Shaji vs K.T.Chathukutty
2021 Latest Caselaw 20790 Ker

           IN THE HIGH COURT OF KERALA AT ERNAKULAM
                           PRESENT
            THE HONOURABLE MR.JUSTICE N.ANIL KUMAR
  WEDNESDAY, THE 6TH DAY OF OCTOBER 2021/ 14TH ASWINA, 1943
                     RSA NO. 581 OF 2021
   AGAINST JUDGMENT AND DECREE IN AS 24/2018 OF ADDITIONAL
 DISTRICT COURT-III, KOZHIKODE DTD.31.1.2020 ARISING FROM THE
  JUDGMENT AND DECREE IN O.S.No.365/2007 ON THE FILE OF THE
       ADDITIONAL SUB COURT-I, KOZHIKODE DTD.27.10.2017
APPELLANTS/APPELLANTS/PLAINTIFFS:
     1    SHAJI,
          AGED 45 YEARS,
          S/O.SREEDHARAN.
     2    T.MANI,
          AGED 52 YEARS,
          S/O SREEDHARAN.

          BOTH RESIDING AT THAZHATHAYIL HOUSE,
          KAKKODI AMSOM AND MAKKADA DESOM,
          KOZHIKODE TALUK-673611.
                BY ADV SRI.M.KRISHNA KUMAR

RESPONDENTS/RESPONDENTS/DEFENDANTS:
     1    K.T.CHATHUKUTTY,
          AGED 85 YEARS,
          S/O.CHATHU,
          SHEEJA NIVAS, ELATHUR VILLAGE,
          PUTHUR DESOM, KOZHIKODE TALUK-673303.
     2    P.THANKAM,
          AGED 82 YEARS,
          W/O.LATE SHEKHARAN,
          PUZHAVAKKATH HOUSE, ELATHUR AMSOM,
          KARANNUR DESOM,
          KOZHIKODE TALUK-673021.
     3    P.RAMAPRASAD,
          AGED 63 YEARS,
          S/O.LATE SHEKHARAN,
          PUZHAVAKKATH HOUSE, ELATHUR AMSOM, KARANNUR DESOM,
          KOZHIKODE TALUK-673021.
     4    P.PRADEEPKUMAR,
          AGED 61 YEARS,
          S/O LATE SHEKHARAN,
          PUZHAVAKKATH HOUSE, ELATHUR AMSOM, KARANNUR DESOM,
          KOZHIKODE TALUK-673021.
 R.S.A.Nos.581 & 582 of 2021


                                     ..2..


     5       P.PROMODKUMAR,
             AGED 59 YEARS,
             S/O.LATE SHEKHARAN,
             PUZHAVAKKATH HOUSE, ELATHUR AMSOM, KARANNUR DESOM,
             KOZHIKODE TALUK-673021.
     6       PRASEEJA KUMAR,
             AGED 57 YEARS,
             D/O.LATE SHEKHARAN,
             PUZHAVAKKATH HOUSE, ELATHUR AMSOM, KARANNUR DESOM,
             KOZHIKODE TALUK-673021.
     7       PRABHIJAKUMARI,
             AGED 52 YEARS,
             D/O LATE SHEKHARAN,
             PUZHAVAKKATH HOUSE, ELATHUR AMSOM, KARANNUR DESOM,
             KOZHIKODE TALUK-673021.
     8       JUSIFA,
             AGED 53 YEARS,
             W/O.PANTHAR KUNHIMOHAMMED,
             P.K.M.MANZIL, PALLIPADAM AMSOM DESOM,
             NILAMBUR TALUK, MALAPPURAM DISTRICT-679329.
     9       FATHIMATH SHYNI,
             AGED 36 YEARS,
             D/O.PANTHAR KUNHIMOHAMMED,
             P.K.M.MANZIL, PALLIPADAM AMSOM DESOM,
             NILAMBUR TALUK, MALAPPURAM DISTRICT-679329.
     10      SHAHIM.P,
             AGED 30 YEARS,
             S/O.PANTHAR KUNHIMOHAMMED,
             P.K.M.MANZIL, PALLIPADAM AMSOM DESOM,
             NILAMBUR TALUK, MALAPPURAM DISTRICT-679329.
     11      SHARVAN.P,
             AGED 26 YEARS,
             S/O.PANTHAR KUNHIMOHAMMED,
             P.K.M.MANZIL, PALLIPADAM AMSOM DESOM,
             NILAMBUR TALUK, MALAPPURAM DISTRICT-679329.

             R8 & R10 BY SR.ADV.SRI.T.SETHUMADHAVAN,
             SMT.P.V.PREETHI, SRI.M.V.BALAGOPAL

         THIS REGULAR SECOND APPEAL HAVING COME UP FOR ADMISSION
ON   30.09.2021,    ALONG     WITH      RSA.582/2021,   THE   COURT   ON
06.10.2021 DELIVERED THE FOLLOWING:
 R.S.A.Nos.581 & 582 of 2021


                                ..3..



             IN THE HIGH COURT OF KERALA AT ERNAKULAM
                              PRESENT
              THE HONOURABLE MR.JUSTICE N.ANIL KUMAR
   WEDNESDAY, THE 6TH DAY OF OCTOBER 2021 / 14TH ASWINA, 1943
                         RSA NO. 582 OF 2021
    AGAINST JUDGMENT AND DECREE IN AS 25/2018 OF ADDITIONAL
 DISTRICT COURT-III, KOZHIKODE DTD.31.1.2020 ARISING FROM THE
   JUDGMENT AND DECREE IN O.S.No.696/2008 ON THE FILE OF THE
         ADDITIONAL SUB COURT-I, KOZHIKODE DTD.27.10.2017


APPELLANTS/APPELLANTS/DEFENDANTS:

     1     T.MANI,
           AGED 52 YEARS,
           S/O.SREEDHARAN.
     2     SHAJI,
           AGED 45 YEARS,
           S/O.SREEDHARAN.

           BOTH RESIDING AT THAZHATHAYIL HOUSE,
           KAKKODI AMSOM AND MAKKADA DESOM,
           KOZHIKODE TALUK - 673 611.

                   BY ADV SRI.M.KRISHNAKUMAR

RESPONDENTS/RESPONDENTS/PLAINTIFFS:


     1     K.T.CHATHUKUTTY,
           AGED 85 YEARS,
           S/O.CHATHU, SHEEJA NIVAS, ELATHUR VILLAGE,
           PUTHUR DESOM, KOZHIKODE TALUK - 673 303.

     2     P.THANKAM,
           AGED 82 YEARS,
           W/O.LATE SHEKHARAN, PUZHAVAKKATH HOUSE,
           ELATHUR AMSOM, KARANNUR DESOM,
           KOZHIKODE TALUK - 673 021.
 R.S.A.Nos.581 & 582 of 2021


                              ..4..


     3     P.RAMAPRASAD,
           AGED 63 YEARS,
           S/O.LATE SHEKHARAN,
           PUZHAVAKKATH HOUSE, ELATHUR AMSOM,
           KARANNUR DESOM, KOZHIKODE TALUK - 673 021.

     4     P.PRADEEPKUMAR,
           AGED 61 YEARS,
           S/O.LATE SHEKHARAN,
           PUZHAVAKKATH HOUSE,
           ELATHUR AMSOM, KARANNUR DESOM,
           KOZHIKODE TALUK - 673 021.
     5     P.PRAMODKUMAR,
           AGED 59 YEARS,
           S/O.LATE SHEKHARAN,
           PUZHAVAKKATH HOUSE,
           ELATHUR AMSOM, KARANNUR DESOM,
           KOZHIKODE TALUK - 673 021.
     6     PRASEEJA KUMAR,
           AGED 57 YEARS,
           D/O.LATE SHEKHARAN,
           PUZHAVAKKATH HOUSE,
           ELATHUR AMSOM, KARANNUR DESOM,
           KOZHIKODE TALUK - 673 021.
     7     PRABHIJAKUMARI,
           AGED 52 YEARS,
           D/O.LATE SHEKHARAN,
           PUZHAVAKKATH HOUSE,
           ELATHUR AMSOM, KARANNUR DESOM,
           KOZHIKODE TALUK - 673 021.
     8     JUSIFA,
           AGED 53 YEARS,
           W/O.PANTHAR KUNHIMOHAMMED,
           P.K.M.MANZIL, PALLIPADAM AMSOM DESOM,
           NILAMBUR TALUK, MALAPPURAM DISTRICT - 679 329.
     9     FATHIMATH SHYNI,
           AGED 36 YEARS,
           D/O.PANTHAR KUNHIMOHAMMED,
           P.K.M.MANZIL, PALLIPADAM AMSOM DESOM,
           NILAMBUR TALUK, MALAPPURAM DISTRICT - 679 329.
    10     SHAHIM.P.,
           AGED 30 YEARS,
           S/O.PANTHAR KUNHIMOHAMMED,
           P.K.M.MANZIL, PALLIPADAM AMSOM DESOM,
           NILAMBUR TALUK, MALAPPURAM DISTRICT - 679 329.
 R.S.A.Nos.581 & 582 of 2021


                                     ..5..


     11    SHARVAN.P.,
           AGED 26 YEARS,
           S/O.PANTHAR KUNHIMOHAMMED,
           P.K.M.MANZIL, PALLIPADAM AMSOM DESOM,
           NILAMBUR TALUK, MALAPPURAM DISTRICT - 679 329.

           R8 & R10 BY SR.ADV.SRI.T.SETHUMADHAVAN,
           SMT.P.V.PREETHI, SRI.M.V.BALAGOPAL


      THIS REGULAR SECOND APPEAL HAVING COME UP FOR ADMISSION
ON   30.09.2021,    ALONG     WITH      RSA.581/2021,   THE   COURT   ON
06.10.2021 DELIVERED THE FOLLOWING:
 R.S.A.Nos.581 & 582 of 2021


                              ..6..


                                                       [CR]

                          JUDGMENT

The plaintiffs filed O.S.No.365/2007 on the file of the

Additional Sub Court-I, Kozhikode (hereinafter referred to

as 'the trial court') for permanent prohibitory injunction

restraining the defendants from evicting the plaintiffs

forcefully. However, the defendants filed O.S.No.696/2008

on the file of the trial court for recovery of the plaint

schedule property from the plaintiffs. For the sake of

convenience, the parties are referred to as per their

litigious status before the trial court in O.S.No.365/2007.

2. The plaint schedule property having an extent of

11.5 cents of land with a three storied shopping complex

belonged to a registered partnership firm under the name

and style 'M/s.Three Associates', in which Sri.T.Mani, the

2nd plaintiff was a partner along with Sri.T.A.Krishnan and

Sri.Kiran Babu as partners. In the year 1997, the 1 st R.S.A.Nos.581 & 582 of 2021

..7..

plaintiff approached the partners of the firm seeking to

get possession of the shop room as a tenant for

conducting a bakery business. The partners of the firm,

namely, Sri.T.A.Krishnan and Sri.Kiran Babu had agreed to

lease out the plaint schedule shop room to the 1 st plaintiff.

The 2nd plaintiff also wanted to include him in the

business. Accordingly, on 3.11.1997, Sri.T.A.Krishnan and

Sri.Kiran Babu rented out their 2/3rd share over the plaint

schedule property in favour of the plaintiff on a monthly

rent of Rs.1,000/-. Thereupon, the 2nd plaintiff obtained

licence from the Corporation of Kozhikode for conducting

bakery business in the plaint schedule shop room. Earlier,

Sri.T.A.Krishnan, Sri.Kiran Babu and the 2nd plaintiff had

availed a loan for their partnership business mortgaging

the plaint schedule property by way of deposit of title

deeds in favour of the Kerala Financial Corporation (for

short 'the KFC'). Subsequently, they defaulted in paying R.S.A.Nos.581 & 582 of 2021

..8..

the amount in time. Hence, recovery proceeding was

initiated by the KFC and the property was brought to sale.

The property was purchased by the defendants. Alleging

fraud in the matter of sale, several litigations were

launched before the courts. Those litigations were

dismissed confirming the sale in favour of the defendants.

According to the plaintiffs, they have been in possession

of the suit property in their personal capacity as tenants in

occupation of the shop room for conducting a bakery

therein. The suit was filed in the year 2007 seeking to

restrain the defendants, who are admittedly auction

purchasers, from forcefully evicting the plaintiffs.

3. The defendants filed a suit for recovery of

possession as O.S.No.696/2008 before the trial court and

both the suits were tried together. The main contention of

the plaintiffs is that the plaintiffs are entitled to get the

benevolent provisions under the Kerala Buildings (Lease R.S.A.Nos.581 & 582 of 2021

..9..

and Rent Control) Act, 1965 (for short 'Act 2 of 1965').

4. The defendants contended that they have

purchased the plaint schedule property in auction

conducted by the KFC. According to them, as per Ext.B2

sale deed No.1192/2007 dated 23.1.2007 executed by the

KFC in favour of the defendants, they have assumed title

over the plaint schedule property. The defendants bid the

property in auction conducted by the KFC and the sale

was confirmed in favour of them. Thereafter the sale deed

was executed in favour of the defendants. It was

contended that the defendants are not tenants coming

under the purview of the Act 2 of 1965.

5. The trial court framed necessary issues during

the trial. Both cases were tried jointly. Treating

O.S.No.365/2007 as the leading case, PWs.1 to 4 were

examined on the side of the plaintiffs and marked Exts.A1

to A21. DW1 was examined on the side of the defendants R.S.A.Nos.581 & 582 of 2021

..10..

and marked Exts.B1 to B42. Ext.C1 is the commission

report filed by the Advocate Commissioner. Exts.X1 to

X(6) series were also marked.

6. The trial court after considering the oral and

documentary evidence of the parties has come to the

conclusion that the plaintiffs are not entitled to get an

equitable remedy of injunction. The suit was dismissed.

However, the suit filed by the defendants for recovery of

possession from the plaintiffs was decreed. Feeling

aggrieved, the appellants, who are the plaintiffs in

O.S.No.365/2007 and the defendants in O.S.No.696/2008,

filed A.S.No.24/2018 and A.S.No.25/2018 respectively

before the Additional District Court-III, Kozhikode

(hereinafter referred to as 'the first appellate court'). The

first appellate court dismissed the appeals confirming the

judgment and decree of the trial court. Aggrieved by the

concurrent findings of the two courts below, the plaintiffs R.S.A.Nos.581 & 582 of 2021

..11..

have filed the present appeals before this Court.

7. Heard Sri.M.Krishna Kumar, the learned counsel

for the appellants and Sri.T.Sethumadhavan, the learned

Senior Counsel for the respondents 8 and 10.

8. Sri.M.Krishna Kumar, the learned counsel for the

appellants submits that the plaintiffs are lessees and they

have a right to be in possession of the suit property

during the period of the lease and this right cannot be

taken away except in accordance with the procedure

established by law. It is submitted that there is nothing

under the provisions of the KFC Act to show that the right

of a lessee to remain in possession of the mortgaged

property during the period of the lease stands

extinguished when the mortgagee initiates auction under

the provisions of the KFC Act. It is submitted that in the

absence of any express language under the provisions of

the KFC Act affecting a lease of a mortgaged property R.S.A.Nos.581 & 582 of 2021

..12..

made by the borrower in favour of a lessee, the lease

continues to be valid even after the mortgagee initiates

auction for realisation of the debt under the provisions of

the KFC Act. The learned counsel further submits that the

lease deed in favour of the plaintiffs satisfies all the

conditions and requirements contemplated under Section

65A of the Transfer of Property Act (for short 'the T.P.

Act'). According to the learned counsel for the appellants,

normally proceedings should have been initiated for

eviction of a tenant before the Rent Control Court.

According to him, the suit for recovery of possession was

filed presumably on the strength of Division Bench ruling

of this Court in Antony v. Kerala Financial Corporation

[1999 KHC 352]. Nevertheless, in Pushpangadan.N.P. &

others v. Federal Bank Ltd. & others [2011 (4) KHC 40],

a Full Bench of this Court overruled the decision in

Antony's case (supra) and held that special statute does not R.S.A.Nos.581 & 582 of 2021

..13..

override the local law and they are tenants in such

buildings. It was submitted that they do have protection

under the Rent Control law in Kerala. Thus, it was argued

that the appellants were in possession much before the

defendants came into the picture and much before the

auction was conducted by the KFC. The learned counsel

further contended that the decree passed by the trial

court lacks inherent jurisdiction and is a nullity in the eye

of law.

9. Per contra, the learned Senior Counsel for the

respondents contended that there were no restrictions on

the right of the borrower to make a lease of an immovable

property prior to the mortgage by deposit of title deeds in

favour of the KFC. Once mortgage is created, their right to

make a lease of the mortgaged property is regulated by

the provisions contemplated under Section 65A of the T.P.

Act. According to the learned Senior Counsel, Sub-section R.S.A.Nos.581 & 582 of 2021

..14..

(3) of Section 65A of the T.P.Act makes it clear that if a

contrary intention is expressed in the mortgage deed

prohibiting the mortgager from making a lease of the

mortgaged property while he is in lawful possession of the

property, the mortgager cannot make a lease and if such

lease is made, it is not binding on the mortgagee. In

support of this submission, the learned Senior Counsel

referred to the observations of the Apex Court in

Harshad Govardhan Sondagar v. International

Assets Reconstruction Company Limited and others

[(2014) 6 SCC 1] and Bajarang Shyamsunder Agarwal

v. Central Bank of India & others [AIR 2019 SC 5017].

10. Assailing the auction proceedings in favour of

the defendants by the KFC, one of the partners, namely,

Kiran Babu admittedly filed a writ petition before this

Court as W.P.(C)No.10189/2006. The writ petition was

dismissed as per Ext.B32 on 14.8.2006. Challenging R.S.A.Nos.581 & 582 of 2021

..15..

Ext.B32, Kiran Babu filed W.A.No.1546/2006 before this

Court. The writ appeal was dismissed as per Ext.B33 on

24.8.2006. Kiran Babu filed W.P.(C)No.34808/2005 before

this Court seeking time to settle the dispute with the KFC.

By Ext.B31 judgment dated 23.12.2005, this Court

granted time till 28.2.2006 to settle the matter with the

KFC. However, no payment was made within the time

stipulated by this Court. Consequently, the KFC proceeded

with the auction. The 2nd plaintiff challenged the auction

proceeding in W.P.(C)No.2700/2007 before this Court. It

was also dismissed as per Ext.B34. As directed by this

Court, the Sub Registrar, West Hill registered the sale

deed in favour of the auction purchasers. Accordingly,

Ext.B2 sale deed was registered.

11. The 2nd defendant Sekharan filed

O.S.No.546/2006 before the Munsiff's Court, Kozhikode

restraining the 2nd plaintiff and others from causing any R.S.A.Nos.581 & 582 of 2021

..16..

alteration or doing anything against his possession over

the plaint schedule property or fabricating any documents

therein. The suit was decreed as per Ext.B9 judgment and

Ext.A18 decree. Challenging the judgment and decree, the

2nd plaintiff and others filed A.S.No.282/2007 before the

District Court which was also dismissed as per Ext.B28

judgment and Ext.B27 decree. The judgment and decree

restraining the 2nd plaintiff and others from disturbing the

possession of the 2nd defendant over the plaint schedule

property are still in force. The decree has become final

between the parties. The 2nd plaintiff is bound by the

terms of the decree and he cannot travel beyond the

scope of the decree to plead otherwise in this suit.

12. Challenging the dismissal of O.S.No.405/2010 of

the Additional Sub Court-III, Kozhikode, seeking to set

aside Ext.B2 sale held under the Kerala State Financial

Corporation Act, (for short 'SFC Act') Kiran Babu filed R.S.A.Nos.581 & 582 of 2021

..17..

R.F.A.(Indigent) No.709/2016 before this Court. The

appeal was dismissed by the judgment and decree dated

17.7.2019. It is clear from the judgment that during the

year 1995-96, for the purpose of constructing a shopping

complex in the property, the firm availed financial

assistance from the KFC. Subsequently, additional facilities

were availed on 18.1.1996 and 16.8.1996 respectively. On

failure to repay the loan amount, possession of the

property was taken over by the KFC under Section 29 of

the SFC Act on 15.5.2001. Thereafter, one of the partners,

namely, Krishnan retired from the firm on 23.4.2003. By

virtue of an assignment deed, his rights over the property

was conveyed in favour of the plaintiff. Since the debt was

not paid off, KFC initiated proceedings for sale of the

property and Ext.B2 sale deed was executed in favour of

the defendants. There were a couple of writ proceedings

which constituted the delay in execution of Ext.B2 sale R.S.A.Nos.581 & 582 of 2021

..18..

deed. Although a suit was filed to challenge the

proceedings it was dismissed. Later, the dismissal was

confirmed by this Court.

13. Admittedly, the lease agreement was made on

3.11.1997 subsequent to the equitable mortgage created

in favour of the KFC by the 2nd plaintiff and others. The

plaintiffs have no case that they have been in possession

of the scheduled property prior to the mortgage in favour

of the KFC. As per the provisions of the SFC Act, if the

borrowers fail to pay the amount, the KFC is entitled to

recover the amount in accordance with the Act. If the

lease was prior to the mortgage of the property, the

tenant shall have the right to enjoy the leasehold

premises in accordance with the terms and conditions of

the lease irrespective of whether a subsequent mortgage

was created by the borrower. Thus, possession of the

lessee are under the three categories. Firstly, leases R.S.A.Nos.581 & 582 of 2021

..19..

created prior to the mortgage, secondly, leases created in

accordance with Section 65A of the T.P.Act and thirdly,

leases created subsequent to the mortgage except in

accordance with sub-section (2) of Section 65A of the

T.P.Act. In Harshad Govardhan's case (supra) the Apex

Court has provided the right to the Banks and other

similar financial institutions facilitating speedy recovery of

their dues by paving way to the bank to secure quick

vacant possession of the property even by evicting certain

kinds of tenants. A tenant who was inducted into the

property before it was mortgaged to the bank is certainly

protected under the Rent Act. The very same principle is

discussed in Bajarang Shyamsunder's case (supra). In

the case on hand, the tenancy was created on 3.11.1997

for a period of three months from 3.11.1997.

14. In view of the contention that the appellant is

entitled to get the benefit of the Full Bench decision in R.S.A.Nos.581 & 582 of 2021

..20..

Pushpangadan's case (supra), this Court deems fit and

proper to examine the legal issue involved in the said

case. In Pushpangadan's case (supra) a Full Bench of

this Court held in paragraph 47 of the judgment as

follows:-

"47. For the aforesaid reasons, we answer the reference as follows: The Securitisation Act has no overriding effect over the provisions of the Kerala Buildings (Lease and Rent Control) Act, 1965. A tenant inducted in the premises before creation of the security interest cannot be summarily evicted under Sections 13(4) and 14 of the Securitisation Act. We also hold that such a tenant, whose right, title, interest or possession is affected by a measure taken under Section 13(4) of the Securitisation Act, would be entitled to make an application to the Debts Recovery Tribunal under Section 17 of the Securitisation Act."

15. It is clear from the above judgment that a

tenant inducted in the premises before creation of the R.S.A.Nos.581 & 582 of 2021

..21..

security interest cannot be summarily evicted under

Section 13(4) and 14 of the Securitisation and

Reconstruction of Financial Assets and Enforcement of

Security Interest Act, 2002 (for short 'Securitisation Act').

There is no evidence in this case to hold that at the time

of creation of the mortgage by the mortgager, the

leasehold right in favour of the plaintiffs was in force. The

2nd plaintiff was one of the partners of the firm and he was

aware of the mortgage created in favour of the KFC. He

suffered orders and decrees in the earlier litigations

between the parties. It is the specific case of the

defendants that the 1st plaintiff is none other than the

brother of the 2nd plaintiff and the suit was filed out of

frustration as an experimental measure to flout the

recovery proceedings.

16. After the mortgage of an immovable property is

created by the borrower in favour of the mortgagee, the R.S.A.Nos.581 & 582 of 2021

..22..

right of the borrower is regulated by Section 65A of the

T.P.Act. The sub-section (1) of Section 65A of the T.P.Act

states that subject to the provisions of sub-section (2); a

mortgager, while lawfully in possession of the mortgaged

property, shall have power to make leases thereof which

shall be binding on the mortgagee. Sub-section (3) of

Section 65A of the T.P.Act further provides that such

power is available with the mortgager to make a lease of

the mortgaged property only if and as far as a contrary

intention is not expressed in the mortgage deed. Needless

to say, so long as the mortgage deed does not prohibit a

mortgager from making a lease of the mortgaged property

and so long as the lease satisfies the requirements of sub-

section (2) of Section 65A of the T.P.Act, a lease made by

a borrower as a mortgager is not only valid but also

binding on a mortgagee. In the instant case, the period of

lease expired after three months from 3.11.1997. There R.S.A.Nos.581 & 582 of 2021

..23..

is no clause in the lease deed to renew the lease.

17. In the present case, the bonafides of the

plaintiffs are highly doubtful. The 1 st plaintiff is one of the

partners of the firm. The firm borrowed money from the

KFC and mortgaged the scheduled property with the KFC.

The present case involves the 1 st plaintiff who allegedly

entered into an unregistered lease along with the 2 nd

plaintiff for 3 months after the mortgage was entered into

between the borrowers and the KFC. Considering the fact

that the contractual period is only for 3 months and the

lease agreement does not contain a clause for renewal

with the consent of the mortgagee, the plaintiffs do not

have any legal rights over the leasehold premises. They

can only be treated as 'tenant at sufferance'. The 'tenant

at sufferance' is one who wrongfully continues in

possession after the extinction of a lawful title. Thus, it is

clear that the alleged possession of the plaintiffs in the R.S.A.Nos.581 & 582 of 2021

..24..

plaint schedule property after the expiry of the lease

period is contrary to the provisions contained under

Section 65A of the T.P.Act. The operation of the Rent Act

cannot be extended to the plaintiffs as held in Bajarang

Shyamsunder's case (supra). Contra interpretation

would violate the provisions under Section 29 of the SFC

Act to realise the amount due from the borrowers in

accordance with the provisions of the SFC Act.

18. In Kerala State Financial Enterprises Ltd. v.

Meenachil Co-operative Agricultural and Rural

Development Bank Ltd. and others [AIR 2005 Kerala

76] this Court observed in paragraph 16 of the judgment

as under:-

"16. It is beyond dispute that mortgage by deposit of title deeds is a valid procedure, accepted under the Transfer of Property Act, for creating an encumbrance. Under Section 58(a) of the Act, a mortgage is a transfer of interest in specific immovable property. This may be for the R.S.A.Nos.581 & 582 of 2021

..25..

purpose of securing the payment of money advanced or to be advanced by way of a loan. It includes an existing or future debt over the performance of an engagement which may give right to pecuniary liability. It is undisputable that in respect of a Kuri transaction the petitioner had entered into such an arrangement. The law recognizes a mortgage by deposit of title deeds. When a person delivers to the creditor or the agent, document of title to immovable property with intent to create a security thereon, the transaction is a mortgage by deposit of title deeds (Section 58(f) of the Transfer of Property Act). The petitioner claims that a mortgage deed as envisaged under Section 2(17) of the Indian Stamps Act is in existence. A mortgager therefore is disabled from further encumbering the properties in any case without the junction of mortgagee. It can well be presumed that a liability is automatically attached to the property and it is a burden imposed upon the land and the interest in the land, by the owner of the land."

19. Facts involved in this case have been fairly tried

by two courts and same conclusion was reached by both R.S.A.Nos.581 & 582 of 2021

..26..

the courts. The suit filed by the plaintiffs was dismissed

mainly for the reason that their conduct in instituting the

suit is rather suspicious. Injunction is a discretionary

remedy. The 2nd plaintiff was a party to the earlier

proceedings and he suffered a decree ultimately when he

challenged the sale proceedings before the civil court. He

is not justified in contending that he is a tenant of the

plaint schedule property under Act 2 of 1965. In fact,

there was a decree restraining him from interfering with

the defendants possession over the plaint schedule

property. When there is a valid decree against him, he

filed a suit seeking an injunction to protect his tenancy

right over the same. He did not raise a contention in the

earlier suit that he had a right to continue in the premises

as a tenant and hence he could not be restrained by way

of an injunction. Despite repeated findings against him in

numerous judgments of this Court, he filed the present R.S.A.Nos.581 & 582 of 2021

..27..

suit for injunction simpliciter along with the 2nd plaintiff to

protect his purported tenancy arrangement in the plaint

schedule property. This Court is of the view that the two

courts below are perfectly justified in disallowing the

discretionary remedy of injunction.

20. This Court can exercise its jurisdiction under

Section 100 of the CPC only on the basis of substantial

questions of law which are to be framed at the time of

admission of the second appeal. It is equally settled that

the High Court in second appeal is not entitled to interfere

with the concurrent findings of facts arrived at by the two

courts below until and unless it is found that the

concurrent findings of facts were perverse and not based

on sound reasonings. This Court does not find that the

concurrent findings of facts arrived at by the trial court as

well as the first appellate court are either perverse or

without any reason or based on non-consideration of R.S.A.Nos.581 & 582 of 2021

..28..

important piece of evidence or admission of some of the

parties.

21. Reverting back to the case on hand, it is not in

dispute that the defendants are the owners of the plaint

schedule property pursuant to Ext.B2 sale deed in their favour.

As noticed earlier, the plaintiffs are not entitled to claim the

benefit under the Act 2 of 1965. Hence, the trial court granted

a decree for recovery of possession directing the plaintiffs to

surrender the plaint schedule property to the defendants. No

substantial questions of law arise for consideration in these

appeals. Hence, these Regular Second Appeals are liable to be

dismissed in limine.

Accordingly, these Regular Second Appeals are dismissed.

There would be no order as to costs. Pending applications, if

any, stand closed.

Sd/-

N.ANIL KUMAR, JUDGE skj