Lok Adalat award without necessary party is non est; bank cannot issue NOC or sale certificate without lawful sale process after decree satisfaction.

JUDGMENT :

N. SENTHILKUMAR, J.

1. This intra court appeal has been filed challenging the order passed by the Writ Court in W.P.No.11343 of 2017 dated 18.09.2025.

2. Ms. K. Aswini Devi, learned Additional Government Pleader takes notice for the 2^nd respondent. In view of the order that is going to be passed in this Appeal at the admission stage, notice to the respondents 1 & 3 are dispensed with.

3.1. The case of the 1^st respondent/writ petitioner before the Writ Court was that he had originally availed loan from the appellant bank by mortgaging his property, admeasuring 2 acres 33 cents comprised in Survey Nos. 407/11A, 407/8, 401/A, 407/10C, situated at Chettypunyam Village, No.71, Chengalpattu Taluk, Kanchipuram District. Based on the said mortgage, title deeds were deposited with the appellant herein. It is the case of the writ petitioner that he was unable to pay the loan amount and therefore, committed default. Thereafter, the appellant filed a Suit in O.S.No.25 of 1979 for foreclosure of the said mortgage and the same was decreed on 08.03.1982. Based on the decree, the appellant filed E.P.No.32 of 1985 in O.S.No.25 of 1979 to execute the said decree.

3.2. During the pendency of the execution proceedings, certain third parties were brought on record. According to the 1^st respondent/petitioner, he had originally entered into an agreement for sale with the 8^th defendant in the suit. Thereafter, the said agreement was made over in favour of the 9^th defendant, who is the 3^rd respondent herein. The said 3^rd respondent was subsequently impleaded in the execution proceedings. Pursuant to such arrangement, the 3^rd respondent paid the balance decretal amount of Rs.9,46,000/- to the appellant. On that basis, the appellant filed a full satisfaction memo. Recording the same, the Execution Court terminated the execution proceedings by an order dated 25.09.1997. According to the 1^st respondent/petitioner, once the entire decretal amount was settled and the execution proceedings stood closed, the appellant had no further right or interest over the mortgaged property.

3.3. However, even after the said full satisfaction, the appellant failed to return the original title deeds to him. On the contrary, in collusion with the 3^rd respondent, the appellant handed over the original title deeds relating to the subject property to the 3^rd respondent. It is the specific case of the 1^st respondent/writ petitioner that the subject property was never brought to sale in the execution proceedings and no auction was conducted at any point of time. After a lapse of nearly 19 years from the date of termination of the execution proceedings, the 3^rd respondent initiated a pre-litigation complaint before the Lok Adalat on 02.09.2016, seeking execution of the sale deed in his favour. On the very same day, the Appellant and the 3^rd respondent entered into a compromise and filed a compromise memo before the Lok Adalat, wherein an award was passed on 02.09.2016 in L.S.P. No.1604 of 2015.

3.4. Based on the said award, the appellant issued a sale certificate dated 09.09.2016 in favour of the 3^rd respondent and the same was presented for registration before the 2^nd respondent, who registered the document as Document No.3 of 2017 on 08.03.2017. The 1^st respondent/writ petitioner would further contend that the appellant had also issued a “No Objection” letter confirming that it has no right over the property and raised no objection in transforming the subject property in favour of the 3^rd respondent.

3.5. The 1^st respondent/writ petitioner further contended that the award was passed by the Lok Adalat, based on the compromi