The ownership of property is valid irrespective of whether it is ancestral or self-acquired, impacting loan eligibility.

JUDGMENT :

M.A. ABDUL HAKHIM, J.

1. The petitioner is a senior citizen, aged 73 years. The petitioner applied for a loan of Rs.20 lakhs to respondents 1 to 3 under the Reverse Mortgage Loan Scheme, offering the property of 7.20 ares, which he derived as per A schedule in Ext.P1 Partition Deed. The Bank rejected the application for a loan as per Exts.P8 and P9, stating that the reverse mortgage loan cannot be sanctioned against partition deed as per the loan policy of the Bank. Though the petitioner approached the Banking Ombudsman, the Banking Ombudsman refused to interfere as per Ext.P12.

2. I heard the learned Counsel for the petitioner, Sri. B. Mohan Lal, and the learned Standing Counsel for the respondents 1 to 3, Sri. Jawahar Jose.

3. The learned Counsel for the petitioner pointed out that the property derived by the petitioner as per Ext.P1 partition deed is duly mutated in the name of the petitioner and he has been paying land tax in his name as revealed from Ext. P2 land tax receipt. The property exclusively belongs to the petitioner as per Ext.P1 and P2. The source from which the petitioner derived the property is not relevant or material for the bank to accept the property as security for the loan. The learned Counsel cited the decision of the Hon’ble Supreme Court in Angadi Chandranna v. Shankar and Others, 2025 Supreme (SC) 677 and Govindbhai Chhotabhai Patel and Others v. Patel Ramanbhai Mathurbhai, (2020) 16 SCC 255 to substantiate the point that there is no difference between ancestral and self-acquired property as far as the property owner is concerned.

4. On the other hand, the learned counsel for the Bank supported the stand of the Bank Exts.P8 and P9 with reference to the Counter Affidavit filed by the Bank.

5. I have considered the rival contentions.

6. It is clear from Ext.P1 that the petitioner got the property as per the A schedule therein and the same is duly mutated in the name of the petitioner and he had been paying land tax for the same. As rightly contended by the Counsel for the petitioner, the source from which the property is derived by the petitioner is not relevant or material as far as the Bank is concerned to accept the said property as security for the loan. The Bank has to see whether the property exclusively belonged to the petitioner or not, considering Exts.P1 and P2. The title of the petitioner will not have any difference, whether it be derived as ancestral or as self- acquired. The property exclusively belongs to the petitioner if he has not made any subsequent encumbrance with respect to the same. The said view is supported by the decision cited by the learned Counsel for the petitioner. In view of the aforesaid decisions, even though this property was originally an ancestral property, after execution of Ext.P1 Partition Deed, it has become a self-acquired property of the petitioner, and it has to be treated accordingly.

7. Accordingly, this Writ Petition is disposed of, setting aside Exts.P8 and P9 Communications issued by the Bank rejecting the loan and Ext.P12 issued by the Banking Ombudsman and directing the respondents 1 to 4 to process the application for the loan of the petitioner accepting the property covered by A Schedule in Ext.P1 if it is otherwise acceptable.

8. The learned Counsel for the petitioner submitted that the Loan Application has already been returned. The petitioner may resubmit the Application along with a certified copy of this judgment in order to enable the Bank to process the same. The Bank is directed to process the Application at the earliest rate within a period of two months from the date of receipt of the said Application.