High Court of KeralaSingle Judge2023-10-30Disposed of with directions; attachments to be ...

The Kodungallur Town Co-operative Bank Limited v. Sub Registrar Mala Sub Registry, Mala; Tahsildar Kodungallur Taluk; Village Officer Poyya Village Office; and Others

Case / Petition Number:WP(C) No.41502/2022

Case Details & Bench

Court: High Court of Kerala
Hon'ble Judges: N. Nagareesh
Judgment Date: 2023-10-30
Court Decision / Holding: The writ petition is disposed of directing respondents 1 to 3 to efface the attachment noted in the records of the SRO, Mala after creation of Ext.P2 and to mutate the revenue records in Ext.P4 in the name of the petitioner. Ext.P7 communication is quashed. The 4th respondent may pursue its rights, if any, through civil proceedings.
Final Disposition: Disposed of with directions; attachments to be effaced and revenue records mutated in the petitioner-bank’s name; Ext.P7 quashed; 4th respondent’s rights reserved through civil proceedings.

Parties to the Case

Appellants / Petitioners

The Kodungallur Town Co-operative Bank Limited

Respondents

Sub Registrar Mala Sub Registry, Mala, Vadama, Thrust district
Tahsildar Kodungallur Taluk, Kodungallur, Thrissur
Village Officer Poyya Village Office, Poyya, Thrissur District
Addl. R4 Joy.P.A. Pathiyam Parambil House, Annalloor, Thrissur District

Legal Representation & Advocates

Counsels for Petitioners

• V.M. Krishnakumar
• Maya M.

Counsels for Respondents

• M.R. Reena
• P.A. Roy
• P.S. Sujeth
• Reshmi Thomas, Government Pleader

Case Synopsis & Summary

The Kodungallur Town Co-operative Bank Limited seeks to quash Ext.P1 and direct the 3rd respondent Village Officer to effect mutation in revenue records of properties covered by Ext.P4 in the petitioner-bank’s name, and to erase the attachment noted in the records of the Sub Registrar, Mala, after creation of Ext.P2. The Bank advanced a ₹2 crore mortgage to Sajitha Ayoob, created by depositing title deeds over two properties (Gahan No. G215/2019, Mala and G386/2019, Kodungallur) on 11.02.2019. After default, SARFAESI proceedings were initiated; the Chief Judicial Magistrate, Thrissur, passed Ext.P3 under Section 14 on 01.06.2022, and the property was auctioned for ₹63 lakhs when no bidders emerged. The Bank obtained Ext.P5 Encumbrance Certificate and applied for Transfer of Registry. The 3rd respondent informed that there is an attachment over the property by the Munsiff’s Court, Chalakkudy in OS No.460/2023, preventing mutation until the court lifts it. The Bank contends that attachments created after the mortgage cannot defeat the Bank’s rights under SARFAESI, citing Housing Development Finance Corporation v. Sub Registry Officer (2011 KHC 851), Madhan S. v. Sub Registrar (2014 (1) KHC 249), and Ali Ashraf M.M. v. Sub Registrar (WA No.612/2015). The Court ultimately directs the 1st–3rd respondents to efface the post-mortgage attachment and to effect mutation in the revenue records in the Bank’s name, quashes Ext.P7, and preserves the 4th respondent’s rights through civil proceedings.

Provisions of Law Cited

Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002Section 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002

Submissions & Arguments

Contentions of Appellants / Petitioners

The petitioner-bank submits that the mortgage created by deposit of title deeds on 11.02.2019 over two properties (Gahan No. G215/2019, SRO Mala and G386/2019, SRO Kodungallur) in favour of the bank confers rights to proceed under SARFAESI. Even though an attachment was ordered later by a Civil Court, the rights under the mortgage cannot be defeated. Cites Housing Development Finance Corporation v. Sub Registry Officer (2011 KHC 851), Madhan S. v. Sub Registrar (2014 (1) KHC 249), and Ali Ashraf M.M. v. Sub Registrar (WA No.612/2015) to urge effacement of the attachment and mutation in revenue records in the bank’s name; prays for quashing Ext.P7 and directing mutation in Ext.P4 properties. Ext.P2 creation date is emphasized, and the encumbrance Ext.P5 evidence of mortgage is highlighted.

Contentions of Respondents

The respondents contended that the attached property cannot be altered in revenue records until the court lifts the attachment; revenue entries are governed by the Civil Court attachment and the procedure under SARFAESI cannot override such attachive orders. The Government Pleader supports the procedural posture that the attachment must be addressed by the proper authorities and that mutation cannot be effected while attachment subsists. The court’s final order disposes of the petition with directions to erase the attachment and mutate in the bank’s name, while acknowledging the 4th respondent’s rights in civil proceedings.

Cited Precedents (4)

Case Name	Citation	Treatment	Explanation
Housing Development Finance Corporation and another v. Sub Registry Officer and others	2011 KHC 851	Positive	Cited as authority supporting that rights under mortgage and SARFAESI proceedings cannot be defeated by post-mortgage attachments.
Madhan S. v. Sub Registrar, Kollam and others	2014 (1) KHC 249	Positive	Held that attachments after creation of equitable mortgage can be effaced after subsequent sale under DRlimits, supporting erasure of post-mortgage attachments.
Ali Ashraf M.M. and another v. Sub Registrar, Thrissur	WA No.612/2015	Positive	Division Bench held that attachments post-dating mortgage are invalid; supports petition’s stance on effacement.
Judgment in WA No. 634/2020	WA No. 634/2020	Mentioned Only	Exhibit P1; cited as evidence but not discussed or treated as binding precedent within the judgment.

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Extracted Judgment Text

Exact text extracted from official judgment records.

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MR.JUSTICE N.NAGARESH** **MONDAY, THE 30[TH] DAY OF OCTOBER 2023 / 8TH KARTHIKA, 1945** **WP(C) NO. 41502 OF 2022** ## **PETITIONER:** **THE KODUNGALLUR TOWN CO-OPERATIVE BANK LTD.NO.102, KODUNGALLUR, THRISSUR DISTRICT, PIN – 680 664 REPRESENTED BY GENERAL MANAGER/AUTHORISED OFFICER, SANAL CHACKO, S/O CHACKOCHAN, AGED 37 YEARS** **BY ADVS.** **V.M.KRISHNAKUMAR MAYA M.** ## **RESPONDENTS:** - **1 THE SUB REGISTRAR MALA SUB REGISTRY, VADAMA-KUNNATHUNAD ROAD, MALA, VADAMA, THRISSUR DISTRICT, PIN – 680 732.** - **2 TAHSILDAR KODUNGALLUR TALUK, TALUK OFFICE, KODUNGALLUR, THRISSUR, PIN – 680 664.** - **3 THE VILLAGE OFFICER POYYA VILLAGE OFFICE, POYYA. P.O, THRISSUR DISTRICT, PIN – 680 733** - **ADDL. R4 JOY.P.A.** **PATHIYAM PARAMBIL HOUSE, ANNALLOOR .P.O., THRISSURE DISTRICT, PIN-680 731.** **[ADDL. R4 IS IMPLEADED AS PER ORDER DATED 08.03.2023 IN IA.1/2023 IN WP(C)No.41502/2022]** W.P.(C) No.41502/2022 : 2 : **BY ADVS.** **M.R.REENA P.A.ROY(R-714) P.S.SUJETH(KAR/662/1999) RESHMI THOMAS, GOVERNMENT PLEADER** **THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 30.10.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** W.P.(C) No.41502/2022 : 3 : ## **N. NAGARESH, J.** ````````````````````````````````````````````````````````````` ## W.P.(C) No.41502 of 2022 ````````````````````````````````````````````````````````````` _Dated this the 30[th] day of October, 2023_ ## **J U D G M E N T** ~ ~ ~ ~ ~ ~ ~ ~ ~ The Kodungallur Town Co-operative Bank Limited is the writ petitioner. The petitioner seeks to quash Ext.P1 and to command the 3[rd] respondent-Village Officer to effect mutation in the revenue records of the properties covered by Ext.P4 in the name of the petitioner. The petitioner also seeks to direct the respondents to efface the attachment noted in the records of the Sub Registrar Office, Mala after creation of Ext.P2. 2. The petitioner states that the Bank had granted a mortgage loan to Smt. Sajitha Ayoob for an amount of ₹2 Crores. The loan was sanctioned after creation of a mortgage by deposit of title deeds of two different properties W.P.(C) No.41502/2022 : 4 : by Gahan No.G215/2019 dated 11.02.2019 of SRO, Mala and No.G386/2019 dated 11.02.2019 of SRO, Kodungallur. 3. When repayment of loan was defaulted, the Bank initiated proceedings under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 and the Chief Judicial Magistrate's Court, Thrissur passed Ext.P3 order dated 01.06.2022 invoking Section 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. As there were no bidders to purchase the property, the Branch Manager of the petitionerBank took the property in auction for ₹63 lakhs. 4. Thereafter, the petitioner obtained Ext.P5 Encumbrance Certificate and submitted application for Transfer of Registry. However, the 3[rd] respondent-Village Officer informed that since there is an attachment over the property made by the Munsiff's Court, Chalakkudy in OS No.460/2023, the entries in the revenue records cannot be changed, without lifting the attachment by the court. W.P.(C) No.41502/2022 : 5 : 5. The petitioner submits that attachment was effected subsequent to the mortgage of the property in favour of the petitioner-Bank. The petitioner pointed out that this Court has held in the judgment in _**Housing Development Finance Corporation and another v. Sub Registry Officer**_ _**and others** [2011 KHC 851]_ that the rights and liabilities conferred on the creditor bank by virtue of mortgage created in the year 2021 and the right to proceed under the Securitisation Act cannot be defeated because of subsequent attachment ordered by civil courts. The petitioner therefore urged that the 1[st] respondent is compellable to efface the attachment noted in the records of the Sub Registrar Office, Mala. 6. I have heard the learned counsel for the petitioner, the learned Government Pleader representing respondents 1 to 3 and the learned counsel appearing for the additional 4[th] respondent. 7. It is evident from Ext.P2 that the mortgage of the secured assets was created in favour of the petitioner-Bank W.P.(C) No.41502/2022 : 6 : on 11.02.2019. The attachment was effected subsequently on 02.07.2022. This Court in the judgment in _**Madhan S. v. Sub Registrar, Kollam and others** [2014 (1) KHC 249]_ has held that attachments effected subsequent to creation of equitable mortgage can be effaced after the property is purchased by another in sale conducted by the Recovery Officer of the Debts Recovery Tribunal. In Ali Ashraf M.M. and another v. Sub Registrar, Thrissur [WA No.612/2015), a Division Bench of this Court held that attachment of property involved therein was subsequent to the date of mortgage and hence the attachments effected by the Munsiff's Court, after the date of mortgage, are invalid. The writ petition is therefore disposed of directing respondents 1 to 3 to efface the attachment noted in the records of the SRO, Mala after creation of Ext.P2. There will be a further direction to the 3[rd] respondent to effect mutation in the revenue records of the properties covered by Ext.P4 in the name of the petitioner. Ext.P7 communication is quashed. It is made clear that the additional 4[th] respondent W.P.(C) No.41502/2022 : 7 : will be at liberty to claim his rights, if any, through civil proceedings. Sd/- **N. NAGARESH, JUDGE** aks W.P.(C) No.41502/2022 : 8 : ## **APPENDIX OF WP(C) 41502/2022** **PETITIONER'S EXHIBITS** **Exhibit P1 TRUE COPY OF JUDGMENT IN WA.NO.634/2020 DATED 04.06.2020.** **Exhibit P2 TRUE COPY OF GAHAN REG.NO.215/2019, DATED 11.02.2019 OF SRO MALA.** **Exhibit P3** **TRUE COPY OF THE ORDER OF THE CHIEF JUDICIAL MAGISTRATE COURT THRISSUR IN CRL.M.P.NO.2024/2022 DATED 01.06.2022.** **Exhibit P4** **TRUE COPY OF SALE CERTIFICATE DATED 21.02.2022.** **Exhibit P5** **TRUE COPY OF THE ENCUMBRANCE CERTIFICATE DATED 02.07.2022 ISSUED BY THE 1ST RESPONDENT IN RESPECT OF THE SECURED ASSET.** **Exhibit P6** **TRUE COPY OF THE REPRESENTATION SUBMITTED BY THE PETITIONER DATED 15.06.2022.** **Exhibit P7** **TRUE COPY OF THE LETTER OF THE 3RD RESPONDENT DATED 05.07.2022.**