Bank of Baroda ROSARB, Ernakulam v. Sub Registrar Kollam; Village Officer Shakthikulangara; Biju M.; Maniyan Pillai; Indira Amma; Arun Mohan

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MR. JUSTICE ANIL K.NARENDRAN** ## **FRIDAY, THE 05TH DAY OF FEBRUARY 2021 / 16TH MAGHA,1942** ## **WP(C).No.27479 OF 2020(H)** ## **PETITIONER:** **BANK OF BARODA ROSARB, ERNAKULAM, PALLIMUKKU, M.G.ROAD, ERNAKULAM, REPRESENTED BY ITS CHIEF MANAGER.** **BY ADVS. SRI.SANTHOSH G. PRABHU SMT.N.U.DEEPA SMT.A.ASWATHY SRI.K.JANARDHANA SHENOY** ## **RESPONDENTS:** - **1 THE SUB REGISTRAR SUB REGISTRAR'S OFFICE, KOLLAM, KOTTAMUKKU, KACHERI P.O., KOLLAM - 691 013.** - **2 THE VILLAGE OFFICER SHAKTHIKULANGARA VILLAGE, KAVANAD P.O., KOLLAM - 691 003.** - **3 BIJU M. AGE NOT KNOWN, S/O.MANIYAN PILLAI, BIJU MANDIRAM, RAMANANKULANGARA NAGAR-112, KAVANAD P.O., KOLLAM - 691 003.** - **4 MANIYAN PILLAI AGED 65 YEARS, S/O.CHELLAPPAN PILLAI, BIJU MANDIRAM, RAMANANKULANGARA NAGAR-112, KAVANAD P.O., KOLLAM- 691003.** **5 INDIRA AMMA AGE NOT KNOWN, W/O.MANIYAN PILLAI, BIJU MANADIRAM, RAMANANKULANGARA NAGAR-112, KAVANAD P.O., KOLLAM - 691 003. 6 ARUN MOHAN AGE NOT KNOWN, S/O.MOHANAN PILLAI S., MANIYATH HOUSE, ADITHYA NAGAR, 124A, KAVANAD, KOLLAM - 691 003.** **R1 & R2 BY SMT K.AMMINIKUTTY, SR GOVERNMENT PLEADER THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 05.02.2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** WP(C).No.27479 OF 2020(H) 2 ## **JUDGMENT** The petitioner, the secured creditor in respect of property having an extent of 2.50 Ares in Re.Sy.No.528/10 and 0.10 Ares in Re.Sy.No.528/29 in Shakthikulangara Village of Kollam Taluk, which has been sold to the 6[th] respondent on the strength of Ext.P3 sale certificate dated 02.11.2020 issued under Rule 9 of the Security Interest (Enforcement) Rules, 2002, has filed this writ petition under Article 226 of the Constitution of India, seeking a declaration that the attachment reflected in Ext.P4 encumbrance certificate, which is subsequent to creation of equitable mortgage created in favour of the petitioner Bank, are non-est and does not affect the marketability of the property. The petitioner has also sought for a writ of mandamus commanding the respondents 1 and 2 to efface all the attachments and encumbrances with respect to the property mentioned in Ext.P3 sale certificate, which are subsequent to creation of mortgage with the petitioner bank. 2. Going by the averments in the writ petition, the 3[rd] respondent is the borrower who availed a loan of Rs.50,00,000/from the Thiruvalla branch of the petitioner Bank on 21.08.2013. Respondents 4 and 5 are the guarantors, who had deposited the WP(C).No.27479 OF 2020(H) 3 title deed of their property to secure due repayment of the loan amount. The property was mortgaged with the petitioner Bank on 21.08.2013, as stated in Ext.P1 notice dated 02.07.2015 issued to the borrower under sub-section (2) of Section 13 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002. The sale of the property was conducted on 03.08.2020, which was confirmed in the name of the 6[th] respondent on 05.08.2020. The petitioner Bank executed Ext.P3 sale certificate dated 02.11.2020 in favour of the 6[th] respondent. As per Ext.P4 encumbrance certificate, there is an attachment on the property in question, which is one made on 26.12.2015, based on the orders of the Sub Court, Karunagappally in O.S.No.45 of 2015 filed by one Satheesan, in which the 4[th] respondent is the defendant. That suit was rejected for non payment of balance court fee, by Ext.P5 judgment dated 31.08.2016. 3. On 11.12.2020, when this writ petition came up for admission, notice before admission was ordered to the respondents. Urgent notice by speed-post was ordered to respondents 3 to 6. The learned Government Pleader was directed WP(C).No.27479 OF 2020(H) 4 to get instructions from respondents 1 and 2. 4. Notice issued to the 3[rd] respondent returned with an endorsement 'unclaimed, returned to sender'. The 3[rd] respondent is the borrower. Despite service of notice, none appears for respondents 4, 5 and 6. The property mortgaged to the petitioner Bank was owned by respondents 4 and 5. Service of notice is complete on respondents 4 and 5. In such circumstances, service of notice on the 3[rd] respondent is dispensed with. 5. In **Madhan v. Sub Registrar [2014 (1) KLT 406]** the question that came up for consideration before this Court was whether the attachments effected subsequent to the creation of equitable mortgage will be effaced after the property is purchased by another in a sale conducted by the Recovery Officer of the Debt Recovery Tribunal. This Court held that, preponderance of judicial opinion leads to the irresistible conclusion that the sale of the mortgaged property in favour of the petitioner under Ext.P5 sale certificate is free of all encumbrances. The attachments effected subsequent to the mortgage created in favour of the bank do not affect the title and ownership of the petitioner over the subject property. Such attachments have no impact on the sale conducted WP(C).No.27479 OF 2020(H) 5 by the Recovery Officer and the same ceases to have any effect or fall to the ground the moment the sale is confirmed in favour of the petitioner. Therefore, this Court directed the Sub-Registrar and the Village Officer to efface the attachments effected subsequent to the mortgage from the relevant records. 6. In **Keechery Service Co-operative Bank Ltd. v. Sajitha Nizar [2020 (5) KHC 231]** a Division Bench of this Court agreed with the declaration of law in **Madhan** . Paragraphs 6 and 7 of that judgment read thus; “6. The issue was again considered by a Division Bench of this Court in an unreported decision in **Ali Asharaf M.M. & another v. Sub Registrar, Thrissur** [W.A.No.612 of 2015]. That was a case where the appellants/writ petitioners purchased property in question in an auction proceedings conducted under the SARFAESI Act. The appellants - petitioners were constrained to approach this Court by filing W.P.(C)No.23435 of 2014, from which the said appeal arose, on account of refusal on the part of the Village Officer to effect mutation of the property purchased by them in the auction under the SARFAESI Act. The reason for not effecting mutation was an order of attachment effected by Munsiff Court, Thrissur in respect of the same property. The learned Single Judge as per judgment dated 13.10.2014 in W.P. (C)No.23435/2014 directed the writ petitioners to approach Munsiff Court, Thrissur for vacating the order of attachment WP(C).No.27479 OF 2020(H) 6 in respect of the property purchased by them in the auction sale conducted under the SARFAESI Act. The Division Bench took note of the indisputable and undisputed fact that the attachment of the property involved therein was subsequent to the date of mortgage of the said property with the Bank whose Authorised Officer conducted the auction proceedings under the SARFAESI Act. In the said circumstances, the Division Bench, in full agreement with the dictum laid down in **Madhan's case (supra)** , declared that the attachments effected by the Munsiff Court, Thrissur after the date of mortgage are invalid and consequently, directed the Sub Registrar and the Village Officer, concerned to efface the attachments effected after 8.7.2008 that is, the date on which the mortgage of the property was created with the Bank. 7. In the light of the aforesaid declaration of law by this Court the order of dismissal of the petition filed for lifting the attachment ordered under Ext.R7(a) viz., Ext.R7(b) by the Federal Bank would pale into insignificance. We do not find any reason to disagree with the declaration of law in **Madhan's case (supra)** which was virtually affirmed by the Division Bench in **Ali Asharaf's case (supra)** . In the said circumstances and taking note of the fact that the orders of attachment of the property in question were after the creation of equitable mortgage of the same with Federal Bank we do not find any reason to interfere with the impugned judgment passed by the learned Single Judge following the dictum in **Madhan's case (supra)** , carrying the directions to effect mutation of the property as also to efface all WP(C).No.27479 OF 2020(H) 7 encumbrance over the property effected after 27.6.2014, the date on which the property in question was mortgaged with Federal Bank.” (underline supplied) 7. In the instant case, the attachment of the property by the order of the Sub Court, Karunagappally in O.S.No.45 of 2015 was on 26.12.2015, much after the mortgage on 21.08.2013. That suit has already been rejected for non-payment of balance court fee, on 31.08.2016, as per Ext.P5 judgment. 8. In such circumstances, this writ petition is disposed of by directing the 1[st] respondent Sub Registrar and the 2[nd] respondent Village Officer to efface/delete the attachment recorded in the relevant books as well as in Ext.P4 encumbrance certificate on the immovable property covered by Ext.P3 sale certificate, within a period of six weeks from the date of receipt of a certified copy of this judgment. No order as to costs. ## **Sd/-** ## **ANIL K.NARENDRAN** ## **JUDGE** JV WP(C).No.27479 OF 2020(H) 8 ## **APPENDIX** ## **PETITIONER'S/S EXHIBITS:** **EXHIBIT P1 TRUE COPY OF THE NOTICE DATED 02/07/2015 ISSUED BY THE PETITIONER BANK TO THE 3RD RESPONDENT UNDER SECTION 13(2) OF THE SARFAESI ACT.** **EXHIBIT P2 TRUE COPY OF THE LETTER OF CONFIRMATION OF SALE NO.ROSARB/SALE-SARFAESI/20-21 DATED 05/08/2020 ISSUED BY THE PETITIONER BANK IN FAVOUR OF THE 6TH RESPONDENT UNDER THE PROVISIONS OF SARFEASI ACT.** **EXHIBIT P3 TRUE COPY OF THE SALE CERTIFICATE DATED 02/11/2020 ISSUED BY THE PETITIONER BANK IN FAVOUR OF THE 6TH RESPONDENT. EXHIBIT P4 TRUE COPY OF THE ENCUMBRANCE CERTIFICATE BEARING NO.5613/20 DATED 03/09/2020 ISSUED BY THE 2ND RESPONDENT. EXHIBIT P5 TRUE COPY OF THE JUDGMENT DATED 31/08/2016 PASSED BY THE HONOURABLE SUB COURT, KARUNGAPPALLY IN O.S.45/2015. EXHIBIT P6 TRUE COPY OF THE JUDGMENT DATED 09/10/2017 IN WP(C) NO.23601/2017 OF THIS HONOURABLE COURT.**