Biju.P.S vs The Sub Registrar

Murali Purushothaman, J

According to the petitioner, the 3rd respondent had borrowed Rs.23,00,000/- from the petitioner for his share trading business. Due to the failure on the part of the 3rd respondent to repay the amount as agreed, the petitioner approached the Taluk Legal Service Committee, Chavakkad and based on a compromise between the parties, Ext. P1 award dated 14.05.2015 was passed in the Pre-litigation petition P.L.P. No. 531/2015. As per Ext.P1, the 3rd respondent was required to repay the amount along with damages. However, the 3rd respondent failed to fulfill the said obligation and the petitioner filed E.P. No. 55/2015 before the Sub Court Thrissur for execution of Ext. P1 award. Consequently, the Court conducted an auction and the petitioner purchased the property.

The petitioner states that the 3rd respondent attempted to stall the confirmation of sale by all means, and various Execution Appeals and Execution First Appeal were filed at the instance of the 3rd respondent. However, all the appeals were dismissed by the Courts and the executing Court issued Ext. P3 sale certificate dated 30.09.2016 to the petitioner. Accordingly, the property was delivered to the petitioner. However, it later came to the notice of the petitioner that the 3rd respondent had mortgaged the property with M/s HDFC Limited. The petitioner states that this fact was suppressed by the 3rd respondent while entering into the agreement leading to Ext. P1 award.

Meanwhile, M/s HDFC Limited filed W.P.(C) No. 7244/2020 claiming that they had taken possession of the property under the SARFAESI Act, conducted an auction, and issued a sale certificate in favour of one Sulochana Chinnappan, but, the Sub Registrar refused to register the property due to the previous registration of the Ext. P3 Sale Certificate issued by the executing Court to the petitioner. The petitioner, the 3rd respondent, his wife, the 4th respondent and Smt. Sulochana Chinnappan, the auction purchaser, were parties to the said writ petition. During the pendency of the said writ petition, a settlement was arrived at between the parties and the petitioner agreed to pay Rs.25,00,000/- to Sulochana Chinnappan, and all claims including that of the HDFC Bank were settled and as a result, this Court set aside the sale certificate issued to Smt. Sulochana Chinnappan.

Later, the petitioner decided to sell the property to overcome his financial constraints. However, upon scrutinizing the encumbrance certificate, the petitioner noticed that the 4th respondent, the wife of the 3rd respondent had obtained an attachment over the property as per the order in I.A. No.1770/2015 in O.P. No. 677/2015 of the Family Court, Thrissur. When the petitioner approached the Sub Registrar to register the property covered by Ext.P3, the 1st respondent insisted on obtaining a Record of Right (ROR) certificate from the 2nd respondent Village Officer. However, the 2nd respondent refused to issue ROR certificate since the encumbrance certificate carries the endorsement of the attachment obtained by the 4th respondent. The petitioner states that, O.P. No. 677/2015 in which the 4th respondent obtained the attachment was later allowed, but the decree/order was not executed which shows a collusive attempt to prevent the petitioner from enjoying the property. The petitioner contends that an attachment under Order 38 Rule 5 of the Code of Civil Procedure is not an encumbrance over the property and that a charge created under Section 100 of the Transfer of Property Act, 1882 gets precedence over the attachment. Accordingly, the petitioner has filed this writ petition for a declaration that the order of attachment obtained by the 4th respondent against the 3rd respondent has no consequence over the property covered by Ext.P3 sale certificate and for direction to the 1st respondent to register the said property without insisting for ROR certificate.

Heard the learned counsel for the petitioner and the learned Government Pleader. Though notice was taken out to respondents 3 and 4 by paper publication, there is no appearance.

In the Pre-litigation petition before the Taluk Legal Services Committee, Chavakkad, based on a compromise between the petitioner and the 3rd respondent, Ext. P1 award was passed. The petitioner purchased the said property in the auction conducted in execution of the said award. The subject property was by the time mortgaged by the 3rd respondent with HDFC on 16.01.2014 as can be seen from the appendix to Ext. P5 judgment. When the 3rd respondent defaulted loan repayment, HDFC initiated proceedings against the mortgaged property/secured asset under the SARFAESI Act and the property was sold in auction to Smt. Sulochana Chinnappan. The 3rd respondent lost his right to redeem the property in terms of Section 13 (8) of the SARFAESI Act. When the Sub Registrar refused to register the said sale certificate issued to Smt. Sulochana Chinnappan due to registration of Ext. P3 Sale Certificate issued by the executing Court to the petitioner, HDFC approached this Court and during the pendency of the writ petition, a settlement was arrived at between the parties and the petitioner agreed to pay Rs.25,00,000/- to Sulochana Chinnappan, and all claims including that of the HDFC Bank were settled and this Court set aside the sale certificate issued to Smt. Sulochana Chinnappan. Respondents 3 and 4 herein were also parties to the said writ petition and the proceedings under the SARFAESI Act were also not objected to. The attachment in O.P. No. 677/2015 of the Family Court in favour of the 4th respondent was subsequent to the creation of equitable mortgage by the 3rd respondent in favour of HDFC. The sale certificate issued pursuant to the proceedings under the SARFAESI Act was set aside by this Court as per Ext. P5 judgment since it was agreed by the parties that the petitioner would pay Rs.25,00,000/- to the auction purchaser. Ext. P5 judgment is not hitherto challenged by respondents 3 and 4. As rightly contended by the learned counsel for the petitioner, an attachment under Order 38 Rule 5 of the Code of Civil Procedure is not an encumbrance over the property. It neither creates any title nor any encumbrance. In Nirmala v. Sundaresan (Deceased) [2023 (5) KHC 28], a Division Bench of this Court held that attachments, by themselves, do not amount to creation of charges and are therefore not encumbrances. In Secretary, Keechery Service Co-operative Bank Ltd. v. Sajitha Nizar alias Sajitha P.M. and Others [2020 (5) KHC 231: ILR 2020 (4) Ker.249: 2020(6) KLT 68: 2020(4) KLJ 970], the Division Bench held that attachment effected after creation of mortgage of the property would stand effaced. The attachment from the Family Court has been obtained by the 4th respondent after the 3rd respondent created charge over the property as per Ext. P1 award. Therefore, the attachment in O.P. No. 677/2015 of the Family Court in favour of the 4th respondent cannot have any consequence over the 4.553 ares of land in Survey No. 114/5 of Kundaliyur Village. It is so declared.

This Court, in Synudheen v. State of Kerala [2013 (1) KLT 221 (2013 (1) KHC 437 : 2013 (1) KLJ 453], held that since the provisions of the Registration Act and the Rules have not been amended so as to incorporate a mandatory condition insisting for production of ROR certificate before the deeds could be registered, the registration officials cannot refuse to register the same on the mere ground that the petitioner has not produced the ROR certificate in respect of the property concerned. In Jacob P.C. v. Village Officer, Ernakulam and another [2020 (4) KHC 167: 2020 (4) KLT 271], this Court, following the dictum in Synudheen (supra), held that the parties cannot be compelled to obtain ROR as a pre-condition for registration and it can only be optional, or else, it will interfere with the right of a property owner to transfer his property in terms of his requirement.

In the light of the law laid down by this Court in Synudheen and Jacob (supra), it is ordered that the 1st respondent cannot refuse registration of the document pertaining to 4.553 Ares of land in Survey No. 114/5 of Kundaliyur Village on the ground that the petitioner has not produced the ROR certificate, if it is otherwise in order. It is also made clear that this judgment will not impede the right of the 4th respondent in seeking any other remedy, as may be available in law, against the 3rd respondent.

The writ petition is disposed of.