The Federal Bank Limited vs Sub Registrar, Sub Registry ...
2021 Latest Caselaw 19036 Ker

               IN THE HIGH COURT OF KERALA AT ERNAKULAM
                                PRESENT
          THE HONOURABLE MR. JUSTICE DEVAN RAMACHANDRAN
    MONDAY, THE 13TH DAY OF SEPTEMBER 2021 / 22ND BHADRA, 1943
                       WP(C) NO. 21250 OF 2020
PETITIONERS:

    1     THE FEDERAL BANK LIMITED
          HEAD OFFICE AT ALUVA, BRANCH AT TRIPRAYAR, REPRESENTED
          BY THE ASSISTANT VICE PRESIDENT OF LCRD THRISSUR
          DIVISION, S.T.NAGAR, THRISSUR , JOHNSON.M.T.

    2     PULIKKAL FAROOK,
          S/O.MOHAMMED, PULIKKAL HOUSE, VENMANAD P.O., PAVARATTY
          VIA, THRISSUR-680 507.

          BY ADVS.
          A.ANTONY
          SMT.LEELAMMA ANTONY



RESPONDENTS:

    1     SUB REGISTRAR, SUB REGISTRY OFFICE, THRIPRAYAR,
          THRISSUR DISTRICT-680 566.

    2     TAHSILDAR, TALUK OFFICE, CHAVAKAKD,
          THRISSUR DISTRICT-680 506.

    3     SUNDARAM FINANCE LTD.,
          SECOND FLOOR, SREE SANKARA COMPLEX, BRAHASWA MADOM, MG
          ROAD, THRISSUR-680 001.

    4     RANSU,
          S/O.VAZHAPPULLY SUNIL KUMAR, KAZHIMBRAM DESOM, VALAPPAD
          VILALGE, CHAVAKKAD TALUK, THRISSUR DISTRICT-680 568.

    5     MAHINDRA AND MAHIDRA FINANCIAL SERVICE LTD.
          3RD FLOOR, GRAND MALL, WEST FORT, SANARAYAR JUNCTION,
          MAIN ROAD, THRISSUR-680 004.

    6     STATE BANK OF INDIA,
          FORMERLY STATE BANK OF TRAVANCORE, TRIPRAYAR BRANCH,
          TRIPRAYAR-680 566.

    7     JIBIN K.ANAND,
          S/O.THERUVIL KARTHIKEYAN, EDAMUTTOM DESOM, EDAMUTTOM
 WP(C) NO. 21250 OF 2020
                                2

          P.O., VALAPPAD VILLAGE, CHAVAKAKD TALUK, THRISSUR
          DISTRICT-680 568.

          BY ADVS.
          SRI.S.RUSSEL
          SRI.T.K.VIPINDAS
          SRI.DEVAPRASANTH.P.J.
          SRI.V.R.ARUN
          SRI.K.M.MUHAMMED HUSSAIN
          SRI.K.V.SREE VINAYAKAN
          SMT.SREELAKSHMI SABU
          SHRI.SMIJOSH K.M.
          SHRI.COLIN ALEX




          SRI. ASWIN SETHUMADHAVAN - SR.GP




     THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON
13.09.2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
 WP(C) NO. 21250 OF 2020
                                      3



                                JUDGMENT

The Federal Bank Limited and the assignee of a property

stated to have been sold by them under the provisions of the

Securitisation and Reconstruction of Financial Assets and

Enforcement of Securities Interest Act ('the SARFAESI Act' for

brevity), are the petitioners in this case.

2. The petitioners say that the property involved in this

case was equitably mortgaged by its original owner -

Sri.Noushad.E.H, on 19.09.2008 by deposit of its title deeds; and

that this is evident from Ext.P1 - which is the confirmation of

such deposit by him. They say that, therefore, going by Section

58 (f) of the Transfer of Property Act ("TP" Act for short), the 1 st

among them obtained the power to sell the property under the

provisions of the SARFAESI Act and the 2 nd respondent became

entitled to hold the same in ownership and possession, without

any let or interference from any other entity or person.

3. The petitioners say that, however, when they presented

the Sale Certificate, namely Ext.P2, before the 1 st respondent - WP(C) NO. 21250 OF 2020

Sub Registrar, said Authority refused to register the same saying

that there are attachments over the property, reflected in Ext.P4

encumbrance certificate.

4. The petitioners say that, as is perspicuous from

Ext.P4, all the attachments over the property are after the date of

the mortgage and therefore, that it cannot obtain any precedence

over the right of the 1st petitioner to sell the property; and thus

prayed that 1st respondent be directed to register Ext.P2 Sale deed

and to efface all the entries of attachment over the same, within a

time frame to be fixed by this Court.

5. I have heard Sri.Antony - learned counsel appearing

for the petitioners; Sri.K.M.Muhammed Hussain, learned counsel

appearing for the 4th respondent; Sri.S.Russel - learned counsel

appearing for the 3rd respondent; Sri.G.G.Manoj - learned

Standing Counsel for the 6th respondent; Sri.P.J.Devaprasanth -

learned counsel appearing for the 5th respondent and Sri.Ashwin

Sethumadhavan - learned Senior Government Pleader appearing

for the official respondents.

WP(C) NO. 21250 OF 2020

6. Sri.P.J.Devaprasanth - learned counsel appearing for

the 5th respondent, submitted that he does not stand in the way of

this Court granting the 1st relief sought for in this writ petition, but

that he has objection as regards the 2 nd relief, wherein, the

petitioners have sought for effacement of attachment and

encumbrances with respect to the property covered by Ext.P2. He

submitted that this is because his clients have the right to proceed

against the property, if there is any surplus funds obtained by the

1st respondent Bank; and consequently, that if the attachments are

effaced, then they would lose that valuable right. He, therefore,

prayed that this writ petition be allowed, only granting the 1 st

relief and not the 2nd therein.

7. Sri.K.M.Muhammed Hussain - learned counsel for

the 4th respondent, submitted that his client, in fact, obtained title

over the property through a sale, conducted by the Sub Court,

Chavakkad in O.S.No.504 of 2012. He explained that his client

had obtained an attachment over the property even before the said

decree; and thus prayed that this Court may not grant any reliefs WP(C) NO. 21250 OF 2020

in this writ petition in favour of the petitioners. He added that the

afore mentioned Sale Deed has already been executed by the

Court in his client's favour and thus contended that it obtains

precedence even over the rights of the petitioners.

8. Sri.G.G.Manoj and Sri.S.Russel - learned counsel

appearing for the party respondents, adopted most of the

submissions as afore, adding that Ext.P1 deposit of the title deed

is not the conclusive proof of mortgage and therefore, that

petitioners cannot seek that they alone be allowed to enjoy the

property, in exclusion of the others. They also, therefore, prayed

that this writ petition be dismissed.

9. Sri.Aswhin Sethumadhavan - learned Senior

Government Pleader submitted that whatever be the contentions

of the petitioners, the fact remains that 1st respondent has not

registered Ext.P2 Sale Certificate because same has not been

presented before him. He submitted that in any event of the

matter, the entire process is now online and that the petitioners

should have approached the competent Authority through such WP(C) NO. 21250 OF 2020

means, before having approached this Court.

10. In reply to the afore submissions of the learned

Government Pleader, Sri.A.Antony - learned counsel for the

petitioners, submitted that, contrary to the above, his clients have

already produced the Sale Certificate before the 1st respondent and

that he has refused to register the same.

11. When I consider the afore submissions, it is without

doubt - it having been settled affirmatively by this Court and by

the Hon'ble Supreme Court in various cases before - that if the 1 st

petitioner Bank is able to establish that they have valid equitable

mortgage in her favour, even prior to the dates of attachments

reflected in Ext.P4, then they certainly obtain the right to sell the

property, under the provisions of the SARFAESI Act and 2nd

petitioner would resultantly obtain competence to bid the property

and to hold it in ownership and possession, in exclusion to all the

others.

12. Therefore, the real issue here is whether the mortgage

claimed by the 1st respondent in their favour is prior to the dates WP(C) NO. 21250 OF 2020

of attachment claimed by the party respondents; and this being a

question of fact, the Sub Registrar will have to verify it based on

available documents.

Needles to say, the if the Sub Registrar is to find that the

mortgage in favour of the 1st petitioner is before the dates of

attachment obtained by the party respondents, then Ext.P2 Sale

Deed will require to be registered in favour of the Bank and the

endorsements of attachments on it effaced, because all that the

attaching creditors can then seek is a right to proceed against the

surplus amount, if any, in the hands of the 1st petitioner - Bank.

In the afore circumstances, I order this writ petition and

direct the parties to appear before the 1 st respondent - Sub

Registrar at ll A.M on 30.09.2021, with all documents in their

possession; and the said Authority will then hear them and verify

whether the date of mortgage claimed by the 1 st petitioner - Bank

is prior to the dates of attachment, as reflected in Ext.P4.

If, after the afore exercise, the Sub Registrar is to find in

favour of the petitioners, then Ext.P2 Sale Certificate will be WP(C) NO. 21250 OF 2020

registered without any avoidable delay thereafter and all the

attachments over the property, as reflected in Ext.P4, will be

effaced, so as to enable the 2nd petitioner to enjoy it without any

impediment in future.

It goes without saying that if the Sub Registrar is to find

in favour of the petitioners, then the attaching creditors -

including the party respondents, will be at liberty to proceed

against the surplus sale consideration, if any, in the hands of the

Bank, after settlement of the loan account; for which purpose,

they will be at liberty to move the competent Forums or Courts,

without any impediment on account of my directions afore.

Sd/-

DEVAN RAMACHANDRAN JUDGE SAS/13/09/2021 WP(C) NO. 21250 OF 2020

APPENDIX OF WP(C) 21250/2020

PETITIONERS' EXHIBITS

EXHIBIT P1 TRUE COPY OF THE INTIMATION OF THE NOUSHAD.E.H. DATED 20.09.2008 CONFIRMING THE DEPOSIT OF TITLE DEED OF THE PROPERTY AS EQUITABLE MORTGAGE AS ENVISAGED UNDER SECTION 58(F) OF THE TRANSFER OF PROPERTY ACT.

EXHIBIT P2 TRUE COPY OF SALE CERTIFICATE DATED 19.09.2016 EXECUTED BY THE 1ST PETITIONER IN FAVOUR OF THE 2ND PETITIONER.

EXHIBIT P3 TRUE COPY OF THE REPRESENTATION DATED 26.11.2019 OF THE 1ST PETITIONER ADDRESSED TO THE 1ST RESPONDENT.

EXHIBIT P4 TRUE COPY OF ENCUMBRANCE CERTIFICATE ISSUED BY THRIPRAYAR SRO DATED 24.04.2018.