IN THE HIGH COURT OF KERALA AT ERNAKULAM
WP(C) No. 26151 of 2005
1. S.SHAMEEM, S/O.SHAHUL HAMEED,
... Petitioner
Vs
1. THE CITY POLICE COMMISSIONER,
... Respondent
2. THE CIRCLE INSPECTOR OF POLICE,
3. R.SOORAJ, S/O.RAMDAS, LAKSHMI SADAN,
For Petitioner :SRI.V.JAYAKUMAR
For Respondent :SRI.V.GIRI
The Hon'ble MR. Justice M.RAMACHANDRAN
The Hon'ble MR. Justice M.N.KRISHNAN
Dated : / /
O R D E R
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W.P.(C).NO.26151 OF 2005-L@@
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Dated this the 23rd day of September, 2005@@
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This is an application for police protection.
The petitioner had invited our attention to Ext.P5
representation submitted by him dated 31-08-2005.
Although it was addressed to the Commissioner of Police,
Thiruvananthapuram, he submitted that the third
respondent was attempting to take law in his hands so as
to evict him from the tenanted premises unlawfully, where
he was conducting business, and it was imperative that
the police is directed to render sufficient help so as to
protect him.
2. According to the petitioner, Ext.P1 rent deed
dated 01-06-2001 in respect of a shop room governed the
relationship between himself and the third respondent,
who was the landlord. He had been authorised to conduct
a readymade dress shop and due licence had been granted
by the Corporation for the business. Later on arrears of
rent fell due and R.C.P.No.6 of 2004 had come to be
filed, which resulted in an order for eviction. Against
the said order, R.C.A.No.9 of 2005 had been filed by him
and the First Additional District Judge,
Thiruvananthapuram in I.A.No.384 of 2005 in R.C.A.No.9 of
2005 had stayed the order of eviction. It was not
attempted to be vacated and the submission was that by
use of force notwithstanding the above order (Ext.P4),
forcible eviction was being attempted.
3. Prima facie it had been found that the
petitioner was entitled to an interim order. This Court
had directed respondents 1 and 2 to give adequate
protection to ensure that his possession and occupation
of the building is not interfered with at the instance of
the third respondent or any strangers.
4. The third respondent had entered appearance
and had filed a counter affidavit and further requested
that the interim orders were to be appropriately
modified. Senior Counsel Sri.S.V.S.Iyer, appearing for
the third respondent, especially highlighted the
circumstance that making use of the interim orders
passed, in a most dishonest manner the petitioner had
secured further orders from the Rent Control Appellate
Authority in I.A.No.2193 of 2005, even by impleading the
Circle Inspector of Police, Thiruvananthapuram as an
additional respondent to the proceedings and had upset
the continued possession of the landlord. He further
submitted that the writ petition was not maintainable.
This Court has been taken astray, as the full and
relevant facts have not been brought to its attention
when the matter came up for admission and the landlord
has been inflicted with civil injury. He submits that
the petitioner had a duty to present full facts and then
only could have made a request for exercising the
discretionary jurisdiction, in proceedings under Article
226 of the Constitution of India. It is submitted that
civil suits and other proceedings are pending before the
appropriate authorities and the short cut method employed
by the petitioner was illegal.
5. We feel that the fuller details supplied to us
do indicate that the petitioner is guilty of
indiscretion. He had presented the facts as if
high-handed action had been resorted to by the landlord.
Of course, the landlord was bound by interlocutory orders
passed by the Rent Control Appellate Authority, which
prohibited him from exercising his right of eviction.
But the tenant appears to have been divested of
possession as a consequence of certain independent,
collateral proceedings only, unconnected with proceedings
under the Rent Control Act.
6. Documentary evidence had been supplied by the
third respondent and the affidavit gives further details.
It is submitted that Ext.P1 is a sham document and it did
not govern the rental arrangements between the parties.
Reliance was placed on Ext.R3(a) dated 01-10-2001, which
was an agreement on which parties had put on record their
respective rights and liabilities and this was to be in
operation for a period of six months from 01-10-2001. He
admits that the arrangement had been continuing
thereafter, but there was heavy default which
necessitated filing of a rent control petition and it had
ended in a decree of eviction, although an appeal
therefrom is pending. It is stated that although the
rental arrangements had started from May 2001 onwards,
there was no payment of Rs.5 lakhs as advance, and during
the subsistence of the rental arrangement the petitioner
in the writ petition had requested the third respondent
to stand as guarantor for a loan from Union Bank of
India. It was for Rs.5 lakhs and the Bank required the
landlord to create a mortgage in respect of the shop
room. Security was consequently created by mortgage and
deposit of title deed of the tenanted premises. This was
to oblige the tenant. There was huge default in
repayment of the loan amount and the Bank had initiated
action for recovery under the Securitisation and
Reconstruction of Financial Assets and Enforcement of
Security Interest Act, 2002 (for short Securitisation
Act). Notices had been issued by the Bank from July,
2001 onwards and as a guarantor the third respondent
could not have evaded from responsibility. It so
happened that the Bank had exercised their right under
the Securitisation Act and they had taken possession of
the mortgaged property on 20-12-2004. Ext.R3(d) is
produced in support thereof.
7. By Ext.R3(d), the tenant was required to pay
up the entire dues, and as a measure in their discretion,
at his request, possession of the property was given to
him by the Bank, recording his undertaking to hold the
property under trust on behalf of the Bank to enable him
to remit the dues to the Bank latest by 5th of January,
2005. Such payments had not been there. As reserved by
Ext.R3(d), possession was taken back by them on
07-05-2005. From 20-12-2004 there was no tenancy in
operation because of the impact of Securitisation Act.
8. Counsel for the third respondent further
invited our attention to the notices issued by the Union
Bank of India proclaiming their possession as envisaged
by the Securitisation Act in news papers, by notices
dated 14-05-2005. It had been notified that the borrower
as well as the guarantor had failed to pay back the dues
and the properties had been taken possession on
07-05-2005. General public were informed that no
transactions in respect of the properties would have
bound the superior claims of the Bank.
9. The petitioner could not have been considered
as in possession or ownership of the properties
thereafter. The shop room was a valuable asset and the
predicament of the third respondent was that because of
the default committed by the petitioner, property would
have been irrevocably lost to him. The third respondent,
according to him, had cleared the outstanding dues by
remitting Rs.6,72,000/- towards the loan amount, as
guarantor. The affidavit as also Ext.R3(g) indicate that
a further sum of Rs.6,03,000/- had been paid by the third
respondent towards another loan account simultaneously,
as the Bank was utilising the opportunity to clear the
dues not only of the petitioner, but also his relative,
in whose favour also the third respondent was considered
as guarantor. He had no other go than to shell out the
money. He submits that the Bank had handed over
possession of the property to him, and such possession is
evidenced by Certificate dated 12-08-2005, copy of which
is marked as Ext.R3(h).
10. According to the third respondent, the shop
was empty as early as from January, 2005 onwards. There
were efforts taken by the petitioner to interfere with
his possession by breaking open the locks and attempting
to place goods in the shop room so as to make it appear
that he retained control over the properties. On
complaints being made, police had given the third
respondent sufficient help. It was after these
adventures that the petitioner had dishonestly moved this
Court and obtained orders. It had been further
misutilised by misrepresenting the Rent Control Appellate
Authority.
11. The version of the third respondent, as above,
of course is controverted by the petitioner. He submits
that it was highly improbable that a landlord might have
come to stand as guarantor for a tenant. It is also
stated that the third respondent has not helped the
relatives of the petitioner for securing loans, for any
purposes, and the claims as above are bereft of truth.
He relied on Ext.P1 as an authentic document and also
referred to pendency of another suit between them as
O.S.No.1005 of 2003 and points out that the disputed
questions could be more profitably adjudicated there. It
is submitted that there was no suppression, as alleged,
and in any case the third respondent was bound by Ext.P4
order of the Appellate Authority and he could not have
any superior claims for possession, as their relations
were governed by the Kerala Buildings (Lease and Rent
Control) Act. A short cut for eviction was impermissible
and any eviction could have been brought about only on
the grounds authorised by the statute. These were the
submissions in short.
12. However, it is difficult for us to accept the
explanations of the petitioner to show that there was no
suppression of relevant facts. In retrospect it can
safely be assumed that if this Court had been supplied
with details, as have now come forth, the petitioner
hardly would have obtained an interlocutory order,
practically restoring him to possession, which he had not
at the relevant time. Necessarily the steps have to be
retraced. Because of the impact of the Securitisation
Act, the tenant had lost the tenancy right, and the Bank
had come to full possession, which had even been
recognised by the tenant, in the course of the said
proceedings.
13. Under Section 13(4) of the Securitisation Act,
in case the borrower fails to discharge his liability,
the secured creditor is authorised to take recourse to
the measures stipulated by the section. This is in
recognition of the provisions of the Act that any
security interest created in favour of the secured
creditor may be enforced without the intervention of the
Court or Tribunal. Thus, a creditor is entitled to take
possession of the secured assets of the borrower
including the right to transfer by way of lease,
assignment or sale for realising the secured asset. The
right also includes taking over management of the secured
assets by right to transfer by way of lease, assignment
or sale. The appointment of a person to manage the
secured assets, the possession of which has been taken
over by the secured creditor is also contemplated.
Sub-section (6) also lays down that any transfer of
secured asset after taking possession thereof shall vest
in the transferee all rights in, or in relation to, the
secured asset transferred as if the transfer had been
made by the owner of such secured asset.
14. The only circumstance that the guarantor
(third respondent herein) was the owner of the secured
asset need not saddle him with any disability. In any
case, the Act does not provide for any such restriction.
By the operation of the section, the transfer brings with
it all the proprietary rights that are usually available
in respect of the holding. Although it is contended by
Sri.Jayakumar that so far as a tenanted premises, to
which provisions of the Kerala Buildings (Lease and Rent
Control) Act applies, the tenancy could have been
terminable only in the manner authorised by the said law,
we do not think the above argument can have any relevance
in view of section 35 of the Securitisation Act. The
provisions of the Securitisation Act shall have effect
notwithstanding anything inconsistent therewith contained
in any other law for the time being in force. In respect
of transactions governed by the said Act, the overriding
provisions effectively nullify the rights normally
admissible even to a tenant, as available under the Rent
Control Act, as it can be only subservient to a later
Central enactment.
15. The Rules under the Securitisation Act
extensively deal with the procedure to be adopted in
respect of sale of immovable assets. Although in the
present case, after publication of notice, there was a
settlement of debts and further proceedings for sale were
not required to be followed, it cannot be disputed that
the Bank in law came to possession of the property and
such rights, including possession, had been handed over
to the landlord on payment of defaulted amounts. The
contention of the petitioner is that he was in possession
all through out. But it is not found as one submission,
which could be countenanced. Naturally, he is not
therefore entitled to police protection for preservation
of any imaginary rights. Although we can foresee
possibility of misuse of such provisions in the
Securitisation Act, in the distant horizon, at least in
this case, we have nothing worthwhile to assume that the
landlord was employing any circuitous methodology.
16. Normally, after vacating the interim orders,
the writ petition was to be dismissed. But, as pointed
out by the senior counsel, further orders had come to be
passed by the Rent Control Appellate Authority, on the
strength of the interim orders passed by this Court, in
I.A.No.2193 of 2005 on 06-09-2005. It essentially has to
be noticed. We feel that follow up directions are
required to be made. On receipt of a certified copy of
this judgment, the landlord will be entitled to move the
said Authority praying for appropriate orders, that may
be necessary, and orders are to be passed by the
Appellate Authority on the application so filed within
one week from the date of presentation of the
application, duly taking notice of the observations made
by us, and especially that the writ petition itself was
misconceived and irregular.
17. On the facts of the case, we feel that we have
to stretch our jurisdiction at least to some extent, so
as to ensure that process of the Court are not misused.
We do not think that the third respondent is to be again
subjected to the disability of challenging orders in
I.A.No.2193 of 2005 by fresh proceedings, and the
direction, as above, is intended to short circuit the
formalities. We direct the first respondent to ensure
that, if necessary, police protection is granted to the
third respondent to regain his possession, after orders
are passed by the Appellate Authority in consequence to
this judgment. The third respondent will be entitled to
Rs.1000/(Rupees one thousand only) as costs.
The writ petition is dismissed.
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Dated: 29th day of July, 2005