MADHAN Vs. SUB REGISTRAR

JUDGEMENT

(1.) Can the attachments effected subsequent to the creation of equitable mortgage be effaced after the property is purchased by another in sale conducted by the Recovery Officer of the Debts Recovery Tribunal

(2.) The fifth respondent had mortgaged his property (3.44 ares in R.S. No. 38/2 and 0.9443 are in R.S. No. 393/3) situated in Kollam west village to the fourth respondent bank ('the bank' for short) as security for the loan availed. The bank filed O.A. No. 437/2002 in the Debts Recovery Tribunal under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 ('the Act' for short) for recovery of dues. The Debts Recovery Tribunal passed Ext.P1 final order allowing the bank to recover a sum of Rs.22,18,958.28 with interest thereon till realisation by sale of the property. A recovery certificate was accordingly issued to the Recovery Officer who proceeded to recover the debt in accordance with the provisions of the second schedule to the Income Tax Act, 1961. The provisions of the second schedule to the Income Tax Act, 1961 and the Income-tax (Certificate Proceedings) Rules, 1962 have been made applicable by virtue of Section 29 of the Act.

(3.) The Recovery Officer proclaimed the mortgaged property for sale under Rule 52 of the second schedule to the Income Tax Act, 1961 on failure of the certificate debtors to pay the amount even after receipt of demand notice. Ext.P2 sale notice published in the 'Malayala Manorama' Daily fixed the date of sale as 16.07.2009 wherein the petitioner was the highest bidder for a sum of Rs.27,30,000/-. No application was filed by anyone to set aside the sale and the same was accordingly confirmed by Ext.P3 order under Rule 63(1) of the Income-tax (Certificate Proceedings) Rules, 1962. Ext.P4 sale certificate issued to the petitioner was registered as document No. 2415/2009, Sub Registry Ofiice, Kollam on the basis of which Ext.P5 order of delivery was issued by the Recovery Officer. Mutation was effected in favour of the petitioner and land tax was also paid for the property evidenced by Ext.P6 receipt which however contained an endorsement by the village officer as to the existence of certain attachments from court.