The South Indian Bank Ltd. v. Sub Registrar, Valapattanam, Kannur; Mansoor Ibrahim Mulavvalappil Zuhra Manzil; Muhammed Shafeeq Moonlight Manzil; Moosakunji Bin Abdul Khader Kavungal House; State Bank of India Retail Assets, Small and Medium Enterprises Credit Centre (RASMECC) Branch, Kannur

# **`IN THE HIGH COURT OF KERALA AT ERNAKULAM`** ## **`PRESENT`** ## **`THE HONOURABLE MR.JUSTICE MURALI PURUSHOTHAMAN`** ``` FRIDAY, THE 17[TH] DAY OF NOVEMBER 2023/26TH KARTHIKA, 1945 WP(C) NO. 12498 OF 2023 ``` ## **`PETITIONER:`** ``` THE SOUTH INDIAN BANK LTD. REGIONAL OFFICE, KANNUR, KVR TOWER, PAMPAN MADHAVAN ROAD, TALAP, KANNUR – 670 002 REPRESENTED BY CHIEF MANAGER, DRT CELL, ERNAKULAM, MRS. JILU HANNAH EAPEN, PIN – 670 002. ``` ``` BY ADVS. SUNIL SHANKER VIDYA GANGADHARAN SANDHRA.S ``` ## **`RESPONDENTS:`** - **`1 THE SUB REGISTRAR THE SUB REGISTRAR'S OFFICE, VALAPATTANAM, KANNUR, PIN – 670 010.`** - **`2 MANSOOR IBRAHIM MULAVALAPPIL ZUHRA MANZIL, KANNDIPARAMBA, NARATH P. O., KANNUR, PIN – 670 601.`** - **`3 MUHAMMED SHAFEEQ MOONLIGHT MANZIL, THURUTHI, CHERUVATHUR, KASARGOD, PIN – 671 313.`** - **`4 MOOSAKUNJI BIN ABDUL KHADER KAVUNGAL HOUSE, PATTUVAM, THALIPARAMBU, KANNUR, PIN – 670 143.`** - **`5 STATE BANK OF INDIA RETAIL ASSETS, SMALL AND MEDIUM ENTERPRISES CREDIT CENTRE (RASMECC) BRANCH, SBI COMPOUND, KANNUR, REPRESENTED BY ITS MANAGER, PIN – 670 001.`** ``` WP(C).No.12498 OF 2023 ``` ``` 2 ``` ``` 6PRABHAKARAN K. KARUVATH PUTHENPURAYIL, CHUNGAM, P.O, KANNUR, PIN – 686 001. *ADDL.SHUKKOOR MOHAMMED IBRAHIM R7AGED 54 YEARS, S/O. LATE IBRAHIM, PAUSIYA MANZIL MALOT, KANNADIPARAMBA P.O., KANNUR – 670 604 ``` ``` *IS IMPLEADED VIDE ORDER DATED 27-06-2023 IN IA 1/2023 IN WPC 12498/2023. ``` ``` BY ADVS. SREEJITH C. K SRI. MANOJ G.G - SC K.N.ABHILASH S.SARATH PRASAD ARDRA P. SUNIL NAIR PALAKKAT RITHIK S.ANAND BABU THOMAS (PAZHAYATHOTTATHIL) ANU PAUL SREELAKSHMI MENON P. RISHI VARMA T.R. SRI. BIMAL K. NATH – SR. GP ``` ``` THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 17.11.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ``` ``` WP(C).No.12498 OF 2023 ``` ``` 3 ``` ## **`JUDGMENT`** The petitioner, a scheduled Bank has approached this Court for direction to efface the attachments effected pursuant to Exts.P6 to P9 from the Encumbrance Register maintained by the 1[st] respondent, the Sub Registrar, Valapattanam, Kannur. 2. One Mrs.Jasmi.P, availed KCC loan of Rs.1.35 Crores from the petitioner Bank after creating an equitable mortgage by deposit of title deed of the property admeasuring an extent of 4.05 Ares situated in old Sy. No.300, Re-Sy No.33/9, Chirakkal Village, Kannur District together with commercial building thereon belonging to the 2[nd] respondent. The equitable mortgage was created on 25.10.2016. The borrower defaulted repayment of loan amount and ``` WP(C).No.12498 OF 2023 ``` ``` 4 ``` proceedings under the SARFAESI Act was initiated against the mortgaged property. The property was sold in auction and the auction purchaser has paid the entire sale consideration and Ext.P4 sale certificate was issued on 27.02.2023. Though Ext.P4 sale certificate was presented for registration before the 1[st] respondent, the 1[st] respondent refused to register the same on the ground that there are attachments effected in the property as per Exts.P6 to P9. Accordingly, the petitioner has filed this writ petition for direction to the 1[st] respondent to efface the attachments (Exts.P6, P7, P8 and P9) detailed in Ext.P5 Encumbrance Certificate and to register Ext.P4 Sale Certificate. 3. The learned counsel for the petitioner contends that the right of redemption of the borrower has been extinguished by the operation of Section 13(8) of the SARFAESI Act and that evenafter the sale, ``` WP(C).No.12498 OF 2023 ``` ``` 5 ``` further amounts are due to the petitioner and that there is no surplus available for the attachment holders. 4. Heard the learned counsel for the petitioner, the learned Standing Counsel and the learned Government Pleader. 5. 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: 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, Keechery Service Co operative Bank Ltd. v.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 affect the right of the Bank to sell the mortgaged property and the 2[nd] respondent ``` WP(C).No.12498 OF 2023 ``` ``` 6 ``` Village Officer has to efface the attachment from the revenue records. 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 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** ``` WP(C).No.12498 OF 2023 ``` ``` 7 ``` **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. 8. In Keechery Service Co-operative Bank 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. …. 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** ``` WP(C).No.12498 OF 2023 ``` ``` 8 ``` **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”.** 9. The attachments entered in Ext.P5 Encumbrance Certificate are court attachments effected at the instance of respondents 3 to 6 subsequent to the creation of equitable mortgage on 25.10.2016. 10. In the light of the aforesaid decisions, all attachments entered in Ext.P5 Encumbrance Certificate pursuant to Exts.P6 to P9 are liable to be effaced and the 1[st] respondent has to register Ext.P4 sale certificate as and when it is presented for registration, ``` WP(C).No.12498 OF 2023 ``` ``` 9 ``` if the same is otherwise in order. It is made clear that, the right of the attaching creditors as against the borrower will not be foreclosed by this judgment. The writ petition is disposed of. ## **`Sd/-`** ``` MURALI PURUSHOTHAMAN JUDGE ``` SPR ``` WP(C).No.12498 OF 2023 ``` ``` 10 ``` ## **`APPENDIX`** ## **`PETITIONER’S EXHIBITS :-`** ``` EXHIBIT P1TRUE COPY OF PARTITION DEED NO. 107 OF 2016, VALAPATTANAM SRO DATED 11.01.2016. EXHIBIT P2TRUE COPY OF CONFIRMATION LETTER DATED 26/10/2016. EXHIBIT P3TRUE COPY OF THE SALE NOTICE DATED 30/12/2022. EXHIBIT P4TRUE COPY OF THE SALE CERTIFICATE DATED 27.02.2023. EXHIBIT P5TRUE COPY OF ENCUMBRANCE CERTIFICATE NO.1229 OF 2023 DATED 27.02.2023. EXHIBIT P6TRUE COPY OF ATTACHMENT ENTERED AS F64/2019 DATED 11.12.2019. EXHIBIT P7TRUE COPY OF THE ATTACHMENT ENTERED AS F20/2021 DATED 25.01.2021. EXHIBIT P8TRUE COPY OF THE ATTACHMENT ENTERED AS F49/2022 DATED 04.08.2022. EXHIBIT P9TRUE COPY OF THE ATTACHMENT ENTERED AS F5/2023 DATED 11.01.2023. ``` ## **`RESPONDENT ANNEXURES:-`** ``` ANNEXURE R7[1]THE TRUE COPY OF THE IMPEDING PETITION IN I.A NO. 2/2023 IN O.S-486/ 2022 ON THE FILES OF THE HON'BLE MUNSIFF COURT KANNUR DATED 25/02/2023. ``` ``` ANNEXURE R7[2]THE TRUE COPY OF THE ORDER DATED 17/5/2023 IN I.A-5/23 IN OS-486/22 ON THE FILES OF THE HONBLE MUNSIFF COURT KANNUR. ```