[Cites 1, Cited by 0]
Kerala High Court
Prakash C Vadakkan vs Dhanlaxmi Bank Ltd on 27 January, 2026
Author: Sathish Ninan
Bench: Sathish Ninan
2026:KER:6219
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE SATHISH NINAN
&
THE HONOURABLE MR.JUSTICE P. KRISHNA KUMAR
TUESDAY, THE 27TH DAY OF JANUARY 2026 / 7TH MAGHA, 1947
FAO NO. 70 OF 2025
AGAINST THE ORDER DATED 17.03.2025 IN EA 15/2024 IN EP NO.12 OF
2019 IN OS 60/2015 OF SUB COURT, PALA
-----
APPELLANT/1ST RESPONDENT/DECREE HOLDER/PLAINTIFF:
PRAKASH C VADAKKAN
AGED 54 YEARS
S/O. CHANDY VADAKKAN, VADAKKAN HOUSE, ALANADU KARA,
BHARANANGANAM VILLAGE, MEENACHIL TALUK, KOTTAYAM
DISTRICT, PIN - 686578.
BY ADVS.
SRI.T.MADHU
SMT.C.R.SARADAMANI
SHRI.RENJISH S. MENON
SMT.AVANTHIKA R.
SHRI.KARTHIK KRISHNA M.
RESPONDENTS/PETITIONER/THIRD PARTY & RESPONDENTS 2 TO 4/JUDGMENT
DEBTORS 1 TO 3/DEFENDANTS:
1 DHANLAXMI BANK LTD.
MUNNAR BRANCH, REPRESENTED BY ITS BRANCH MANAGER, JEL
JAMES JOSEPH, S/O. JOJI, KACHAPPILLY HOUSE,
PALARIVATTAM P.O., PUNITHURA VILLAGE, ERNAKULAM
DISTRICT, PIN - 682018.
2026:KER:6219
FAO NO. 70 OF 2025 -2-
2 MATHEW MICHAEL,
(DIED)
3 ANI MATHEW,
W/O. MATHEW MICHAEL, VELLIYEPPALLIL HOUSE, ALANADU
KARA, BHARANANGANAM VILLAGE, MEENACHIL,
KOTTAYAM DISTRICT, PIN - 686578.
4 TOGO MATHEW,
S/O. MATHEW MICHAEL,VELLIYEPPALLIL HOUSE, ALANADU KARA,
BHARANANGANAM VILLAGE, MEENACHIL,KOTTAYAM DISTRICT,
PIN - 686578.
BY ADVS.
SHRI.C.K.KARUNAKARAN
SRI.TOM THOMAS (KAKKUZHIYIL)
SMT.LEKSHMI P. NAIR
SMT.SHIFNA MUHAMMED SHUKKUR
SMT.KRISHNA SURESH
SMT.MEKHA MANOJ
SHRI.ANIRUDH INDUKALADHARAN
THIS FIRST APPEAL FROM ORDERS HAVING COME UP FOR HEARING ON
27.01.2026, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
2026:KER:6219
SATHISH NINAN &
P. KRISHNA KUMAR, JJ.
= = = = = = = = = = = = = = = = = =
F.A.O. No.70 of 2025
= = = = = = = = = = = = = = = = = =
Dated this the 27th day of January, 2026
J U D G M E N T
Sathish Ninan, J.
The application filed under Order XXI Rule 90 of the Code of
Civil Procedure(CPC), seeking to set aside an execution sale, was
allowed by the execution court. The decree holder-auction
purchaser is in appeal.
2. In execution of a decree for money, the immovable
property belonging to the judgment debtors was sold in execution.
The applicant in the present application-a Bank, who is a third
party, sought to set aside the sale under Order XXI Rule 90 CPC.
The applicant-Bank claimed that they had a prior mortgage over
the property, which was not taken note of by the Court.
3. The execution court, finding that the applicant has
established the existence of a prior mortgage over the property,
set aside the sale.
2026:KER:6219
4. We have heard learned counsel on either side.
5. Order XXI Rule 90 CPC enables any person whose interests
are affected by sale, to move an application to set aside the
sale on the grounds specified therein. The applicant claims a
prior mortgage right over the property. The existence of such
mortgage has been established by the applicant. By virtue of the
execution sale, the rights of the prior mortgagee would not be
affected.
6. Taking it to be that the applicant is entitled to
maintain the application, the Rule specifies the grounds on which
the sale is liable to set aside under the said provision. The
grounds provided are, material irregularity or fraud in
publishing or conducting the sale. Therefore, it needs to be
considered by the court whether there was any material
irregularity or fraud in publishing or conducting the sale in
question.
7. Exts.A1 to A5 documents produced by the applicant-bank
evidence existence of a prior mortgage over the property.
Admittedly the mortgage was an equitable mortgage created by
deposit of title deed. Hence the existence of a mortgage will not
2026:KER:6219
be reflected in the encumbrance certificate. But for the
existence of the mortgage, any irregularity or fraud in
publishing or conducting the sale could be made out. Therefore,
the execution sale could not have set aside.
8. However, as held by the execution court, there existed a
prior mortgage in favour of the applicant. The execution sale
held could only be subject to the said mortgage over the
property. At the time of the execution sale, the right that the
mortgager had over the property was subject to the mortgage
liability. Therefore, the rights obtained by the auction
purchaser-decree holder-appellant under the execution sale is
only subject to the mortgage. The said mortgage right will remain
unaffected by the present execution sale. It is clarified
accordingly.
9. It is brought to our notice that in enforcement of the
mortgage, the Bank has since sold the property, and has been
purchased by a third party auction purchaser who seeks to get
himself impleaded in this appeal as an additional respondent. We
are not required to go into the said aspects.
2026:KER:6219
Resultantly, the appeal is allowed. The order dated
17.03.2025 in EA 15/2024 is set aside. The execution sale held in
EP 12/2019 in OS 60/15 of the sub Court, Pala, is set aside.
However, it is held that under the execution sale, the rights
sold and purchased by the decree holder-auction purchaser is
subject to the mortgage right in favour of the applicant-bank.
Sd/-
SATHISH NINAN
JUDGE
Sd/-
P. KRISHNA KUMAR
JUDGE
kns/-
//True Copy//
P.S. To Judge
