IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HON'BLE THE CHIEF JUSTICE MR.S.R.BANNURMATH & THE HONOURABLE MR. JUSTICE A.K.BASHEER MONDAY, THE 12TH OCTOBER 2009 / 20TH ASWINA 1931 WA.No. 1273 of 2009 --------------------- AGAINST THE JUDGEMENT IN WPC.24569/2008 Dated 03/04/2009 .................... APPELLANTS/PETITIONERS: ------------------------------ 1. THOMAS MATHEW, S/O.ABRAHAM MATHAI, PLATHOTTATHIL HOUSE, UTHIMOODU P.O., RANNI, PATHANAMTHITTA DISTRICT. 2. MATHEW M.PHILIP, S/O.MATHAI PHILIPOSE, MALETHOPPIL HOUSE, UTHIMOODU P.O., RANNI, PATHANAMTHITTA DISTRICT, REP. HY HIS P/A.HOLDER ALIYAMMA MATHEW,49YRS,W/O.MATHEW M.PHILIP,MALETHO- PPIL(H),UTHIMOODU P.O.,RANNI,PATHANAMTHITTA DIST. BY ADV. SRI.C.RAJENDRAN RESPONDENTS/RESPONDENTS: ---------------------------------- 1. THE STATE BANK OF INDIA, PATHANAMTHITTA BRANCH, PATHANAMTHITTA DISTRICT. 2. THE AUTHORIZED OFFICER, THE STATE BANK OF INDIA, PATHANAMTHITTA BRANCH, PATHANAMTHITTA DISTRICT. BY ADV. SRI.K.K.CHANDRAN PILLAI THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 12/10/2009, ALONG WITH WPC NOS. 21046 & 23307 OF 2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: S.R. Bannurmath, C.J. & A.K. Basheer, J. - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - W.A. No. 1273 OF 2009 AND W.P.(C) Nos. 21046 & 23307 OF 2009 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Dated this the 12th day of October, 2009 JUDGMENT Basheer, J. These three cases are taken up for hearing and disposal, since they are intrinsically interconnected. 2. We have heard learned counsel for the parties. 3. Appellants in WA No.1273 of 2009(herein after referred to as 'debtors') had availed of a loan to the tune of Rs.38 lakhs in the aggregate, from respondent No.1 Bank in the year 2002 and 2004. Admittedly the debtors committed default in repayment. Therefore, coercive steps were initiated against the properties mortgaged by them under the SARFAESI Act. 4. WP(C) No.24568 of 2008, was filed by the debtors calling in question the legality of the proceedings initiated by the Bank against those properties mortgaged by them. The learned Single Judge after considering the entire aspects of the matter held that the proceedings initiated by the Bank were WA No.1273/09 and WP(C) Nos.21046 & 23307/09 -:2:- totally valid and in accordance with the provisions of the Act and accordingly dismissed the Writ Petition. However, it was clarified that if the debtors paid off the entire outstandings and accruals even through a third party, who would purchase the entire holdings or part of the holdings, it would be open to the Bank to accept the same and close the loan account. 5. It is on record that the Bank had permitted the debtors to sell item No.2 situated in Survey No.193/4-1 having an extent of 43.50 Ares in Vadasserikkara Village to a third party, namely Sri.V.G. Madhu who is the petitioner in WP(C) No.23307 of 2009. It is also the admitted position that the purchaser had deposited the sale proceeds before the Bank; and therefore the Bank admittedly has no subsisting grievance or right over the said item of property now. 6. However, as far as a portion of item No.1 situated in Survey No.611/1E9 having a total extent of 10.12 Ares in Ranni Village is concerned, the State of Kerala had initiated Revenue Recovery Proceedings for realisation of a sum of Rs.2 lakhs and WA No.1273/09 and WP(C) Nos.21046 & 23307/09 -:3:- odd as could be seen from Ext.P2 in WP(C) No.21046 of 2009 filed by the Bank. 7. When these three cases were taken up for consideration on the last occasion, it was submitted by the learned counsel for the Bank that the sale of a small portion of item No.1 would cause prejudice and loss to the Bank in as much as the remaining portion of the property may not attract buyers, since there would not be any access to the same. Therefore the Standing Counsel submitted that the Bank would be prepared to pay off the liability of the debtors outstanding to the State towards arrears of sales tax. 8. Consequently, Sri.Vinod Chandran, learned Special Government Pleader(Taxes) has filed a statement through the Deputy Tahsildar, Ranni Taluk Office, Ranni indicating the total amount due from the debtors towards sales tax as Rs.2,45,190/-. 9. Learned counsel for the Bank submits that the Bank is prepared to pay off the said liability to the Revenue and debit it WA No.1273/09 and WP(C) Nos.21046 & 23307/09 -:4:- to the account of the debtors. It is agreed that if the assessee succeeds in the appeal that is stated to be pending before the Appellate Authority, adjustment, if any, will have to be made by the Revenue and the Bank respectively; in which event the Revenue undertakes to remit the balance, if any, to the loan account. 10. The Bank shall pay the said amount of Rs.2,45,190/- (Rupees two lakhs fourty five thousand one hundred and ninety only) to the Tahsildar, Ranni Taluk Office, Ranni by way of a Demand Draft within two weeks from today; in which event the Revenue Recovery notice issued by the Revenue authorities in respect of item No.1 (Ext.P2 in WP(C) No.21046/2009) shall stand revoked. It will be open to the Bank to put the said property (item No.1) for sale for recovery of the outstanding dues. It is made clear that the amount of Rs.2,45,190/- shall be a charge on the said property and the Bank will be entitled to recover the same through the sale of that property. 11. As far as the Writ Appeal is concerned, we have WA No.1273/09 and WP(C) Nos.21046 & 23307/09 -:5:- carefully perused the impugned order. Even during the pendency of this writ appeal we had given ample opportunity to the appellants to find out ways and means to pay off the liability so that they could save the property from distress sale. However, despite the indulgence shown to the appellants, they have not been able to find out any safety route to save the property. In that view of the matter having carefully perused the entire materials on record, we do not find any merit in any of the contentions raised by the appellants. In our view, the learned Single Judge had rightly dismissed the Writ Petition. There is no merit in the Writ Appeal and it is liable to be dismissed. We do so. 12. As far as WP(C) No.23307 of 2009 is concerned, it is the admitted position that the petitioner(Sri.V.G.Madhu) had purchased the property(item No.2) from the debtors with the knowledge and consent of the Bank. The entire sale proceeds in respect of that item of property was deposited with the Bank. The grievance of the petitioner is that, respondent Nos.1 to 3, WA No.1273/09 and WP(C) Nos.21046 & 23307/09 -:6:- the revenue authorities are not allowing mutation of the said property in his name. 13. Having heard learned counsel for the petitioner and the learned Standing Counsel for the Bank as well as the learned Government Pleader, we are of the view that the prayer made in the Writ Petition is only just and proper. 14. Sri.K.K.Chandran Pillai, learned counsel for the Bank submits that in fact the debtors had agreed to pay off all the liabilities including the sale tax and other statutory liabilities payable by them in respect of this property. It was on that undertaking that the title deeds were released to the debtors at the time of sale of this item of property. 15. Admittedly, the petitioner had deposited the entire sale proceeds before the Bank which was adjusted towards the loan account of the debtors. But, the sale tax and other statutory liabilities were not paid by the debtors as undertaken by them. In the peculiar facts and circumstances of the case, we are of the view that the petitioner is entitled to get mutation effected in WA No.1273/09 and WP(C) Nos.21046 & 23307/09 -:7:- respect of item No.2 purchased by him from the debtors. Therefore, the prayer made by the petitioner is allowed. 16. Respondent No.1 in WP(C) No.23307 of 2009 is directed to consider and pass orders on Ext.P9 application and allow mutation as prayed for, if there is no other legal impediment. The Writ Appeal is dismissed and Writ Petitions are disposed of in the above terms. S.R. Bannurmath, Chief Justice. A.K. Basheer, Judge. ttb