[Cites 6, Cited by 0]
Kerala High Court
Peter Damiyan vs Messers Oiko Credit Ecumenical ... on 16 December, 2025
Author: Sathish Ninan
Bench: Sathish Ninan
2025:KER:96674
IN THE HIGH COURT OF KERALA AT ERNAKULAM C. R.
PRESENT
THE HONOURABLE MR. JUSTICE SATHISH NINAN
&
THE HONOURABLE MR.JUSTICE P. KRISHNA KUMAR
TUESDAY, THE 16TH DAY OF DECEMBER 2025 / 25TH AGRAHAYANA, 1947
RFA NO. 454 OF 2015
AGAINST THE JUDGMENT AND DECREE DATED 09.11.2012 IN OS NO.99
OF 2009 OF SUB COURT, MUVATTUPUZHA
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APPELLANT/5th DEFENDANT:
PETER DAMIYAN, AGED 57 YEARS, S/O JOSEPH,
REPRESENTED THROUGH HIS POWER OF ATTORNEY HOLDER
AUGUSTINE F. AKKARA @ AUGUSTINE FRANCIS AKKARA,
AGED 65 YEARS, S/O.FRANCIS AKKARA, RESIDING AT 2/581/2
PANOKKARAN ROAD, KANIMANGALAM, THRISSUR-680 027.
BY ADVS.
SRI.K.K.CHANDRAN PILLAI (SR.)
SRI.ARUN ANTONY
SRI.BOBBY THOMAS
SRI.THOMAS JAMES MUNDACKAL
SMT.S.AMBILY
SMT.RUPA R. NAIR
RESPONDENTS/PLAINTIFF AND DEFENDANTS 1 TO 3 & 6 TO 11:
1 MESSERS OIKO CREDIT ECUMENICAL DEVELOPMENT CO-OPERATIVE
SOCIETY,UA, AMERSFOORT, NETHERLANDS REPRESENTED BY ITS
CREDIT RISK MANAGER, MR.LAM BERTUS CALIS, AGED 59
YEARS, S/O.MR. LAM BERTUS GIJISBERTUS CALIS, 1072,
BUDAPEST, HUNGARY.
2 NIRMAL GRAM VANITHA DAIRY CENTRAL SOCIETY
REPRESENTED BY ITS SECRETARY, BHANUMATHI RAJU
NIRMALGRAM VANITHA DAIRY CENTRAL SOCIETY, KEERAMPARA
PO, KOTHAMANGALAM, 686 691, KERALA.
2025:KER:96674
RFA NO. 454 OF 2015 -2-
3 FR.JOY ARAMBANKUDY,
S/O.MATHAI, EXECUTIVE DIRECTOR, NIRMALGRAM VANITHA
DAIRY CENTRAL SOCIETY, RESIDING AT NIRMALGRAM ASHRAM,
BHOOTHATHANKETTU PO, KOTHAMANGALAM, 686 691, KERALA.
4 ANNAMMA JACOB WO.JACOB,
PRESIDENT, NIRMALGRAM VANAITHA DAIRY CENTRAL SOCIETY
RESIDING AT MANACHERY PUTHAYATHIL HOUSE, OONNUKAL PO,
NAMBOORIKUP, KOTHAMANGALAM - 686 691.
5 GEORGE,
S/O.JOSEPH, CHIRAYIL HOUSE, KIZHAKKUMBHAGHAM,
ETTUMANOOR, KOTTAYAM DISTRICT - 686 631.
6 BANK OF BARODA,
KOTHAMANGALAM BRANCH, REPRESENTED BY ITS SENIOR
MANAGER, POTHANIKKAD BUILDING, HIGHRANGE JUNCTION
KOTHAMANGALAM - 686 691.
7 SHERLY WO.JOSE EUGINE JOSEPH,
CHIRAYIL HOUSE, KIZHAKKUMBHAGAM, ETTUMANOOR PO KOTTAYAM
DISTRICT - 686 631.
8 AMMU SO.JOSE,
CHIRAYIL HOUSE, KIZHAKKUMBHAGAM, ETTUMANOOR PO,
KOTTAYAM DISTRICT - 686 631.
9 OUSEPH, S/O.JOSE,
CHIRAYIL HOUSE, KIZHAKKUMBHAGAM, ETTUMANOOR PO,
KOTTAYAM DISTRICT - 686 631.
10 CHINNU DO.JOSE EUGINE JOSEPH,
CHIRAYIL HOUSE, KIZHAKKUMBHAGAM, ETTUMANOOR PO KOTTAYAM
DISTRICT - 686 631.
* ADDL. RESPONDENTS 11 TO 13
ADDL. R11 MARY CHIRAYIL
W/O LATE MR. GEORGE CHIRAYIL, CHIRAYIL HOUSE,
KIZHAKKUMBHAGAM, ETTUMANOOR, KOTTAYAM DISTRICT-686631.
NOW RESIDING AT 63 NEVADA STREET, HIKSVILLE, NEWYORK
110801.
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RFA NO. 454 OF 2015 -3-
ADDL. R12 JOSEPH G CHIRAYIL
S/O LATE MR. GEORGE CHIRAYIL, CHIRAYIL HOUSE,
KIZHAKKUMBHAGAM, ETTUMANOOR, KOTTAYAM DISTRICT-686631,
NOW RESIDING AT 63 NEVADA STREET, HIKSVILLE, NEWYORK
110801, USA.
ADDL. R13 THOMAS G CHIRAYIL
S/O LATE MR. GEORGE CHIRAYIL, CHIRAYIL HOUSE,
KIZHAKKUMBHAGAM, ETTUMANOOR, KOTTAYAM DISTRICT-686631,
NOW RESIDING AT 63 NEVADA STREET, HIKSVILLE, NEWYORK
110801, USA
[ADDITIONAL RESPONDENTS 11 TO 13 ARE IMPLEADED IN THE
APPEAL BEING THE LEGAL HEIRS OF THE DECEASED RESPONDENT
NO. 5, VIDE ORDER DATED 24.10.2025 IN IA 2/2025]
BY ADVS.
DR.GEORGE ABRAHAM
SRI.K.M.ANEESH
SRI.ADARSH KUMAR
DR.ELIZABETH VARKEY
SHRI.K.J.SAJI ISAAC
SHRI.VIVEK VARGHESE P.J.
SRI.VARUGHESE M EASO
SRI.T.SETHUMADHAVAN (SR.)
THIS REGULAR FIRST APPEAL HAVING COME UP FOR HEARING ON
16.12.2025, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
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C. R.
SATHISH NINAN &
P. KRISHNA KUMAR, JJ.
= = = = = = = = = = = = = = = = = =
R.F.A. No.454 of 2015
= = = = = = = = = = = = = = = = = =
Dated this the 16th day of December, 2025
J U D G M E N T
Sathish Ninan, J.
The decree in a suit for money is under challenge by the 5 th
defendant. Since the issue involved in the appeal is confined to
the liability of the 5th defendant and his properties, only the
facts relevant thereto are being adverted.
2. The plaintiff is a financial institution seated abroad.
The first defendant is a co-operative society. Defendants 2 and 3
are its Executive Director and President. The plaintiff granted a
loan of US Dollars 4,28,571/- to the first defendant Society. The
loan was adequately secured by mortgage of the immovable
properties belonging to defendants 4 to 6. Defendants 4 to 6 are
brothers. Plaintiff claims that, defendants 5 and 6 had executed
a power of attorney in favour of the 4 th defendant and mortgage
was created by the 4 th defendant of the properties of defendants 5
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and 6. Alleging failure on the part of the defendants to clear
off the liability, suit was filed.
3. Defendants 1 to 3, while admitting the transaction
contended that the suit is barred by limitation.
4. The 5th defendant filed a written statement denying the
execution of the power of attorney in favour of the 4 th defendant
and also the creation of the mortgage of his properties. He
contended that he is a stranger to the transaction. It was
contended that he is and have been at the United States of
America from the year 1970 and that he had rarely come down to
his native place after that. He is an American citizen.
5. The trial court held that the 4 th defendant was the power
of attorney holder of the 5 th defendant and that the properties of
the 5th defendant were mortgaged by the 4 th defendant in favour of
the plaintiff to secure the credit facility. The court decreed
the suit allowing the plaintiff to realise the liability from the
mortgaged properties and from defendants 1 and 2.
6. We have heard Sri.K.K.Chandran Pillai, learned Senior
Counsel for the appellant-5 th defendant and Sri.T.Sethumadhavan,
the learned Senior Counsel appearing for the first respondent-
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plaintiff.
7. The points that arise for determination in this appeal
are :-
(i) Did the 5th defendant constitute the 4th defendant as his power of
attorney holder, enabling creation of mortgage of his properties?
(ii) Is there a valid mortgage in favour of the plaintiff in respect of
plaint schedule item numbers 1 to 4 properties?
(iii) Does the decree and judgment of the trial court warrant any
interference?
8. Exts.A4 to A7 are original title deeds relating to the
properties of the 5th defendant. Exts.A20, 21 and 22 are the
documents evidencing the mortgage. With regard to the properties
of the 5th defendant, mortgage is claimed to have been created by
the 4th defendant as the power of attorney holder of the 5 th
defendant. The power of attorney is claimed to be one executed
before a Notary Public at USA. The 5 th defendant denies of having
executed any such power of attorney. It is the contention of the
5th defendant that, Exts.A4 to A7 original deeds, which were kept
in the Tarwad house was unauthorisedly taken away by the 4 th
defendant and the alleged mortgage was created on fabricating a
power of attorney of the 5th defendant.
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9. Before we go to the merits of the above contention, we
deem it appropriate to consider the legal effect of Ext.A21, the
deed of mortgage. The title and the recitals in Ext.A21 without
the schedule of the properties, read thus:-
"
TITLE DEED MORTGAGUE
(Under Section 58(f) of the Transfer of Property Act, India)
I, Mr. JOSE EUGIN JOSEPH, Chirayil House Ettumannoor, Ettumannoor P.O., Kottayam Dist.,
Kerala State, The advisory board member of Nirmalgram Vanitha Dairy Central Society,
Kothamangalam, hereby mortgage and deposit the following TITLE DEEDS of 1.33.13 Ares of
land in Ettumanoor Township, of which I am the Power of Attorney holder as per Power of
Attorney L.No.0849 executed before Vice Consul, Consulate General of India, New York., to
Oikocredit (Ecumenical Development Co-operative Society UA) The Netherlands.
The Title deeds are mortgaged and deposited with Oikocredit as envisaged under section 58(f) of
the Transfer of Property Act, India, as a continuing collateral security for the loan of US Dollars
4,28,571.00 (United States Dollars). Four Lakhs Twenty Eight Thousand Five Hundred and
Seventy one only) to be availed by Nirmalgram Vanitha Dairy Central Society, Kothamangalam,
and the for the interest and all other amounts due to Oikocredit according to the loan agreement
made by Oikocredit and Nirmalgram Vanitha Dairy Central Society on 18 th December 2000."
Section 17(1)(c) of the Registration Act stipulates that any non-
testamentary instrument creating an interest over immovable
property shall be compulsorily registrable. The recitals in
Ext.A21, quoted above, reveals that the mortgage is purported to
be created under the document. The recitals does not suggest that
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it was executed merely to acknowledge the creation of a mortgage.
The mortgage is created under the instrument. Therefore, in terms
of Section 17(1)(c) above, the document is compulsorily
registrable.
10. The learned Senior Counsel for the plaintiff would rely
on the judgment of this Court in South Indian Bank Ltd. v. K.P.Ramachandran
and Another [2017 (2) KHC 998] to contend that, since Ext.A21 does not
incorporate the terms and conditions of the mortgage, the
document is not compulsorily registrable. We are unable to accept
the argument for reasons more than one. In South Indian Bank Ltd. (supra),
this Court was considering the question whether, the memorandum
or letter of acknowledgment of creation of mortgage executed
contemporaneously with the deposit requires registration or not.
Relying on the judgment of the Apex Court in Rachpal Mahraj v.
Bhagwandas Darulka and others (AIR 1950 SC 272) and State of Haryana and others v.
Navir Singh and Another (AIR 2014 SC 339), this Court held that, whether
the letter of acknowledgment was executed contemporaneous to or
simultaneous with the deposit of title deed is not the relevant
criteria in deciding whether the document requires registration
or not. In that case, the letter of acknowledgment was
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simultaneous to the creation of mortgage by deposit of title
deed. This is evident from the following statement in the
judgment.
"..... The purpose behind the execution of such a document is to acknowledge the fact
that the title deed/s referred to therein relating to the particular property has been
deposited/handed over by the party to the creditor with intend to create a mortgage.
Mortgage is created by the deposit of the title deed and not under the memorandum or
letter of acknowledgment. Ext.A9 is such a document. ....."
It is to be noticed that this Court had referred to the
judgment of the Apex Court in State of Haryana (supra) which held
".... the parties may choose to have a memorandum prepared only showing deposit of the
title deeds. In such a case also registration is not required. But in a case in which the
memorandum recorded in writing creates rights, liabilities or extinguishes those, the same
requires registration."
So, where the creation of the mortgage itself is under the
instrument, Section 17(1)(c) squarely applies.
11. In the case at hand, as is evident from the recitals in
Ext.A1, the mortgage having been created thereunder, it falls
within the clutches of Section 17(1)(c) of the Registration Act.
The document being an unregistered one it cannot affect immovable
property. Consequently no valid mortgage is created thereunder.
Hence there cannot be a decree on the mortgage.
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12. Now we proceed to consider the merits of the factual
contentions regarding the power of attorney and the mortgage over
the plaint schedule properties. It is very material and
significant to note that, the disputed power of attorney nor even
a copy of the same has been produced before Court. The contention
of the plaintiff is that, since the power of attorney was a
general power of attorney, it was retained by the 4 th defendant,
the power holder. Even if that be so, definitely the plaintiff,
who had lend such a huge amount, would have definitely obtained
an authenticated or at least a mere photostat copy. Pertinently,
not even a photostat copy of the power of attorney is produced
before the court.
13. To substantiate the claim with regard to the power of
attorney, the plaintiff relies on Ext.B30 title scrutiny report
given by a lawyer in respect of the property. Going by Ext.A30,
one of the documents perused by the lawyer, for the issuance of
the certificate was, the original power of attorney executed by
the 5th defendant in favour of the 4 th defendant. The lawyer who
issued Ext.A30 was examined as PW2. He would vouch that he has
seen the documents as stated in the report.
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14. PW2, in his cross-examination, would depose that the
scrutiny report was prepared as instructed by the Federal Bank,
Ernakulam, Kacheripady Branch. However, Ext.A30 report does not
indicate as to whom the report was issued or on whose request the
report was issued. If the legal opinion was given for the Federal
Bank, then it would have been available with the Bank. The same
could have been summoned. However, that is not attempted to. So
also, Ext.B30 is the original legal opinion. If the opinion was
given to the Bank, then the original would have been in the
possession of the Bank and the plaintiff could not have been able
to produce the original. PW1, the representative of the plaintiff
has deposed that he has no personal knowledge about the
transaction.
15. The claim of the plaintiff is that, the power of
attorney was one jointly executed by defendants 5 and 6 in favour
of the 4th defendant. However, going by Ext.B30, it is by the 5 th
defendant alone.
16. The suit has been filed as against the 5 th defendant
showing his address at Kottayam. Even going by the plaintiff's
case, the 5th defendant is abroad at United State of America and
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has given a power of attorney in favour of his brother, the 4 th
defendant. Summons was served on the fifth defendant by
substituted service and he was set ex parte. Subsequently, on his
application, the ex parte order was set aside.
17. The plaintiff claims that the plaint schedule item
numbers 1 to 3 belong to the 5 th defendant and was mortgaged to
secure the debt. However, at paragraph 6 of the plaint it is
pleaded thus,
"The properties described as plaint schedule properties item No.1(one) to 3(three)
belongs to the fifth defendant alone and property item No.4(four) belongs to the sixth
defendant. Schedule item No.2 (two) belongs jointly to defendants four and five."
Schedule item No.2 is 24.68 Ares of property in survey No.149/3
belonging to the 5th defendant under Ext.A5 Exchange Deed executed
with the 4th defendant. Under Ext.A5, 24.68 Ares of property in
survey 149/3 which belonged to the 4 th defendant was given to the
5th defendant in exchange for another 24.68 Ares of property in
survey 150/2 which belonged to the 5 th defendant. On the reverse
side of the document it is written that a duplicate copy of the
document has been prepared. Ext.A5 is seen prepared on a stamp
paper worth ₹ 5. The stamp paper is seen purchased in the name of
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the 4th defendant. Therefore, evidently Ext.A5 is the duplicate
prepared at the time of execution of exchange deed, which belongs
to the 4th defendant. Therefore, insofar as the 5 th defendant is
concerned, the original exchange deed is his title deed and
insofar as the 4th defendant is concerned it is the duplicate
prepared along with the original which is his title deed. If the
mortgage was to be created in respect of 24.68 Ares of property
in survey 149/3 which belongs to the 5 th defendant under Ext.A5
Exchange Deed, then the document to be deposited to create
mortgage ought to have been the original exchange deed of the 5 th
defendant, and not the duplicate with the 4 th defendant. This
shows that there has been no valid creation of mortgage in
respect of schedule item No.2 property. This also reveals that
the contradictory pleading in the plaint, referred to above,
cannot be brushed aside and apparently appears to lack bonafides.
18. With regard to scheduled item No.4, the plaint averment
is that the property belongs to the 6 th defendant. That contains
two items of properties viz. 48.16 Ares in 558/1 and 32.37 Ares
in survey 149/3. Ext.A7 is claimed to be the title deed deposited
for the creation of mortgage. Ext.A7 is document number 782/1984.
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The document stands in the name of the 6 th defendant. However, a
reading of the document shows that it does not relate to plaint
item No.4 properties. It relates to another property having an
extent of 1 acre and 36 cents. Ext.A7(a) is claimed to be English
translation copy of Ext.A7. A perusal of the same reveals that it
is the English translation of a document bearing No.2416/1978
which stands in the name of the 5 th defendant. The scheduled
description in Ext.A7(a) shows that it relates to plaint schedule
item No.4 property. Therefore, it is evident that the property
scheduled as plaint schedule item No.4, in fact belongs to the 5 th
defendant and not to the 6 th defendant as claimed in the plaint.
The title deed relating to property has not been deposited.
19. The various circumstances noticed herein before
sufficiently probabilises the case of the 5 th defendant that the
original documents of title of the 5 th defendant was taken away by
the 4th defendant from the Tarwad house. The contention of the 5 th
defendant that he had not given any power of attorney in favour
of the 4th defendant, is seen probable. Though PW1 claimed that
there are documents executed by the 5 th defendant in favour of the
plaintiff as a guarantor, such documents are not produced.
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Therefore it can only be concluded that there are no such
documents.
20. The trial court, to grant a decree against the
properties of the 5th defendant, has relied on Ext.A30 legal
opinion and the evidence of PW2, and also the non-filing of any
complaint with regard to the theft of the document. However, in
the light of the afore circumstances noticed by us earlier, the
mere non-filing of police complaint by the 5 th defendant against
his brother 4th defendant, especially when he is abroad, and in
the light of the 5th defendant having sought to set aside the ex
parte decree on the very allegations, is inconsequential.
Circumstances emerging in the case discredits Ext.A30 and the
evidence of PW2. The trial court has failed to appreciate the
aforesaid aspects.
21. Therefore, the properties of the 5 th defendant, which
are scheduled as plaint schedule item No.1 to 4 cannot be made
liable for the plaint claim. The decree and judgment of the trial
court, insofar as the 5 th defendant, is concerned is liable to be
set aside.
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In the result, the appeal is allowed. The decree and
judgment of the trial court insofar as it granted a decree
against the 5th defendant and plaint schedule item Nos.1 to 4 are
set aside. The suit, insofar as it relates to them, will stand
dismissed.
Sd/-
SATHISH NINAN
JUDGE
Sd/-
P. KRISHNA KUMAR
JUDGE
kns/-
//True Copy//
P.S. To Judge
APPENDIX OF RFA NO. 454 OF 2015
PETITIONER ANNEXURES
Annexure 1 Draft Publication
Annexure A1 THE ORIGINAL SALE DEED NO. 2416 OF 1978 DATED
14.07.1978 OF THE ETTUMANOOR SUB REGISTRY
OFFICE
Annexure A2 CERTIFIED COPY OF THE EXCHANGE DEED NO.
2004/1980 DATED 06.08.1980 OF THE ETTUMANOOR
SUB REGISTRY
Annexure A3 PHOTOSTAT COPY OF THE EXCHANGE DEED NO.
2004/1980 DATED 06.08.1980 OF THE ETTUMANOOR
SUB REGISTRY
Annexure A4 THE ORIGINAL PURCHASE CERTIFICATE NO.52 OF
1998 DATED 27.02.1998 ISSUED BY THE SPECIAL
TAHASILDHAR (LAND REFORMS) KOTTAYAM
ANNEXURE Copy of the proof of service to additional
respondents 11 to 13 through email
Annexure A5 ORIGINAL OF THE POWER OF ATTORNEY NO. 0969011
DATED 10.03.2011 EXECUTED BY THE APPLICANT /
APPELLANT
Annexure A5(a) NOTARIZED COPY OF THE POWER OF ATTORNEY NO.
0969011 DATED 10.03.2011 EXECUTED BY THE
APPLICANT / APPELLANT
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