Bank of Baroda, Kayamkulam Branch v Sub Registrar, Kayamkulam and Others

# **IN THE HIGH COURT OF KERALA AT ERNAKULAM** # **PRESENT** **THE HONOURABLE MR. JUSTICE ALEXANDER THOMAS** **WEDNESDAY, THE 23RD DAY OF JANUARY 2019 / 3RD MAGHA, 1940** ## **WP(C).No. 40599 of 2018** ## **PETITIONER:** **BANK OF BARODA, KAYAMKULAM BRANCH, KAYAMKULAM ALAPPUZHA-690502, REPRESENTED BY ITS CHIEF MANAGER, MR.K. JAYACHANDRAN.** **BY ADVS.SRI.K.M.ANEESH, SRI.ADARSH KUMAR SRI.BIJU VARGHESE ABRAHAM, SRI.DILEEP CHANDRAN SRI.K.SANTHOSH KUMAR (KALIYANAM),SRI.SHASHANK DEVAN** ## **RESPONDENTS:** |1|**SUB REGISTRAR,**| |---|---| ||**SUB REGISTRAR'S OFFICE,**| ||**KAYAMKULAM, ALAPPUZHA DISTRICT-690502.**| ||**DR.RAMJITH KUMAR,**| |2|**NANATTUCHAITHRAM, KARAKKAD (PO),**| ||**CHENGANNUR, PIN-689 504, PRESENTLY RESIDING AT**| ||**FLAT NO.2B, NIVEDYAM, VADUTHALA P.O.,**| ||**COCHIN-682023.**| |3|**SIMI RAMJITH, W/O.DR.RAMJITH KUMAR,**| ||**NANATTUCHAITHRAM, KARAKKAD (PO),**| ||**CHENGANNUR, PIN-689 504, PRESENTLY RESIDING AT**| ||**FLAT NO.2B, NIVEDYAM, VADUTHALA P.O.,**| ||**COCHIN-682023.**| **SHOBHANVAS V.R.** 4 **S/O.LATE N.RAJAN, VARANAPPALLY THEKKETHIL, PUTHUPPALLY NORTH, PUTHUPPALLY P.O., KAYAMKULAM, ALAPPUZHA DISTRICT, PIN-690 527.** **VILLAGE OFFICER,** 5 **PUTHUPPALLY VILLAGE, PUTHUPPALLY, KAYAMKULAM, ALAPPUZHA DISTRICT-690 527. SMT.PRIYA SHANAVAS, GOVT.PLEADER FOR R1 AND R5** **THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON** **23.01.2019, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** ## ALEXANDER THOMAS, J. ------------------------------------ ## W.P.(C)No. 40599 of 2018 ------------------------------------Dated this the 23[rd] day of January, 2019 ## J U D G M E N T The petitioner is now aggrieved by the refusal on the part of 1[st] respondent Sub Registrar to register Ext.P-2 sale certificate on the ground that encumbrace has been noted in respect of the subject property as per Sl.No.3 of Ext.P-3 Encumbrance Certificate, even though the said attachment order has been rendered long after the creation of mortgage of the subject property in favour of the petitioner Bank. 2. The prayers in the above Writ Petition (Civil) are as follows:- “ - _a) Declare that the attachment reflected in Exhibit P3 encumbrance certificate subsequent to creation of equitable mortgage created in favour of the petitioners non-est and does not affect the marketability of the property._ - _b) Issue a writ of mandamus or other appropriate writ, direction or order directing the 1[st] respondent to efface the attachment made on 3.43 Ares of property in ReSy No.148/3 (Sy.No.1249 B) of Puthupally Village, Karthikappally Taluk, Alapuzha District subsequent to 16/09/2008 and to register Exhibit P2 sale certificate issued in favour of the 4[th] respondent._ - _c) Issue a writ of mandamus or other appropriate writ, direction or order directing the 5[th] respondent to conduct mutation of the property in favour of 4[th] respondent after the registration of the sale certificate by the 1[st] respondent._ - _d) To grant such other reliefs as may be prayed for in the circumstances of the case.”_ W.P.(C).No.40599/2018 **==> picture [19 x 9] intentionally omitted <==** 3. Heard Sri.K.M.Aneesh, learned counsel appearing for the petitioner Bank and Smt.Priya Shanavas, learned Government Pleader appearing for the official respondents 1 & 5. 4. From the pleading and materials on record, it is seen that contesting respondents 2 and 3 had availed a loan from the petitioner Bank and they had mortgaged the subject property in favour of the Bank in that loan transaction on 16.9.2008. Since there was consistent defaults on the part of the borrowers, the petitioner Bank had initiated proceedings under SARFAESI Act and this led to the sale of the subject property covered by mortgage under the provisions of the SARFAESI Act on 27.8.2018. Thereafter Ext.P-2 sale certificate dated 3.9.2018 has also been duly issued in terms of the provisions contained in the SARFAESI Act in respect of the subject property. When the petitioner and the 4[th] respondent had taken steps to register Ext.P-2 sale certificate before the 1[st] respondent Sub Registrar, the said registering authority has taken the view that the sale cannot be registered as encumbrance has been noted in respect of subject property as per Sl.No.3 of Ext.P-3 Encumbrance Certificate relating to the attachment of the very same property, at the instance of another creditor of the same borrower. According to the petitioner, W.P.(C).No.40599/2018 ..4.. it is self evident from Sl.No.3 of Ext.P-3 that the impugned attachment order is the one which rendered on 23.7.2011 by the Sub Court, Mavelikkara in IA.No.974/2011 in OS.No.171/2011 wherein the plaintiff is one Radhakrishnan on account of the liability owed by the 2[nd] respondent to that party. 5. The matter in issue is no longer res integra and is fully covered by the dictum laid down by this Court in various decisions as in _**HDFC v. SRO (2011 (3) KLT 567), Madan v. SRO (2014 (1) KLT 406),**_ etc. This Court has held in both decisions as in _**Madan v. SRO (2014 (1) KLT 406)**_ that the sale of mortgage property in such cases in favour of the purchaser under sale certificate issued under provisions of enactments like the Recovery of Debts due to Banks and Financial Institutions Act, 1993, the SARFAESI Act, 2002, etc. is free from all encumbrances where attachments have been effected subsequent to mortgage in favour of the financial institution and that such attachments effected subsequent to mortgage so created do not affect the title and ownership of the purchaser of the subject property and such attachments have no impact on the sale conducted under the Act and ceases to have any effect or fall to the ground the moment the same W.P.(C).No.40599/2018 ..5.. is confirmed in favour of the purchaser etc. This Court has directed in these cases that in such situations, the Sub Registrar and the Village Officer are obliged to efface and delete such attachments effected subsequent to mortgage from the relevant records. As otherwise, those attachments would remain as a permanent taboo which preducially affect the marketability of the title of the property even though they ceased to have any legal efficacy etc. 6. Accordingly it is ordered and declared that in case the impugned attachment in this case has been rendered after the date of creation of mortgage, then such attachment order will have no legal efficacy and would fall to the ground the moment the sale has been confirmed and that in such cases, the 1[st] respondent Sub Registrar and the 5[th] respondent Village Officer concerned are obliged to efface and delete such attachments from the encumbrance records. 7. However the petitioner has not arrayed as a respondent the said beneficiary of the attachment order as referred to in Sl.No.3 of Ext.P-3 Encumbrance Certificate. Accordingly it is ordered that the petitioner may file an appropriate application before the 1[st] respondent Sub Registrar after arraying the W.P.(C).No.40599/2018 **==> picture [19 x 9] intentionally omitted <==** beneficiary of the attachment order as a respondent therein, giving the details of the loan transaction and date of creation of mortgage and about the impugned attachment orders issued. The petitioner will also produce a certificate showing the exact date of creation of mortgage in respect of the subject property in this case. Thereafter the 1[st] respondent will issue notices to the petitioner and the beneficiary of attachment order and decide on the limited factual issue as to whether the impugned attachment order has been rendered after the creation of mortgage in favour of the petitioner Bank and if it is so found, then the 1[st] respondent SRO will make additional entries in Book No.1 in respect of the said property as envisaged in Sec.89(5) of the Registration Act, 1908 so as to delete and efface such attachment from the encumbrance records. Thereupon the petitioner may make an application for grant of fresh encumbrance certificate after deletion of such encumbrances and the 1[st] respondent SRO then will immediately issue fresh encumbrance after deletion of such encumbrance, but payment of cost/fee for issuance of such certificate. 8. Thereafter the original of Ext.P-2 sale certificate may be produced before the 1[st] respondent for registration upon which W.P.(C).No.40599/2018 **==> picture [18 x 8] intentionally omitted <==** the same shall be registered if otherwise in order. The petitioner will also be at liberty to produce the copy of the above said fresh encumbrance certificate before the 5[th] respondent Village Officer after deletion of such attachments, upon which the 5[th] respondent Village Officer will also efface and delete those encumbrance from the revenue records forthwith. With these observations and directions, the above Writ Petition (Civil) will stand finally disposed of. Sd/- ALEXANDER THOMAS, JUDGE MMG W.P.(C).No.40599/2018 ..8.. ## **APPENDIX** ## **PETITIONER'S EXHIBITS:** **EXHIBIT P1 TRUE COPY OF THE FINAL ORDER PASSED BY THE LEARNED DRT ERNAKULAM DATED 21.12.2012** **EXHIBIT P2 TRUE COPY OF THE SALE CERTIFICATE DATED 3.9.2018 EXHIBIT P3 TRUE COPY OF THE ENCUMBRANCE CERTIFICATE DATED 12.1.2015** **EXHIBIT P4 TRUE COPY OF THE SALE CERTIFICATE PRINTED ON STAMP PAPER WORTH RS.80,000/-**