A writ petition remains maintainable despite alternative appellate remedies when a tribunal acts in violation of natural justice by ignoring substantive pleadings. Furthermore, a mortgagee cannot enforce a security interest over property where the mortgagor lacks valid legal title or authorization to encumber the subject land.

JUDGMENT :

MURALEE KRISHNA S., J.

1. This intra-court appeal is filed under Section 5(i) of the Kerala High Court Act, 1958, by the 2^nd respondent, IDBI Bank Ltd., formerly known as Industrial Development Bank of India (hereinafter referred to as ‘Bank’), challenging the judgment dated 12.10.2015 passed by the learned Single Judge in W.P.(C)No.26496 of 2005.

2. The facts which led to the filing of the writ petition in brief are as follows:

During 1990, the 4^th respondent, M/s.ABN Granites Ltd., represented by its Chairman and Managing Director, submitted an application to the General Manager of the District Industries Centre, Ernakulam, for allotment of land in the Development Areas, Edayar, for the establishment of an industrial unit to manufacture polished granite tiles. Considering the project details submitted along with the application, the General Manager, on the strength of the delegation of powers by the Government to allot the land in Development Areas on hire purchase to the General Managers of the District Industries Centres as per Ext.P2 order dated 10.01.1992, had allotted four acres of land on hire purchase to the 4^th respondent at Edayar. The company had taken the land into its possession and executed Ext.P4 hire purchase agreement on 31.12.1990 as per Ext.P1 Government order dated 05.04.1969, whereby the scheme of the State for the allotment of Government land in Development Areas (DA) on Hire Purchase (HP) for industrial purposes was laid down.

2.1 Later, the 4^th respondent company represented that the land allotted to them is not suitable as a high-tension electricity line crosses through the land. In addition to that, the company requested to enhance the allotment to ten acres, and the land allotted to them is insufficient for the functioning of the unit. Considering the request, an additional six acres of land were allotted to the company, contiguous to the land covered by Ext.P4 hire purchase agreement, by executing Ext.P5 agreement dated 24.03.1992. The land was taken into possession by the 4^th respondent on the same day.

2.2 When the 4^th respondent company produced a detailed building plan proposed to be constructed in the allotted land and sought permission for the same, the General Manager by Ext.P6 order dated 28.10.1992 granted permission for the same and also issued permission to mortgage the superstructure to be build in the allotted land and to hypothecate the machineries to be installed in the building to the appellant, but had never permitted to mortgage the land as he had no authorization for the same.

2.3 When the 4^th respondent company expressed willingness to remit the full cost of the land as envisaged in the hire purchase agreement and requested to issue a certificate to that effect to produce it before the financing bank, the said request was permitted, and the 4^th respondent had remitted an amount of Rs.5,92,614/- towards the cost of the land. While issuing Ext.P7 certificate dated 28.10.1992, evidencing the remittance of the cost of the land, the General Manager specifically mentioned in that certificate that the certificate does not purport to be a guarantee that the patta of the land shall be given to the unit. Though the 4^th respondent produced Ext.P7 certificate before the appellant-Bank to mortgage the land to avail the loan facilities, t