Bombay HC – Prior Sale Deed Prevails Over Subsequent Bank Attachment – Bona Fide Purchaser Protected – Rule 107 of the MC Societies Rules
Attachment of the Property of Default – Bona fide Purchaser of Property before Attachment – Sub-Rule 19 Rule 107 of the MC Societies Rules.
The mortgage of the property in favour of the society was released in the year 2004.
On 24.6.2010, the petitioner purchased the property by the registered instrument.
On 25.11.2012, the Bank attached the property pursuant to the action of Special Recovery Officer.
When the petitioner entered into the transaction in 2010, the property was free from encumbrance so far as the society was concerned. There was no subsisting charge. There was no attachment. In law, attachment does not create title. It only operates against the property of the defaulter. Once ownership had passed to the petitioner prior to the attachment, the authorities could not treat the property as if it still belonged to the original borrower. A recovery proceeding cannot travel beyond the assets of the defaulter. It cannot defeat a prior lawful transfer, unless the transfer is shown to be sham, fraudulent, or intended to defeat recovery.
Bombay HC – Prior Sale Deed Prevails Over Subsequent Bank Attachment – Bona Fide Purchaser Protected – Rule 107 of the MC Societies Rules
Bombay HC – Bank Attachment Cannot Defeat Completed Sale of Bona Fide Purchaser
Bombay HC – Recovery proceedings & Attachment of the Bank Cannot Override Prior Rights of Bona fide Purchaser
Order dated 9.2.2026 of the High Court of Bombay in Writ Petition No.2111 of 2013 of Bhalchandra Baburao Kanade Vs. Special Recovery Officer and Sale Officer, Nashik Jilha Girana Sahakari Bank Ltd and others
