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2021 Supreme(Mad) 3395

BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
V. Bhavani Subbaroyan, J.
Kalaimani (died) and ors. - Appellants
Versus
K.T. Suriyaprakash and ors. – Respondents
S.A(MD)No.426 of 2021 and C.M.P(MD)No.5608 of 2021
Decided On : 16-12-2021

Advocates:
Advocate Appeared:
For the Appellant : Mr.A.Saravanan

Headnote:

SARFAESI Act - Section 26(C) – Auction Sale - Sale Certificate – Challenged – Loan – Mortgage of property by deposit of title Deeds -Plaintiff cannot claim any right through the sale deed executed as a power of attorney holder and the original principal has not paid the amount and as per the sale of property has been conducted by open auction and the said sale binds on the principal and accordingly, the Bank in order to recover the loan, has taken action under the SARFAESI Act – Plaintiff cannot claim any right through the sale deed executed as a power of attorney holder and the original principal has not paid the amount and as per the sale of property has been conducted by open auction and the said sale binds on the principal and accordingly, the Bank in order to recover the loan, has taken action under the SARFAESI Act. Para 15.

Finding of the Court:

Sale Certificate has been registered and revenue records mutated has not been produced either of parties - If plaintiff is a genuine purchaser she would have immediately mutated revenue records but she has not mutated and now she cannot turn around and ask first defendant to mutate records - Further evidence of P.W.1 to P.W.3 are rejected and these are all factual aspects and also denial of knowledge of mortgage and based on a encumbrance certificate and an affidavit executed was relied on by plaintiff is not accepted and it has been well considered by both Courts below and case been appropriately rejected and valid reasons have been given - In year they have numbered suit and proceeded based on preliminary decree and SARFAESI Act came into effect in year - That being case authorities are at liberty to chose their course of auction by an Act which is convenient to them.

Result: Second Appeal stands Dismissed.

JUDGMENT :

The concurrent Judgments and decrees passed in O.S.No.66 of 2014 by the Additional Subordinate Court, Dindigul and in A.S.No.3 of 2017, on the file of the Additional District Court, Dindigul, are being challenged in the present Second Appeal.

2. Originally, one Kalaimani as plaintiff has instituted a suit in O.S.No.66 of 2013 on the file of the trial Court for the relief of declaration, permanent injunction and also to declare the sale deed, dated 16.04.2009 of the first respondent herein in respect of the suit property as null and void, wherein, the present respondents have been shown as defendants.

3. For the sake of convenience, the parties are referred to as, as described before the trial Court.

4. The case of the plaintiff is that originally the suit property belonged to one Rajamaniammal, wife of late.S.P.Renganatha Mudaliar. One Sukumaran, who is the son of the said Rajamaniammal, had obtained loan in the second respondent/the Punjab National Bank by depositing the title deed of the suit property as security for the loan. The said fact was not known to the plaintiff. However, without disclosing the said depositing of title on the suit property as a security for the loan obtained from the second respondent, the said Sukumaran executed a power of attorney in favour of the husband of the plaintiff viz., Palanisamy in respect of the suit property on 29.06.2005. Further, an affidavit was also sworn in by the said Sukumaran, which was attested by the Notary Public, dated 01.10.2005, to the effect that the original title of the suit property had been stolen. Subsequently, on 29.03.2006, the said Palanisamy had sold the suit property to his wife, namely, Kalaimani, the plaintiff. While the plaintiff was in possession and enjoyment of the suit property, the first defendant came to the suit property on 20.09.2013 with his henchmen and informed that he has purchased the suit property and handed over the copy of the sale certificate and ex-parte preliminary decree passed in O.S.No.445 of 2003, on the file of the Subordinate Court, Dindigul. Subsequently, on 24.01.2014, a legal notice was issued by the plaintiff and on 10.02.2014, the first respondent issued a reply notice in contrary to the real facts. Hence, the plaintiff has filed the suit for the above stated relief.

5. The first defendant had filed a written statement and stated that the suit property originally owned by Rajamani Ammal. Her son, Sukumaran, who is running M/s.Abirami Textiles, had obtained loan from the second defendant by depositing the title deeds of the suit property. Later, the said Sukumaran executed a power of attorney in favour of the husband of the plaintiff viz., Palanisamy, who in turn had sold the same to his wife, the plaintiff. The plaintiff is not a bonafide purchaser and the sale deed executed by the second defendant in favour of the first defendant, dated 16.04.2009 is valid under law. On 14.09.2000, the said Sukumaran had obtained a loan from the second defendant Bank for a sum of Rs.2,50,000/- by depositing the title deed of the suit property. Due to the non-payment of the loan amount, the second defendant filed a suit in O.S.No.445 of 2003, on the file of the Subordinate Court, Dindigul, wherein, a preliminary decree was passed on 01.07.2003 in favour of the second defendant Bank for a sum of Rs.6,41,348.42/- with interest as on 22.09.2006. In the said suit, Sukumaran and Rajamaniammal were shown as parties. The second defendant Bank conducted a public auction of the suit property and the first respondent was issued with sale certificate, dated 16.04.2009 and possession was handed over and prayed for dismissal of the suit.

6. Before the trial Court, on the side of the plaintiff, P.W.1 to P.W.3 were examined and Exs.A1 to A8 were marked. On the side of the defendants, the first defendant himself was examined as D.W.1 and Ex.B.1 was marked.

7. On the basis of the rival pleadings made on either side, the trial Court, after framing necessary i

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