Case Note & Summary
The petitioner, Vijayanand Srinivasan, an auction purchaser, filed a writ petition under Article 226 of the Constitution of India seeking a writ of mandamus directing the respondent, Punjab National Bank, to deliver and hand over vacant possession of a property (Villa No.75, Palm Villas, Nallambakkam Village, Chengalpet Taluk and District) measuring 2578.1 square feet of undivided share of land in various survey numbers, admeasuring approximately 12.80 acres, situated at Malrojapuram, Nellikuppam Road, Nallambakkam Village, Chegalpattu Taluk, Kancheepuram District. The petitioner had purchased the property in an auction conducted by the bank under the SARFAESI Act. The sale was confirmed and a sale certificate was issued in favor of the petitioner. However, the bank failed to deliver vacant possession of the property to the petitioner despite repeated requests. The petitioner therefore approached the High Court seeking a writ of mandamus to compel the bank to deliver possession. The court considered the maintainability of the writ petition and the bank's obligation to deliver possession. The court held that a writ of mandamus is maintainable against a bank for failure to perform its statutory duty to deliver possession after sale confirmation, as the bank acts as a public authority under Article 12. The court further held that the bank's obligation to hand over possession arises from the sale certificate and the SARFAESI Act, and its failure amounts to dereliction of duty. The court directed the bank to deliver vacant possession of the property to the petitioner within a specified period. The court also held that the auction purchaser's right to possession is a legal right enforceable by writ, and the bank's inaction is arbitrary and violative of Article 14.
Headnote
A) Constitutional Law - Writ of Mandamus - Enforcement of Contractual Obligation - Article 226 of the Constitution of India - Auction purchaser sought direction to bank to deliver vacant possession of property purchased in auction under SARFAESI Act - Court held that writ of mandamus is maintainable against a bank for failure to perform its statutory duty to deliver possession after sale confirmation, as the bank acts as a public authority under Article 12 - Held that the bank's obligation to hand over possession arises from the sale certificate and the SARFAESI Act, and its failure amounts to dereliction of duty (Paras 1-10). B) Banking Law - Auction Sale - Delivery of Possession - Sections 13, 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 - Petitioner purchased property in auction conducted by bank; sale was confirmed and sale certificate issued, but bank did not deliver possession - Court held that the bank is duty-bound to deliver vacant possession to the auction purchaser, and the writ court can enforce this duty - Held that the bank's inaction is arbitrary and violative of Article 14 (Paras 11-20). C) Property Law - Sale Certificate - Rights of Auction Purchaser - Transfer of Property Act, 1882, Section 55 - Auction purchaser acquires title upon issuance of sale certificate and is entitled to possession - Court held that the bank cannot retain possession after sale confirmation and must hand over possession to the purchaser - Held that the auction purchaser's right to possession is a legal right enforceable by writ (Paras 21-29).
Issue of Consideration
Whether a writ of mandamus can be issued to a bank to deliver vacant possession of property to an auction purchaser under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act) after the sale has been confirmed and sale certificate issued.
Final Decision
The court allowed the writ petition and directed the respondent bank to deliver vacant possession of the property to the petitioner within a specified period.
Law Points
- Auction purchaser has a right to seek writ of mandamus against secured creditor for delivery of possession
- SARFAESI Act does not bar writ jurisdiction for enforcement of contractual obligation post-sale
- Bank's failure to deliver possession after sale confirmation amounts to dereliction of duty
