Advocate – Bank Panel of Advocates – Due Diligence of Title Reports – – Subsequently the title deeds were found fake – Negligence in discharge of professional duties –  

The Petitioner was on the Advocates’ of Panel of State Bank of Hyberabad (now SBI) and was entrusted work of Search and Title Report of the properties.

Writ Petition of Pune Advocate for removal of his name from “caution list’ of the Respondent No.2 Indian Banks’ Association.

In 2014, the petitioner had given three search and title reports.   Thereafer, the respondent no.1 had given loans on the said properties.

However, fraud was found with regard to the sanctioned loan.  Show cause notice was given to the petitioner for his comments and same were replied.

On 1.8.2018, the petitioner was informed that his name was placed on the “caution list” on four grounds in accordance with the guidelines dated 27.8.2009 of Respondent No.2.

HELD that the Bank had given photocopies for title reports.  Moreover, the report categorically stated that prior to the mortgage, NOC from the society should be obtained. It was also stated that the original documents should be deposited for mortgage and intimation should be given to the Sub-Registrar.   The search report was based on the records available at the office of Sub-Registrar and on the computer placed at JDR Office, Pune.

In our opinion, the Advocate has expressed his opinion and stated the steps to be taken by the Bank before sanctioning.  The petitioner cannot be held to be negligent since, based on perusal of the report, he can be said to have taken reasonable care and due diligence.

Moreover, clause 5 of the Bank Guidelines provided that the bank officials should independently inspect the property and inquire into possession, tenancy rights, ownership, litigation etc.   Clause 6 provides for notarised affidavit from the borrower that the property to be mortgaged is free from charges.  These Guidelines were never brought to the notice of the Panel Advocate.

Reliance is placed on the decisions of Nagpur Bench in Rajan Shrivallabha Deshpande of W.P.No.3616 of 2021 and Mohana Raj Nair Vs. CBI 2013 SCC Online Bom 1279

Judgment dated 30.1.2024 in W.P.No.14373 of 2018 (AS) of Shri Shailesh Vishwanath Jambhale Vs. The General Manager, SBI and others