Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2026 Supreme(Online)(Mad) 34707

IN THE HIGH COURT OF JUDICATURE AT MADRAS
ABDUL QUDDHOSE, J
Reliance Assets Reconstruction Co. Ltd Rep. by its Assistant Vice President P.Prabhu – Appellant
Versus
The Sub Registrar Bhavani Sub Registration office, Bhavani Main Road, Taluk office campus, near ward 4, Erode-638 301 – Respondent
Writ Petition

Advocates:
For the Petitioner(s): Mr.Gautam S.Raman
For Respondent(s): Mr.U.Baranidharan,SGP

SARFAESI sale certificate registration cannot be refused due to court attachment without hearing; quashed for violating natural justice.

Headnote:The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act) governs the issuance of sale certificates to purchasers from secured creditors, vesting ownership upon execution. The Sub-Registrar refused registration of a sale certificate citing a court attachment by an unsecured creditor. The court found no legal impediment to registration under SARFAESI provisions despite the attachment. The refusal order violated natural justice principles, lacking hearing opportunity and being non-speaking. Issues framed: Whether Sub-Registrar can refuse SARFAESI sale certificate registration due to court attachment; validity of refusal without hearing. Ratio: SARFAESI sale certificate confers ownership overriding subsequent attachments by unsecured creditors; registration cannot be denied without considering secured creditor rights and affording hearing. The refusal check slip was quashed, matter remanded for fresh consideration with directions for speaking order.

Table of Content
1. challenges sub-registrar's refusal to register sarfaesi sale certificate due to court attachment. (Para 1)
2. no impediment to registration; violates natural justice without hearing. (Para 2 , 3)
3. non-speaking order quashed for ignoring contentions and hearing. (Para 4 , 5)
4. remanded for fresh consideration with speaking order directive. (Para 6)

Order

This writ petition has been filed, challenging the impugned refusal check slip dated 20.11.2025 issued by the first respondent, refusing to register the Sale Certificate dated 14.11.2025, presented by the petitioner for registration on the ground that there is a court attachment over the very same property, which is the subject matter of the Sale Certificate.

2.The petitioner categorically contends before this Court that there is no legal impediment for the first respondent to register the Sale Certificate, which is presented for registration. By initiating SARFAESI proceedings, the purchaser by virtue of the Sale Certificate dated 14.11.2025 became the owner of the property. However, the first respondent has refused to register the sale certificate presented by the petitioner, which is an Asset Re-construction Company on the ground that there is a court attachment over the very same property, which is the subject matter of the sale certificate presented by the petitioner for registration. The petitioner categorically contends that being a secured creditor and the sale certificate having been issued in favour of the purchaser as per the provisions of SARFAESI Act , there is no legal impediment for the first respondent to register the sale certificate despite there being a court attachment order by an unsecured creditor over the very same property.

3.The petitioner has also challenged the impugned order on the ground of violation of the principles of natural justice as they were not afforded any opportunity of hearing by the first respondent before issuing the impugned refusal check slip dated 20.11.2025.

4.Mr.U.Baranidharan, learned Special Government Pleader accepts notice on behalf of the respondents.

5.As seen from the impugned refusal check slip dated 20.11.2025 issued by the first respondent, the contentions of the petitioner as raised in this writ petition along with the supporting documents have not been considered by the first respondent. The petitioner was also not afforded an opportunity of hearing by the first respondent before issuing the impugned refusal check slip dated 20.11.2025. Being a non-speaking order and an order passed in violation of the principles of natural justice, this Court is of the considered view that the impugned refusal check slip dated 20.11.2025 issued by the first respondent has to be quashed and the matter has to be remanded back to the first respondent for fresh consideration, on merits and in accordance with law.

6.Accordingly, this writ petition is disposed of and the impugned refusal check slip dated 20.11.2025 issued by the first respondent is quashed and the matter is remanded back to the first respondent for fresh consideration, on merits and in accordance with law. The petitioner shall submit a written explanation along with the supporting documents to the first respondent stating as to why there is no legal impediment for the first respondent to register the Sale Certificate, presented by the petitioner for registration despite there being a court attachment over the very same property, within a period of one week from the date of receipt of a copy of this order. On receipt of the said written explanation along with the supporting documents within the stipulated time from the petitioner, the first respondent, after giving due consideration to the written explanation submitted by the petitioner and the supporting documents produced by them, shall take a final decision as to whether the Sale Certificate presented by the petitioner for registration can be registered or not, within a period of 3 weeks thereafter. In case

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