The court dismissed a writ petition seeking the return of original mortgage documents by a bank to a subsequent purchaser. The court held that issuing such a direction would revive illegality.
Petitioner granted liberty to approach the bank while treating the writ petition as dismissed.
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THE HON’BLE SRI JUSTICE V.V.S.RAO AND
THE HON’BLE SRI JUSTICE G.KRISHNA MOHAN REDDY
WRIT PETITION No.25823 of 2011
Dated:12.03.2012
Between:
Nallamilli Sitharamareddy.
Petitioner
And Oriental Bank of Commerce, And others.
... Respondents
THE HON’BLE SRI JUSTICE V.V.S.RAO AND
THE HON’BLE SRI JUSTICE G.KRISHNA MOHAN REDDY
WRIT PETITION No.25823 of 2011
ORDER: (Per Hon’ble Sri Justice V.V.S.Rao)
The petitioner filed the instant writ petition seeking a direction to the first respondent (hereafter referred to as, the bank) to return the original documents deposited by the third respondent with the bank in respect of the immovable property.
The third respondent availed credit facilities against the mortgage of the immovable property as security. When he committed default in payment of the loan instalments, the bank initiated action under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002
(the Act), and issued auction notice proposing to sell vacant site admeasuring 200 square yards (out of 400 square yards) in T.S.No.52/1, L.P.No.417/87, situated at Kannayyakapu Nagar, Kakinada. In the meanwhile, the petitioner having purchased the same property (Door No.3-19-23 and the vacant land of 200 square yards) under registered sale deed dated 10.06.2011 from the third respondent issued legal notice on 16.08.2011. While expressing willingness to repay the entire amount due to the bank, he requested for return of the original documents deposited by the third respondent, in vain. Therefore, he filed the instant writ petition.
The Assistant General Manager of the bank filed counter affidavit. While admitting that the petitioner deposited Rs.9,08,818/- with the second respondent, it is stated that the said amount is kept in sundry account, and the same has not been appropriated to the account of the third respondent. An objection is also raised that the purchase of the property by the petitioner is not valid, and therefore, the very locus standi of the petitioner is questioned by the respondent bank.
This Court heard the Counsel for the petitioner and the Counsel for the bank. There is no doubt that when the mortgage created by the third respondent in favour of the first respondent was subsisting, the petitioner purchased part of the property without notice to the mortgagee. If a direction is issued to the bank to release the documents – even though the petitioner has admittedly paid the amount due to the bank – it would amount to restoring the illegality. A writ of mandamus cannot be issued if the same has effect of reviving an illegal order or an illegality (Gadde [1] Venkateswara Rao v Government of Andhra Prades h ) . Therefore, we are not inclined to pass any order in this case. We give liberty
to the petitioner to approach the first respondent in this regard. The bank may consider any such request of the petitioner keeping in view Section 13(4)(d) and Section 13(8) of the Act.
The Writ Petition, with the above observations, shall stand dismissed. The miscellaneous petitions, if any, shall also stand dismissed. There shall be no order as to costs.
________________ (V.V.S.RAO, J)
________________________________ (G.KRISHNA MOHAN REDDY, J)
12.03.2012 vs
2 issues framed by the court
Whether a writ of mandamus can be issued directing a bank to return original documents when such relief would revive an illegality arising from a purchase of mortgaged property without notice.
Whether the petitioner has locus standi to seek return of possession documents after purchasing part of a mortgaged property.
Colour shows how this judgement treated each authority
AIR 1966 SC 828 · Who else cites this
2 provisions across 1 enactments
Nallamilli Sitharamareddy
Oriental Bank of Commerce
V.V.S.Rao
G.Krishna Mohan Reddy
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
