W.A.No.1062 of 2020

IN THE HIGH COURT OF JUDICATURE AT MADRAS

Orders Reserved on

Orders Pronounced on

4.9.2023

08.11.2023

CORAM

THE HONOURABLE MR.JUSTICE D.KRISHNAKUMAR

AND

THE HONOURABLE MR.JUSTICE P.B.BALAJI

W.A.No.1062 of 2020

and C.M.P.No.12977 of 2020

P.K.Parthiban

...

Appellant/Petitioner

Vs.

1. The Regional Manager,

Canara Bank,

No.524, Anna Salai,

Teynampet, Chennai.

2. The Manager,

Canara Bank, Ponneri Branch,

Ponneri – 601 204,

Tiruvallur District.

... Respondents/Respondents

Appeal filed under Clause 15 of Letters Patent to set aside the order

dated 12.08.2020 passed in W.P.No.8986 of 2017.

For Appellants

: Mr.M.L.Ramesh

For Respondents 1 & 2 : Mr.S.Parthasarathy

*****

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W.A.No.1062 of 2020

JUDGMENT

D.KRISHNAKUMAR, J.

Facts in Brief:

The appellant executed a mortgage deed in Doc.No.1155 of 2014

dated 11.2.2014 on the file of the Office of Registrar, Ponneri, as a guarantor

by deposit of title deed in respect of vacant land measuring an extent of 17

cents comprised in S.No.348/2A of Kolur Village, situated at Ponneri Taluk,

Tiruvallur District for the overdraft facility availed by one G.Mahendiran for a

sum of Rs.25,00,000/- in Overdraft A/c No.3725256000025. Thereafter, the

appellant had availed an overdraft facility independently for a sum of Rs.15.00

lakhs initially and later it was enhanced to Rs.35,00,000/- during the year 2014

by mortgaging his another property viz., vacant land measuring an extent of

0.65 acres (26.5 ares) comprised in S.No.342/5B of No.22, Kolur-III Village,

Kolur Panchayat Union, Ponneri Taluk, Tiruvallur District. The borrower

G.Mahendiran had cleared the entire loan and the respondent Bank had also

issued a certificate stating that there is no due pending in the aforesaid

overdraft account. However, pursuant to the certificate issued by the

respondent bank, when the appellant had approached the respondent Bank to

return the title deed deposited by him since the borrower already cleared the

entire loan, the respondent bank refused to release the documents and giving

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W.A.No.1062 of 2020

no objection or removing the encumbrance by stating that the appellant is

liable to pay an outstanding amount of Rs.56,42,429/- as on 31.10.2017. The

respondent Bank is claiming a general lien under Sec.171 of the Contract Act.

Challenging the same, the appellant has filed the instant writ petition in

W.P.No.8986 of 2017 for issuance of Mandamus directing the respondents to

return the title deeds placed with the second respondent Bank by creating a

mortgage by deposit of title deeds in Doc. No.1155 of 2014 dated 11.2.2014 on

the file of the Registrar of Ponneri.

2. The learned Single Judge dismissed the writ petition by holding

that the rights under Section 171 of the Indian Contract Act can be exercised

on an immovable property deposited with the respondent Bank as security.

Aggrieved by the same, the present appeal.

3. The appellant raised several grounds in the appeal by stating

that the learned Single Judge failed to note that there is no express

undertaking given by the appellant with the second respondent to extend the

mortgage created on 11.2.2014 to the overdraft facility obtained by the

appellant later. The learned Single Judge failed to note that the overdraft

facility obtained by the appellant later is also secured by another property by

creating a mortgage. Therefore, power under Section 171 of the Indian

Contract Act cannot be exercised by the Bank without approval from the

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W.A.No.1062 of 2020

appellant.

4. According to the learned counsel appearing for the appellant,

the respondent bank cannot exercise right of general lien to secure any other

liabilities of the mortgagor by reta