Ravi S vs Uco Bank
2025 Latest Caselaw 3961 Ker

Kerala High Court

Ravi S vs Uco Bank on 12 February, 2025

                                                         2025:KER:11559

               IN THE HIGH COURT OF KERALA AT ERNAKULAM

                               PRESENT

                THE HONOURABLE MR. JUSTICE GOPINATH P.

    WEDNESDAY, THE 12TH DAY OF FEBRUARY 2025 / 23RD MAGHA, 1946

                        WP(C) NO. 4438 OF 2025

PETITIONERS:

    1     RAVI S
          AGED 50 YEARS
          S/O. CHANDRASHEKARAN PILLAI, DEEPASREE, MANAKKARA,
          SASTHAMCOTTA, KOLLAM, PIN - 690521

    2     AJAYAKUMAR
          AGED 57 YEARS
          S/O. KUNJIRAMAN, ABHIJITH BHAVANAM, PADINJATTAMURI,
          SOORANAD NORTH, KOLLAM, PIN - 690561

    3     BABUJAN
          AGED 53 YEARS
          S/O. CHINNAPARAROVUTHAR, THUNDIL PUTHANVEEDU,
          MANAKKARA, SASTHAMCOTTA, KOLLAM, PIN - 690521

    4     ASLAM SHAH
          AGED 39 YEARS
          S/O. MAJEED MOULAVI, PUTHENVILA KAJA MANSIL, VENGA,
          SASTHAMCOTTA, KOLLAM, PIN - 69052

    5     JAYAKRISHNAN
          AGED 43 YEARS
          S/O. RAJASHEKARAN PILLAI, MENAVETHOZHA VADAKKATHIL,
          THOTTAMUGAM, MAINAGAPALLY, KOLLAM, PIN - 690519

    6     SREEJITH R
          AGED 48 YEARS
          S/O. RAJENDRAN PILLAI, THARAVDU,VENGA, SASTHAMCOTTA,
          KOLLAM, PIN - 690521
 WP(C) NO. 4438 OF 2025

                                   2


                                                      2025:KER:11559

     7       NAZARUDHEEN
             AGED 58 YEARS
             S/O. HAMEED KUTTY, KULANGARATHARA VEETTIL,VENGA,
             MYNAGAPPALLY, KOLLAM, PIN - 690519

     8       PRAMODH S.K
             AGED 54 YEARS
             S/O. KUMADAKAN, PRAMOD BHAVANAM, SHOORANAD NORTH,
             KOLLAM, PIN - 690561


             BY ADV THUSHARA JAMES


RESPONDENTS:

     1       UCO BANK
             KOLLAM BRANCH, KHAISE BUILDING, BEACH ROAD, KOLLAM
             REPRESENTED BY ITS CHIEF MANAGER, PIN - 691001

     2       THE CHIEF MANAGER
             UCO BANK, KOLLAM BRANCH, KHAISE BUILDING, BEACH
             ROAD, KOLLAM, PIN - 691001

     3       THE AUTHORISED OFFICER
             UCO BANK, KOLLAM BRANCH, KHAISE BUILDING, BEACH
             ROAD, KOLLAM, PIN - 691001

     4       HAMEED KUNJU
             S/O. KOCHU KUNJU, RESIDING AT KODIYIL HOUSE,
             MYNAGAPPALLY, VENGA P.O, KOLLAM, PIN - 690521



     THIS WRIT PETITION (CIVIL) HAVING COME UP FOR HEARING ON
12.02.2025,     THE   COURT   ON   THE   SAME   DAY   DELIVERED   THE
FOLLOWING:
 WP(C) NO. 4438 OF 2025

                                    3


                                                       2025:KER:11559

                            JUDGMENT

The petitioners claim to be tenants in a building belonging to

the 4th respondent. The building in question is mortgaged to the 1 st

respondent-Bank to secure repayment of loans availed by a company

known as M/s. Arafa Gold and Diamonds Private Limited. The liability

of M/s. Arafa Gold and Diamonds Private Limited is stated to be in

excess of Rs.65,00,00,000/- (Rupees sixty five crores only) as on date.

The 4th respondent is also a guarantor in respect of the loan facilities

availed by the aforesaid company.

2. According to the petitioners they are tenants of shop rooms

bearing numbers SP XI 60, 61, 62, 63, 66, 67, 69, 70 &SP IX/152 of

Sasthamcotta Grama Panchayat. Admittedly none of the petitioners

have executed a registered lease deed though they claim to be in

occupation of the shop room in question for many years. According to

the petitioners they cannot be evicted from the shop rooms in question

in proceedings initiated by the 1st respondent-Bank under the

provisions of the SARFAESI Act. The petitioners also have a case before

this Court that they are willing to redeem the mortgage in question by

paying the amounts equivalent to the valuation of the building. WP(C) NO. 4438 OF 2025

2025:KER:11559

3. The learned Standing Counsel appearing for the 1 st

respondent-Bank submits that yet another person one, Irfan K.H had

approached the Debts Recovery Tribunal by filing Securitization

Application No.460 of 2024 where he had taken the stand that shop

rooms bearing nos.SP II 57, 58, 59, 60, 61, 62, 63, 64, 65, 66, 67, 68,

69, 70, 71 and 72 were in his possession and occupation by virtue of a

registered lease deed. It is submitted that the Tribunal, by order dated

27.11.2024, dismissed the Securitization Application with costs relying

on the judgment of the Supreme Court in Bajarang Shyamsunder

Agarwal v Central Bank of India; (2019) 9 SCC 94. It is

submitted that the order of the Tribunal in S.A. No. 460 of 2024 was

challenged before the Debts Recovery Appellate Tribunal and on the

ground that the appeal was pending before the Debts Recovery

Appellate Tribunal along with stay petitions, OP (DRT) Nos.392, 395,

396, 397 and 398 of 2024 had been filed before this Court seeking stay

of eviction till the matter is considered by the Debts Recovery Appellate

Tribunal. It is submitted that this Court by common judgment dated

20.12.2024 in OP (DRT) No.392 of 2024 and connected cases found

that no case had been made out for grant of any interim protection and

dismissed the Original Petitions. It is submitted that the judgment of WP(C) NO. 4438 OF 2025

2025:KER:11559

the Supreme Court in Bajarang Shyamsunder Agarwal (supra)

is authority for the preposition that where tenants claim on the basis of

an unregistered lease deed they cannot resist any action by the Bank

under the provisions of Section 14 of the SARFAESI Act.

4. Having heard the learned counsel appearing for the

petitioners and also the learned Standing Counsel appearing for the

respondent-Bank, I am of the view that no relief whatsoever can be

granted to the petitioners in the present writ petition. Without going

into any other aspect of the matter it is clear that since the petitioners

are claiming under an unregistered lease deed, the issue stands covered

against the petitioners by the judgment of the Supreme Court in

Bajarang Shyamsunder Agarwal (supra) where in paragraph

24, the Supreme Court held as follows:

"24. In our view, the objective of the SARFAESI Act, coupled with the TP Act and the Rent Act are required to be reconciled herein in the following manner:

24.1. If a valid tenancy under law is in existence even prior to the creation of the mortgage, the tenant's possession cannot be disturbed by the secured creditor by taking possession of the property. The lease has to be determined in accordance with Section 111 of the TP Act for determination of leases. As the WP(C) NO. 4438 OF 2025

2025:KER:11559

existence of a prior existing lease inevitably affects the risk undertaken by the bank while providing the loan, it is expected of banks/creditors to have conducted a standard due diligence in this regard. Where the bank has proceeded to accept such a property as mortgage, it will be presumed that it has consented to the risk that comes as a consequence of the existing tenancy. In such a situation, the rights of a rightful tenant cannot be compromised under the SARFAESI Act proceedings.

24.2. If a tenancy under law comes into existence after the creation of a mortgage, but prior to the issuance of notice under Section 13(2) of the SARFAESI Act, it has to satisfy the conditions of Section 65-A of the TP Act.

24.3. In any case, if any of the tenants claim that he is entitled to possession of a secured asset for a term of more than a year, it has to be supported by the execution of a registered instrument. In the absence of a registered instrument, if the tenant relies on an unregistered instrument or an oral agreement accompanied by delivery of possession, the tenant is not entitled to possession of the secured asset for more than the period prescribed under Section 107 of the TP Act."

In the facts of the present case, the shop rooms in question

appear to have been the subject matter of a subsequent registered lease

deed as noticed above. Taking all the aforesaid facts cumulatively into

consideration, I am of the view that the petitioners have not made out

any case for grant of any of the reliefs sought for in this writ petition. WP(C) NO. 4438 OF 2025

2025:KER:11559

The writ petition fails and is, accordingly, dismissed.

Sd/-

GOPINATH P. JUDGE

SVP WP(C) NO. 4438 OF 2025

2025:KER:11559

APPENDIX OF WP(C) 4438/2025

PETITIONER EXHIBITS

Exhibit P1 TRUE COPY OF THE LEASE DEED DATED 01/01/2016 EXECUTED BETWEEN 1 ST PETITIONER AND 4 TH RESPONDENT

Exhibit P1(a) TRUE COPY OF THE LEASE DEED DATED 01/02/2016 EXECUTED BETWEEN 6TH PETITIONER AND 4TH RESPONDENT

Exhibit P1(b) TRUE COPY OF THE LEASE DEED DATED 01/01/2013 EXECUTED BETWEEN 7TH PETITIONER AND 4TH RESPONDENT

Exhibit P2 TRUE COPY OF THE NOTICE DATED 30/01/2025 ISSUED BY THE ADVOCATE COMMISSIONER APPOINTED BY THE LEARNED CHIEF JUDICIAL MAGISTRATE COURT, KOLLAM IN M.C NO.

Exhibit P3 TRUE COPY OF THE REPRESENTATION DATED 01/02/2025 ISSUED BY THE PETITIONERS TO THE 1ST RESPONDENT