Bank Seeking Judicial Declaration Of Sale Deed's Validity Before Sanctioning Loan On Minor's Property Sold Without Prior Approval Not Arbitrary: Kerala HC

The Kerala High Court has held that the bank's insistence for a court declaration on the validity of a sale deed before sanctioning a loan on the property of a minor, sold without approval from the District Court as mandated under the Hindu Minority and Guardianship Act, is not arbitrary or unreasonable.Justice C S Dias noted that Section 8 (2) of the Act mandates that minor's property shall not be sold without obtaining prior permission from the District Court. Court stated, “There is no doubt that it is the prerogative and discretion of the second respondent bank to sanction loans as per their regulations and guidelines. The insistence of the second respondent (Bank) for a declaration from the Court is not arbitrary or unreasonable, especially in view of the above-cited provisions of the Act (Hindu Minority and Guardianship Act) and that the minor's share in the property was sold without previous permission from the Court.”In the facts of the case, the minor was given a share in the property of his deceased father. This property was sold by the first petitioner-mother to the second petitioner without seeking prior permission from the Court. The second petitioner approached a bank for sanctioning house loan on the property purchased from the minor. The bank sought for a declaration from the Court regarding the validity of the sale deed before sanctioning loan to the second petitioner. The Court observed took note of the fact that the minor's property was sold without obtaining permission from the District Court as per the Hindu Minority and Guardianship Act. Court added, “As per Section 8 (3) of the Act, any sale made in contravention of the provisions of the Act is voidable at the instance of the minor child.”The Court further stated that the dispute involved requires a private law remedy and that the bank has not violated any public duty for issuance of writs under Article 226 of the Constitution. As such, the Court dismissed the writ petition and held that the writ court is not the appropriate forum to issue an ex post facto declaring the validity of the sale deed for getting the loan sanctioned. Counsel for Petitioners: Advocate M HemalathaCounsel for Respondents: Standing Counsel R S Kalkura, Government Pleader Vidya KuriakoseCase Number: WP(C) NO. 31197 OF 2024Case Title: Yamnuna Kumari v The Sub-RegistrarCitation: 2025 LiveLaw (Ker) 36Click here to Read/Download the Order

Bank Seeking Judicial Declaration Of Sale Deed's Validity Before Sanctioning Loan On Minor's Property Sold Without Prior Approval Not Arbitrary: Kerala HC

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