The CSB Bank Ltd. (formerly Catholic Syrian Bank Ltd) v Sub Registrar, Chengamanad; Village Officer, Karimalur Village; M/S Real Tech; Jaison Devassy; Devassy K.P; Anandhu Sunil; S.M.L Finance Limited

# **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MR. JUSTICE DEVAN RAMACHANDRAN FRIDAY, THE 10[TH] DAY OF DECEMBER 2021 / 19TH AGRAHAYANA, 1943** ## **WP(C) NO. 27847 OF 2021** ## **PETITIONER:** THE CSB BANK LTD.(FORMERLY KNOWN AS CATHOLIC SYRIAN BANK LTD), THRIKKAKARA BRANCH, ERNAKULAM, KERALA, REPRESENTED BY ITS AUTHORISED OFFICER, ASSET RECOVERY BRANCH, ERNAKULAM 682 021. BY ADVS. MADHU RADHAKRISHNAN NELSON JOSEPH DEEPAK ASHOK KUMAR M.D.JOSEPH ## **RESPONDENTS:** 1 THE SUB REGISTRAR, CHENGAMENAD, ERNAKULAM 682 011. 2 THE VILLAGE OFFICER, KARIMALUR VILLAGE, ERNAKULAM, PIN 683 102. 3 M/S. REAL TECH, MALIKAPEEDIKA, PARAVUR ROAD, ALEGAD, ALUVA 683 511, THROUGH ITS PROPRIETOR SRI. JAISON DEVASSY. 4 JAISON DEVASSY, S/O. DEVASSY, KIZHAKKUMTHALA HOUSE, VELIYATHUNAD KARA, U.C. COLLEGE P.O, ALUVA 683 102. 5 DEVASSY K.P, S/O. POULOSE, KIZHAKKUMTHALA HOUSE, VELIYATHUNAD KARA, U.C. COLLEGE P.O, ALUVA-683 102 6 ANANDHU SUNIL, MANALEL HOUSE, THOTTAKKATUKARA P.O, ALUVA, ERNAKULAM DISTRICT-683 108. **2** ## **WP(C) NO. 27847 OF 2021** 7 S.M.L FINANCE LIMITED, TOLL JUNCTION, POOKKATTUPADY ROAD, EDAPPALLY, KOCHI AND HAVING BRANCH OFFICE AT MANNAM, NORTH PARAVUR REPRESENTED BY ITS BRANCH MANAGER. ## **OTHER PRESENT:** SMT.K.AMMINIKUTTY .SR.G.P. THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 10.12.2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: **WP(C) NO. 27847 OF 2021** **3** ## **JUDGMENT** The petitioner is stated to be a banking company registered under the Companies Act, 1956, and has approached this Court seeking a direction to the 1[st] respondent – Sub Registrar to register Ext.P6 Sale Certificate, which they have executed in favour of the petitioner, who is the Auction Purchaser of a property sold by them under the provisions of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI ACT for short), within a time frame to be fixed by this Court. 2. Sri.Madhu Radhakrishnan – learned counsel for the petitioner, explained that the property in question was equitably mortgaged in favour of his client by respondents 4 and 5, as collateral security to a loan facility availed of by the 3[rd] respondent, as early as on 10/11/2014. He added that, however, since the borrowers did not service the loan facility properly and since it became a Non Performing Asset, his client was forced to take possession of the same on 25/09/2019, under the provisions of the SARFAESI ACT and to **WP(C) NO. 27847 OF 2021** **4** thereafter sell it on 20/10/2021, after complying with all statutory requirements. He then showed me that as is evident from Ext.P3 Encumbrance Certificate, an attachment over the property in question appears has been obtained by the 7[th] respondent only on 24/07/2015; and that it is now well settled, through a catena of judgments of this Court and that of the Honourable Supreme Court, his client will obtain first charge over the property in question on account of the equitable mortgage which they obtained much prior to the date of attachment obtained by the 7[th] respondent. He alleged that the Sub Registrar is, however, refusing to register the Ext.P6 Sale Certificate merely citing the pendency of the attachment obtained by the 7[th] respondent. 3. Smt.Rekha K.B. – learned counsel appearing for the 7[th] respondent, in response, pleaded that the request of the petitioner in this writ petition may not be acceded to because the 4[th] respondent had borrowed large amounts of money from her client and that they have no other remedy against him, except proceeding against the property in question. She **WP(C) NO. 27847 OF 2021** **5** then impressed me that her client had granted the loan to the 4[th] respondent on the strength of the property in question, without being aware that a mortgage had been created by him over it in favour of the petitioner. She, therefore, prayed that this writ petition be dismissed. 4. Smt.K.Amminikutty – learned Senior Government Pleader appearing for respondents 1 and 2, submitted that the first respondent has been incapacitated from registering Ext.P6 Sale Certificate because he noticed the pendency of an order of attachment from a competent Court over the property covered by it. She, however, submitted that, if this Court is so inclined, the 1[st] respondent will register the document without any further delay. 5. When I evaluate the afore submissions, it is now well settled – without requirement of any restatement - that when the petitioner sold the property under the SARFAESI Act on the strength of a prior equitable mortgage extended in their favour by the 3[rd] respondent, the 7[th] respondent, cannot object to the same or impede such action relying upon the **WP(C) NO. 27847 OF 2021** **6** order of attachment obtained by them over it subsequently. Obviously, therefore, the 7th respondent cannot stand against the petitioner from registering Ext.P6 Sale Certificate in favour of the auction purchaser. Resultantly, I order this writ petition and direct the 1[st] respondent to register Ext.P6 Sale Certificate as and when it is produced by the petitioner or by the 6[th] respondent, as the case may be; and to thereafter efface the entries of attachment on the property, which are subsequent to the date of mortgage in favour of the petitioner, in terms of the judgment of this Court in _**Secretary, Keechery Service Cooperative Bank Ltd., v. Sajitha Nizar Alias Sajitha P.M. (2020 (6) KLT 68).**_ Needless to say, the 7[th] respondent will have full liberty to proceed against the 4[th] respondent in any manner that they may chose and also to seek any surplus of the sale price, which may be available with the petitioner - Bank after closure of the loan account; for which purpose, all their contentions and remedies are left open, to be pursued appropriately in **WP(C) NO. 27847 OF 2021** **7** future. It goes without saying that after the Sale Certificate is registered by the Sub Registrar, the 6[th] respondent - purchaser will be at liberty to approach the Tahsildar and the Village Officer, for transfer of Registry of the property in his favour and for remittance of land tax thereon, which shall be acceded to without any avoidable delay. ## **Sd/-** **DEVAN RAMACHANDRAN JUDGE** ANB **8** ## **WP(C) NO. 27847 OF 2021** ## **APPENDIX OF WP(C) 27847/2021** PETITIONER EXHIBITS - Exhibit P1 TRUE COPY OF THE HOUSE LOAN SANCTION LETTER DATED 10.11.2014 ISSUED BY THE PETITIONER TO THE 3RD RESPONDENT. - Exhibit P2 TRUE COPY OF THE LETTER OF CONFIRMATION OF DEPOSIT OF TITLE DEEDS BY THE 5TH RESPONDENT DATED 10.11.2014 - Exhibit P3 THE COPY OF THE ENCUMBRANCE CERTIFICATE NO. 14446/19 DATED 24.12.2019 ISSUED BY THE 1ST RESPONDENT. - Exhibit P4 TRUE COPY OF THE SALE NOTICE DATED 10.09.2021 ISSUED BY THE PETITIONER. - Exhibit P5 THE TRUE COPY OF THE LETTER DATED 20.10.2021 ISSUED BY THE PETITIONER TO THE 6TH RESPONDENT. - Exhibit P6 TRUE COPY OF THE SALE CERTIFICATE DATED 18.11.2021 ISSUED BY THE PETITIONER. - Exhibit P7 THE TRUE COPY OF THE JUDGMENT IN W.P.C 16745/2018 DATED 10.12.2018 PASSED BY THIS HON'BLE COURT. Exhibit P8 TRUE COPY OF THE JUDGMENT PASSED BY THIS HON'BLE COURT IN WPC NO. 3956/2019 DATED 11.2.2019. - Exhibit P9 THE TRUE COPY OF THE JUDGMENT IN W.P.C NO. 27827/2020 DATED 21.01.2021.