Court issues writ of mandamus to Bank of India, compelling release of property documents following issuance of "No Dues Certificate."
In a significant ruling, the Allahabad High Court has directed the Bank of India to release the title deeds of a property in Ghaziabad, following a full settlement of dues by the petitioner, Seema Jain. The Division Bench, comprising Justices Ajit Kumar and Indrajeet Shukla, issued a writ of mandamus against the bank, ordering the release of the original sale deed within two weeks. The decision came after the petitioner filed a writ petition under Article 226 of the Indian Constitution, seeking the release of the title deeds which had been unjustly withheld despite the issuance of a "No Dues Certificate."
The case arose when Seema Jain, who had purchased the property and settled all outstanding loans with the bank through a compromise payment of Rs. 5.5 lakhs, found herself unable to obtain the title documents. Despite clearing all dues, the bank refused to hand over the title deed, citing procedural reasons. The court noted the absence of any legal or ownership disputes over the property and highlighted the bank’s own acknowledgment of the full settlement and issuance of a "No Dues Certificate."
The judgment emphasized that the bank cannot retain the title deeds once the dues are cleared and no disputes remain. The court's order mandates the bank to release the documents, facilitating the petitioner in her plans to secure a loan for her daughter’s marriage. This ruling underscores the court's commitment to protecting citizens' rights against undue bureaucratic hurdles, reinforcing the legal principle that financial institutions cannot withhold property documents without valid reasons.
Bottom line:-
Bank cannot withhold title deeds of a property after accepting the full settlement amount and issuing a "No Dues Certificate," particularly when no dispute exists regarding the ownership of the property.
Statutory provision(s): Article 226 of the Constitution of India
Seema Jain v. Zonal Manager, Bank of India, (Allahabad)(DB) : Law Finder Doc id # 2907623
