Robin Joseph Baby vs The District Collector
2021 Latest Caselaw 15464 Ker

WP(C) NO. 8653 OF 2021              1



             IN THE HIGH COURT OF KERALA AT ERNAKULAM
                                  PRESENT
         THE HONOURABLE MR. JUSTICE RAJA VIJAYARAGHAVAN V
     FRIDAY, THE 23RD DAY OF JULY 2021 / 1ST SRAVANA, 1943
                         WP(C) NO. 8653 OF 2021
PETITIONER/S:

            ROBIN JOSEPH BABY,
            AGED 36 YEARS,
            S/O. K.BABY, RESIDING AT PALAMOOTTIL HOUSE,
            KATTANAM MURI, KATTANAM VILLAGE, PALACKAL P.O,
            ALAPPUZHA DISTRICT-690 503.

            BY ADV S.SREEKUMAR (KOLLAM)



RESPONDENT/S:

     1       THE DISTRICT COLLECTOR,
             COLLECTORATE, ALAPPUZHA-688 001.

     2       THE TAHASILDAR,
             (RR) TALUK OFFICE, MAVELIKKARA, ALAPPUZHA DISTRICT-
             690 101.

     3       VILLAGE OFFICER,
             BHARANIKAVU VILLAGE OFFICE, ALAPPUZHA DISTRICT-690
             503.

     4       AUTHORISED OFFICER,
             BANK OF BARODA, MAVELIKARA BRANCH, ALAPUZHA-690 101

     5       THE TAX RECOVERY OFFICER,
             RECOVERY CELL, PUBLIC LIBRARY BUILDING, SASTRI
             ROAD, KOTTAYAM-686 001.

             SMT.K.AMMINIKUTTY,SR GP
             BY ADV LEO GEORGE


      THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION
ON   23.07.2021,   THE    COURT    ON   THE   SAME   DAY   DELIVERED   THE
FOLLOWING:
 WP(C) NO. 8653 OF 2021                2



                                  JUDGMENT

By virtue of Ext.P1 sale certificate issued by the 4th respondent in

exercise of his powers under Section 13 of the Securitisation And

Reconstruction of Financial Assets and Enforcement of Security Interest Act,

2002 ('SARFAESI Act' for short) read with Rule 8 and 9 of the Security

Interest (Enforcement) Rules, 2002, the petitioner secured title over property

having a total extent of 21.97 Ares in Re-survey Nos. 248/7, 348/16, 348/8-4

and 348/14 in Bharanikkavu Village, Alappuzha District.

2. After acquiring title over the property, the petitioner filed an

application before the 3rd respondent to effect mutation of property, which

came to be rejected by Ext.P2 order for the reason that some revenue

proceedings were effected subsequent to the creation of the mortgage.

According to the petitioner, as the mortgage was created on 10.03.2014 and

the attachment was effected only on 22.03.2019, it would not affect the title

and ownership of the property nor would it have any impact on the sale

conducted as per the provisions of the SARFAESI Act. On registration of the

sale deed, the petitioner again approached the 3rd respondent and mutation

of the property was effected by Ext.P5 order. However, the 3rd respondent

recorded the liability of the prior owner in the tax receipt, which according to

the petitioner is against all tenets of the law. Being aggrieved, the petitioner

is before this Court seeking the following reliefs:

(i) To issue writ of certiorari or any other appropriate writ, order quashing Ext.P2 order of the 3rd respondent;

(ii) To issue a writ of mandamus, order or direction to the 3rd respondent to remove the liability of the prior owner mentioned in Ext.P5 tax receipt of the petitioner.

3. Sri.S. Sreekumar, the learned counsel appearing for the

petitioner submitted that it has been laid down by this Court in a catena

of decisions that under Section 26E of the SARFAESI Act, priority in

payment has been statutorily created in favour of a secured creditor over

all other debts including tax payable to the Central Government or State

Government on registration of the security interest. He would further

point out that the sale of the property under Ext.P1 sale certificate is free

from all encumbrances and the attachments effected subsequent to the

mortgage would not affect the title and ownership of the petitioner over

the property. Such attachments will have no effect on the sale conducted

invoking the provisions of the Act and the same would cease to have any

effect the moment the sale is confirmed in favour of the petitioner.

4. I have heard the learned standing counsel appearing for the

4th respondent and the learned Government Pleader.

5. I have considered the submissions advanced and have

perused the records. Section 26E of the SARFAESI Act grants priority to

secured creditors after the registration of the security interest, and the

debts due to any secured creditor shall be paid in priority over all other

debts, revenues, taxes, cesses and other rates payable to the Central

Government or State Government or local authority. The rights and

liberties conferred on the creditor/bank by virtue of mortgage created and

the right to proceed under the relevant provisions of the SARFAESI Act

cannot be defeated because of the subsequent attachments ordered by

the Civil Court (see HDFC v. Sub Registry Officer [2011 KHC 851] and

Madhan v. Sub Registrar [2014 (1) KLT 406]). In TDB v Deputy

Examiner, Local Fund Audit and Others, [2020 (3) KHC 129] a

Division Bench of this Court had occasion to observe that the sale carried

out either under the SARFAESI Act or under the RDB Act takes

precedence even over the statutory charges due to the Government

created under KVAT Act or under other State Enactments after the

Amendment Act of 2016. A secured creditor in whose favour a security

interest has been created thus has priority in sale and payment over all

other statutory charge holders. In that view of the matter, the petitioner

is entitled to succeed.

This writ petition will stand allowed. It is declared that the

attachment effected subsequent to the creation of mortgage on

10.03.2014 shall not affect the title and ownership of the petitioner over

the property covered under Ext.P1 sale certificate. Consequently, there

will be a direction to the 3rd respondent to remove the entries relating to

the liability of the previous owner and issue fresh tax receipts to the

petitioner in the usual course.

SD/-

RAJA VIJAYARAGHAVAN V JUDGE NS

APPENDIX OF WP(C) 8653/2021

PETITIONER(S) EXHIBITS :

EXHIBIT P1         A TRUE COPY OF THE SALE CERTIFICATE
                   BEARING NO. 1445/2020 DATED 11.11.2020
                   REGISTERED BEFORE THE BHARANIKAVU S.R.O,
                   ALAPPUZHA.

EXHIBIT P2         TRUE COPY OF THE ORDER DATED 17.11.2020
                   PASSED BY THE 3RD RESPONDENT, THE VILLAGE
                   OFFICER, BHARANIKAVU VILLAGE, ALAPPUZHA.

EXHIBIT P3         THE TRUE COPY OF THE LETTER ISSUED BY THE
                   4TH RESPONDENT BANK DATED 04.12.2020.

EXHIBIT P4         THE TRUE COPY OF THE ORDER OF ATTACHMENT
                   OF IMMOVABLE PROPERTY ISSUED BY THE TAX
                   RECOVERY OFFICER DATED 22.03.2019.

EXHIBIT P5         TRUE COPY OF THE TAX RECEIPT ISSUED BY
                   THE VILLAGE OFFICER, BHARANIKAVU, DATED
                   15.09.2020, NO.KL04060904534/2020.



RESPONDENT(S) EXHIBITS :   NIL