MANAPPURAM HOME FINANCE LIMITED v BRD SECURITIES LIMITED and SUB REGISTRAR OFFICE KONGORPPILLY, ALANGAD - KADUNGALLOOR ROAD, VARAPUZHA, ERNAKULAM

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MR.JUSTICE MURALI PURUSHOTHAMAN WEDNESDAY, THE 20[TH] DAY OF DECEMBER 2023 / 29TH AGRAHAYANA, 1945** **WP(C) NO. 25927 OF 2023** ## **PETITIONER:** ## **MANAPPURAM HOME FINANCE LIMITED** **ERNAKULAM BRANCH, 2ND FLOOR BUILDING NO.55/2770, MUNDUKOTTACKAL ESTATE" OPPOSITE HDFC BANK, KADAVANTHRA ERNAKULAM, REPRESENTED BY ITS BRANCH MANAGER AND AUTHORISED SIGNATORY SARATH P. THAMPY, PIN – 682 020.** **BY ADVS. C.HARIKUMAR SANDRA SUNNY ARUN KUMAR M.A FARAH JYOTHI PRADEEP** ## **RESPONDENTS:** **1 BRD SECURITIES LIMITED KUNNAMKULAM VILLAGE AND DESOM THALAPPILLY TALUK, BRANCH OFFICE AT BRD COMPLEX NEAR THRISSUR - KODUNGALLUR ROAD, KAROOOPADANNA THRISSUR REPRESENTED BY ITS PRESENT LITIGATION CLERK, PIN – 680 670. 2 SUB REGISTRAR OFFICE OF THE SUB REGISTRAR OFFICE KONGORPILLY - ALANGAD - KADUNGALLOOR ROAD KONGORPPILLY, VARAPUZHA ERNAKULAM, PIN – 683 518.** **BY ADVS. R1 - SRI. SANTHOSH P.PODUVAL - R.RAJITHA - CHITHRA S.BABU SMT. DEEPA V. - GP** **THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON** **20.12.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** **W.P(C) No.25927 of 2023** **2** ## **JUDGMENT** The petitioner, a financial institution, has filed this writ petition for a direction to the 2[nd] respondent Sub Registrar to permit the registration of Exhibit P6 Sale Certificate for the sale of immovable properties under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act). 2. The petitioner sanctioned a housing loan to the mortgagors by creating an equitable mortgage by deposit of title deed in respect of the property having an extent of 1496 sq. ft. situated in Survey No. 211/12 of Alangad Village, Ernakulam, on 30.05.2016. On account of default in payment of installments, the petitioner initiated proceedings under the SARFAESI Act, and the mortgaged property was sold at auction. 3. When the petitioner took steps for registration **W.P(C) No.25927 of 2023** **3** of the sale certificate, it was found that certain attachment orders were obtained by third parties. The petitioner submits that, it can be seen from Ext.P3 encumbrance certificate that all the attachments referred to therein obtained by third parties are subsequent to the creation of the equitable mortgage by the borrowers in favour of the petitioner. The petitioner, in such circumstances, filed W.P.(C) No.10219/2021 for direction to the Sub Registrar to efface the attachment from the encumbrance register and to register the sale certificate in favour of the auction purchaser. This Court, by Ext.P4 judgment, directed the the Sub Registrar to efface the entries of attachment and to register the sale certificate. 4. Subsequent to Ext.P4 judgment, when the petitioner approached the Sub Registrar to register the sale certificate, it was noted that, in Ext.P3 encumbrance certificate dated 07.12.2020, issued by **W.P(C) No.25927 of 2023** **4** the Registration Department, they omitted to show one of the attachments effected vide order dated 26.07.2018 in I.A. No. 4865 of 2018 in O.S. No. 827 of 2018 of the Munsiff Court, Chavakkad at the instance of the 1[st] respondent. The Sub Registrar therefore refused to register the auction sale of the attached property. The petitioner states that the attachment effected vide order of the Munsiff Court, Chavakkad referred to above is subsequent to the creation of equitable mortgage in favour of the petitioner by the borrowers and the same cannot affect the right of the petitioner to sell the property under the provisions of the SARFAESI Act. 5. Heard Sri. C. Harikumar, the learned counsel for the petitioner, Sri. Santhosh Poduval for the 1[st] respondent and the learned Government Pleader. 6. The learned counsel for the petitioner relied on **W.P(C) No.25927 of 2023** **5** the decision of this Court in **Madhan S.** _**v**_ **. Sub Registrar, Kollam and Others [2014 (1) KHC 249: 2014 (1) KLT 406: ILR 2014 (1) Ker.586: 2014 (1) KLJ 483: AIR 2014 Ker.54]** and the decision of a Division Bench of this Court in **Secretary, Keechery** _**v**_ **Service Co-operative Bank Ltd. . Sajitha Nizar alias Sajitha P.M. and Others [2020 (5) KHC 231: ILR 2020 (4) Ker.249: 2020(6) KLT 68: 2020(4) KLJ 970]** and contends that the attachment effected subsequent to the creation of equitable mortgage will not affect the right of the petitioner to sell the mortgaged property and the attachment has to be effaced from the encumbrance register. 7. In Madhan's case (supra), this Court held in paragraph 9 as follows:- ## _“9. The preponderance of judicial_ _opinion leads to the irresistible conclusion that the sale of the mortgaged property in_ **W.P(C) No.25927 of 2023** **6** _favour of the petitioner under Ext. P5 sale certificate under the Act 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 under the Act and the same ceases to have any effect or fall to the ground the moment the sale is petitioner. The confirmed in favour of the declaration so sought by the petitioner is therefore granted and I further direct the Sub-Registrar and the Village Officer to efface the attachments effected subsequent to the mortgage from the relevant records. Otherwise those attachments would remain as a permanent taboo prejudicial affecting the marketability and title to the property even though they ceased to have any legal efficacy. The_ **W.P(C) No.25927 of 2023** **7** _needful in relation to the property bought by the petitioner shall be done within a period of two months from the date of receipt of a copy of this judgment.”_ 8. A Division Bench of this Court in **Ali Asharaf M.M. and Another** _**v**_ **. Sub Registrar, Thrissur (Judgment dated 24.7.2015 in W.A. No.612/2015)** has affirmed the law laid down in Madhan's case.In Keechery Service Co-operative Bank case (supra), another Division Bench of this Court also affirmed the law laid down in Madhan's case (supra) and held in paragraph 7 as under:- _“7. …. 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_ **W.P(C) No.25927 of 2023** **8** _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 encumbrance over the property effected after 27/06/2014, the date on which the property in question was mortgaged with Federal Bank”._ Thus it is trite law that attachment effected subsequent to the creation of equitable mortgage does not have any effect on the sale conducted by the petitioner under the SARFAESI Act and has to be effaced from the encumbrance register. The attachment effected vide order dated 26.07.2018 in I.A. No. 4865 of 2018 in O.S. No. 827 of 2018 of the Munsiff Court, Chavakkad at the instance of the 1[st] **W.P(C) No.25927 of 2023** **9** respondent is subsequent to the creation of equitable mortgage in favour of the petitioner. 9. Accordingly, there will be a direction to the 2[nd] respondent to efface the entry of attachment made pursuant to the order in I.A. No. 4865 of 2018 in O.S. No. 827 of 2018 of the Munsiff Court, Chavakkad from the encumbrance register and to register Ext. P6 sale certificate as and when presented, if the same is otherwise in order. The writ petition is disposed of. Sd/- **MURALI PURUSHOTHAMAN JUDGE** SPR **W.P(C) No.25927 of 2023** **10** ## **APPENDIX** ## **' - PETITIONER S EXHIBITS:** **EXHIBIT P1 THE TRUE COPY OF THE ORDER IN M.C.NO 203 OF 2019 PASSED BY THE SPECIAL ADDITIONAL CHIEF JUDICIAL MAGISTRATE COURT, ERNAKULAM DATED 10.04.2019.** **EXHIBIT P2 THE TRUE COPY OF THE SALE CERTIFICATE ISSUED BY THE AUTHORIZED OFFICER OF THE PETITIONER DATED 18.03.2021.** **EXHIBIT P3 THE TRUE COPY OF THE ENCUMBRANCE CERTIFICATE OF THE PROPERTY ISSUED BY THE REGISTRATION DEPARTMENT, GOVERNMENT OF KERALA DATED 07.12.2020.** **EXHIBIT P4 THE TRUE COPY OF THE JUDGMENT IN W.P. (C.)NO 10219 OF 2021 PASSED BY THIS HON'BLE COURT DATED 09.09.2021.** **EXHIBIT P5 THE TRUE COPY OF THE ENCUMBRANCE CERTIFICATE OF THE PROPERTY ISSUED BY THE REGISTRATION DEPARTMENT GOVERNMENT OF KERALA DATED 21.07.2023.** **EXHIBIT P6 THE TRUE COPY OF THE SALE CERTIFICATE ENTERED BETWEEN THE PETITIONER AND THE SONIA K.J. DATED 20.07.2023.** ## **RESPONDENTS EXHIBITS: NIL.**