Buyers of duplex apartments in the 30-story Orbit Haven on Napean Sea Road were relieved as the Supreme Court held that their two-year-old suit for ownership of apartments or reimbursement of cash with damages was heard before the Bombay High Court against both the builder and the bank.
The SC annulled a relief from the HC to Axis Bank in October 2018, which dropped the suit against it. The 12 Orbit Haven duplex flats are priced from Rs 12 crore to Rs 25 crore.
The situation dates back to 2017, when five flat buyers approached the HC alleging that the builder, Orbit Corporation, now in liquidation, had colluded with Axis Bank, borrowed approximately Rs 150 crore and mortgaged the property in 2013, after selling them apartments since 2009.
The bank, invoking the Securitisation Act regulations, said that the case could not be brought against it before the HC, but only against the builder.
But the SC held that only one party could drop the suit. Either it is rejected against all or none of the sides, held on Monday in its decision the SC bench of Justices A M Khanwilkar and Ajay Rastogi.
The SC reinstated Justice S C Gupte of the Bombay HC's 2017 order and set aside the 2018 decision of an appeal panel of Justices Naresh Patil and Girish Kulkarni, who rejected the lawsuit against the bank.
Three petitions, lodged before Justice Gupte by Padma Bhatt, M P Aggarwal and Manisha Saraf through SatyanVaishnav, claimed absence of due diligence on the part of Axis Bank before promoting a loan to Orbit.
They claimed to have jointly paid the builder over Rs 200 crore.
The bank, through its law firm Cyril Amarchand Mangaldas, rejected suspected collusion charges and argued that it could not be mistaken as the flat sale contracts had not been recorded. The bank also stated that it was not even an important party to the conflict that the suit could proceed against it.
The bank said that the Securitisation Act prevents the HC from roping the bank into the claim of the customers before it.
Courtesy/By: Kabir Jaiswal
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06 Jul 2019
