IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM THURSDAY, THE 19TH NOVEMBER 2009 / 28TH KARTHIKA 1931 WP(C).No. 18057 of 2009(B) -------------------------- PETITIONER(S): --------------- 1. C.NARAYANAN, CHERIYIL HOUSE, ELAMKULAM, KUNNAKKAVU DESOM, PERINTHALMANNA TALUK. 2. SUBRAMANIAN A, ALIKKAL HOUSE, ELAMKULAM VILLAGE, PERINTHALMANNA TALUK, MALAPPURAM DIST. BY ADV. SRI.BRIJESH MOHAN SMT.RESMI G. NAIR SRI.P.VENUGOPAL (1086/92) RESPONDENT(S): --------------- 1. THE URBAN CO-OPERATIVE BANK NO. 1758, PERINTHALMANNA, MALAPPURAM 679 322, REPRESENTED BY ITS SECRETARY. 2. THE DEVELOPMENT OFFICER/AUTHORISED OFFICER, URBAN CO-OPERATIVE BANK NO. 1758, PERINTHALMANNA, MALAPPURAM -22. 3. P. RAJAN, KIZHAKKE POOZHIKUTH HOUSE, ELAMKULAM, KUNNAKKAVU P.O., PERINTHALMANNA. ADV. SRI.R.RAJESH KORMATH FOR R1-2 THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 19/11/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).No. 18057 of 2009 APPENDIX PETITIONERS EXHIBITS: EXT.P1: COPY OF THE JUDGMENT OF THE SUB COURT MANJERI DATED 25/7/07 IN O.S NO.139/03 EXT.P2: COPY OF THE DECREE OF THE SUB COURT MANJERI DATED 25/7/07 IN O.S NO.139/03 EXT.P3: COPY OF THE JUDGMENT OF THE SUB COURT MANJERI DATED 24/7/07 IN O.S NO.102/03 EXT.P4: COPY OF THE DECREE OF THE SUB COURT MANJERI DATED 24/7/07 IN O.S NO.102/03 EXT.P5: COPY OF I.A NO.1583/03 IN O.S NO.139/03 ON THE FILES OF SUB COURT, MANJERI FILED BY THE 1ST PETITIONER EXT.P6: COPY OF I.A NO.1811/03 IN O.S NO.102/03 ON THE FILES OF SUB COURT, MANJERI FILED BY THE 2ND PETITIONER EXT.P7: COPY OF THE ENCUMBRANCE CERTIFICATE DATED 14/5/09 IN RESPECT OF THE PROPERTY OF THE 3RD RESPONDENT ISSUED TO THE 1ST PETITIONER EXT.P8: COPY OF THE ENCUMBRANCE CERTIFICATE DATED 19/10/07 IN RESPECT OF THE PROPERTY OF THE 3RD RESPONDENT ISSUED TO THE 2ND PETITIONER EXT.P9: COPY OF THE POSSESSION NOTICE PUBLISHED BY THE 1ST RESPONDENT IN MALAYALA MANORAMA DAILY DATED 24/4/09 EXT.P10: COPY OF THE REGISTERED LETTER ISSUED BY THE PETITIONERS TO THE 1ST RESPONDENT DATED 28/4/09 EXT.P11: COPY OF THE REPLY GIVEN ON BEHALF OF THE 1ST RESPONDENT DATED 23/5/09 TO THE PETITIONERS RESPONDENTS EXHIBITS: EXT. R1 (a): TRUE COPY OF THE MORTGAGE DEED EXECUTED BY THE 3RD RESPONDENT IN FAVOUR OF THE 1ST RESPONDENT BANK EXT. R1 (b): TRUE COPY OF THE TITLE DEED DATED 5.1.2000 DOCUMENT NUMBER 157 OF 2000 OF SUB REGISTRAR'S OFFICE, PERINTHALMANNA. /TRUE COPY/ ma C.K.ABDUL REHIM, J. ------------------------------ W.P.(C).No.18057 OF 2009 ------------------------------ Dated this the 19th day of November, 2009 J U D G M E N T ---------------------- 1. Challenge in this writ petition is against Ext.P9 notice issued by respondents 1 and 2 under Section 13(4) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act). Petitioners are inter alia seeking declaration to the effect that they are having first charge over the property covered under Ext.P9 and further to declare that the respondents 1 and 2 are not entitled to proceed against that property. The petitioners are not the borrowers. They claim right over the property by virtue of Ext.P2 and P4 decrees passed by the Sub Court, Manjeri in O.S.No:139/03 and in O.S.No:102/03. Both the suits are filed by the petitioners against the 3rd respondent herein, who is the borrower as far as the loan transaction of respondents 1 & 2 is concerned. According to the petitioners even before passing Ext.P2 and P4 decrees the petitioners there existed interim orders of attachment against the property, which is now sought to be proceeded against, as evidenced from Ext.P5 and P6. Contention of the petitioners based on Ext.P2, P4, P5 and P6 W.P.(C).18057/09-B 2 is that there is a charge created with respect to the property which is now proceeded against under the SARFAESI Act. Therefore they claim that the proceedings initiated by the respondents 1 and 2 cannot be allowed to be continued, without discharging the rights which is said to have been accrued on the property in favour of the petitioners by virtue of the above said decrees as well as orders of attachment. 2. The respondents 1 and 2 in their counter affidavit stated that the 3rd respondent had availed a loan from the 1st respondent as early as on 29.8.2000 by creating equitable mortgage with respect to the property, as evidenced from Ext.R1 (a)- Memorandum of mortgage by deposit of title deed. It is further stated that Ext.R1(b) is the title deed pertaining to the 3rd respondent and the original of which is in deposit with the Bank. 3. Going by Ext.P5 and P6 interim orders of attachment it is noticed that those orders are issued respectively on 9.12.2003 and on 27.8.2003. Ext.P2 and P4 decrees are issued thereafter. From the above facts it is clear that the mortgage was created much prior to the date of attachment. On the date of creation of the equitable mortgage the petitioners could not claim any charge over the property nor they could effectively claim any right or interest which has been created on the property as on that date. Therefore I am of the opinion that the W.P.(C).18057/09-B 3 claim of the petitioners that the charge created based on the interim orders of attachment or by virtue of the decrees, can be enforced against respondents 1 and 2 seems to be highly misconceived in view of the fact that they have got a clear charge of mortgage created much prior to those orders. Hence the challenge raised by the petitioners against the proceedings initiated at the instance of respondents 1 and 2 is totally unsustainable. Therefore the writ petition deserves no merit and the same is liable to be dismissed. 4. However it is made clear that dismissal of this writ petition will not prejudice rights if any available to the petitioners to proceed against any receipt of the sale in excess of the amount due to the Bank, under the SARFAESI Act by invoking appropriate remedies before appropriate forum. C.K.ABDUL REHIM, JUDGE. okb