019-SLLR-SLLR-2005-V-3-NIZAM-vs.-NATIONAL-DEVELOPMENT-BANK.pdf
CA
Nizam vs. National Development Bank (Somawansa, J. (P/CA))
97
NIZAMvs
NATIONAL DEVELOPMENT BANKCOURT OF APPEAL.
SOMAWANSA, J. (P/CA) ANDWIMALACHANDRA, J.
CA 671/2004 (REV.).
DC COLOMBO 6692/SPL.
SEPTEMBER 16, 2005.
National Development Bank of Sri Lanka No. 2 of 1979, sections 51, 51(2)-Board resolution to sell-public auction – Bought by Bank – Recovery of vacantpossession – Non tendering of the original of the alleged certificate of sale -Fatal ?
98
Sri Lanka Law Reports
(2005) 3 Sri L ft
The petitioner- respondent parate-executed the property in question and atthe ensuing public auction the Bank purchased the property, and thereafterfiled application in the District Court for the recovery of vacant possession. Therespondent-petitioner objected to the grant of the order in favour of the Bank,on the basis that the Bank had failed to comply with section 51(1), as it hadfailed to tender the original of the alleged cetificate of sale either with theapplication for delivery of possession of property or at a'ny stage thereafter. TheDistrict Court overruled the objection and entered decree nisi in favour of thepetitioner-respondent and thereafter entered order absolute. The respondent-petitioner moved in revision.
Held:
In order to meet the objection of the respondent-petitioner, the petitioner-respondent Bank should have produced the original certificate of sale.
The defects highlighted in the alleged certificate generates a doubt asto the genuineness of the document and that it is not in the prescribedform – Form B
The purported copy filed is not in conformity with Form B.
The Land Registry extracts produced do not take away the requirementof producing the original certificate of sale.
APPLICATION in revision from an order of the District Court of Colombo.
Ikram Mohamed, PC with A. T. Shayama Fernando for respondent-petitioner.
Romesh de Silva, PC with Geethaka Gunawardane for petitioner-respondent.
Cur. adv. vult.
September 16, 2005.
ANDREW SOMAWANSA, J. (P/CA)The respondent-petitioner by this application is seeking to invoke therevisionary jurisdiction of this Court to set aside the order of the learnedDistrict Judge of Colombo dated 09.04.2004 marked A6 and for an orderdischarging the order nisi entered in the instant case and or dismissingthe application made by the petitioner-respondent Bank marked A1.
Nizam vs. National Development Bank (Somawarisa, J. (P/CA))
99
CA
When this matter was taken up for argument both counsel agreed totender written submissions initially and reserved their rights to make oralsubmissions thereafter if necessary. However having filed their writtensubmissions both parties invited Court to decide the matter and deliverjudgment on the written submissions already tendered.
The relevant facts are as follows: The respondent-petitioner mortgagedhis residential premises to the petitioner-respondent Bank by way ofpreliminary and secondary mortgages for financial facilities obtained in asum of Rs. 7 million. As there was default in the repayment of the loan thepetitioner-respondent Bank passed a resolution to sell the premises bypublic auction and at the auction, premises in suit were purchased by thepetitioner-respondent Bank itself and a certificate of sale bearing no. 413dated 26.12.2002 is alleged to have been issued in favour of the petitioner-respondent Bank. The petitioner-respondent Bank thereafter filed applicationin the District Court of Colombo in terms of Section 51 of the NationalDevelopment Bank of Sri Lanka Act, No. 2 of 1979 as amended for therecovery of vacant possession of the premises by way of summaryprocedure. Court entered order nisi in favour of the petitioner-respondentand the respondent-petitioner filed his objections marked A2 and thereafteramended objections marked A3. Thereafter both parties tendered theirwritten submissions and the learned Additional District Judge of Colomboby his order dated 09.03.2004 marked A over-ruled the objection taken bythe respondent-petitioner and made the order nisi that has been enteredan order absolute. It is from the aforesaid order that the respondent-petitionerhas preferred this application for revision.
The thrust of the argument of counsel for the respondent-petitioner inthis Court as well as in the original Court was that the petitioner-respondentBank has failed to comply with the provisions of Section 51 (1) of the NationalDevelopment Bank of Sri Lanka Act, No. 2 of 1979 as amended in that thepetitioner-respondent failed to tender the original of the alleged certificateof sale either with the application for delivery of possession of properly orat any stage thereafter. The petitioner-respondent in paragraph 4 of theirobjections filed in this Court admit this fact by saying –
“The certificate of sale that has been filed in the District Courtcase was the true copy duly certified by the Notary who attested thesame. The original of the said certificate of sale is in the custody ofthe petitioner-respondent Bank and could be produced at the hearingof this matter”.
2- CM 7218
100
Sri Lanka Law Reports
(2005) 3 Sri L R.
It is to be noted that right along in the original Court as well as in thisCourt in their objections that were tendered and also in their writtensubmissions have pin pointed the fact that the alleged certificate of salehas not been produced in Court in terms of secton 51 (1) of the NationalDevelopment Bank of Sri Lanka Act, No. 2 of 1979 and as such the petitioner-respondent in not entitled in law to obtain an order for delivery of possessionof property in question. In the circumstances he submits that the impugnedorder is an order which the learned Additional District Judge was not entitiledin law to make without the original certificate of sale being produced inCourt and hence the aforesaid order is contrary to the express provisionsof the Act and is an order made without the certificate of sale and shouldthus necessarily be set aside. I would say there is merit in this submissionfor in the original Court as well as in this Court the respondent-petitionerraised this objection and it was up to the petitioner-respondent to meetthis challenge by producing the original certificate of 'sale which thepetitioner-respondent has failed to do. the averment in the petitioner-respondent’s objections in paragraph 4 that the original of the certificate ofsale is in the custody of the respondent Bank and could be produced atthe hearing of this matter is no averment that could meet the objection ofthe respondent-petitioner. In order to meet this objection the petitioner-respondent should have produced the original certificate of sale. Howeverthe petitioner-respondent has failed to produce the same.
It is useful at this stage to consider the provisions contained in section51 (1) of the aforesaid Act, No. 2 of 1979.
“The purchaser of any immovable property sold in pursuance ofthe preceding provisions of this Act shall, upon application made tothe District Court of Colombo or the District Court having jurisdictionover the place where that property is situate, and upon production ofthe certificate of sale issued in respect of that property under section50, be entitled to obtain an order for delivery of possession of thatproperty”.
As submitted by counsel for the respondent-petitioner other defectshigh lighted in the alleged certificate of sale marked as P3 generates adoubt as to the genuiness of the document marked P3. It is to be seenthat the purported seal appearing on the alleged certificate of sale showsthat the certificate of sale marked P3 is only a true copy as stated byAttorney-at-Law for the defendant-petitioner-respondent. It is also interesting
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Nizam vs. National Development Bank (Somawansa,- J. (P/CA))
101
to observe that as per the certificate of sale no. 413 marked P3 the attestingNotary is one T. Shihan Anthoneyz. However on top of page 01 of the saidcertificate of sale his seal has been scored off and Attorney-at-Law andNotary Public Karalliyadda’s seal has been placed therein. There is noexplanation as to why this was done. It is also contended by counsel forthe respondent-petitioner that provisions contained in section 50(3) of theNational Development Bank Act has not been complied with as thecertificate of sale is not in the form B in the Schedule to the Act whichrequire that the purchase price be mentioned with the words-
“Which has been duly certified to the Bank in part (or full as the
case may be) satisfaction of the sum due as aforesaid’.
Here again it would appear the document marked P3 does not indicatethat this requirement has been complied with.
While conceding that the certificate of sale cannot be challenged in aCourt of law the question arises as to whether the alleged certificate ofsale (a true copy with such anomalies) could be accepted as the certificateof sale. I would answer in the negative in spite of the undertaking given toproduce the original. The Land Registry extracts marked P4 does not takeaway the requirement of producing the original cetificate of sale. In anyevent, as stated in paragraph 11 of the written submissions of therespondent-petitioner did not or does not seek to invalidate the sale andall what the respondent-petitioner sought to do was to establish that thepurported copy of the cetificate of sale filed of record is not in conformitywith form B and that the said copy of the certifiate of sale is not a documentupon which an order could be obtained for the delivery of possession of theproperty. Thus it appears that the reasoning of the learned District Judgeis erroneous and cannot be permitted to stand.
For the foregoing reasons, I would hold that there are exceptionalcircumstances for this Court to invoke its extraordinary jurisdiction to allowthe instant application for revision of the order of the learned District Judge.Accordingly I would allow, the application for revision and set aside theorder of the learned District Judge dated 09.04.2004 marked A6 and make,order discharging the order nisi entered in this case with costs fixed at Rs.20,000/-.
WIMALACHANDRA, J -1 agree.
Application allowed.