Subsequent attachments after the creation of an equitable mortgage do not affect the title of the property sold under the SARFAESI Act and must be removed from records.

J U D G M E N T

Notice to the respondents have been duly served except the 4^th respondent and he has been deleted from the party array as per order dated 17.01.2024 in I.A. No. 1/2024.

2. Petitioner is a public sector bank. The 4^th respondent along with his wife availed a housing loan of Rs. 30,000,00/- from the Pattambi Branch of the petitioner Bank, and to secure the due repayment of the outstandings in the credit facility, an equitable mortgage was created on 21.08.2013 in respect of the property having an extent of 4.53 ares comprised in Sy.No. 4/8 of Pattambi Village, Ottapalam Taluk, Palakkad District together with building and other structures covered by Sale Deed No. 144/1/2013 of Pattambi SRO in favour of the petitioner Bank. Subsequently there was default in repayment of the amount, and SARFAESI proceedings were initiated. Ultimately the mortgaged property was sold to the 5^th respondent on 23.08.2023 and Ext.P5 sale certificate was issued by the authorised ofÏcer of the petitioner in favour of the 5th respondent as is evident from Ext.P5. When enquiry was made with the Sub- Registrar’s OfÏce, Pattambi in connection with registration of the sale certificate, it was informed by the Sub-Registrar that the sale certificate cannot be registered as the encumbrance register reveals that an attachment has been created over the subject property by the 6^th respondent on 20.08.2022 as is evident from Ext.P6 encumbrance certificate.

3. Petitioner submits that the mortgage of the property with the bank was on 21.08.2013 and the attachment in favour of the 7^th respondent was subsequent to the mortgage, i.e. on 20.08.2022. Petitioner relies on the judgment in Madhan S. v. Sub Registrar, Kollam and Others [2014 (1) KHC 249] wherein paragraph 9 reads as follows:-

“9. The preponderance of judicial opinion leads to the irresistible conclusion that the sale of the mortgaged property in favour of the petitioner under Ext.P5 sale certificate under the Act is free of all encumbrances. The attachments effected subsequent to the mortgage created in favour of the bank do not affect the title and ownership of the petitioner over the subject property. Such attachments have no impact on the sale conducted under the Act and the same ceases to have any effect or fall to the ground the moment the sale is confirmed in favour of the petitioner. The declaration so sought by the petitioner is therefore granted and I further direct the Sub-Registrar and the Village OfÏcer to efface the attachments effected subsequent to the mortgage from the relevant records. Otherwise those attachments would remain as a permanent taboo prejudicially affecting the marketability and title to the property even though they ceased to have any legal efÏcacy. The needful in relation to the property bought by the petitioner shall be done within a period of two months from the date of receipt of a copy of this judgment.”

Petitioner also relies on the judgment in Secretary, Keecheri Service Co-operative Bank ltd. v. Sajitha Nizar Alias Sajitha P.M. [2020 (6) KLT 68] wherein in paragraph 5, 6 and 7 reads as follows:

“5. The 6th respondent in the writ petition who obtained order of attachment from the Munsiff Court, Muvattupuzha in O.S.No.505 of 2015 did not contest the writ petition. It is the case of the appellant who was the 7th respondent in the writ petition that in ARC.No.216/2015 the Joint Registrar of Co- operative Societies, Ernakulam passed an order of attachment viz., Ext.R7(a) dated 6.7.2015. According to the appellant, one Shamsudheen and his sons namely, Sham.P.S. and Shaji.P.S., who were conducting a Jewellery in Arayankavu, cheated the appellant Bank by pledging fake gold ornaments and receiving about Rs.1,60,00,000/-. Against them the appellant filed 5 Arbitration cases including ARC.No.216/2015. Evidently, in ARC N