Case Note & Summary
The petitioner, Sri T. Bharathgowda, purchased a property at an auction conducted by Canara Bank (respondent No.3) under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act). The bank issued a sale certificate dated 30.09.2022 in favour of the petitioner. When the petitioner presented the sale certificate for registration before the Sub-Registrar (respondent No.2), the Sub-Registrar refused to register it on the ground that a civil suit was pending in respect of the property. The petitioner then filed a writ petition under Articles 226 and 227 of the Constitution of India seeking a direction to the Sub-Registrar to register the sale certificate. The High Court of Karnataka examined the provisions of the Registration Act, 1908, particularly Section 89(4), which mandates the registration of certificates of sale issued by secured creditors. The court held that the sale certificate issued under the SARFAESI Act is a 'certificate of sale' within the meaning of Section 89(4) and its registration is mandatory. The Sub-Registrar cannot refuse registration on the ground of a pending civil suit, as the certificate is conclusive evidence of the transfer of title. The court also noted that Section 17(2) of the Registration Act, 1908, which exempts certain documents from compulsory registration, does not apply to sale certificates under the SARFAESI Act. The court allowed the writ petition and directed the Sub-Registrar to register the sale certificate within four weeks.
Headnote
A) Registration Act, 1908 - Section 89(4) - Mandatory Registration of Sale Certificate - Sale certificate issued by a secured creditor under SARFAESI Act is a 'certificate of sale' under Section 89(4) of the Registration Act, 1908, and its registration is mandatory - The Sub-Registrar cannot refuse registration on the ground of a pending civil suit, as the certificate is conclusive evidence of transfer of title (Paras 10-15). B) SARFAESI Act, 2002 - Section 13(4) read with Rule 9 of the Security Interest (Enforcement) Rules, 2002 - Sale Certificate - Conclusive Evidence - A sale certificate issued under the SARFAESI Act is conclusive evidence of the sale and transfer of title, and the Sub-Registrar is bound to register it without reference to any pending litigation (Paras 12-14). C) Constitution of India - Article 226 - Writ of Mandamus - Statutory Duty - Where a public officer fails to perform a statutory duty, a writ of mandamus can be issued to compel performance - The Sub-Registrar's refusal to register the sale certificate despite a clear statutory mandate under Section 89(4) of the Registration Act, 1908, warrants issuance of a writ of mandamus (Paras 16-18).
Issue of Consideration
Whether the Sub-Registrar can refuse to register a sale certificate issued under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act) on the ground that a civil suit is pending in respect of the property?
Final Decision
The writ petition is allowed. The Sub-Registrar is directed to register the sale certificate dated 30.09.2022 issued by Canara Bank in favour of the petitioner within four weeks from the date of receipt of a copy of this order.
Law Points
- Registration of sale certificate under SARFAESI Act is mandatory and cannot be refused by Sub-Registrar on grounds of pending civil suit
- Section 17(2) of the Registration Act
- 1908 does not apply to sale certificates issued under SARFAESI Act
- Section 89(4) of the Registration Act
- 1908 mandates registration of certificates of sale issued by secured creditors
- Writ of mandamus lies against Sub-Registrar for failure to perform statutory duty
