Legal Reference Library

While relying upon the Supreme Court decision in State of Karnataka v. Shreyas Papers Pvt. Ltd., 2006 (1) SCC 615 the Division Bench comprising of S. C. Dharmadhikari, B.P. Colabawalla, JJ. held that no charge can be enforced against a property legitimately purchased for consideration by the transferee if he has had no notice, either actual or constructive, of the charge. In the instant case, when a defaulter company could not repay the loan taken from the respondent bank, the bank took physical possession of a property belonging to the defaulter company under Section 13(4) of the SARFAESI Act and invited offers for sale of the said property. On 1st September, 2010 the petitioners placed their bid for purchasing the property at Rs. 11,00,29,000. Thereafter, a Deed of Conveyance was registered in favour of the petitioners with the Registrar of Assurances on 10th March, 2011. At the time of registration, the petitioners perused the 7/12 extract relating to the property and learnt that t...

In Sonoma Management Partners Pvt. Ltd. Vs. Bank of Maharashtra, the Hon'ble Bombay High Court found that the amount of sales tax was not disclosed to the final auction buyer till after the sale of the asset has been completed. Further the amount due from the defaulting company cannot be claimed from the auction purchaser can by no stretch of the imagination be termed as a successor of the business of the Defaulter Company. The Hon'ble court said that in State of Karnataka & Anr Vs. Shreyas Papers Pvt. Ltd., (2006) it has been held that  a charge may not be enforced against a transferee if she/he has had no notice of the same, unless by law, the requirement of such notice has been waived. The Hon'ble court also mentioned the newly amended Sections 26D & E of the SARFAESI Act which states :- " 26D. Notwithstanding anything contained in any other law for the time being in force, from the date of commencement of the provisions of this Chapter, no secure...

Supreme Court in Anant Prakash Sinha @ Anant Sinha vs State of Haryana, has observed that while adding or altering a charge under Section 216 CrPC, the trial court has to keep in view, the test of prejudice to the accused. Apex Court Bench comprising of Justices Dipak Misra and Shiva Kirti Singh said that it is the duty of the trial court to bear in mind that no prejudice is caused to the accused as that has the potentiality to affect a fair trial. Background In this case, the Magistrate had allowed an application under Section 216 of the Code of Criminal Procedure by a-wife for framing an additional charge under Section 406 IPC, holding that prima facie case for criminal breach of trust was made out. This order was assailed in revision and the Revisional court partly allowed the revision petition by setting aside the order of framing of charge against the mother-in-law. The said order was upheld by the High Court. The husband then approached the Apex Court. Test of Prejudice Referring...