ORDER

1. This appeal is filed under Sec.18 of the SARFAESI Act, to set aside the final order passed in SA 618/2024 on 27.11.2024 by the Ld. Presiding Officer, DRT –

2, Ernakulam.

2. The petitioner/appellant filed the aforesaid SA challenging the securitization measures initiated by the 1^st respondent bank. It is the case of the appellant that the 2^nd respondent is the owner of the property mortgaged in this case. 2^nd respondent agreed to rent out the entire ground floor of the two storied building and the two shop rooms on the southern side of the upstair portion of the building bearing Door No.AMCW-33/803 for a monthly rent of Rs.30,000/- for a period of seven years by a registered Rent Agreement bearing No. 1648/2023 dated 29.04.2023 of SRO, Alappuzha. As per this agreement, appellant is in possession of the rented out premises. Appellant is a statutorily protected tenant and therefore the 1^st respondent has no right to vacate him from the property on the basis of the order passed by the Ld.CJM, Alappuzha in MC No.327/2024. The securitization proceedings initiated by the 1^st respondent against the 2^nd respondent will not affect the possession of the appellant and therefore, the aforesaid SA was filed. After contest, this SA was dismissed and hence, this appeal is filed, along with the waiver application.

3. Ld. Senior Counsel, Mr.E.Om Prakash appearing on behalf of the counsel on record for petitioner/appellant, Mr. T.Kamalakannan submitted that appellant is a tenant. The mortgaged property had been let out for a long time. The rent agreement was not created to defeat the rights of the bank. There is no condition stipulated in the sanction proceedings that the borrower should not rent/lease the premises. Whatever the condition imposed in the sanction proceedings will not bind the petitioner/appellant, the tenant. There is no express condition in the mortgage deed that the borrower should not rent/lease the property mortgaged. The sanction proceedings refer only about property of firm whereas the property in question is individual property. The agreement, concerned in this case, is a Registered Rent Agreement, which was executed after the execution of mortgage deed but prior to the issuance of Sec. 13(2) demand notice. This rent/lease is protected in terms of Sec.65 (A) of Transfer of Property Act. Though the rent/lease is for a period of more than three years, it is enough that appellant’s possession, as per the rent agreement, is protected for a maximum period of three years. Petitioner/appellant is not challenging any other measures taken by the bank against the borrower for the sale of the property except seeking protection of the possession of the property as a lawful tenant under Sec.65(A) of the Transfer of Property Act. Ld. Counsel produced an order of the Hon’ble High Court in Sree Jeya Soundharam Textile Mills Pvt. Ltd., Vs Canara Bank and others, reported in 2019 SCC OnLine Madras 30541 vide CRP (NPD) No.1492/2017 for the proposition that, third parties who had purchased the property or derived/accrued title or right or tenancy right over the property prior to the date of mortgage, are not liable to make any pre-deposit for preferring an appeal before the Debt Recovery Appellate Tribunal, provided that they establish that they derived/accrued title or right or tenancy right over the property prior to the date of mortgage and that the property was mortgaged with the Bank without their knowledge.

4. In reply to this submission, Ld. Senior Counsel for respondent bank, Mr.

K.S.Viswanathan, appearing on behalf of the counsel on record for 1^st respondent, Smt.T.Hemalatha submitted that five similar cases had been filed by the alleged tenants. The rent agreement had been created just prior to the date of issuance of Sec.13(2) demand notice under SARFAESI Act and just to defeat the right of the bank in taking possession of the property. As per the terms of the rent agreement, appellant came into possession of the property on th