Ghanashyam Kampa vs The Sr. Manager
2022 Latest Caselaw 2227 Ori

                 IN THE HIGH COURT OF ORISSA AT CUTTACK

                               W.P.(C) No.36127 Of 2021
                                (Through hybrid mode)


            Ghanashyam Kampa                         ....                Petitioner

                                             Mr. Panchanan Panigrahi, Advocate

                                          -versus-

            The Sr. Manager, Canara Bank,    ....            Opposite Party
            BBSR
                                        Mr. Sudhir Kumar Mishra, Advocate

                      CORAM: JUSTICE ARINDAM SINHA

                                     ORDER

13.04.2022

Order No.

05. 1. Petitioner, by this writ petition wants return of his title

document, deposited to create security for repayment of housing loan.

2. Mr. Panigrahi, learned advocate appears on behalf of petitioner

while Mr. Mishra, learned advocate appears on behalf of the bank.

3. Earlier, Mr. Panigrahi, had relied on judgment dated 9th

August, 2017 of a Division Bench of Madras High Court in

W.P.(MD) no.12613 of 2016 ( M. Shanthi v. Bank of Baroda). He

submitted, in the judgment several views of different High Courts and

declaration of law of the Supreme Court on, inter alia, section 171 in

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Contract Act, 1872 were discussed. He submitted, in year, 2011 credit

facility of cash credit was obtained upon creating security of stock.

Subsequently, a separate sanction for housing loan was made and

security for repayment of that was by deposit of title deed in respect of

the property. According to him, his client took the first loan for

business and the second loan for house. For the house, the title deed

was deposited.

4. It appears from M. Shanti (supra) there were several views

expressed. Some of them are:-

(i) Where there is credit facility extended upon security obtained

for repayment and the bank has a right to recover under the

Securitization and Reconstruction of Financial Assets and

Enforcement of Security Interest Act, 2002, provisions therein will be

override provisions in the Contract Act.

(ii) A specific contract will be a contract to the contrary that will

militate against the banker's general right of lien under section 171 in

the Contract Act.

(iii) Bank cannot exercise general right of lien to secure any other

liability of mortgagor, when the deposit was with intention to secure a

particular loan transaction.

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(iv) It is doubtful, whether in exercise of general right to retain title

deed, the bank can being the property to sale, for recovery of some

debt in connection with a different transaction, not covered by the

mortgage.

5. Mr. Mishra, files additional affidavit. In it is disclosed, inter

alia, letter dated 28th December, 2012 evidencing deposit of title

deeds. The letter says that the document was deposited as security for

repayment of a credit facility with limit of Rs.16,90,000/-, which

petitioner urges was housing loan and repaid. There is no dispute on

this. However, the letter goes on to say that the security is being

created also in respect of any other monies in any other account

standing in name of petitioner. As such, there is no contract to the

contrary, militating against the banker's right of general lien as can be

found from said letter.

6. On the reason given above, petitioner is not entitled to

interference by Court on his banker having exercised general lien over

his title document.

7. The writ petition is disposed of.

(Arindam Sinha) Judge Prasant