• Auction property outstanding dues with the housing society

I bid for an auction property from a Bank and was convinced somehow by the Bank Manager to purchase the same.
This without checking & making due deligence. This propety was auctioned with a term "as is where is basis"
After the succesful bid it was found that even the society had raised dues agains this property.

The Property in question has a following history.

The property was purchased by a builders relative on the completion of the Building.
Later he mortgaged this to the Bank. But failed to pay the installment and its interest.
Now this person is obsconding and nowhere to be found.
The property was siezed by the bank and auction notice was processed.
During this process the society was formed and expt for this owner everyone contributed to its intitialization funds etc.
This property is at good location but not maintained (both interior and exterior) till date.

Presently, I have purchased this peropty and wish to get membership of the society, get this repaired and also settle the outstanding dues.

But the exhorbitant amount is a deterent for settlment.

Can any learned advocate put some light on the issues as below :

1. What are my rights as purchaser whether I will have to pay the principal and interest till date as levied by the Society
2. Is their any court where i can present my case and get releif from this harassment
3. I have been told that the membership or repair or any connection (both electrical / water) cannnot be given unless I pay the old dues.
4. I am ready to pay the maintenance from the date of my occupation ie. 1 year but they insist to get the old dues too.
5. The Bank has asked to settle the same with mutual understanding as they have sold this property "as is where is"
6. The Soceity till date has not issued any notice to the holder of this property underSection 101 vide amendment to the M C S Act 1960	
7. Is there any way I have can settle at the minimum cost.
8. Can the limitation act be applicable in this since society has not issued any legal notice for recovery. It's more than 3 years no dues are recovered.

Please advise or can mail me on [deleted] / Mobile [deleted]
Asked 4 years ago in Property Law
Religion: Hindu

3 answers received in 30 minutes.

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6 Answers

You have to pay principal amount with interest to the society

2) cooperative or consumer court would not grant you any relief

3) water and electricity are essential services cannot be disconnected by society

4) you are liable to pay all old dues to the society

5) society would not transfer flat in your name till society dues are paid

6) society ought to hav e taken legal proceedings against defaulter if he failed to pay dues

7) under section 101 of MCS act recovery proceedings ought to hav e been taken within period of 3 years otherwise claim would be barred by limitation

Ajay Sethi
Advocate, Mumbai
87932 Answers
6207 Consultations

5.0 on 5.0

1. You have the full right on the said purchased property but have a liability to pay the amount standing in the name of the owner of the flat as outstanding. You should have taken NOC from the said Society beore taking part in the auction since it is a flat in the Housing society.

2. You can file a Writ Petition before the High Court against the Bank (if it is a PSU Bank) praying for an order upon the bank to refund you the amount paid by you to the bank and the registration charge with interest, damage and cost

3. It is a fact that unless you clear the dues of the Society, it may not permit you to make any entry in to the premises of the said society.

4. You have purchased the flat with all the liabilities and dues standing in its name including the electricity bill remaining unpaid by the earlier owner.

5. It is understandable that the bank will take that stand but you can argue before the High Court that the bank had nowhere specified about the said dues standing on the said flat and has acted dishonestly.

6. & 7. You can file the Writ Petition and seek refund of the entire amount as suggested above.

8. The Society will argue that you are not yet a member of the Society and your ownership is subject to your clearance of the dues and sending bill to you does not arise for the said reason.

Krishna Kishore Ganguly
Advocate, Kolkata
26602 Answers
726 Consultations

5.0 on 5.0

Dear sir,

The auction of the property by the banks as is where is basis means after purchase a property you are liable for all the dues related to the property the society outstanding comes as a Priority outstanding and you have to clear all the dues outstanding with the society as the society is formed during the course of position so from the date of formation of the society this apartment is liable to clear the dues and interest if any as decided by the society as per the bye laws of the society in case you have any problem you can move to the consumer forum against the society.

The common area maintenance is the part of the maintenance of the society and in case there is any problem in the common area that you can ask the society to maintain society is not responsible for any maintenance inside the flat that you have to maintain by yourself.

Limitation act is applicable and most of the litigations but that can be condoned by the court. Societies normally issue notices to their members and send to the flats only.

If you need to discuss the provisions at length please do call me.

Vimlesh Prasad Mishra
Advocate, Lucknow
6848 Answers
23 Consultations

4.9 on 5.0

1.You have pay the complete outstanding amount to the society. Though you are absolute owner of the property.

2. The court shall not provide you relief as it was sold on as is where basis.

3.electricity water cannot be disconnected as they are essential for life though society shall not give you possession.

4. you have to clear old dues.

5. Yes you should request society to wave of interest.

6.if there no notice then the 3 year old dues are barred from limitation. you should persuade the society for maintenance at some fixed amount

Shubham Jhajharia
Advocate, Ahmedabad
25516 Answers
179 Consultations

5.0 on 5.0

Dear Client,

As is where is basis has no more application in case sale by bank/FI. The ignorance of the secured creditor regarding the encumbrance on the property is no longer an acceptable argument in light of the decisions of court rejecting the plea of “as is where is”.

Can not from the present owner for the liabilities of the previous owner and there was no society formed, this also a reason.

Complain to registrar or co operative society court.

Get interim relief from court, essential necessities cannot be withheld or deny.

Point 6 valid ground to deny noitce. Demand should been raised and was shown due against the actual owner. no fresh demand justify from new owner of past owner.

Limitation is issue in court, if matter will reach there than plea of limitation will come.

Yogendra Singh Rajawat
Advocate, Jaipur
21481 Answers
31 Consultations

4.4 on 5.0

1. You will be compelled to pay the arrears amount that is due to the society, which was not paid by the previous owner till date.

You have no options than to pay the same and can initiate action against the defaulter after that.

2. You may have to aproach the bank for clearing the dues, but your efforts will be in vain because it was on the as is where is basis, you may not get any relief on this from any court.

3.You may have to accept the same.

4. You can issue a legal notice to the society and advise them to refrain from demanding the old dues for the period which is not under your occupation.

5. The bank is right.

6. You may inform this in the legal notice to seek relief under this umbrella.

7. By negotiations with the society.

8. No doubt they cannot enforce the same through court even if it is not barred by limitation, but they will keep torturing you ever after.

T Kalaiselvan
Advocate, Vellore
78089 Answers
1543 Consultations

5.0 on 5.0

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