ORDER

1. This appeal is filed under Section 18 of SARFAESI Act, as against the order dated 3.2.2020 in IA 1652/2018 in SA 316/2018 passed by Ld. Presiding Officer, DRT-2, Ernakulam. The said SA was filed against the order dated 24.9.2019 passed by Ld.CJM, Thiruvananthapuram in CMP No.3759/2018 in MC 723/17 and IA 1652/2018 in the said SA was filed to stay all further proceedings.

2. Ld. Counsel for appellant submitted that the appellant entered into a lease deed of the mortgaged property through an unregistered lease deed dated 30.11.2013 and thereafter the said lease was extended through a registered lease deed for a period of 3 years on 4.11.2014. It is further submitted that the appellant was thus protected by the unregistered and registered lease deeds, therefore, there cannot be a proceedings under SARFAESI Act and under the circumstances, the proceedings initiated by the Ld. CJM, Thiruvananthapuram is illegal. Aggrieved by the said order, said SA was filed along with along with astay petition.It is further submitted that Tribunal below, without considering the merits involved in the case proceeded to dismiss the IA 1652/2018 in SA 316/2018.

3. In reply, Ld. Counsel for respondents 1 & 2 submitted that admittedly lease deed dated 30.11.2013 is an unregistered lease deed and before the registered lease deed was entered into on 14.11.2014, demand notice under Section 13(2) under SARFAESI Act was issued on 24.10.2014. It is further submitted that Section 13(13) of SARFAESI Act prohibits the borrower that “no borrower shall, after receipt of notice referred to in sub-section (2), transfer by way of sale, lease or otherwise (other than in the ordinary course of his business) any of his secured assets referred to in the notice, without prior written consent of the secured creditor.”

4. That apart, it is submitted that in ground (L) of grounds of appeal, it is stated that “In an admitted tenancy matter, moreover, registered document and continuing tenancy and further for 10 years, the finding of the Tribunal is illegal” which means tenancy was agreed for 10 years. It is stated that this is hit by Section 65(A) of Transfer of (Properties)Act which prohibits for entering into a tenancy registered for a period of more than 3 years.

5. In conclusion, Ld. Counsel for respondents 1 and 2 relied upon the decision laid by Hon’ble Supreme Court of India in re,BajarangShyamsunder Agarwal Vs. Central Bank of India and others, reported in AIR 2019 SC 5017, wherein Hon’ble Supreme Court of India has clearly laid down the preposition with regard to the right of a tenant against the proceedings initiated under SARFAESI Act. Therefore, SA 316/2018 filed under SARFAESI Act has no locus to stand and Ld. Presiding Officer, DRT-II, Ernakulam rightly dismissed the said IA and prayed for dismissal of the appeal.

6. Ld. Counsel for respondents 1 and 2 also relied upon the following decisionin support of his argument.

a) Hemraj Ratnakar Salian Vs. HDFC Bank Ltd and others reported in AIR

2021 SC 3880

7. No representation for R3. R3 is called absent and set exparte.

8. I have considered the rival submissions and perused the records.

9. From the facts narrated above, the admitted position is that there was an unregistered lease deed dated 30.11.2013 in favour of the appellant in respect of the mortgaged property and there was also a demand notice issued under Section 13(2) of SARFAESI Act dated 24.10.2014. After receiving this Notice, a registered lease deed was executed in favour of the appellant in respect of the mortgaged property on 4.11.2014.

10. As rightly pointed out by Ld. Counsel for respondents 1 and 2 that this lease deed dated 4.11.2014 is hit by Section 13(13). It is useful to extract the said section for ready reference, which is as follows:

(13) No borrower shall, after receipt of notice referred to in sub-section (2), transfer by way of sale, lease or otherwise (other than in the ordinary course of his business) any of his secured assets referred to