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2018 Supreme(AP) 333

IN THE HIGH COURT OF JUDICATURE AT HYDERABAD FOR THE STATE OF TELANGANA AND THE STATE OF ANDHRA PRADESH
SANJAY KUMAR, T. AMARNATH GOUD, JJ.
City Union Bank Limited - Petitioners
Versus
The Sub Registrar & Others - Respondents
Writ Petition Nos.1084 OF 2017
Decided On : 06-08-2018

Advocates Appeared:
For the Petitioner: Sri Ambadipudi Satyanarayana.

Headnote:

Transfer of Property Act, 1882 – Sections 53 and 54 – Registration Act, 1908 – Sections 47 and 49 – Civil Procedure Code – Order XXXVIII Rule 5 – Registration – Petitioner Bank and fifth respondent both approached the first respondent for registration of property and also the fifth respondent paid the requisite amount through challan, but first respondent refused to do so on the ground that the property is subjudice before the Court of the Senior Civil Judge, Karimnagar in I.A. in O.S. and by order, attachment before judgment under Order XXXVIII Rule 5 of Civil Procedure Code has been passed – Bank filed the present writ petition challenging the action of the first respondent in not registering the sale certificate – Held, Preponderance of judicial opinion leads to the irresistible conclusion that the sale of the mortgaged property in favour of the auction purchaser and the sale certificate under the SARFAESI Act in such circumstances is free of all encumbrances –Attachments effected subsequent to the mortgage created in favour of the bank do not affect the rights of the secured creditor 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 same is confirmed in favour of the secured creditor Bank and auction purchaser – Court has no hesitation to hold that the secured creditor is entitled to succeed in these writ petitions –Writ Petitions Allowed (Paras 14, 15)

ORDER :

T. AMARNATH GOUD, J.

1. Since both the writ petitions raise common question of law, they are being disposed of by this common order.

W.P.No.1084 of 2017:

2. M/s. Sri Maha Lakshmi Mobile Agencies, Karimnagar, the fourth respondent herein, availed a loan of Rs.7 lakhs on 10.07.2014 from the City Union Bank Limited, Karimnagar Branch, the petitioner herein. The Managing Partner of the fourth respondent firm created an equitable mortgage in favour of the secured creditor/Bank by depositing title deeds of his immovable property i.e., open plot admeasuring 90 square yards situated beside H.No.2-1-225, 2-1-226 & 2-1-227, Pragathinagar Sub Road, Peddapalli Village and Nagara Panchayat, Karimnagar District. As the fourth respondent failed to pay the scheduled loan instalments, the secured creditor/Bank invoked the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short, the SARFAESI Act) after the loan account was treated as a Non-Performing Asset (NPA) and accordingly, the Bank issued demand notice dated 11.08.2015 and also possession notice dated 22.12.2015 under the provisions of the SARFAESI Act. Later, sale notice dated 13.01.2016 was issued and thereafter the secured asset was auctioned on 25.02.2016. The fifth respondent stood as the highest bidder in the auction by offering sale consideration of Rs.9,51,000/- and thereafter, the Bank issued sale certificate dated 19.08.2016 in favour of the fifth respondent. The petitioner Bank and the fifth respondent both approached the first respondent for registration of the property and also the fifth respondent paid the requisite amount through challan, but the first respondent refused to do so on the ground that the property is subjudice before the Court of the Senior Civil Judge, Karimnagar in I.A.No.290 of 2015 in O.S.No.901 of 2015 and by order dated 26.05.2015, attachment before judgment under Order XXXVIII Rule 5 of the Civil Procedure Code has been passed. The Bank filed the present writ petition challenging the action of the first respondent in not registering the sale certificate.

W.P.No.2585 of 2017:

3. M/s.Lakshmi Telecom, Nellore, the third respondent herein, availed a total loan of Rs.45 lakhs from 07.01.2006 to 21.02.2014 from the City Union Bank Limited, Nellore Branch, the petitioner herein. The husband of the proprietrix of the third respondent created an equitable mortgage over his plot, along with superstructures and building thereon, admeasuring Ac.0-28 ankanams in Sy.No.1034, Old D.No.8-29-1A and new D.No.8-29-1, Kondurivari Street, Kavali, SPSR Nellore District, in favour of the secured creditor/Bank by depositing title deeds of the aforesaid property. As the borrower failed to pay the loan instalments as per the payment schedule, the secured creditor invoked the provisions of the SARFAESI Act after the loan account was treated as a Non-Performing Asset (NPA) and accordingly, the Bank issued demand notice dated 23.09.2015 and also possession notice dated 19.03.2016 under the provisions of the SARFAESI Act. Later, sale notice dated 23.06.2016 was issued and thereafter, the secured asset was auctioned on 10.08.2016. In the auction, respondent Nos.4 and 5 stood as the highest bidders with sale consideration of Rs.35,20,000/- and thereafter, the Bank issued sale certificate dated 09.09.2016 in favour of respondent Nos.4 and 5. The petitioner Bank and respondent Nos.4 and 5 both approached the first respondent for registration of the property and also respondent Nos.4 and 5 paid the requisite amount through challan, but the first respondent refused to dos so on the ground that the property is subjudice before the Court of the Additional Senior Civil Judge, Nellore in I.A.No.331 of 2015 in O.S.No.236 of 2015 and by order dated 01.06.2015, attachment before judgment under Order XXXVIII Rule 5 of the CPC has been passed. The Bank filed the present writ petition challenging the action of the first res


























































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