.

Shivakumar
9008103425

 

[nansurabhi]

hi all,

I purchased a property from citibank but after registration i came to know that i have been cheated by citi bank.

Series of events

A sold site 23 measuring 30x50 to B
A sold site 23 measuring 30x40 to C
C sold to D
D to Citi Bank
Citibank to myself through action.
Now B is not allowing me to take possession.

All above transactions are registered in sub registrar office. My question is how can citibank sell the property which belongs to B.

Shivakumar
9008103425

can you upload or pm me copy of paper advertisement given by citi bank for the auction? Paper advertisment will solve half of your case. But 95% of chances about getting back your money through ombudsmen

 

[skbt78]

hi all,

I purchased a property from citibank but after registration i came to know that i have been cheated by citi bank.

Series of events

A sold site 23 measuring 30x50 to B
A sold site 23 measuring 30x40 to C
C sold to D
D to Citi Bank
Citibank to myself through action.
Now B is not allowing me to take possession.

All above transactions are registered in sub registrar office. My question is how can citibank sell the property which belongs to B.

Shivakumar
9008103425

can you upload or pm me copy of paper advertisement given by citi bank for the auction? Paper advertisment will solve half of your case. But 95% of chances about getting back your money through ombudsmen

 

[nansurabhi]

Have you sent a written letter to the bank about this issue? If not then give a written complaint to bank and take acknowledgement about it. Find out the nodal officer details and mail him about the issue. wait for their reply.
This is your first step towards filing complaint against bank @ banking ombudsman. Rule says you have to give a written complaint to bank and wait for their reply and if they do not reply or if their response is negative then after 1 month you can file a complaint against bank at banking ombudsman.
Admin of this forum advised me initially, now am doing the same to you. Do not think of going through court case. First try with banking ombudsman or consumer court .
Forgot to tell you, you can complaint in BO if your claim amount is below 10 L (i think) .
If u need any help you can get in touch with me.
I will try and upload my papers and documents. I have to check i they are still with me or not. Will try and do that this week so that it might help victims like us[hr]

hi all,

I purchased a property from citibank but after registration i came to know that i have been cheated by citi bank.

Series of events

A sold site 23 measuring 30x50 to B
A sold site 23 measuring 30x40 to C
C sold to D
D to Citi Bank
Citibank to myself through action.
Now B is not allowing me to take possession.

All above transactions are registered in sub registrar office. My question is how can citibank sell the property which belongs to B.

Shivakumar
9008103425

can you upload or pm me copy of paper advertisement given by citi bank for the auction? Paper advertisment will solve half of your case. But 95% of chances about getting back your money through ombudsmen

Bro can you PM me copy of sale deed by bank? Need to read the sale deep copy also. [hr]

hi all,

I purchased a property from citibank but after registration i came to know that i have been cheated by citi bank.

Series of events

A sold site 23 measuring 30x50 to B
A sold site 23 measuring 30x40 to C
C sold to D
D to Citi Bank
Citibank to myself through action.
Now B is not allowing me to take possession.

All above transactions are registered in sub registrar office. My question is how can citibank sell the property which belongs to B.

Shivakumar
9008103425

Secured creditor shall recover the debt by way of sale under Section 13 (4) of SARFAESIAct,2002. Generally the assets are sold on "as is where is" and as is what is" basis and while effecting sale by inviting tender from public or holding public action, the details of the encumbrance known to the secure creditor are declared/furnished to the public at large. [undefined=undefined]While interpreting Rule 8(6) of Security Interest (Enforcement) Rule, 2002, the Bank/Financial Institution is imposed with the accountability to conduct due diligence/make thorough search on the assets before the sale. The plea of ignorance of the knowledge of encumbrance on the assets sold on the pretext of "as is where is" is no longer an acceptable argument in the light of the judicial interpretation.

The relevant provision of Rule 8(6) of the Security Interest ( Enforcement ) Rules, 2002 which deals with the procedure for bringing the immovable secured assets for sale is extracted hereunder :

(a) the description of the immovable property to be sold, including the details of the encumbrances known to the secured creditor;
(b) the secured debt for recovery of which the property is to be sold;
(c) reserve price, below which the property may not be sold;
(d) time and place of public action or the time after which sale by any other mode shall be completed;
(e) depositing earnest money as may stipulated by the secured creditor;
(f) any other thing which the authorised officer considers it material for a purchaser to know in order to judge the nature and value of the property.
[hr]
SARFAESI ACT

. Rule 8(6)(f) mandates the secured creditors to set out in the terms of sale notice any other thing which the authorized officers considers it material for a purchaser to know in order to judge the nature and value of the property and the Hon'ble High Court interpreted that the said rule would also include the encumbrance relating to the property and the intending purchaser to be put on notice as to the encumbrance, as otherwise he/she will be purchasing the property and simultaneously buying the litigation as well and an intending purchaser may not bid in the event he/she came to know of any encumbrance over the property
factors which is likely to influence the mind of intending purchaser to proceed or not to proceed with his participation in the auction and even if the encumbrance certificate is made available for inspection before auction, thesamewould not amount to strict compliance with mandatory Rule 8(6) of the SecurityInterest (Enforcement) Rules, as per which the particulars of the encumbrance, if any, or any other factor which the Authorised Officer considers it material for an intending purchaser to be aware as referred to in Rule8(6)(a) and (f) are to be disclosed in the public notice regarding sale

 

[skbt78]

I have sent a letter along with documents showing that bank was duped by the borrower. But bank replied mentioning that they are the owners and not the third party and hence, auction is legal. But i know that third party is the owner. Because property was sold and registered by landlord twice. Now how to convince bank to get my money back

 

[skbt78]

hi nansurabhi,

can you get me any earlier judgement case reference .. by referring to that case i can get my money back easily from ombudsman..really i am in deep trouble,, i have pledged all my mothers jewellery,, now no money, no jewellery, no site,, only mental agony

 

[nansurabhi]

hi nansurabhi,

can you get me any earlier judgement case reference .. by referring to that case i can get my money back easily from ombudsman..really i am in deep trouble,, i have pledged all my mothers jewellery,, now no money, no jewellery, no site,, only mental agony

Hi bro,

I can imagine your situation as i have gone through the same phase. No need to panic. You have to proceed step by step according to rules and then file a case in banking ombudsman. As i have told you earlier, first write to bank and take a copy of it and wait for their reply. If they do not reply or reply is not satisfactory then mail to nadal officer of that bank and wait for their reply. If you do not get reply in 1 month or if their reply is not satisfactory to you then with all the documents goto banking ombudsman or file a complaint online with all the details. [hr]
i tried calling your number but there was no reply. Anyways, all the best. Proceed according to rules. You are dealing with RBI banking ombudsman. make sure you carry all the documents and go with proper home work. Bangalore ombudsman officers are really very friendly and helpful.