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Punjab and Haryana High Court orders Karnal sub-registrar to clear stalled property registration, slaps Rs 25,000 cost

The Punjab and Haryana High Court said the rights of a secured creditor take precedence even over government dues.

3 min readChandigarhDec 11, 2025 05:15 PM IST

Punjab and Haryana High Court, Karnal administration, property registration, bank auction, State Bank of India,

While Senior Advocate Vikas Chatrath represented SBI, Additional Advocate General Neeraj Gupta appeared for Haryana, and Advocate Diwan Sharma represented the auction purchaser. (File photo)

The Punjab and Haryana High Court Wednesday pulled up the Karnal administration for blocking the registration of a property sold in a bank auction, and directed the sub-registrar of Nigdhu to complete the registration within two months.

A Division Bench of Chief Justice Sheel Nagu and Justice Sanjiv Berry was hearing a petition filed by the State Bank of India (SBI). The state-run bank said its efforts to recover more than Rs 6.38 crore from a defaulting borrower had been held up because the sub-registrar refused to register the sale deed in favour of the auction buyer, Mahadev Foods.

While Senior Advocate Vikas Chatrath represented SBI, Additional Advocate General Neeraj Gupta appeared for Haryana, and Advocate Diwan Sharma represented the auction purchaser.

The court noted that the borrower, Mahavir Cereals, had taken an Rs 8.10 crore loan in 2013 and later defaulted on it. SBI then proceeded under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act and auctioned the mortgaged property on September 21, 2021. The buyer paid the full amount of Rs 7.38 crore, and SBI issued a sale certificate on September 29, 2021.

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Despite this, the sub-registrar refused to register the deed, citing a revenue entry made in November 2018 that recorded the District Food and Supply Department’s claim for tax dues.

The bench found this refusal unjustified. It pointed out that SBI’s mortgage was created in July 2013, much before the state’s attachment. The judges said the 2018 entry could not override a legally valid mortgage.

“The rapat entry itself does not decide rights of parties, it is merely an administrative note and cannot defeat a prior statutory right of mortgage of petitioner Bank,” the court said, adding that the sub-registrar could not rely on this “later in time attachment” to block the registration.

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The judges also cited Supreme Court rulings to underline that the rights of a secured creditor take precedence even over government dues.

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Finding the delay unwarranted, the bench ordered the sub-registrar to register the deed and submit a compliance report within two months. It also quashed the 2018 revenue entry made in favour of the Food and Supply Department and held that the state could recover its dues only after the bank had recovered its own or by any lawful method.

The court imposed a cost of Rs 25,000 on the Haryana Government for causing an unjustified delay. Of this, Rs 10,000 will go to SBI, and Rs 15,000 to the Punjab and Haryana High Court Bar Association.

Before concluding, the bench also clarified that, in cases where the security interest is registered after January 24, 2020, the date on which Section 26E of the SARFAESI Act came into force, banks will enjoy statutory priority over government dues.

Manraj Grewal Sharma

Manraj Grewal Sharma is a senior journalist and the Resident Editor of The Indian Express in Chandigarh, where she leads the newspaper’s coverage of north India’s most politically and institutionally significant regions. From Punjab and Haryana to Himachal Pradesh and the Union Territory of Chandigarh, she oversees reporting at the intersection of governance, law, politics and society. She also reports on the diaspora, especially in Canada and the US. With a career spanning journalism across several countries, academia and international development, Manraj brings a rare depth of perspective to regional reporting. She is widely regarded as a leading chronicler of Punjab’s contemporary history and socio-political evolution, particularly its long shadow of militancy, federal tensions and identity politics. Her book, Dreams after Darkness, remains a definitive account of the militancy years and their enduring aftermath. Professional Background & Expertise A gold medalist in mass communication and a post-graduate in English literature, Manraj has a multifaceted career spanning journalism, academia, and international development. She was also awarded a fellowship by National Foundation of India and did several in-depth pieces on Manipur. Internationally, she has reported from Israel, US, UK, Myanmar, and Mauritius Her key focus areas include: Regional Politics, History, Agriculture, Diaspora, and Security. Of late, she has started focusing on Legal & Judicial Affairs: Much of her recent work involves reporting on high-stakes cases in the Punjab and Haryana High Court, ranging from environmental policy to civil rights. International Consulting: She previously served as a consulting editor for the Asia Pacific Adaptation Network and a publishing consultant for the Asian Development Bank (ADB) in Manila. Academia: For five years, she was the managing editor of Gender, Technology and Development, a peer-reviewed international journal at the Asian Institute of Technology, Bangkok. Recent Notable Articles (Late 2025) Her recent reportage focuses heavily on judicial interventions and regional governance: 1. Environment & Governance "‘NGT can’t test legality of policy’: HC hears challenge to Punjab’s ‘Green Habitat’ plan" (Dec 22, 2025): Covering a critical legal battle over whether the National Green Tribunal has the authority to strike down a state policy regularizing farmhouses on delisted forest land. "High court pulls up Punjab poll panel over audio clip probe" (Dec 10, 2025): Reporting on judicial concerns regarding the transparency and fairness of local body elections. 2. Legal Rights & Social Welfare "HC issues notice to Punjab, Haryana over delay in building old age homes" (Dec 22, 2025): Reporting on a contempt petition against top officials for failing to establish government-run homes for the elderly as promised in 2019. "Victims can appeal acquittals in sessions court without seeking special leave" (Dec 19, 2025): Highlighting a significant procedural shift in criminal law following a Supreme Court ruling. "HC upholds benefits for Punjab FCI officer acquitted in 20-year-old bribery case" (Dec 19, 2025): A report on the concept of "honourable acquittal" and its impact on employee benefits. 3. Human Rights & Identity "As Punjab denies parole to MP Amritpal Singh, HC asks it to submit ‘foundational material’" (Dec 1, 2025): Covering the legal proceedings regarding the radical preacher and sitting MP's request to attend Parliament. "Protecting life paramount: HC backs Muslim woman in live-in after verbal divorce" (Nov 6, 2025): Analyzing judicial protections for personal liberty in the context of traditional practices. Signature Beats Manraj is recognized for her ability to decode complex judicial rulings and relate them to the everyday lives of citizens. Whether it is a 30-year-old land battle in Fazilka or the political implications of Kangana Ranaut’s candidacy in Mandi, her writing provides deep historical and regional context. Contact @grewal_sharma on X manrajgrewalsharma on Instagram ... Read More

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