IMPORTANT POINTS:
" The Plaintiffs lost the right to sue for redemption of the mortgaged property by virtue of the proviso to Section 60 of the Act.

Introduction:

1. It is a tussle between a bank and a borrower, as usual. The bank auctions the secured asset, certifies the sale, and wants it to be registered in the purchaser’s name. The borrower balks. She wants the property ‘redeemed’—at any length of time—even years later. For she asserts that her right to redeem the property at a tardy pace should triumph over the bank’s right to recover the loan with dispatch.

2. How should a mortgagor’s right to redeem the property under S.60 of the Transfer of Property Act fare vis-a-vis a banker’s right to sell the secured asset and the SARFAESI Act?

Case History:

3. There are two Writ Petitions: W.P.(C) No.12045 of 2018 and W.P.(C) No.38194 of 2018. The former is by the bank and the latter by the borrower-couple. The bank wants the sale to be registered, so it can convey the property to the auction purchaser. The borrowers, however, want their property back—redeemed.

4. I will take up the bank’s Writ Petition, the earlier of the two, to set out the facts. So should the parties be described as arrayed in that Writ Petition.

Facts:

W.P.(C) No.12045 of 2018:

5. Mariyumma and Hameed, wife and husband, took a housing loan, besides securing credit facilities from the Kerala Gramin Bank. To obtain the loan, they mortgaged over 35 cents of land. This was in 2006.

6. On the couple’s default, the Bank started recovery proceedings. First it issued a notice under S.13(2) of the Act, later under S.13(4) took symbolic possession, and finally, under S.14, took physical possession, too. After notifying the sale and after following the procedure, it sold the secured asset to Asharaf, the third respondent. Ext.P2, dt.13.12.2016, is the sale-confirmation letter.

7. To register the property in the purchaser’s name, the Bank applied to the Sub-Registrar, the first respondent. But the Sub Registrar refused. In the Ext.P4 order of refusal, he cited the reason of some other later attachments over the property. The mortgage was in 2006, and the attachments were in 2012, 2013 and 2015. Though apprised of this fact, the Sub-Registrar persisted with his refusal to register. Aggrieved, the Bank has filed W.P.(C) No.12045 of 2018.

8. Hameed and Mariyumma, the couple, filed this Writ Petition. After admitting the loan transactions, they pleaded financial difficulties—business failure—as the reason for the default. According to them, this Court’s earlier intervention did not help them, as they had, by then, no money to comply with the conditions. And their efforts to pursue their case before the DRT, too, failed because it was decided ex parte. But when the Review Petition was pending before the DRT, the bank went ahead, auctioned the property, and now wanted it to be registered in the purchaser’s name. So they have assailed the bank’s entire recovery proceedings.

Submissions:

Bank’s:

9. Summarised, Sri.Sreekumar, the petitioner’s counsel asserts that the bank has followed the procedure to perfection and the debtors’ challenge is only dilatory. Focusing on the Sub Registrar’s Exhibit P4 refusal to register the property, he contends that all the attachments are very recent and they cannot affect the mortgage many years before. According to him, of all the persons the Sub Registrar is the least qualified to refuse registration on the ground of the later attachments. If ever that plea is valid, it must be by those who secured the attachments.

10. Sri.Sreekumar has also further contended the SARFAESI Act prevails over all other enactments, including the Transfer of Property Act. Therefore, to sum up, he submits that the Exhibit P4 is illegal and arbitrary. And it must be set aside. In this regard, he relies on (1) Allokam Peddabbayya v. Allahabad Bank (2017) 8 SCC 272) and (2) Kerala Gramin Bank v. Sub Registrar Judgment in W.P.C.No.19535 of 2018 dated 28.6.2018 of High Court of Kerala).

The Debtors’

11. Sri. S. Eswaran has, to begin with, submitted that the right to property is a valuable constitutional right, and the right