SREE SANKARA FUNDS Vs. TAHSILDAR (LAND)

JUDGEMENT

(1.) Petitioner's attempt to effect mutation of a property purchased by it was not successful. The application was 'rejected' on the basis of legal opinion obtained by the District Collector. Through Ext.P9, the first respondent has communicated to the petitioner, the nature of the legal opinion. It is stated in Ext.P9 that since petitioner's registration under Section 45-IA(6) of the Reserve Bank of India Act, 1934 ( for short 'the Act') has been cancelled with effect from 02-06-2018, the sale deed executed after such date is without authority. Apart from challenging Ext.P9, petitioner has also sought for a direction to the respondents to effect mutation of the property purchased by the petitioner.

(2.) Petitioner was a Non-Banking Financial Company [for short, 'NBFC'] engaged in the business of providing loans and advances. The certificate of registration (CoR), as an NBFC, is dated 15-12-2000 with No.B-16.00135. While it was carrying on its business as an NBFC, two persons availed loans from the petitioner and created a mortgage over two immovable properties in the year 2012. Due to default in repayment of the dues, after classifying the account as NPA, proceedings were initiated under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short 'SARFAESI Act'), as is evident from Ext.P1 and Ext.P2 notices dated 18-01-2018, issued under section 13(2) of the SARFAESI Act.

(3.) While so, petitioner's registration as NBFC was cancelled by the Reserve Bank of India, through Ext.P4 dated 03-07-2018 and directed the petitioner to repay the deposits already accepted by the petitioner so as to bring down the financial assets below 50%. The reason for cancellation of CoR is stated to be the failure of the petitioner to achieve the required net owned fund before 01-04-2017, which was found to be a violation of the directions issued by the Reserve Bank of India. As a matter of fact, Ext.P4 was issued after following the statutory procedure.