The limitations on the power of a mortgagor to lease the mortgaged property under Section 65-A of the Transfer of Property Act and the impact of Section 13(13) of the SARFAESI Act on the right to transfer rights or possession of the property after the issue of a notice under Section 13(2) were central to the judgment.

V.RAMASUBRAMANIAN,J

1. The petitioner, whose writ petition challenging a possession notice issued by the first respondent under Section 13(4) of the SARFAESI Act was allowed by this Court, has come up with the above application seeking a review of one finding recorded by this Court while allowing the writ petition in their favour.

2. We have heard Mr. Sriram Panchu, learned senior counsel for the review applicant, Mr. N.R.Chandran, learned senior counsel appearing for the first respondent, Ms. L.Poompavai, learned counsel for the second respondent, Mrs. A.Srijayanthi, learned Special Government Pleader appearing for the third respondent and Mr. J.Thilagaraj, learned counsel for the fourth respondent.

3. A group of three companies by name Peninsula Food Products Private Limited, Pen Food Private Limited and Taj Mahal Agro Industries Private Limited (which is the fourth respondent herein) availed certain credit facilities from Axis Bank Limited and committed default in re-payment. The debt due to Axis Bank Limited by these companies was assigned by them in favour of the International Asset Re-construction Company Private Limited, which is the first respondent herein, under a deed of Assignment dated 10.02.2011.

4. The fourth respondent herein appears to have approached the first respondent with a proposal for a One Time Settlement, during the period from April-May 2011. Though the last of such offers made on 31.5.2011 was accepted by the first respondent by a letter dated 11.6.2011, the fourth respondent failed to honour its commitment under the proposal.

5. Therefore, a notice under Section 13(2) of the SARFAESI Act was issued sometime in September 2011 and a possession notice under Section 13(4) was issued on 07.4.2012.

6. Challenging the possession notice issued under Section 13(4) on 07.4.2012, the review applicant herein filed a writ petition in W.P.No.10199 of 2012 on the file of this Court. The primary contention of the review applicant in their writ petition was that they are the lawful tenant of one of the secured assets namely a portion of the land in No.33-C, Palanjur Road, Chembarabakkam, Chennai 602 103 and that therefore, they cannot be evicted otherwise than in accordance with the provisions of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960.

7. By a final order dated 07.8.2013, the writ petition was allowed and the possession notice quashed, on the short ground that the first respondent ought not to have taken possession of the property forcibly, without taking recourse to the provisions of Section 14 of the SARFAESI Act. However, this Court gave liberty to the first respondent to issue a fresh possession notice and take steps in accordance with the provisions of Section 14 of the SARFAESI Act.

8. Despite the fact that the review applicant has thus succeeded in the writ petition, they have come up with the above review application on the short ground that in paragraph 26 of the judgment, this Court had recorded a finding that the petitioner, having taken the property on lease subsequent to the mortgage, cannot be taken to be a bona fide tenant. The apprehension of the petitioner is that this finding that they are not a bona fide tenant would stand in their way while defending an action under Section 14 of the Act. Therefore, what the review applicant wants is just a re-call of the finding recorded in paragraph 26 that they cannot be termed as a bona fide tenant.

9. Briefly stated, the contention of Mr.Sriram Panchu, learned senior counsel for the review applicant, is that the right of a mortgagor to lease the mortgaged property, recognised under Section 65-A of the Transfer of Property Act, 1882, is not taken away by the SARFAESI Act, 2002 and that the only prohibition under section 13 (13) of the SARFAESI Act is that after the issue of a notice under Section 13(2), the mortgagor is not entitled to transfer his rights or part with possession of the property. Therefore, it is his contention that wh