In a significant relief for residents of Malad East, the Debts Recovery Appellate Tribunal (DRAT) has halted efforts by Khush Housing Finance Private Limited (KHFL) to take possession of three properties in Atharva Landmark Co-operative Housing Society, pointing to procedural deficiencies under the SARFAESI Act.
The order, passed on April 24 by Vivek Bharti Sharma, restrains the finance company, its officials, and assignees from proceeding with possession of the properties, which include two residential flats and a parking podium. Earlier, on April 3, KHFL had attempted to evict occupants with police assistance.
The tribunal issued two separate orders—one covering Flat No. 1201 and Flat No. 301, and another for Office Nos. 201, 202, and 203 are located on the second-floor parking podium. All interim applications filed by the homeowners were allowed, effectively pausing any further action under SARFAESI proceedings.
The dispute centres on flats in Atharva Landmark, Poddar Road, purchased by the appellants in 2019 and 2020 through registered conveyance deeds. The buyers maintain they are bona fide purchasers. However, KHFL contended that the developer had mortgaged multiple units, including these flats, in April 2018—before the sales took place.
Representing the society and homeowners, advocates Jay Rajpopat and Akshit Kothari confirmed the tribunal’s decision. Society chairman Jagdish Rajpopat said, “We have 52 families who purchased their homes honestly. This order gives them breathing space. The fight continues.”
At the core of the case is compliance with SARFAESI provisions. The appellants argued that the affidavit submitted before the Magistrate failed to confirm adherence to mandatory requirements under Section 14. While the respondent acknowledged the absence of explicit compliance in the affidavit, it maintained that the registered mortgage served as public notice.
The tribunal observed that the lack of a mandatory declaration constituted a serious procedural lapse and noted that the appellants had established a prima facie case. It further held that the properties are occupied residences and that forcible possession could cause irreparable harm, with the balance of convenience favouring the homeowners.
The tribunal has stayed all possession proceedings, with the next hearing scheduled for September 17, 2026.
Source: Mid-day
