Legal Question in Banking Law in India

Dear Sir,

I have purchased a flat from a builder[Pvt.ltd.] in 2010. Loan was processed by LIC housing finance, loan was sanctioned and i have got my flat registered in 2010 March. Recently I came to know through paper notice that, Land on which flats were constructed is given as second collateral security to some other venture of a builder. Loan for this other venture is processed by Syndicate bank in 2008. Now Syndicate bank issued a public notice saying that, nobody should not do any transactions with the mentioned flats[My flat is there in that list including 50 other flats in same venture] as the loan account in Syndicate bank became NPA [Loan is taken by builder for other venture, keeping our venture land as second collateral security]. Neither we were aware of this loan details nor builder revealed this to us while purchasing flats. We just beleived LIC housing finance about the title check and all, as it is premier financial institution. Now LICHFL is saying that they were also not aware of this collateral security. How come it is possible? Without a title check can this kind institutions sanction loans.

We are in tough situation now, can you please suggest us how to proceed further to resolve this situation. [If we won't take action immediately, Syndicate bank may proceed towards auctioning property]. Please suggest us.

-Santosh


Asked on 5/17/12, 2:09 am

1 Answer from Attorneys
ranganathan raghavachari R.Ranganathan & Associates

You don't have to worry about this. Syndicate Bank cannot bring your property to sale unless and until it is proved that the first charge is not sufficient to satisfy their dues. Further you can approach DRT for this purpose when auction notice is issued against your properties. Contact me for further advice at [email protected]

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Answered on 5/18/12, 12:57 am


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