The South Indian Bank Ltd. DRT Cell, Ernakulam v Sub Registrar, Office of the Sub Registrar, Edappally; Village Officer, Thrikkakkara North; Vinayakumar; Reji M. Poulose

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MR.JUSTICE MURALI PURUSHOTHAMAN** **MONDAY, THE 11[TH] DAY OF DECEMBER 2023 / 20TH AGRAHAYANA, 1945** ## **WP(C) NO. 24986 OF 2023** ## **PETITIONER:** **THE SOUTH INDIAN BANK LTD. DRT CELL, 2ND FLOOR, SIB BUILDING, MARKET ROAD ERNAKULAM, PIN – 682 011 REPRESENTED BY THE CHIEF MANAGER/AUTHORISED OFFICER. BY ADVS. MOHAN JACOB GEORGE P.V.PARVATHY REENA THOMAS NIGI GEORGE** ## **RESPONDENTS:** |**1**|**SUB REGISTRAR**| |---|---| ||**OFFICE OF THE SUB REGISTRAR,**| ||**EDAPPALLY,**| ||**PONEKKARA, ERNAKULAM,**| ||**KERALA,**| ||**PIN – 682 024.**| |**2**|**VILLAGE OFFICER**| ||**VILLAGE OFFICE, THRIKKAKKARA NORTH,**| ||**ERNAKULAM, PIN – 682 024.**| |**3**|**MR.VINAYAKUMAR**| ||**S/O. MR.T B RAJAPPAN,**| ||**VINOD BHAVAN,**| ||**PERUMBAVOOR, OKKAL P O.,**| ||**CHELAMATTOM,**| ||**CHELAMATTOM,**| ||**PIN – 683 550.**| |**4**|**REJI M. POULOSE**| ||**S/O. POULOSE, 10-C, ASSET CITY BAY,**| ||**CHATHARI, TRIPUNITHURA – 682 301**| ||**ALSO AT 618 MALAYIL HOUSE,**| ||**THIRUVAMKULAM,**| ||**PIN – 682 305.**| **W.P (C) No.24986 of 2023 2** **5 MRS.AJITHA REJI W/O. MR.REJI.M.POULOSE, 10-C, ASSET CITY BAY, CHATHARI, TRIPUNITHURA – 682 301 ALSO AT 618 MALAYIL HOUSE, THIRUVAMKULAM, PIN – 682 305. 6 MR.FASIL THAMBIKUDY ABBAS MANAKKAT HOUSE, HMT COLONY P.O., KALAMASSERY, PIN – 683 503. BY ADVS. SMT. PREETHA K.K - GP R3 - SRI. ABRAHAM P.GEORGE M.SANTHY JOHNY THOMAS M.B.RATHEESH SANDRA K. SANJAY AKASH PHILIP ELSA JACOB** **THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON** **11.12.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** **W.P (C) No.24986 of 2023** **3** ## **JUDGMENT** The petitioner Bank (hereinafter referred to as 'Bank' for short) has filed this writ petition for a direction to the 1[st] respondent Sub Registrar, to delete the entry of attachment in the encumbrance register in respect of its secured asset. 2. The respondents 4 and 5 (hereinafter referred to as 'borrowers' for short) availed financial facilities from the Bank by creating an equitable mortgage by deposit of title deeds on 13.12.2010, in respect of the property having an extent of 6.47 Ares in Re.Sy. No.677/4 of Block No. 5 (old Sy.No.753/2/7/9 and 753/2/8) along with residential building having area of 1200 sq. ft bearing Door No.1/1994 of Thrikkakkara North Village, Kanayannoor Taluk, Ernakulam. When borrowers defaulted repayment of loan amounts, the Bank initiated proceedings against them **W.P (C) No.24986 of 2023** **4** under the provisions of the SARFAESI Act, and the property was sold in auction in favor of the 6[th] respondent. Ext.P6 is the sale certificate dated 21.03.2023. The Bank has also approached the Debts Recovery Tribunal for realisation of balance amounts due to it from the borrowers after the sale. 3. The 3[rd] respondent has obtained an attachment in I.A. No.5510/2015 in Arbitration O.P. No.1062/2015 on the files of the Court of District Judge - III, Ernakulam in respect of the aforesaid mortgaged property as evident from Ext.P7 encumbrance certificate. Ext.P7 shows that the said attachment is obtained by 3[rd] respondent subsequent to the creation of the equitable mortgage by the borrowers in favour of the petitioner. The petitioner contends that the attachment at the instance of the 3[rd] respondent cannot affect the right of the petitioner to sell the property under the provisions of the SARFAESI Act. According to them, the attachment obtained by the 3[rd] respondent is not an **W.P (C) No.24986 of 2023** **5** encumbrance on the property. The learned counsel for the petitioner contends that the borrower has lost the right to redeem the property as per the provisions of the SARFAESI Act. 4. Heard Sri.Mohan Jacob George, the learned counsel for the petitioner, Smt.Preeta K.K, the learned Government Pleader and Sri.Abraham P.George, the learned counsel for the 3[rd] respondent. 5. Sri.Mohan relied on 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,** _**v**_ **Keechery 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 **W.P (C) No.24986 of 2023** **6** affect the right of the Bank to sell the mortgaged property and the attachment has to be effaced from the encumbrance register. 6. 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 effect or fall to the ground the moment the sale is petitioner. The confirmed in favour of the declaration_ **W.P (C) No.24986 of 2023** **7** _so sought by the petitioner is therefore granted and I further direct the SubRegistrar 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 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.”_ 7. 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 **W.P (C) No.24986 of 2023** **8** 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 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_ **W.P (C) No.24986 of 2023** **9** _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 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 3[rd] respondent is subsequent to the creation of equitable mortgage by the borrowers in favour of the petitioner. 8. Accordingly, there will be a direction to the 1[st] respondent to efface the attachment obtained by the 3[rd] respondent noted in Ext.P7 encumbrance certificate from the concerned Register and register Ext.P6 sale certificate if the same is otherwise in order. The 2[nd] respondent shall **W.P (C) No.24986 of 2023** **10** thereafter effect mutation of the said property _de hors_ the aforesaid attachments, if there are no other impediments. The writ petition is disposed of. **Sd/-** **MURALI PURUSHOTHAMAN JUDGE** SPR **W.P (C) No.24986 of 2023** **11** ## **APPENDIX** ## **' - PETITIONER S EXHIBITS:** **EXHIBIT P1 TRUE COPY OF THE SECTION 13(2) NOTICE DATED 11.06.2013 ISSUED BY THE PETITIONER THROUGH ITS AUTHORIZED OFFICER. EXHIBIT P2 TRUE COPY OF THE LETTER DATED 14-12-2010 OF THE MORTGAGOR CONFIRMING THE DEPOSIT OF THE ORIGINAL TITLE DEED CREATING EQUITABLE MORTGAGE IN FAVOUR OF THE PETITIONER BANK. EXHIBIT P3 TRUE COPY OF THE POSSESSION NOTICE DATED 13-112013 ISSUED IN RESPECT OF THE SECURITY PROPERTY. EXHIBIT P4 TRUE COPY OF THE RELEVANT PORTION OF THE PAPER PUBLICATIONS MADE ON 17-11-2013 IN ENGLISH DAILY "NEW SUNDAY EXPRESS", ERNAKULAM EDITION. EXHIBIT P4(a) TRUE COPY OF THE PAPER PUBLICATION MADE ON 17.11.2013 IN THE VERNACULAR MALAYALAM DAILY "MANGALAM" DATED ERNAKULAM EDITION. EXHIBIT P5 COPY OF THE TENDER CUM AUCTION SALE NOTICE ISSUED BY THE AUTHORIZED OFFICER DATED 10.02.2023. EXHIBIT P6 COPY OF THE SALE CERTIFICATE DATED 21-03-2023. EXHIBIT P7 TRUE COPY OF THE ENCUMBRANCE CERTIFICATE DATED 17.01.2023 OBTAINED FROM EDAPPALLY SRO.** **RESPONDENTS EXHIBITS: NIL.**