Sundaram Home Finance Ltd. v. State of Kerala and Others

# **`IN THE HIGH COURT OF KERALA AT ERNAKULAM`** ## **`PRESENT`** ``` THE HONOURABLE MR.JUSTICE VIJU ABRAHAM ``` ``` THURSDAY, THE 4[TH] DAY OF APRIL 2024 / 15TH CHAITHRA, 1946 WP(C) NO. 34372 OF 2023 ``` ## **`PETITIONER:`** ``` SUNDARAM HOME FINANCE LTD.,AGED 34 YEARS (FORMERLY KNOWN AS SUNDARAM BNP PARIBAS HOME FINANCE LTD) SUNDARAM TOWERS, 46, WHITES ROAD, CHENNAI, PIN-600014, REPRESENTED BY ITS AUTHORISED OFFICER, MR. ABU ROSHAN ANDREWS, S/O JOSHY CYRIAC, RESIDING AT CHUMAPPUNKAL HOUSE, KALPETTA NORTH, WAYANAD DISTRICT, PIN - 673121 ``` ``` BY ADVS. VARGHESE C.KURIAKOSE KURUVILLA MATHEW AMRITHA.J VIPIN C. VARGHESE ``` ## **`RESPONDENTS:`** |**`1`**|**`STATE OF KERALA`**| |---|---| ||**`REP. BY SECRETARY, DEPT. OF REVENUE,`**| ||**`SECRETARIAT, TRIVANDRUM-695001, PIN - 682031`**| |**`2`**|**`THE SUB REGISTRAR`**| ||**`SUB REGISTRY OFFICE, PERINTHALMANNA,`**| ||**`MALAPPURAM DISTRICT, PIN - 679322`**| |**`3`**|**`THE VILLAGE OFFICER`**| ||**`PATHAIKKARA VILLAGE OFFICE,`**| ||**`MALAPPURAM DISTRICT-, PIN - 679322`**| |**`4`**|**`SHANAVAS C.M., AGED 45 YEARS`**| ||**`S/O UMMER HAJI, CHOLAMUKHATHU HOUSE,`**| ||**`THAZHEKODE WEST P.O. PERINTHALMANNA,`**| ||**`THAZHEKODE MALAPPURAM, PIN - 679352`**| |**`5`**|**`MRS FATHMATH SUHARA M`**| ||**`W/O SHANAVAS C.M., CHOLAMUKHATHU HOUSE,`**| ||**`THAZHEKODE WEST P.O. PERINTHALMANNA,`**| WP(C) No.34372 of 2023 2 ## **`THAZHEKODE MALAPPURAM-, PIN - 679352`** ``` 6MOHAMMED ASHARAF, AGED 43 YEARS S/O RAYINKUTTY HAJI, CHETTIYAMPARAMBIL HOUSE, CHERIYAMUNDAM AMSOM, THALAKKADATHUR DESOM, REP. BY POWER OF ATTORNEY HOLDER NAZARATHZEEN, AGED 45, S/O MUHAMMEDKUTTY, CHETTIYAMPARAMBIL HOUSE, CHERIYAMUNDAM AMSOM, THALAKKADATHUR DESOM, TIRUR TALUK MALAPPURAM DISTRICT, PIN - 676106 ``` - **`7 MUHAMMED FAISAL BABU, AGED 36 YEARS S/O CHOLAMUKHATH SAYED, ELAMKULAM AMSOM, KIZHUNGATHOLE PERINTHALMANNA TALUK, MALAPPURAM, PIN - 679340`** ``` BY ADVS. ``` ``` M.U.VIJAYALAKSHMI ``` ``` K.RAKESH K.JAJU BABU (SR.)(K/116/1981) BRIJESH MOHAN(K/1851/1999) ``` ## **`OTHER PRESENT:`** ## **`GP - AJITH VISWANATHAN`** ``` THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 04.04.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ``` WP(C) No.34372 of 2023 3 ## **VIJU ABRAHAM, J.** **................................................................. W.P (C) No.34372 of 2023 .................................................................** Dated this the 4[th] day of April, 2024 ## **JUDGMENT** Petitioner has approached this Court seeking a direction to the 2[nd] respondent to forthwith facilitate registration of the sale certificate in relation to the properties covered by Exts.P1 to P3 notices and which is subject matter of Ext.P4 sale certificate without insisting for ROR certificate. 2. It is averred that the petitioner is a housing finance institution. Respondents 4 and 5 availed financial facility from the petitioner bank by executing a mortgage on 19.07.2012. Thereafter there was default in the payment of amount and SARFAESI proceedings were initiated and later on the property was put to sale and it was sold in the name of one Ummer K.T. as evident from Ext.P4 sale certificate. When Ext.P5 encumbrance certificate was obtained as part of the registration of the sale deed, it was revealed that there is an endorsement to the effect that attachments are effected in respect of the said property at the instance of respondents 6 and 7. Learned counsel for the petitioner would submit that a perusal of Ext.P5 would reveal that the attachment in respect of the 6[th] respondent is WP(C) No.34372 of 2023 4 dated 25.03.2013 whereas the attachment in respect of the 7[th] respondent is dated 25.02.2016, which is much after the mortgage was created in favour of the petitioner on 19.07.2012. The contention of the petitioner is that the said attachments which are subsequent to the mortgage cannot affect the sale conducted as per the provisions of the SARFAESI Act and the respondents are bound to register the sale deed. 3. Heard the learned counsel for the petitioner and the learned Government Pleader. 4. The learned counsel for the petitioner relied on the decision of this Court in **Madhan S. v. Sub Registrar, Kollam and Others [2014 (1) KHC 249]** and the decision of a Division Bench of this Court in **Secretary, Keechery Service Co-operative Bank Ltd. v. Sajitha Nizar alias Sajitha P.M. and Others, [2020 (5) KHC 231]** and contends that the attachment effected subsequent to the creation of equitable mortgage will not affect the right of the Bank to sell the mortgaged property and the attachment has to be effaced from the encumbrance register. 5. 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 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_ WP(C) No.34372 of 2023 5 _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.”_ 6. 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 of 2015)** has affirmed the law laid down in **Madhan** 's case. In **Keechery Service Co-operative Bank** 's 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.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 encumbrance over the property effected after 27/06/2014, the date on which the property in question was mortgaged with Federal Bank”._ WP(C) No.34372 of 2023 6 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 Bank under the SARFAESI Act and has to be effaced from the encumbrance register. It is evident from the documents produced in the writ petition that the attachment obtained by the sixth respondent is subsequent to the creation of equitable mortgage by the borrowers in favour of the petitioner. 7. This Court in **Phoenix ARC Pvt. Ltd. v. Sub Registrar, Feroke [2023 KHC Online 9452]** while considering an identical issue referring to Section 89(5) of the Registration Act, 1908 has held that since the attachment subsequent to creation of equitable mortgage has lost its efficacy and has to be obliterated from the records, the same can be done by the Sub Registrar by filing the certified copy of the order/judgment of this Court in Book No.1 maintained by the Sub Registrar. 8. As regards insistence for production of ROR certificate for the purpose of registration, in the light of the decision in **Jacob P.C. v. Village Officer, Ernakulam and another, 2020 (4) KLT 271** , ROR cannot be insisted for registration of documents. Accordingly, there will be a direction to the 2[nd] respondent to efface the attachment obtained by respondents 6 and 7 noted in Ext.P5 encumbrance certificate from book no.1 by filing the certified copy of this judgment in the said book and register Ext.P4 sale certificate if the same WP(C) No.34372 of 2023 7 is otherwise in order, without insisting for production of ROR certificate. The 3[rd] respondent shall thereafter effect mutation of the said property de hors the said attachments, if there are no other impediments. With the abovesaid directions the writ petition is disposed of. **Sd/-** **VIJU ABRAHAM JUDGE** cks WP(C) No.34372 of 2023 8 ## **`APPENDIX OF WP(C) 34372/2023`** ## **`PETITIONER EXHIBITS`** ``` Exhibit P1TRUE PHOTOSTAT COPY OF THE 13 (2) NOTICE DATED 01.11.2013 ISSUED BY THE PETITIONER Exhibit P2TRUE PHOTOSTAT COPY OF THE POSSESSION NOTICE DATED 04.09.2021 ISSUED BY THE PETITIONER Exhibit P3TRUE PHOTOSTAT COPY OF THE SALE NOTICE DATED 28.07.2023 ISSUED BY THE PETITIONER ``` - **`Exhibit P4 TRUE PHOTOSTAT COPY OF THE SALE CERTIFICATE DATED 13.09.2023 IN FAVOUR OF THE PURCHASER UMMER K.`** - **`Exhibit P5 TRUE PHOTOSTAT COPY OF THE ENCUMBRANCE CERTIFICATE DATED 31.07.2023 OF PERINTHALMANNA SUB REGISTRY`** - **`Exhibit P6 TRUE PHOTOSTAT COPY OF THE REPRESENTATION SUBMITTED BY THE PETITIONER BEFORE RESPONDENTS NO.2 AND 3 DATED 18.09.2023`** - **`Exhibit P7 TRUE PHOTOSTAT COPY OF THE INDIA POST TRACK RECORD INDICATING DELIVERY ON THE 2ND RESPONDENT DATED 20.09.2022`** - **`Exhibit P8 TRUE PHOTOSTAT COPY OF INDIA POST TRACK RECORD INDICATING DELIVERY ON THE 3 RD RESPONDENT DATED 21.09.2022`** - **`Exhibit P9 TRUE PHOTOSTAT COPY OF THE SPECIFIC REQUEST DATED 18.09.2022 GIVEN TO 2ND RESPONDENT FOR ERASING THE ATTACHMENT`** ``` Exhibit P10TRUE PHOTOSTAT COPY OF THE INDIA POST TRACK RECORD INDICATING DELIVERY ON THE 2ND DATED 20.09.2022 Exhibit P11TRUE PHOTOSTAT COPY OF THE LOAN ``` WP(C) No.34372 of 2023 9 ``` AGREEMENT DATED 25.07.2012 ISSUED BY THE PETITIONER TO 4 TH AND 5 TH RESPONDENT ``` ## **`Exhibit P12`** ``` TRUE PHOTOSTAT COPY OF THE LETTER CONFORMING DEPOSIT OF TITLE DEEDS SUBMITTED BY SHANAVAS AND SMT.FATHMATH SUHARA.M ``` ## **`RESPONDENT EXHIBITS`** ``` Exhibit R6(a)Copy of the IA.No. 790/2013 in OS.No.85/2013filedbeforethe Subordinate Judge's Court, Thirur on 16.03.2013 Exhibit R6(b)Copy of the order sheet in IA.No. 790/2013 in OS.No.85/2013 of the Subordinate Judge's Court, Thirur Exhibit R6(c)Copy of the counter affidavit filed in I.A.No.790/2013 in OS.No.85/2013 before the Thirur Sub Court Exhibit R6(d)Copy of the judgment dated 12.07.2023 in OS.NO.85 of 2013 passed the Subordinate Judge's Court, Thirur Exhibit R6(e)Copy of the decree dated 12.07.2023 in OS.NO.85 of 2013 passed the Subordinate Judge's Court, Thirur ```