JUDGMENT :

(Prayer: Second Appeal is filed under Section 100 of Civil Procedure Code, against the judgment and decree of the Learned Principal District Judge, Karur, dated 23.04.2003 in A.S.No.80 of 2002 reversing the judgment and decree of the Principal District Munsif Court, Karur in O.S.No.29 of 2000.)

1. The plaintiffs are the appellants herein.

2. The plaintiffs filed O.S.No.29 of 2000, before the Principal District Munsif Court, Karur for permanent injunction not to disturb their possession over the suit schedule properties. The suit was decreed as prayed for. The defendant filed A.S.No.80 of 2002 before the Principal District Court, Karur. The first appeal was allowed and the suit was dismissed. As against the same, the plaintiffs have filed the present second appeal.

3. The plaintiffs had contended that they had purchased the suit schedule property from one, Swaminathan on 15.02.1996. The plaintiffs had further contended that the defendant which is a Nationalised Bank is attempting to interfere with their possession over the suit schedule properties and hence, the present suit.

4. The defendant filed a written statement contending that though the said Swaminathan is the owner of the suit schedule property, he had created a equitable mortgage by depositing the title deeds of the suit schedule property with the Bank on 01.02.1994 and thereafter, he has extended the said mortgage on 15.05.1996. The defendant further contended that on 21.05.1996, the said Swaminathan had created an equitable mortgage on suit schedule property by depositing the original sale deeds. Since the said Swaminathan had defaulted in payment, the Bank had filed O.A.No.374 of 1994 before the Debt Recovery Tribunal, Chennai and recovery certificate has also been issued as against the said Swaminathan and two other persons who were the guarantors for the loan.

5. The defendant further contended that the plaintiffs have created a fraudulent document on 15.02.1996 and the plaintiffs have no title or possession over the suit schedule property. The fact that the plaintiffs have not received the original documents at the time of purchasing the suit schedule properties will indicate that they are not the bonafide purchaser for valuable consideration. The defendant further contended that in view of the provisions of Recovery of debts due to Bank and Financial Instructions 1993, (RDDB Act) Civil Court has no jurisdiction to entertain a Civil suit.

6. The trial Court decreed the suit as prayed for after giving a finding that the sale deed in favour of the plaintiffs under Exhibit A2 has been properly registered and only after the registration of the sale deed on 15.02.1996, an equitable mortgage has been created in favour of the Bank on 21.05.1996. Hence, the said equitable mortgage will not bind the plaintiff. Based upon the said findings, the trial Court decreed the suit as prayed for.

7. The First Appellate Court held that the documents filed on the side of the defendant would establish that the plaintiffs' vendor has created an equitable mortgage with the defendant Bank and hence, the sale deed in favour of the plaintiffs is not valid. The First Appellate Court also found that the proceedings have been initiated before the Debt Recovery Tribunal, Chennai by the defendant Bank and the same are pending. The First Appellate Court also found that Exhibit A2 in favour of the plaintiffs is sham and nominal. The First Appellate Court also found that the Civil Court has no jurisdiction in view of Section 18 of Recovery of Debts due to Banks and Financial Institution Act, 1993.

8. That apart, the First Appellate Court found that the Debt Recovery Tribunal is a higher forum and any injunction granted by the Civil Court, will be in violation of Section 41(b) of the Specific Relief Act. On the above said grounds, the First Appellate Court reversed the judgment and decree of the trial Court and dismissed the suit. As against the same, the present second appeal has been filed.

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