State Bank of India, Asset Recovery Management Branch v. Sub Registrar, Registrar's Office, Cherpu, Thrissur and Others

## **`IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT`** ## **`THE HONOURABLE MR. JUSTICE GOPINATH P. FRIDAY, THE 9[TH] DAY OF JUNE 2023 / 19TH JYAISHTA, 1945 WP(C) NO. 14353 OF 2023`** ## **`PETITIONER/S:`** ``` STATE BANK OF INDIA, ASSET RECOVERY MANAGEMENT BRANCH R.S.BUILDINGS, M G ROAD, ERNAKULAM KOCHI- 682016 REPRESENTED BY ITS CHIEF MANAGER AND AUTHORISED OFFICER, BY ADV S.EASWARAN ``` ## **`RESPONDENT/S:`** - `1 SUB REGISTRAR REGISTRAR'S OFFICE, CHERPU, THRISSUR, PIN - 680561` - `2 M/S MATHA CHAIN CUTTING(BORROWER) REPRESENTED BY (PRO.SHRI JEO VARGHESE.E E S/O SHRI.VARGHESE, ELINJIKKADAN HOUSE,KALLETTUMKARA, THRISSUR, PIN - 680683` - `3 JEO VARGHESE, S/O SHRI.VARGHESE, ELINJIKKADAN HOUSE,KALLETTUMKARA, THRISSUR-, PIN - 680683` - `4 MEJO VARGHESE , S/O SHRI.VARGHESE, ELINJIKKADAN HOUSE,KALLETTUMKARA, THRISSUR-, PIN - 680683` - `5 SANTO P SANTO, S/O ANTO, "PELLISSERRY HOUSE, MULLAKKARA ROAD, PARALAM, AMMADAM, THRISSUR, PIN - 680563` ``` 6BIJU VARGHESE S/O VARGHESE, NEREPARAMBIL HOUSE, KALLETTUMKARA VILLAGE & DESOM, KALLETTUMKARA.P.O, CHALAKKUDY TALUK, THRISSUR DISTRICT, PIN - 680683 BY ADVS. B.SABITHA (DESOM) N.L.BITTO SMT. PREETHA K.K. SR. GP ``` ``` THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 09.06.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ``` `WP(C) NO. 14353 OF 2023` 2 ## **JUDGMENT** The petitioner, a banking company constituted under the State Bank of India Act, 1955, has approached this Court, being aggrieved by the fact that the 1[st] respondent refused to register the sale certificate issued by the petitioner under the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act (hereinafter referred to as ‘the SARFAESI Act’) on the ground that there is a pending attachment by a civil court, at the instance of the 6[th] respondent. 2. The learned counsel for the petitioner submits that when the mortgage in favour of the petitioner is admittedly prior to the date of the attachment in the suit, the rights of the petitioner under the provisions of the SARFAESI Act, cannot be defeated by a subsequent attachment. It is submitted that the rights of the attaching creditor are always subject to the rights of the petitioner to recover the money due to it by enforcing the security under the provisions of the SARFAESI Act. It is submitted that the mortgage, in this case, was created on 21.03.2013, and an attachment order was obtained in O.S. No.110 of 2022 on the file of the Subordinate Judge’s Court, `WP(C) NO. 14353 OF 2023` 3 Irinjalakuda only on 19.05.2022. It is also pointed out that the suit itself has been filed almost nine years after the date on which the mortgage was created in favour of the petitioner. Counsel submits that the issue raised in the writ petition is covered in favour of the petitioner by the following judgments:- - **(i) Secretary, Keechery Service Co-operative Bank Ltd. V. Sajitha Nizar Alias Sajitha P.M. and Others: 2020(5) KHC 231;** ## **(ii) Francis @ Porinju V. Navodaya Kuries & Loans (P) Ltd and Others: 2010 KHC 726;** **(iii) Kabidi Venku Sah V. Syed Abdul Hai and Another:1983 KHC 537;** - **(iv) Madhan S V. Sub Registrar, Kollam and Others; 2014(1) KHC 249;** - **(v) Thiru Venkita Reddiar V. Noordeen: 1977 KHC 302; and** - **(vi) Rajalekshmi Amma V. E.A. Basheer and Others; 2013 KHC 3678.** 3. Learned counsel appearing for the 6[th] respondent would vehemently oppose the grant of any relief to the petitioner. It is the case of the learned counsel for the 6[th] respondent that going by the recent judgment of the Supreme Court in **South Indian Bank Ltd., and Others v. Naveen Mathew Philip and Another;** 2023 SCC OnLine SC 435, the writ petition is clearly not maintainable in matters arising under `WP(C) NO. 14353 OF 2023` 4 the SARFAESI Act. It is submitted that where an alternative remedy is available to the petitioner, it is for the petitioner to avail such remedy instead of approaching this Court under Article 226 of the Constitution of India. It is submitted that if the petitioner has any objection with regard to the attachment made by the Civil Court, it is for the petitioner to approach the Civil Court and get the order of attachment lifted in the manner prescribed by the Code of Civil Procedure. 4. Having heard the learned counsel appearing for the petitioner and the learned counsel appearing for the 6[th] respondent, I believe that the contentions taken by the learned counsel appearing for the 6[th] respondent cannot be accepted. The judgment of the Supreme Court in **Naveen Mathew Philip (supra)** was a case where the writ petitioner had approached this Court by challenging the recovery proceedings initiated against him under the provisions of the SARFAESI Act and had obtained an order for repayment of the loan in instalments. It is in such circumstances, considering the scope and provisions of the SARFAESI Act and the purpose for which such a law was enacted, the Supreme Court held that when that statute creates an alternative remedy, permitting the borrower to approach the Debts Recovery Tribunal by filing a `WP(C) NO. 14353 OF 2023` 5 Securitisation Application under Section 17 of the SARFAESI Act, the High Court should not, in the exercise of jurisdiction under Article 226 of the Constitution of India, grant any relief to the borrower. The said decision is no authority for the proposition that, in a matter like this, when the bank seeks an order against the Sub Registrar for registration of a sale certificate, the bank should avail the alternative remedies, instead of approaching this Court under Article 226 of the Constitution of India. Further, it is settled law that the rule of alternative remedies is only a rule of convenience and practice, and it does not affect the jurisdiction of the High Courts with regard to the issuance of prerogative writs when circumstances for the issuance of such prerogative writs are made out. 5. In the facts and circumstances of this case, the mortgage was created on 21.03.2013 and the suit itself, in which the attachment was obtained by the 6[th] respondent, was filed only in the year 2022. In **Secretary, Keechery Service Co-operative Bank Ltd. v. Sajitha Nizar Alias Sajitha P.M. and Others (supra),** it was held: **-** ‘’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 `WP(C) NO. 14353 OF 2023` 6 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 encumbrance over the property effected after 27.6.2014, the date on which the property in question was mortgaged with Federal Bank. ## In **Madhan S v. Sub Registrar, Kollam and Others (supra)** , ## it was held:- ‘’The 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 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 confirmed in favour of the petitioner. 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 prejudicially affecting the marketability and title to the property even though they ceased to have any legal efficacy. The 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.’’ Therefore, applying the principles laid down in the judgments of this Court referred to above, I am of the view that the contention of the learned counsel appearing for the 6[th] respondent that the only remedy available to the petitioner is to seek lifting of the order of attachment by approaching the civil court, is only to be rejected. `WP(C) NO. 14353 OF 2023` 7 6. Therefore, the 1[st] respondent is directed to register the sale certificate issued by the ptetitioner without being affected in any manner by order of attachment obtained by the 6[th] respondent from the Subordinate Judge’s Court, Irinjalakkuda in O.S. No.110 of 2022. The 1[st] respondent shall also efface the details of such attachment on the record of encumbrance maintained by him. The Writ petition stands allowed on the aforesaid terms. Sd/- **GOPINATH P. JUDGE** ajt `WP(C) NO. 14353 OF 2023` 8 ## **`APPENDIX OF WP(C) 14353/2023`** ``` PETITIONER EXHIBITS ExhibitP1COPY OF THE ASSIGNMENT DEED NO 3966 OF 2006 DATED 26-9-2006 ExhibitP2COPY OF THE LETTER OF CONFIRMATION OF MORTGAGE DATED 21-1-2013 ExhibitP3COPY THE DEMAND NOTICE DATED 31-10-2019 ISSUED UNDER SECTION 13(2) OF THE SECURITISATION ACT ExhibitP4COPY OF THE SALE NOTICE DATED 20-5-2022 ISSUED BY THE PETITIONER ExhibitP5COPY OF THE SALE NOTICE BY PRIVATE TREATY DATED 6-12-2022 ISSUED BY THE PETITIONER ExhibitP6COPY OF THE SALE CERTIFICATE DATED 7-3-2023 ISSUED BY THE PETITIONER ExhibitP7COPY OF THE ENCUMBRANCE CERTIFICATE DATED 24-3-2023 ```