IDBI Bank Limited vs K. Easwara Pillai & Anr.

[Per: Justice Sharad Kumar Sharma, Member (Judicial)]:-

The subject ‘land’ under the Constitution of India, is a state subject, which is governed by the statute as framed under the Article 246 of the Constitution of India. Owing to the aforesaid since, land, it is a state subject as contained under List II, Schedule 7, Entry 18. The State of Kerala, with an objective to consolidate the laws relating to the survey of lands and the settlement of boundary disputes, had legislated Act No. 37 of 1961 i.e., The Kerala Survey & Boundaries Act, 1961. The said provides for conducting of the surveys, which includes all operations and incidental actions, which are required to be taken for the purposes of determination, measurement and recording of the boundaries or even any part of the boundary of the land. The powers of conducting the ‘survey’ as defined under Section 2(vi) of the Act No. 37 of 1961, have been vested with the individual officer named as “survey officers”, which has been defined under Section 3 of the Act. The provisions of the aforesaid act are self-contained, which contemplate that, the demarcation can be done with regards to the land in accordance with the provisions contained under Chapter II of the said Act.

The controversy in the two instant Company Appeals are given below: (1) Company Appeal (AT)(CH)(Ins) No. 183/2025, challenges the Impugned Order as it was passed on 04.11.2025, in MA(IBC)/01/KOB/2024 in IBA/04/KOB/2020. By virtue of the Impugned Order, the application thus preferred, to set aside the sale certificate and also to direct the Liquidator to cooperate with the process of identification of the location of the land and of identifying the property mortgaged to the Applicant Bank was rejected. (2) The accompanying Company Appeal, i.e., CA(AT)(CH)(Ins) No.184/2025, challenges the order dated 04.11.2024, as it was passed in MA(IBC)/06/KOB/2023 in IBA/04/KOB/2020, being an application as it was preferred under Section 60(5), to be read with Rule 11 of the NCLT Rules, 2016. By virtue of the Impugned order under challenge, the application preferred by the Appellant for the purposes seeking the identification of the land and/or holding of a demarcation of the land which belongs to the Applicant, as sought for in IA(IBC)No.06/KOB/2023, which has been rejected, on the ground that, since the land, which has been sought to be demarcated and identified, has already been demarcated and identified by the Taluk surveyor and Village officer, no further fresh demarcation was required, as the earlier demarcation remained unobjected.

Both these Company Appeals, are accompanied with Condone Delay Applications, being IA No. 495/2025 and IA No. 496/2025, respectively where the Appellant has sought a condonation of 6 days of delay, which has chanced in preferring the Appeal. The reasons for seeking condonation of delay, since happen to be on similar grounds, in both the applications, as it has been described in Para-II (3). It is on the ground that, it took certain administrative formalities to be discharged for collating the records for filing the appeal and that, owing to the internal procedural approvals, which were required, the delay has chanced. Since, the reason in both these applications being similar in nature, coupled with the facts that, since the reasons for delay is owing to the procedural lacuna, which cannot be over ruled particularly, in the organisations like that of the Appellant, the reason for delay seems to be reasonable. Hence, the same deserves to be condoned and also because the delay of 6 days only which will be falling well within the Proviso of Section 61(2) of I & B Code, 2016, the Condone Delay Application would stand allowed and the delay of 6 days which has respectively chanced in both the Appeals would hereby stand condoned.

The undisputed facts which are subject matter of consideration in the two Company Appeals that

In the application MA(IBC)/01/KOB/2024, the Appellant has sought following reliefs before Learned Adjudicating Authority: -

In the application MA(IBC)/06/KOB/2023, the nature of the relief sought for is similar, that is, for seeking demarcation of the mortgaged land, excluding the same from the liquidation estate and then to proceed with the sale of the liquidation estate. The relief as sought for in the said application is extracted hereunder: -

Admittedly, the Appellant is not a party to the proceedings, in the Company Petition which was pending consideration before the Learned Adjudicating Authority. The interlocutory applications thus preferred by the Appellant was considered by the Tribunal and the same was rejected, on the ground that the liquidator has made a statement that the property forming part of the liquidation estate of the Corporate Debtor, has already been identified and demarcated with the assistance of the competent revenue officials and only the said the property, has been sold as per the provisions of the IBC, and that the property, which is mortgaged to does not form part of the Appellant liquidation estate, that it is not the task of NCLT or liquidator to demarcate the mortgaged property and that the Appellant may approach concerned taluk surveyor or the village officer.

The Learned Tribunal came to the conclusion that, an identification of the property or even a consequential direction of the restraint from sale of the property i.e., the land, which was allegedly mortgaged to the Appellant, cannot be made, as the subject matter of the liquidation proceedings as according to the liquidator, the property for which the mortgage has been executed in favour of the Appellant, has not been made as a part of the liquidation estate and hence it will not be under any threat of being sold in accordance with the provisions contained under the I&B code. The Learned Tribunal based upon the statement recorded by the liquidator, that the property of the liquidation estate has already been demarcated and identified by the competent revenue officials, and the consequential sale is confined to the property which has been identified, as to be the property under the liquidation estate, has correctly come to the conclusion that the relief as prayed for by the Appellant in his application, for setting aside the sale certificate, for identifying and demarcating the mortgaged land and for commencing the same of property of the liquidation estate only after excluding the mortgaged land so identified cannot be made a subject matter in the liquidation proceedings. Further when the property in question which has been sold has been duly demarcated to constitute to be part and parcel of the liquidation estate, in that eventuality, the relief claimed by the Appellant for demarcation and identification of the mortgaged property and consequentially for a restraint of sale till exclusion of such mortgaged property from the liquidation estate couldn’t have been granted to the Appellant on his application as preferred before the Learned Adjudicating Authority, for the reason being that, the Appellant’s rights to claim or even to appeal against the survey for an identification or demarcation of the property, stands saved by the provision of the Kerala Survey and Boundaries Act, 1961, which has not been invoked by the Appellant at any point of time nor there is any material which has been on record in both the Company Appeals, to show the same, when the Appellant faced with the problem of an identification of the property alleging and suspected that, the mortgaged property was being sold by including the same in the liquidation estate. In that eventuality, the Appellant has to blame himself for having not resorted to the remedies which were available to him under law. It is to be acknowledged that survey and demarcation of land requires a particular expertise and skill set it needs to be carried, by officials having the expertise available and the liquidator, could not have alternatively exercise the power of the Taluk surveyor for identifying the land. It is not an authority vested with the liquidator to identify the property and that is the reason why the observation has been made in the Impugned Order that, the property was already surveyed at the behest of the liquidator and owing to the survey report thus submitted, the Tribunal rightly observed that since the survey has already been completed, on the request being made by the Liquidator by the competent authority and that too in accordance with the provisions of the Kerala Survey and Boundaries Act, 1961, no repeat survey or demarcation, is required to be made on the request of the Appellant and that too when it is made for the first time before the Liquidator without filing any appeal against the respondent as per Act of 1961. The appropriate recourse available to the Appellant would have been to file an appropriate application for survey and demarcation, before the competent authorities if at all there was any need, as mandated under the Kerala Survey and Boundaries Act, 1961, as the authority to conduct survey of land created under the statute cannot be delegated to the liquidator making herein competent to demarcate the land.

There would be yet another aspect, which requires to be taken into consideration. It is that, the Appellant at no point of time in his Memorandum of Appeal or grounds taken therein had ever raised any question or doubts about the validity of the finding recorded in the Impugned Order, and that the survey has already been concluded. He does not even deny the fact of the conclusion of the survey, he does not take any ground doubting the survey conducted on the request of the liquidator. Besides that, in none of the grounds, he has taken in the grounds of Memorandum of the Appeal, he questions the propriety of the survey report, by arguing it to be contrary to law. In fact, what can be derived from the Memorandum of Appeal, the Appellant rather admits that:

There is nothing on record to show, that the Appellant had ever moved any application for demarcation, hence, he has to blame himself for his inability to resort to the appropriate remedies at an appropriate given time, available to him under law, rather the Appellant indirectly intends to impose the responsibility on the liquidator to demarcate and identify the land which is not within the powers vested with the liquidator under the I & B Code.

The platform of the Learned Adjudicating Authority, or consequently this Tribunal cannot be utilised by the appellant for the purposes of conferring a jurisdiction on the liquidator, which is otherwise not permissible under law and which is saved to be vested to be exercised by the authority constituted under a special statute i.e., Act of 1961, for conduct of survey and for demarcation or identification of land.

There could be yet another aspect, which is required to be observed and considered at this juncture, which is that an action involving demarcation and survey of any land always entails in itself an adjudication of a Civil right of a person over the property, which has to depend upon an appreciation of fact and law which has to be undertaken by experts in the field, which under no set of circumstances could be exercised by the liquidator, being a power which is outside the ambit of his powers as a liquidator. Hence, when the factum of the survey having been concluded has been taken, as the basis by the Learned Adjudicating Authority for rejecting the application, it cannot be faulted in any manner, because the survey was being required to be done by the liquidator in a very limited manner for identifying the properties of the liquidation estate of the Corporate Debtor which were supposed to be sold in the liquidation proceedings. In the view of the aforesaid, since there already happens to be a survey report on record, conducted by officials empowered to survey by the concerned statute and the demarcation of the liquidation estate has already been carried out, there cannot be a re-survey by liquidator, at the behest of the appellant who himself admits the fact that, his property is not a property which is presently the subject matter of liquidation and if he has any apprehension, that the property might be placed within the demarcated liquidation estate and, in that eventuality, he will have to work out his remedies as available to him under law for the purposes of demarcation of his mortgaged land by officials designed by the relevant statute, in accordance with the Civil and Revenue rights available to him under the statute.

Owing to the above, the reliefs, which has been sought by the Applicant in the respective Interlocutory Applications preferred before the Learned Adjudicating Authority has rightly been rejected, which does not call for any interference by this Appellate tribunal at this stage.

Consequentially, the Appeal lacks merits and the same is accordingly dismissed.