2013 (8) TMI 1180 - HC - Indian Laws

Summary

Issues Involved:
1. Registration and validity of the Sale Certificate.
2. Right of redemption by the borrower.
3. Authority of the Authorised Officer to cancel the Sale Certificate.
4. Entitlement of the auction purchaser to physical possession and changes in revenue records.

Summary:

1. Registration and Validity of the Sale Certificate:
The petitioner sought a writ of mandamus to register the Sale Certificate dated 16.09.2011 and to effect changes in revenue records. The court observed that the Sale Certificate issued by the Authorised Officer under the SARFAESI Act does not require registration as per the judgments in (2007) 5 SCC 745 and AIR 2008 Madras 108. However, since the Authorised Officer is not a Civil or Revenue Officer, the Sale Certificate requires registration under Section 17(2)(xii) of the Registration Act. The petitioner's claim for mandatory registration was not pressed, and the court acknowledged that the auction purchaser derives title on confirmation of sale, making the Sale Certificate merely evidence of such title.

2. Right of Redemption by the Borrower:
The third respondent argued their right to redeem the mortgage u/s 60 of the Transfer of Property Act. The court noted that this right is available until the sale becomes absolute. Since the Sale Certificate was issued on 16.09.2011, the sale became complete, and the right of redemption was extinguished. The borrower failed to exercise this right before the sale, and no competent court or tribunal set aside the Sale Certificate.

3. Authority of the Authorised Officer to Cancel the Sale Certificate:
The court held that the Authorised Officer has no authority under the SARFAESI Act to cancel a Sale Certificate once issued. The cancellation by letter dated 08.02.2012 was without jurisdiction and violated principles of natural justice as it was done without notice to the petitioner. The court emphasized that only a competent court or tribunal could cancel the Sale Certificate.

4. Entitlement of the Auction Purchaser to Physical Possession and Changes in Revenue Records:
The court directed the respondents to hand over physical possession of the properties to the petitioner within three months and allowed the petitioner to effect changes in the revenue records. The respondents must provide necessary documents to facilitate this process. The court set aside the proceedings/letter dated 08.02.2012 and instructed the petitioner to repay the refunded amount within two weeks.

Conclusion:
The writ petition in W.P.No.4088 of 2012 was allowed, setting aside the cancellation letter, and the writ petition in W.P.No.1937 of 2012 was disposed of with directions for the respondents to assist in updating revenue records. The petition for perjury was dismissed as no arguments were advanced.