Dr. Ansari Backer v. Union of India and Others

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS** **THURSDAY, THE 22[ND] DAY OF SEPTEMBER 2022 / 31ST BHADRA, 1944** ## **WP(C) NO. 10340 OF 2022** ## **PETITIONER:** **DR. ANSARI BACKER, AGED 54 YEARS, S/O. LATE P. BAKER, ASHARAF MANZIL, THALAYOLAPARAMBU, VADAYAR VILLAGE, VAIKOM TALUK, KOTTAYAM DISTRICT, NOW RESIDING AT HANNZ VILLA, KUMARANASAN NAGAR, KADAVANTHRA, ELAMKULAM VILLAGE, KANAYANNUR TALUK, ERNAKULAM DISTRICT, KOCHI 682 020** **BY ADVS.** **SRI.VARGHESE C.KURIAKOSE SRI.SUSANTH SHAJI SRI.ALBIN A. JOSEPH SMT.AMRITHA.J** ## **RESPONDENTS:** **1 UNION OF INDIA, REPRESENTED BY SECRETARY, BANKING OPERATIONS DEPARTMENT, MINISTRY OF FINANCE , 3RD FLOOR, JEEVAN DEEP BUILDING, SANSAD MARG, NEW DELHI 110 001. 2 M/S. PIRAMAL CAPITAL & HOUSING FINANCE LIMITED, 1ST FLOOR, K.M.M. BUILDINGS, DOOR NO. 32/2383, B & D1, PALARIVATTOM, KOCHI 682 025, REP. BY ITS BRANCH MANAGER. 3 THE AUTHORISED OFFICER, M/S. PIRAMAL CAPITAL AND HOUSING FINANCE LIMITED, 1ST FLOOR, K.M.M. BUILDINGS,** W.P.(C) 10340/22 ## **-:2:-** **DOOR NO. 32/2383, B & D1, PALARIVATTOM, KOCHI, 682 025.** **4 AFZAL B, S/O. P. BAKER, FIRDOUS, THALAYOLAPARAMBU P.O, VADAYAR , VAIKOM TALUK, KOTTAYAM DISTRICT-686 605** - **5 SHAMALA UMMERKHAN,** **W/O. AFZAL B, FIRDOUS, THALAYOLAPARAMB P.O, VADAYAR, VAIKOM TALUK, KOTTAYAM DISTRICT-686 605** **BY ADV P.PAULOCHAN ANTONY, SC** **SRI.N.SASI** **THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 22.09.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** **-:3:-** W.P.(C) 10340/22 ## **BECHU KURIAN THOMAS, J. --------------------------------W.P.(C) No.10340 of 2022** ## **----------------------------------** Dated this the 22[nd] day of September, 2022 ## **JUDGMENT** Petitioner is an auction purchaser of a property sold in a court auction. He is also the decree-holder in O.S. No.319 of 2012 on the files of Sub Court, Kottayam. Petitioner had purchased the property in the court sale conducted in execution of the decree in the aforementioned suit. In this writ petition, petitioner seeks a direction to facilitate a one-time settlement with the secured creditor of the prior owner and also seeks a direction for the return of the title deeds of the property after satisfaction and discharge of the entire liability. 2. Petitioner and the fourth respondent were the plaintiff and defendants in O.S. No.319 of 2012 on the files of Sub Court, Kottayam. They are brothers too. The suit was decreed in favour of the petitioner, and the appeal preferred by the fourth respondent as R.F.A. No.396 of 2016 was dismissed by judgment dated 18.06.2018. In E.P. No.35 of 2016 filed by the petitioner for execution of the decree, the properties belonging to the **-:4:-** W.P.(C) 10340/22 fourth respondent herein, which were attached in the suit, were brought for sale, and petitioner purchased the said properties. Ext.P2 Sale Certificate dated 24.08.2020 was issued by the Sub Court, Kottayam, which was duly entered in the Register at the office of the Sub Registrar at Thalayolaparambu, as evidenced by Ext.P3 Encumbrance Certificate. The delivery of the property was also taken pursuant to the sale, as is evidenced by the delivery report dated 17.11.2020, produced as Ext.P4. 3. In the meantime, petitioner came to understand that the fourth and fifth respondents had mortgaged the property with a financial institution for availing a loan, even prior to the suit. The mortgaged property was the one purchased by the petitioner in the court auction. While so, the liability due to the secured creditor became the subject of a one time settlement scheme. However, respondents 4 and 5 failed to abide by the terms of the one-time settlement, and hence liability remained due to the secured creditor. Thus the mortgage subsisted even when the petitioner purchased the property. 4. It is pertinent to mention that, in the meantime, the secured creditor was taken over by the second respondent and therefore the liability from respondents 4 and 5 remained due to **-:5:-** W.P.(C) 10340/22 the second respondent. Though the liability due to the secured creditor was paid in part by respondents 4 and 5, since the entire liability was not cleared, the title deeds were retained by the second respondent. After petitioner became the owner of the property, he submitted Ext.P5 representation on 17.03.2022, being the person interested in the property, requesting facilitation of the entire transaction and to close the loan account by accepting amounts from the petitioner and also sought for return of the title deeds deposited by respondents 4 and 5. Respondents 2 and 3 failed to take a decision on the request of the petitioner, and hence this writ petition was preferred. 5. On noticing the possibility of a settlement, this Court, by an order dated 06.07.2022, directed the parties to appear before the mediation centre. Pursuant to the order of referral for mediation, a report dated 08.08.2022 has been filed specifying that the matter has been settled and the amount liable to be paid for clearing the liability of the borrowers was fixed at Rs.20,50,000/-. It was also agreed at the mediation that the amounts due to the secured creditor will be paid by the petitioner before 31.08.2022, and on such payment, the title deeds will be handed over to the petitioner as per the direction **-:6:-** W.P.(C) 10340/22 of this Court. 6. I have heard Sri.Varghese C.Kuriakose, learned counsel for the petitioner, Sri.P.Paulochan Antony, learned Standing Counsel for respondents 2 and 3 as well as Sri.N.Sasi, learned counsel for respondents 4 and 5. 7. The entire liability due to respondents 2 and 3 has admittedly been cleared, partly by respondents 4 and 5 and after purchasing the property in the court sale, by the petitioner. Obviously, since the liability has been cleared in its totality, the documents of title cannot be retained by respondents 2 and 3. Thus the issue to be considered relates only to whom the documents of title are required to be returned. 8. Petitioner claims that he is entitled to be handed over the documents of title by respondents 2 and 3 even though the mortgage by deposit of title deeds was created by respondents 4 and 5. In this context, it is relevant to mention that on 29.08.2022, this Court had directed respondents 2 and 3 to ascertain whether the properties covered by Ext.P2 sale certificate and the properties mortgaged by respondents 4 and 5 with respondents 2 and 3 are the same properties. Sri.Paulochan Antony, after getting instructions, submitted that W.P.(C) 10340/22 **-:7:-** the properties covered by the sale certificates are the same properties over which security interest was created by mortgage of title deeds. In such a view, there is no dispute on the identity of the property also. 9. Irrefutably petitioner had purchased the mortgaged property in a court sale, as evidenced by Ext.P2. He has become the owner of the property by virtue of the court sale. As an owner of the property, all the prior title deeds are entitled to be handed over to him. 10. It is trite law that once a person has purchased a property, the equity of redemption is part of his title, and as an owner, he can seek redemption of the mortgage. In the decision in **Muhammed Sherieff K.S. v. Registrar of Co-operative Societies and Others** (2016 (2) KHC 665) it was held that a bonafide purchaser of the property can redeem the property without reference to the mortgagor and seek return of the title deeds from the mortgagee bank. In the decision in **Narayan Deorao Javle (deceased) through LRs v. Krishna and Others** (AIR 2021 SC 3920), the Supreme Court had held that the original mortgagor who had mortgaged the property had no subsisting title, by virtue of an intervening sale and once the **-:8:-** W.P.(C) 10340/22 plaintiff had purchased the property, the equity of redemption is part of the title, and as an owner, he could seek redemption of the suit land. In a recent decision in **Axis Bank (M/s.) v. Hilal Ahamed Bhat and Another** (2022 (4) KHC 508), it was held that _“we hasten to add that equity of redemption available to the mortgagor - debtor can certainly be attached and sold by a civil court as long as his right to pay off under the provisions of S.13(8) of the SARFAESI Act subsists. In the event of sale by the civil court before such time, the auction purchaser, who steps into the shoes of the mortgagor, shall have the right of redemption as regulated by S.13(8) of the SARFAESI Act”_ . 11. Thus, once the petitioner purchased the property, as evidenced by Ext.P2, he stepped into the shoes of the original mortgagor and thereafter, as an owner of the property, he is entitled to possess the title deeds, including the prior title deeds. 12. Since admittedly, the liability due to the secured creditor has been cleared, they are bound to return the title deeds to the owner, and the petitioner, as the owner of the property, is entitled to the prior title deeds. In view of the above, I am of the considered opinion that respondents 2 and 3 are bound to return the title deeds to the petitioner by virtue of **-:9:-** W.P.(C) 10340/22 his acquisition of title to the property under Ext.P2. 13. Accordingly, there will be a direction to respondents 2 and 3 to handover the prior title deeds of the property mortgaged by respondents 4 and 5 to the petitioner. Needful shall be done within a period of two weeks from the date of receipt of a copy of this judgment. The writ petition is allowed as above. **BECHU KURIAN THOMAS JUDGE** vps W.P.(C) 10340/22 ## **-:10:-** ## **APPENDIX OF WP(C) 10340/2022** ## **PETITIONER'S/S' EXHIBITS** **Exhibit P1 TRUE COPY OF THE JUDGMENT IN R.F.A NO. 396/2016 PASSED BY THIS HON'BLE COURT DATED 18.06.2018.** **Exhibit P2 TRUE COPY OF THE SALE CERTIFICATE ISSUED BY THE ADDL. SUB COURT, KOTTAYAM DATED 24.08.2020.** **Exhibit P3 TRUE COPY OF THE ENCUMBRANCE CERTIFICATE DATED 22.12.2020.** **Exhibit P4 TRUE PHOTOCOPY OF THE DELIVERY REPORT DATED 17.11.2020. Exhibit P5 TRUE COPY OF THE REPRESENTATION DATED 17.03.2022.**