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2018 DIGILAW 277 (KER)

Dewan Housing Finance Corporation Limited v. Superintendent of Police

2018-03-21

A.M.BABU, A.M.SHAFFIQUE

body2018
JUDGMENT : A.M.Shaffique, J. 1. The petitioner is a secured creditor under the SARFAESI Act. They have approached this Court inter alia contending that though the secured asset was taken possession pursuant to the direction issued by the Chief Judicial Magistrate Court, Manjeri and possession was taken delivery by the Advocate Commissioner on 18.4.2017 and the possession was handed over to the petitioner, subsequently, the respondents 4 and 5 had trespassed into the property. Petitioner therefor preferred Ext P3 complaint to the Police to restore possession of the secured asset. But no action has been taken in the matter so far. Hence the petitioner has approached this Court by filing this writ petition. 2. The fifth respondent appeared through counsel. The learned counsel for the fifth respondent submitted that the fifth respondent was the owner of the property. In order to arrange certain loan, he had executed a sale deed in favour of the fourth respondent, who had taken loan from the petitioner, Finance Company. The contention urged is that the sale deed was not to be acted upon and it was only executed by way of security for the loan and that it was a sham document. 3. Further it is contended that the fifth respondent was residing in the property and there was a tenancy arrangement with fourth respondent. The fourth respondent had filed RCP No.25/2016 before the Rent Control Court, Ponnani under Sec.11 (3) of the Kerala Buildings (Lease and Rent Control) Act and the same came to be dismissed for default. 4. Further it is submitted that the fifth respondent had filed writ petition before this Court as WP(C) No.5806/2017 and an interim order was passed by this Court staying the possession to be taken on condition of the petitioner depositing Rs 5,00,000/-. The said amount was deposited. However, the deposit of the amount was not informed by the fifth respondent to the counsel. The said writ petition was therefore not prosecuted further stating that the said amount was not deposited. In the meantime, on 29.3.2017 the document had been created stating that possession was taken. It is submitted that actual possession was never taken. 5. Having regard to the fact that by Ext P1, an Advocate Commissioner was appointed by the Chief Judicial Magistrate exercising power under Sec.14 of the SARFAESI Act and the Commissioner had gone to the premises and had taken possession. It is submitted that actual possession was never taken. 5. Having regard to the fact that by Ext P1, an Advocate Commissioner was appointed by the Chief Judicial Magistrate exercising power under Sec.14 of the SARFAESI Act and the Commissioner had gone to the premises and had taken possession. We do not think that a different view can be taken. Therefore the contention of the fifth respondent that the petitioner had not taken possession of the premises cannot be believed. The report of the Advocate Commissioner is extracted as under: Report submitted by Lakshmanan. A, Advocate Commissioner in the above matter: I take the possession of the above mentioned petition schedule property and handed over the same to the petitioner bank on 29.3.2017 at 4.00 p.m. petition schedule property comprising of a house (EP 1/185A in RS9/9,9/10,9/6C in Eazhuvathiruthy Village, Ponnani Taluk) I closed the house and handed over the key and inventory materials to the petitioner bank authority – Vipindas. Authorized officer Dewan Housing Finance Corporation Limited. 6. Further, based on the Advocate Commissioner's report, the Chief Judicial Magistrate had passed the following order: This is a petition filed under Sec.14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. 2. Authorized Officer of the petitioner Bank filed affidavit. Respondent called. Absent. No representation also. The affidavit and true copy of stay order shows that stay was only till 21.3.2017 and possession was taken on 29.3.2017. Hence the Commission report is accepted. So the Advocate Commissioner has taken possession of the secured asset and handed over the same to the secured creditor. Hence this CMP is closed. 7. The above facts clearly indicates that the bank had taken possession of the secured asset. The exercise of right by the bank to take possession of the secured asset is a statutory right under the SARFAESI Act. When such statutory rights are being exercised by a secured creditor, it is not open for any person for that reason to trespass into such property which has already been taken possession. If such attitude is permitted, the statutory right of the secured creditor will become an eyewash and it may not be possible for the Bank to realise the secured debt. If such attitude is permitted, the statutory right of the secured creditor will become an eyewash and it may not be possible for the Bank to realise the secured debt. At any rate, since the possession of the property had already been taken as per the direction issued by the Chief Judicial Magistrate, we are of the view that the direction sought for is reasonable. 8. Having regard to the aforesaid factual situation, we are of the view that this is a fit case in which the Police has to be directed to restore possession of the property to the petitioner, Finance Company. If at all the petitioner has any right in respect of the property it shall be open for him to take appropriate proceedings in accordance with law. 9. Accordingly the writ petition is disposed of directing the third respondent to provide necessary police assistance to the petitioner for restoring possession of the secured asset by removing any person from the said property including the fifth respondent and his family members. It shall be done within a period of one month from the date of receipt of a copy of this judgment. It is made clear that the judgment shall not preclude the fifth respondent from taking appropriate steps in accordance with law to agitate his rights and any observation made in the judgment shall not affect his legal rights in any manner.