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HIGH COURT OF KERALA
ANTONY DOMINIC, J
SAIRA BEEGAM – Appellant
Versus
AUTHORISED OFFICER – Respondent
WRIT PETITION (CIVIL) 4421/2013
Property - Mortgage - SARFAESI Act Section List - Court allowed a third party to pay dues related to a mortgaged property, emphasizing that acceptance of payment does not entail obligation to restore title deeds.
Fact of the Case:
The petitioner, who sold property to the 4th respondent, sought to discharge the 4th respondent's mortgage liability after the bank initiated SARFAESI proceedings due to default.
Finding of the Court:
The court found that the bank could accept payments from the petitioner for the 4th respondent's liability without obligation to return title deeds.
Issues: Whether a third party can discharge the mortgage liability of another party without being a party to the original loan agreement.
Ratio Decidendi: The court established that a third party can make payments on behalf of a debtor, but such actions do not confer any rights to the security documents held by the bank.
Final Decision: The writ petition was disposed of allowing the petitioner to pay the dues in installments without affecting the bank's rights over the title documents.
JUDGMENT
1. Petitioner says that he sold the property covered by Ext.P1 to the 4th respondent. The 4th respondent mortgaged the property to the respondent bank and obtained a loan. Default was committed by the 4th respondent and therefore, SARFAESI proceedings are initiated by the bank and possession also has been taken over in pursuance of Ext.P3. It is at that stage, this writ petition is filed and the main prayer made by the petitioner is that she may be allowed to discharge the liability of the 4th respondent.
2.The bank states that petitioner being a stranger, it cannot accept any payments from her for regularising the loan. However, the bank cannot have any objection in accepting payments from the petitioner towards the liability of the 4th respondent without any obligation on its part to return the title deeds to the petitioner.
WPC.4421/13
3.In such circumstances, I direct that the petitioner will be allowed to pay the amounts which are due from the 4th respondent in three equal monthly instalments. The first instalment shall be paid on or before 5.3.2013 and the second and third instalments shall be paid on or before 5.4.2013 and
5.5.2013 respectively.
4. Subject to payments as above, coercive action as against the property will stand deferred and in case of default, the respondents will be free to continue with recovery action. It is also clarified that this acceptance of the payments as directed above will not oblige the bank to return the documents of title mortgaged by the 4th respondent to the petitioner.
Writ petition is disposed of as above.
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