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Wednesday, May 29, 2013

"Certiorari does not lie to quash the judgments of inferior Courts of civil jurisdiction". These observations would indicate that in England the judicial orders passed by civil Courts of plenary jurisdiction in or in relation to matters brought before them are not held to be amenable to the jurisdiction to issue writs of certiorari."

THE HON'BLE THE ACTING CHIEF JUSTICE N.V. RAMANA AND THE HON'BLE SRI JUSTICE VILAS V. AFZULPURKAR              

Writ Petition No.7837 of 2013 and another

18.04.2013

M/s. Aasra Archiventures Pvt., Ltd., Hyderabad rep., by its Partner A.
Raghunath and another.

The State of A.P., rep., by its Law Secretary,Law Department, Hyderabad and
others.

Writ Petition No.7837 of 2013 & Writ Appeal No.411 of 2013

COMMON ORDER: (Per The Hon'ble the Acting Chief Justice N.V. Ramana)    

        The writ appeal is filed by the 2nd respondent in W.P.No.7837 of 2013
against the interim orders, dated 18.03.2013, passed by the learned Single Judge
in W.P.No.7837 of 2013 suspending all further proceedings in I.A.Nos.269 and 270
of 2012 in O.S.No.33 of 2012 on the file of the III Additional Chief Judge, City
Civil Court, Hyderabad.

2.      When the appeal was initially heard by us both the learned counsel
represented that W.P.No.7837 of 2013 itself may be heard and disposed of.
Accordingly, we called for the writ petition and heard the learned counsel on
either side in the writ petition itself.

3.      Brief facts of the case are that the petitioners in the writ petition are
defendant Nos.1 and 2 in O.S.No.33 of 2012.  The said suit was filed by the 2nd
respondent herein against the defendants as well as against the company
described as M/s. Salarpuria Properties Private Limited.
The said suit was
filed under Order XXXVII C.P.C. for recovery of a sum of Rs.61,52,767/- arising
out of a contract entered into by the parties for development of the property.
On receipt of the summons, the writ petitioners filed application for grant of
leave to defend and after considering the said application on merits, the trial
Court by its order, dated 09.07.2012, in I.A.No.1592 of 2012 granted conditional
leave to defend by directing the petitioners to deposit a sum of Rs.20 lakhs to
the credit of the suit within one month.
The said order was questioned by the
petitioners in C.R.P.No.3530 of 2012 before this Court.
The said revision was
heard and disposed of by an order, dated 08.08.2012, wherein the learned Single
Judge came to the conclusion that the order of the trial Court granting
conditional leave does not give sufficient reasons as to how Order XXXVII C.P.C.
can be invoked and accordingly, set aside the order of the trial Court and
remitted the matter for fresh consideration.  The operative paragraph of the
order may be appropriate to be extracted hereunder:
        "With the above observations, the order of the Court below is set aside,
the Court below is directed to consider afresh the plea of the revision
petitioners for granting of leave if entitled in the summary suit, and to decide
as to whether the suit has to be treated as a regular suit for money and dispose
of the application for attachment also, within one month from the date of
receipt of this order.  The Civil Revision Petition is accordingly disposed of.
No order as to costs."

4.      Thereafter, it appears that the Court below considered the applications,
as directed by this Court, but could not dispose of the same for various
reasons.  The writ petitioners have thereupon filed the present writ petition on
14.03.2013 seeking a Writ of Prohibition, as extracted below:
        "... Hon'ble Court may be pleased to issue an appropriate writ, order or
direction more particularly one in the nature of writ of Prohibition,
prohibiting the Subordinate Tribunal i.e., III Additional Chief Judge, City
Civil Court at Hyderabad proceed with I.A.No.269 of 2012 and I.A.No.270 of 2012
in O.S.No.33 of 2012, as illegal, without any jurisdiction with material
irregularity."

5.      After hearing the said writ petition, the learned Single Judge on
18.03.2013 while issuing notice before admission granted interim direction as
prayed for, which is the subject matter of W.A.No.411 of 2013, reads as follows:

        "Post after three weeks.  In the meanwhile, there shall be interim
direction to the Hon'ble III Additional Chief Judge, City Civil Court at
Hyderabad not to proceed further suspend with the I.A.No.269 of 2012 and
I.A.no.270 of 2012 in O.S.No.33 of 2012."

6.      Learned counsel for the petitioners contended that the suit filed by the
2nd respondent itself being under Order XXXVII, no interlocutory applications
could have been filed therein.  He submits that I.A.No.269 of 2012 seeking
injunction against the petitioners from alienating/encumbering the schedule
immovable property as well as I.A.No.270 of 2012 for attachment before judgment
over the schedule property could not have been moved.  According to the learned
counsel, when the suit itself is one under Order XXXVII, the procedure as
available in ordinary suits cannot be resorted to and the very filing of
interlocutory applications and entertaining the same by the Court below is
without jurisdiction and consequently justified the relief of Writ of
Prohibition as sought for in the writ petition.  Learned counsel has drawn our
attention to Order XXXVII C.P.C. and also relied upon the decision of the
Hon'ble Supreme Court in S. Govinda Menon vs. Union of India and another1,
wherein principles relating to grant of Writ of Prohibition are laid down and
submits that as held by the Hon'ble Supreme Court a Writ of Prohibition is
required to be issued to keep the inferior Court within the limits of its
jurisdiction and there being no other remedy, the prayer of the writ petitioner
is clearly sustainable.
       
7.      Learned counsel for the respondents, on the other hand, contends that a
reading of Order XXXVII and its sub-rules do not show any prohibition for making
any applications as such and he submits that the said suit remains at the stage
of consideration of the petitioners' application for leave to defend.  He also
submits that this Court in C.R.P.No.3530 of 2012 earlier directed that the
application for leave to defend as also the interlocutory application for
attachment etc., be heard and disposed of by the trial Court within a specified
time.  However, in spite of the best efforts, the trial Court could not dispose
of the applications and at the request of the 2nd respondent/plaintiff an ad
interim order of status quo was passed, which was in operation till 11.03.2013.
Learned counsel submits that thereafter the petitioners have filed the present
writ petition and consequently further proceedings were suspended. It is
contended that this is not a case of inherent lack of jurisdiction on the part
of the trial Court and as per the directions of this Court in C.R.P.No.3530 of
2012, the trial Court is required to dispose of the applications on merits.
Learned counsel placed reliance upon the decisions of this Court in Ushodaya
Enterprises Limited vs. State of Andhra Pradesh2 and Saini Lakshmi and another
vs. Bolliepalli Janardhan and others3.
       
8.      We have considered the aforesaid contentions and perused the material
available on record.

9.      We may, at the out set, mention that we are not satisfied with the
bonafides of the petitioners and we are of the view that the petitioners cannot
be allowed to contend lack of jurisdiction on the part of the trial Court on the
principles of constructive res judicata also.  It is noteworthy that the
petitioners filed a counter affidavit before the trial Court so far as the
interlocutory applications seeking injunction and attachment respectively, are
concerned.  They also filed application seeking leave to defend.  The
jurisdiction of the Court below to entertain a suit under Order XXXVII C.P.C. is
not in dispute and the learned counsel for the petitioners fairly stated that
his objection is only with regard to maintainability of the interlocutory
applications.  We find that neither in the counter affidavit filed by the
petitioners nor in the grounds of revision preferred by them, before this Court
in C.R.P.No.3530 of 2012 any contention is advanced by them even remotely
questioning the maintainability of the interlocutory applications vis--vis the
jurisdiction of the trial Court.  Even in the said revision, referred to above,
no such ground was raised and on the contrary this Court gave direction, as
extracted in the opening paragraph above, that the application seeking leave to
defend as well as the interlocutory application for attachment was required to
be disposed of by the trial Court, had to be given effect to.  The said
direction of this Court, which has become final, is binding on the petitioners
and that they cannot be allowed to turn around and seek Writ of Prohibition
against the trial Court from entertaining the said applications and passing
orders thereon on merits.  In our view, the premise on which the writ petition
is filed questioning the jurisdiction of the trial Court to entertain the said
interlocutory applications is not only hit by principles of constructive res
judicata against the petitioners but also on the principle of estoppel.  The
petitioners cannot be allowed to turn around and question the maintainability of
the applications or jurisdiction of the trial Court.

10.     So far as the contention with regard to the jurisdiction of the trial
Court under Order XXXVII is concerned, the trial Court is yet to decide the
application for leave and also whether the suit is treated as a regular suit or
as a summary suit and also to consider the interlocutory applications as
directed by this Court in C.R.P.No.3530 of 2012.  As has already been noted, the
petitioners do not dispute the jurisdiction of the trial Court and as such the
attempt on the part of the petitioners amounts to defeating the orders of this
Court in the said civil revision petition.

11.     The circumstances under which a writ of prohibition can be sought for
against a civil Court, fell for consideration before the Hon'ble Supreme Court
in Thirumal Tirupati Devasthanams vs. Thallappaka Anantha Charyulu4 and para 14
of the said judgment, to the extent relevant for our purpose, is extracted
hereunder:
"14. On the basis of the authorities it is clear that the Supreme Court and the
High Courts have power to issue writs, including a writ of prohibition. A writ
of prohibition is normally issued only when the inferior Court or Tribunal (a)
proceeds to act without or in excess of jurisdiction, (b) proceeds to act in
violation of rules of natural justice,
(c) proceeds to act under law which is itself ultra vires or unconstitutional,
or (d) proceeds to act in contravention of fundamental rights.  The principles,
which govern exercise of such power, must be strictly observed.  A writ of
prohibition must be issued only in rarest of rare cases.  Judicial disciplines
of the highest order has to be exercised whilst issuing such writs. It must be
remembered that the writ jurisdiction is original jurisdiction distinct from
appellate jurisdiction.  An appeal cannot be allowed to be disguised in the form
of a writ.  In other words, this power cannot be allowed to be used "as a cloak
of an appeal in disguise". Lax use of such a power would impair the dignity and
integrity of the subordinate Court and could also lead to chaotic consequence.
It would undermine the confidence of the subordinate Court. It was not even
argued that there was total lack of jurisdiction in this civil Court. It could
not be denied that the civil Court, before which the suit was pending; had
powers to decide on the maintainability of the suit and to decide on the
questions of its jurisdiction.  The civil Court had jurisdiction to decide
whether the suit was barred by Section 14 of the said Act or on principles of
res judicata/estoppel.  Thus unless there was some very cogent or strong reason
the High Court should not have prevented the Court of competent jurisdiction
from deciding these questions.  In other words the High Court should not usurp
the jurisdiction of the civil Court to decide these questions..."

12.     A similar question was also decided by a Division Bench of this Court in
Chintapalli Atchaiah vs. P. Gopala Krishna Reddy5 and the following para thereof
would be relevant to be quoted:
"...Moreover, the 2nd respondent in the writ petition happens to be the civil
Court before whom the impugned I.A. filed under Order 20, Rule 12 of the Code of
Civil Procedure read with Section 151, is pending and as per the settled
proposed of law jurisdiction to decide maintainability of the suit in the I.A.
is vested in the Court before whom it is pending.
It may be stated here that the scope of a writ of prohibition is, by the very
nature of things, a limited one.  The law is well-settled on the point that if
the Court or an adjudicating authority is embarking upon a decision in a matter
in which apparently it lacks jurisdiction or when such a court or authority, as
the case may be, is exercising jurisdiction vested in it in a manifestly
improper manner, then a writ of prohibition can be issued to prevent such
judicial forums to decide the matters pending before them.  We are convinced
that in the matter before us there is no scope for the issue of a writ of
prohibition to the 2nd respondent - Additional Chief Judge, City Civil Court as
it has all the power under the Civil Procedure Code to decide the questions
arising in I.A.No.203/88 including the question of its own jurisdiction to
decide such matters.  From another point of view also this writ appeal is
rendered devoid of any merit because in the presence of an effective alternative
remedy available to the petitioner by way of having the matter decided by the
civil court before whom the matter is pending, the writ petition cannot be
entertained..."

        We, therefore, see no substance in the contention of the learned counsel
for the petitioners that a Writ of Prohibition can be sought by the petitioners.


13.     It is also well settled that a Writ of Prohibition and a Writ of
Certiorari are remedies primarily invoked to confine the Courts/Tribunals below
within their jurisdictional limits and the only difference being that a Writ of
Prohibition is issued before the lower Court or Tribunal adjudicates on the
matter whereas a Writ of Certiorari is issued when such adjudication by the
Court or the Tribunal is questioned on the ground of error of jurisdiction.
Thus, the principle being the same, it would be appropriate to notice a decision
of a Division Bench of this Court to which one of us (VVA,J) is a party in G.V.
Nishita vs. The Presiding Officer of the Court and 9 others6 wherein extracts
from the decision of the Supreme Court as well as Halsbury laws of England was
quoted.  For the sake of convenience, relevant paragraphs are reproduced
hereunder:
        "In Ghan Shyam Das Gupta vs. Anant Kumar Sinha (AIR 1991 SC 2251) it was  
held as under:

        7..........It was, therefore, necessary to adjudicate upon the dispute
between the parties and record a finding on the character of possession of the
writ petitioners, before proceeding to consider whether the decree is executable
or not against them; and having not done so, the High Court has seriously erred
in law in allowing the writ petition by the impugned judgment.  The decision on
the disputed issue was dependent on the consideration of the evidence to be led
by the parties, and while exercising the writ jurisdiction the High Court was
not expected to go into that question.  In the circumstances, the Court ought to
have refused to dispose of the writ petition on merits, leaving the writ
petitioners to avail of the remedy before the Civil Court.

        8.  The principle as to when the High Court should exercise its special
jurisdiction under Art. 226 and when to refuse to do so on the ground of
availability of an alternative remedy has been settled by a long line of cases.
The remedy provided under Art. 226 is not intended to supersede the modes of
obtaining relief before a Civil Court or to deny defences legitimately open in
such actions.  As was observed in State of Andhra Pradesh v. Chitra Venkata Rao,
(1976) I SCR 521: (AIR 1975 SC 2151) the jurisdiction to issue a writ of
certiorari is supervisory in nature and is not meant for correcting errors like
an appellate Court.

        63.  Whilst we are dealing with this aspect of the matter, we may
incidentally refer to the relevant observations made by Halsbury on this point.
"In case of judgments of inferior Courts of civil jurisdiction" says Halsbury in
the footnote,

        "It has been suggested that certiorari might be granted to quash them for
want of jurisdiction [Kemp v. Balne (1844), I Dow. & L. 885, at p. 887],
inasmuch as an error did not lie upon that ground.  But there appears to be no
reported case in which the judgment of an inferior Court of civil jurisdiction
has been quashed on certiorari, either for want of jurisdiction or on any other
ground."

The ultimate proposition is set out in the terms:

"Certiorari does not lie to quash the judgments of inferior Courts of civil
jurisdiction". These observations would indicate that in England the judicial
orders passed by civil Courts of plenary jurisdiction in or in relation to
matters brought before them are not held to be amenable to the jurisdiction to
issue writs of certiorari."


14.     The decisions cited by the learned counsel for the respondents, referred
to above, are hardly relevant, as they do not be deal with either of the
questions, which we have considered as above.  It is therefore not necessary to
deal with the said decision.
        In view of the above, we see no merit in the writ petition and the same is
accordingly dismissed and consequently, the interim order passed therein also
stands vacated.  Since the writ appeal is directed against the said interim
order passed in the writ petition and the same is vacated, nothing survives for
consideration in the writ appeal and the same is also dismissed.  The trial
Court shall now proceed with the hearing of the suit and the application
therein,
as directed in CRP.No.3530 of 2012 dated 08.08.2012 and pass orders thereon on
or before 30.04.2013. As a sequel, miscellaneous petitions, if any, shall stand
disposed of.  No costs.
___________________  
N.V. RAMANA, ACJ  
_________________________  
VILAS V. AFZULPURKAR    
Date:18.04.2013.

OR. 6, RULE 17 EVEN AFTER COMMENCEMENT OF TRIAL, PLAINT AMENDMENT FOR CANCELLATION OF SALE DEED IN BARE INJUNCTION SUIT IS PERMISSIBLE =No doubt, in a suit for permanent injunction simplicitor, possession of the plaintiff is the primary concern, the second or secondary concern being as to whether the plaintiff has got better title to the property than that of the defendants. In the secondary aspect to be decided in the suit for permanent injunction, the plaintiff has to necessarily attack the sale deed dated 08.06.2011. Since the sale deed dated 08.06.2011 is in respect of the suit property only and in between the defendants 1 and 2 on the one hand and the 3rd defendant on the other hand, scope of the suit may not be totally changed. The proposed amendment if allowed will only enlarge the procedure of the suit by way of giving permission to defendants to file additional written statement and framing additional issues before proceeding with further trial. 5) In the circumstances, this Court is of the opinion that the lower Court did not exercise its discretion properly and it resulted in dismissal of the petition refusing to give permission for amendment of the plaint. 6) In the result, the revision petition is allowed setting aside impugned order passed by the lower Court and directing the lower Court to permit the plaintiff/petitioner to amend the plaint as prayed for in I.A. No.1166 of 2012 in the suit, subject to the plaintiff paying Rs.500/- to the District Legal Services Authority, Khammam within 4 weeks from today; and in default, this order shall stand set aside automatically. No further extension of time will be granted.

THE HONOURABLE SRI JUSTICE SAMUDRALA GOVINDARAJULU              

CIVIL REVISION PETITION No.1409 of 2013  

24-04-2013

Vallala Yasodha

Vallala Naga Venkata Laxmi & 2 others

Counsel for the Petitioner : Sri N.V.Anantha Krishna
Counsel for the Respondents :  Sri M.Rajamalla Reddy

<Gist :

>Head Note:

?Cases referred:

ORDER:
        This revision petition is filed questioning order of the lower Court
refusing to permit amendment of the plaint.  Originally the suit is filed for
permanent injunction by the petitioner and it was being contested by the
respondents/defendants.  Trial of the suit has commenced and evidence of the
plaintiff as P.W-1 was over.  At that stage, the plaintiff filed the present
petition in the lower Court for amendment of the plaint in order to include the
relief of cancellation of the document No.4615/2011, dated 08.06.2011.  The said
sale deed dated 08.06.2011 was executed by the defendants 1 and 2 in favour of
the 3rd defendant in respect of the suit property.  The said document was prior
to filing of the suit in the lower Court.  The suit was filed in August, 2011.
The lower Court dismissed the petition on the ground that the plaintiff-
petitioner was knowing about the said sale deed at least since the time of
filing of the written statement and in spite of it the petitioner did not come
forward with the prayer for amendment of plaint till after trial of the suit is
commenced.
        2) It is contended by the petitioner's counsel that the petitioner is an
old lady of 87 years and she is not well versed in law and that therefore she
could not file the petition expeditiously.  On the other hand, the respondents'
counsel contended that the present petition for amendment is hit by proviso to
Order VI Rule 17 C.P.C.  The said provision reads as follows:
"17. Amendment of pleadings:- The Court may at any stage of the proceedings
allow either party to alter or amend his pleadings in such manner and on such
terms as may be just, and all such amendments shall be made as may be necessary
for the purpose of determining the real questions in controversy between the
parties:
        Provided that no application for amendment shall be allowed after the
trial has commenced, unless the Court comes to the conclusion that in spite of
due diligence, the party could not have raised the matter before the
commencement of trial."
        3) The above proviso, on plain reading reveals that initial prohibition
for a party to approach the Court for amendment of pleading after commencement
of trial, is not a rigid prohibition.  The said initial rigidity was watered
down by the Parliament itself by the latter part of the proviso to the effect
that "unless the Court comes to the conclusion that in spite of due diligence,
the party could not have been raised the matter before the commencement of
trial".  In a matter of this nature relating to seeking an additional prayer in
the plaint, usually the party has no much role.  It is for the advocate of the
party to decide as to frame of the suit and as to the amendment to be sought by
way of inclusion of an additional prayer in the suit.  The party instructs the
advocate only on the factual aspects of the case and not on legal aspects which
are within exclusive domain of the legal counsel.  Perhaps, during the course of
P.W-1's evidence it was thought that the sale deed dated 08.06.2011 executed by
the defendants 1 and 2 in favour of the 3rd defendant has to be attacked
directly.  In the circumstances, I am of the opinion that the rigor of 1st part
of proviso to Order VI Rule 17 C.P.C can be reduced by way of imposing penalty
on the petitioner by way of costs.
        4) Secondly it is contended by the respondents' counsel that prayer for
cancellation of sale deed dated 08.06.2011 is outside the scope of the existing
suit for permanent injunction.
No doubt, in a suit for permanent injunction
simplicitor, possession of the plaintiff is the primary concern, 
the second or
secondary concern being as to whether the plaintiff has got better title to the
property than that of the defendants.  
In the secondary aspect to be decided in
the suit for permanent injunction, the plaintiff has to necessarily attack the sale deed dated 08.06.2011. 
 Since the sale deed dated 08.06.2011 is in respect
of the suit property only and in between the defendants 1 and 2 on the one hand
and the 3rd defendant on the other hand, scope of the suit may not be totally
changed.  
The proposed amendment if allowed will only enlarge the procedure of
the suit by way of giving permission to defendants to file additional written
statement and framing additional issues before proceeding with further trial.
        5) In the circumstances, this Court is of the opinion that the lower Court
did not exercise its discretion properly and it resulted in dismissal of the
petition refusing to give permission for amendment of the plaint.
        6) In the result, the revision petition is allowed setting aside impugned
order passed by the lower Court and directing the lower Court to permit the
plaintiff/petitioner to amend the plaint as prayed for in I.A. No.1166 of 2012
in the suit, subject to the plaintiff paying Rs.500/- to the District Legal
Services Authority, Khammam within 4 weeks from today; and in default, this
order shall stand set aside automatically.  No further extension of time will be
granted.
____________________________  
SAMUDRALA GOVINDARAJULU,J      
Dt.18th April, 2013

CORRECTION OF DATE OF BIRTH IN SERVICE REGISTER =The petitioner filed declaratory suit in 1990 for correction of his date of birth as 08.07.1954 in all records including service records i.e. after completion of almost 15 years of his joining the service. Even if it is assumed that the date of birth of the petitioner is wrongly entered in the service records, the petitioner has not properly explained what prevented him from getting his date of birth altered by taking necessary steps within a reasonable period of time, and as such, it cannot be said that the petitioner is diligent in taking steps to correct his date of birth. The Apex Court time and again cautioned the civil Courts including High Courts against entertaining and accepting the claim made by the government servant long after entering into service for correction of the recorded date of birth. Further, a perusal of the record shows that on 30.11.1994, the petitioner submitted his declaration declaring that his date of birth is 08.07.1952, which is subsequent to passing of decree and judgment by the civil Court. In the circumstances, we do not find any error or irregularity in the impugned order warranting interference by this Court in exercise of jurisdiction under Article 226 of the Constitution of India. 10. The writ petition is devoid of merit and the same is accordingly dismissed. No order as to costs.

THE HON'BLE SRI JUSTICE ASHUTOSH MOHUNTA AND THE HON'BLE SRI JUSTICE B.N. RAO                
W.P. No.38766 OF 2012  

24.04.2013    

S.Ram Manohar  s/o. late S.Sundera  Murthy

The Union of India,rep. by the Deputy Commissioner,Kendriya Vidyalaya
Sanghatan, Regional Office, Picket, Secunderabad, and another

Counsel for the petitioner: Mr.V.R. Balachary

Counsel for Respondents:Mr.B.Narasimha Sarma  

<GIST:

>HEAD NOTE:  

Referred Cases:
     nil


ORDER: (Per Hon'ble Sri Justice B.N. Rao Nalla)

This writ petition is filed for a writ of Certiorari calling for the records
relating to the order dated 05.10.2012 passed by the Central administrative
Tribunal, Hyderabad Bench (for short 'the Tribunal') in O.A. No.866 of 2012, and
to quash the same by declaring the action of the respondents  in prematurely
retiring the petitioner from service as contrary to law, and consequently direct
the respondents to correct the entry relating to the date of birth of the
petitioner in the service record as 08.07.1954 with all attendant benefits
including  reinstatement into service.

2.      The brief facts of the case of the petitioner are that he was appointed on
22.12.1975 as Lower Division Clerk with the respondents, thereafter he was
promoted as Upper Division Clerk and subsequently he was promoted as Assistant.
The date of birth of the petitioner was recorded as 08.07.1952 in service
register.
The petitioner came to know through his mother that his actual date of birth is 08.07.1954.  
The petitioner approached the schools where he
studied.  His date of birth was wrongly entered as 08.07.1952 instead of
08.07.1954, in transfer certificate issued by Government Primary School,
Kattelguda, Hyderabad where he studied from III standard to V standard and the
same was entered in admission records in Government High School, Azampura, where  
he studied from VI standard to X standard.
The petitioner made a representation
to the school authorities to correct his date of birth in the records, however,
the school authorities advised him to approach a competent civil Court for
declaring the correct date of birth.  
Then the petitioner filed O.S.No.2516 of
1990 on the file of VII Assistant Judge, City Civil Court, Hyderabad against the
2nd respondent, Government High School, Azampura, Hyderabad, Secretary, Board of   
Intermediate Education and Registrar of Osmania University, Hyderabad for a
declaration that his date of birth as 08.07.1954 instead of 08.07.1952 as
entered in School records and in all services including his service record.  The
defendants did not contest the suit and the suit was decreed
ex parte on 27.04.1993.
As the defendants did not challenge the decree, it has
become final.  Pursuant to the decree and judgment, he made several
representations to the respondent authorities, but there was no response from
them. 

3.      While the petitioner was working at Kendriya Vidyalaya, Gachibowli,
Hyderabad, the 1st respondent issued proceedings dated 01.12.2011 to the
Principals of all Kendriya Vidyalayas in Hyderabad region calling upon them to
send the details as to the retirement of employees on superannuation during the
period 01.04.2012 to 31.03.2013.
The Principal, Kendriya Vidyalaya, Gachibowli,
sent a reply dated 07.12.2011 showing the retirement date of the petitioner as
31.07.2012.
 Immediately, the petitioner  got issued a  notice, dated 07.12.2011
to the 1st respondent bringing to his notice the decree and judgment dated
27.04.1993 passed in O.S.No.2516 of 1990 wherein his date of birth is declared
as 08.07.1954, and called upon him to direct the concerned authority to stop
further proceedings with reference to letter (reply) dated 07.12.2011.
The 1st
respondent sent a reply dated 16.01.2012 to the said notice stating that his request for correction of date of birth could not be conceded as it should have been urged within five years of his joining the service as per Rule 56 of the Fundamental Rules.  
Then the petitioner filed Writ Petition
No.8990 of 2012 before this Court assailing the premature retirement letter
dated 07.12.2011 in pursuance of proceedings dated 01.12.2011 stating that his
actual date of birth is 08.07.1954 but it was wrongly entered in service record
as 08.07.1952 by the respondent authorities and that the VII Assistant Judge,
City Civil Court, Hyderabad, passed a decree and judgement dated 27.04.1993 in
O.S. No.2516 of 1990 declaring his date of birth as 08.07.1954.  This Court
while admitting the said writ petition on 26.06.2012 granted interim order in
W.P.M.P.No.11371 of 2012 suspending the impugned proceedings and directed the  
respondent authorities to continue the petitioner in service by reckoning his
date of birth as 08.07.1954. The respondents filed a counter affidavit in the
said writ petition raising a plea that the Kendriya Vidyalaya Sanghathan is an
institution notified under Section 14 of the Administrative Tribunals Act, 1985
and this Court has no jurisdiction to entertain the said writ petition.  In view
of the same, the writ petition was dismissed.  Then the petitioner approached
the Tribunal by filing O.A.No.866 of 2012 questioning the legality and validity
of the proceedings of the 1st respondent dated 01.12.2011 and the information
furnished by the Principal through letter dated 07.12.2011.

4.      The respondents filed their counter denying the claim of the petitioner
and stated that while entering into service, he declared his date of birth as
08.07.1952 and as per Rules he has to retire on 31.07.2012, and as such, the
application is devoid of merit and the same is liable to be dismissed.

5.      The Tribunal taking into consideration the material available on record
and the submissions made by either counsel, dismissed the O.A. on 05.10.2012  
holding that the petitioner has not made out any case for correction of date of
birth in his service register as 08.07.1954 in place of 08.07.1952.   As against
the order of dismissal, the petitioner filed the present writ petition.

6.      Heard the learned counsel for the petitioner and the learned Standing
Counsel for Kendriya Vidyalaya Sanghathan appearing for the respondents.

7.      The learned counsel for the petitioner vehemently contended that the
Tribunal having observed that the judgment of the civil Court became final,
erred in observing that the petitioner has not filed execution petition for
implementing the decree and judgment of the civil Court and that the Tribunal
has no jurisdiction to direct the respondents to correct the date of birth of
the petitioner in service register basing on the judgment of the civil Court.
The learned counsel for the petitioner contended that the Tribunal has
erroneously held that the petitioner did not make any application for correction
of date of birth within the stipulated period as per instructions dated
07.10.1988 under Rule 56 of the Fundamental Rules, in fact, the said
instructions are not applicable to him since he was appointed prior to framing
of those instructions.  The learned counsel for the petitioner further contended
that the Tribunal erred in observing that the petitioner gave a declaration
before the respondent authorities on 30.11.1994 that his date of birth is
08.07.1952. The learned counsel for the petitioner submitted that the Tribunal
ought to have seen that the date of birth of the petitioner is corrected in all
the school records including the matriculation certificate on the basis of the
decree and judgement of the civil Court.

8.      On the other hand, the learned Standing Counsel for Kendriya Vidyalaya
Sanghathan appearing for the respondents submitted that the Tribunal has given
cogent and convincing reasons while passing the impugned order, and as such, it
needs no interference at the hands of this Court.

9.      We have perused the record.  The petitioner entered the Government service
on 22.12.1975 as Lower Division Clerk, thereafter he was promoted as Upper
Division Clerk and then as Assistant.  The date of birth of the petitioner was
recorded in service register as 08.07.1952 based on his matriculation
certificate and his declaration.
The petitioner filed declaratory suit in 1990
for correction of his date of birth as 08.07.1954 in all records including
service records i.e. after completion of almost 15 years of his joining the
service. 
Even if it is assumed that the date of birth of the petitioner is
wrongly entered in the service records, the petitioner has not properly
explained what prevented him from getting his date of birth altered by taking
necessary steps within a reasonable period of time, and as such, it cannot be
said that the petitioner is diligent in taking steps to correct his date of
birth.   
The Apex Court time and again cautioned the civil Courts including High
Courts against entertaining and accepting the claim made by the government
servant long after entering into service for correction of the recorded date of
birth.   
Further, the petitioner cannot seek a direction from the Tribunal to
the respondent authorities for correction of date of birth in his service
register pursuant to the decree and judgment in O.S. No. 2516 of 1990, as the
Tribunal is not competent forum for implementing the decree and judgment passed
by a civil Court.  
Further, a perusal of the record shows that on 30.11.1994,
the petitioner submitted his declaration declaring that his date of birth is
08.07.1952, which is subsequent to passing of decree and judgment by the civil
Court.  In the circumstances, we do not find any error or irregularity in the
impugned order warranting interference by this Court in exercise of jurisdiction
under Article 226 of the Constitution of India.

10.      The writ petition is devoid of merit and the same is accordingly
dismissed.  No order as to costs.
_______________________  
ASHUTOSH MOHUNTA, J      

B.N. RAO NALLA, J  
DATE:24.04.2013

M.V.ACT - RICKSHAW PULLER= It is the evidence of PW.2 that the deceased was the rickshaw puller and was earning Rs.100/- to Rs.150/- per day. PW.2 is also the rickshaw puller and that he is the eye witness to the accident. As observed by the Tribunal there was no material on record to prove that the deceased was earning Rs.3,000/- per month except oral testimony of PWs 1 and 2. As per Second Schedule under Section 163-A of the Motor Vehicles Act, 1988, non- earning person's income has to be fixed at Rs.15,000/- per annum. In this case, the evidence of PWs 1 and 2 is that the deceased was a rickshaw puller and was earning Rs.3,000/- per month. In the circumstances and the deceased was non-earning member person, in fact, he was living by plying rickshaw and also to meet the ends of justice, this Court is of the view that the Tribunal ought to have fixed the income of the deceased at Rs.2,000/- per month, which is just and reasonable, and as such this Court has fixed the income of the deceased at Rs.2,000/- per month and Rs.24,000/- per annum. Since there are six dependents, 1/4th of the income has to be deducted towards personal expenses of the deceased and thus, the loss of dependency is Rs.18,000/- per annum. Further, Ex.A.2 - post-mortem certificate indicates that the deceased was 48 years at the time of his death in the accident. As per the decision of the Apex Court in Sarla Verma v. Delhi Transport Corporation (supra), the appropriate multiplier for a person aged 48 years is "13" and thus the total loss of dependency would come to Rs.2,34,000/- (Rs.18,000/- x 13), apart from that the petitioner No.1 is entitled to Rs.16,000/- towards loss of consortium. Therefore, the petitioners are held to be entitled to a total compensation of Rs.2,50,000/-. Since the petitioners were awarded Rs.50,000/- under 'no fault liability' in M.O.P. No.1187 of 1997, the said amount has to be deducted from the total compensation and the same is hereby deducted and thus the petitioners are held to be entitled to Rs.2,00,000/- (Rupees two lakhs) only (Rs.2,50,000/- minus Rs.50,000/-). In the result, the C.M.A. is allowed enhancing the compensation from Rs.70,360/- to Rs.2,00,000/-, with interest at 6% per annum so far as the enhanced compensation is concerned. There shall be no order as to costs.

HON'BLE SRI JUSTICE B.N. RAO NALLA      

C.M.A. No.2069 OF 2004  

25.04.2013    

Smt. Dosali Appalanarasamma w/o. late D.Suri and five others Appellants

Smt. A.V. Swarnalatha w/o. A. Narayana Murthy and another Respondents  

Counsel for the Appellants: Sri G. Ram Gopal

Counsel for Respondent No.2:Sri B.Devanand

<GIST :

>HEAD NOTE :  

?Cases referred :
2009 ACJ 1298

JUDGMENT:  
           The petitioners in M.O.P. No.204 of 2000 on the file of the Motor
Vehicles Accidents Claims Tribunal- cum- District Judge, Visakhapatnam assailing
the impugned order dated 13th August,2003 filed this appeal seeking enhancement
of compensation since they were awarded only Rs.1,20,360/- with proportionate
costs and interest at 9% per annum from the date of the petition till
realisation, though they claimed a total compensation of Rs.2,00,000/- for the
death of deceased - Dosali Suri, who is husband of petitioner No.1 and father of
petitioner Nos. 2 to 6.

2.      For the sake of convenience, the parties hereinafter referred to as they
arrayed in the M.O.P.

3.      The brief facts of the case that led to filing the present appeal are that
the deceased was rickshaw puller and on 11.10.1997 at about 2.00 p.m., when he
was proceeding with his rickshaw from Maddilapalem to Isukathota, a car bearing
No. AP 31 5157 came from the opposite direction and dashed against the rickshaw,
as a result, the deceased  received grievous injuries and he was shifted to King
George Hospital, Visakhapatnam, where he succumbed to the injuries.  III Town
Police registered a case in Crime No.132 of 1997.   The deceased was aged 48
years at the time of the accident and was earning Rs.100/- to Rs.150/- per day.
Respondent No.1 being the owner of the car and respondent No.2 being the insurer
of it are jointly liable to pay compensation.

4.      Respondent No.1 - owner of the car was set ex parte.  Respondent No.2 -
insurance company filed counter contending that the petitioners are put to
strict proof of the averments made in the petition including the manner in which
the accident occurred and also put to strict proof with regard to possession of
valid driving licence by the driver of the car at the time of the accident.  It
is stated that the compensation claimed by the petitioners is excessive.

5.      Basing on the pleadings of both sides, the relevant issues were framed by
the Tribunal as to the rash and negligent driving of the car bearing No.AP 31
5157 by its driver and as to the entitlement of the petitioners to claim
compensation and the liability of the respondents to pay the same.

6.      During the course of trial, on behalf of the petitioners, petitioner No.1
- wife of the deceased was examined as PW.1 besides examining eye witness to the
accident as PW.2 and Exs.A.1 to A.5 were marked.  On behalf of the respondents,
no evidence was adduced.

7.      The Tribunal after taking into consideration the evidence and other
material brought on record, held that the accident occurred  due to rash and
negligent driving of the car by its driver  and that the petitioners are
entitled to a total compensation of Rs.1,20,360/-.  Not being satisfied with the
compensation awarded, the present appeal has been preferred by the petitioners
seeking enhancement thereof.

8.       Heard the learned counsel for the petitioners - appellants and the
learned standing counsel for respondent No.2 - insurance company.

9.       The learned counsel for the petitioners - appellants contended that the
Tribunal committed error in fixing the income of the deceased at Rs.1,000/- per
month and that as per the decision of the Apex Court in Sarla Verma v. Delhi
Transport Corporation1, the appropriate multiplier is  "13"   for a  person aged
48 years.  The learned counsel contended that the Tribunal ought to have awarded
Rs.15,000/- towards of loss of estate and Rs.8,000/- towards funeral expenses.

10.     The learned standing counsel for respondent No.2 -insurance company
submitted that the Tribunal has awarded just compensation by giving cogent and
convincing reasons, and as such, the impugned order does not warrant
interference at the hands of this Court.

11.     It is the evidence of PW.1- wife of the deceased that her husband used to
earn Rs.3,000/- per month by plying rickshaw and that she and petitioner Nos.2
to 6 are dependents on him.  It is the evidence of PW.2 that the deceased was
the rickshaw puller and was earning Rs.100/- to Rs.150/- per day.  PW.2 is also
the rickshaw puller and that he is the eye witness to the accident. 
 As observed
by the Tribunal there was no material on record to prove that the deceased was earning Rs.3,000/- per month except oral testimony of PWs 1 and 2.   
As per
Second Schedule under Section 163-A of the Motor Vehicles Act, 1988, non- 
earning person's income has to be fixed at Rs.15,000/- per annum.  
 In this
case, the evidence of PWs 1 and 2 is that the deceased was a rickshaw puller and
was earning Rs.3,000/- per month. 
 In the circumstances and the deceased was 
non-earning member person, in fact, he was living by plying rickshaw and also to
meet the ends of justice, this Court is of the view that the Tribunal ought to
have fixed the income of the deceased at Rs.2,000/- per month, which is just and
reasonable, and as such this Court has fixed the income of the deceased at
Rs.2,000/- per month and Rs.24,000/- per annum.  
Since there are six dependents,
1/4th of the income has to be deducted towards personal expenses of the deceased 
and thus, 
the loss of dependency is Rs.18,000/- per annum.  
Further, Ex.A.2 -
post-mortem certificate indicates that the deceased was 48 years at the time of
his death in the accident.  
As per the decision of the Apex Court in Sarla Verma
v. Delhi Transport Corporation (supra), the appropriate multiplier for a person
aged 48 years is "13" and thus the total loss of dependency would come to
Rs.2,34,000/- (Rs.18,000/- x 13),  
apart from that the petitioner No.1 is
entitled to Rs.16,000/- towards loss of consortium.  
Therefore, the petitioners
are held to be entitled to a total compensation of Rs.2,50,000/-. 
Since the
petitioners were awarded Rs.50,000/- under 'no fault liability' in M.O.P.
No.1187 of 1997, the said amount has to be deducted  from the total compensation
and the same is hereby deducted and thus the petitioners are held to be entitled
to Rs.2,00,000/- (Rupees two lakhs) only (Rs.2,50,000/- minus Rs.50,000/-).

12.      In the result, the C.M.A. is allowed enhancing the compensation from
Rs.70,360/- to Rs.2,00,000/-, with interest at 6% per annum so far as the
enhanced compensation is concerned.   There shall be no order as to costs.

___________________  
B.N. RAO NALLA, J  
Date: 25.04.2013

SARFAESI Act, verses Official liquidator under companies Act = any sale conducted defraud other secured creditor within one year after the commencement of company petition is void = There cannot be any doubt of the fact from the dates given earlier that the transfer was within a period of six months from the date of presentation of the liquidation proceedings and consequently it is statutorily invalid and the law does not recognize it. In fact, an attempt was sought to be made that there is no reference to sale in either of the Sections and it only refers to transfer and consequently these provisions can have no application. It has to be held that the transfer of interest in immovable property is in consequence of a sale and therefore the word transfer takes in its fold the very act of sale. Therefore, by applying Section 531 it is quite clear that the transfer shall be deemed to be invalid. 12. Even under Section 531-A it is quite clear if the sale was within a period of one year from the date of presentation of the liquidation proceedings as against the Official Receiver who represents the body of the creditors on his appointment after the winding up proceedings, the sale is void. Therefore, by applying Section 531 or 531-A it is quite clear from any angle the sale in this case is hit by the above provisions and when the sale is statutorily invalid or void there is no need for a relief to be asked by the Official Receiver to set aside the sale or approach the Debt Recovery Tribunal, since these two provisions are to be exclusively dealt by the Company Court alone, which is rightly contended by the Official Liquidator. I hold that this Court alone can decide the binding nature of the transactions under Section 531 or 531(A) of the Companies Act. It is to be noted that the powers conferred under the SARFAESI Act for the Bank or the Authorized Officer is only in order to avoid the delay of legal proceedings and it does not give any right or advantage to misuse the power of quasi judicial nature in order to convert a Non Performing Asset and realize the money by adopting improper mode. Therefore, for all the above reasons, I hold that the sale as held by the Authorized Officer on behalf of the Creditor Bank is void and the right of the Official Receiver in the liquidation proceedings cannot be defeated and as the sale is void, it goes to the root of the obligations between the auction purchaser and the Authorized Officer and when once the sale is set aside as void, it is needless to say that the Creditor Bank cannot take advantage of the void sale and the auction purchaser shall be restored to the same position prior to the sale and any amount realized by the Creditor Bank cannot be retained by it. Accordingly, W.P.No.19297 of 2012 is allowed granting the reliefs claimed thereunder. W.P.No.33655 of 2011 and Company Application No.1972 of 2011 are dismissed. Consequent on the orders holding that the sale as void as it comes within the purview of this Court, Company Application No.421 of 2013 is also allowed as a consequence of the sale being held as void under Section 531 and 531 (A) of the Companies Act. No costs.

HON'BLE SRI JUSTICE N.R.L. NAGESWARA RAO        

WRIT PETITION Nos.19297 of 2012 & 33655 of 2011 & COMP.A.Nos.1972 of 2011 & 421      
of 2013 in C.P.No.215 of 2010

22.04.2013.

M/s. United Steel Allied Industries Private Limited             ....Petitioner

M/s. Indian Bank, Corporate Office, and others            ...Respondents

Counsel for the Petitioner:

Counsel for the Respondents:

<Gist :

>Head Note:

?Cases referred:
1. (2004) 4 SCC 311
2. 2013 LawSuit(SC) 205
3. 2012 (2) D.R.T.C. 47 (M.P.)
4. (2006) 134 Comp Cases 267 (Madras)
5. (2005) 127 Comp Cases 85 (Madras)
6. 2004 Comp Cases 27
7. (2007) 139 Comp Cases 191 (Madras)
8. 2012 (6) ALD 345 (DB)
9. (2010) 1 SCC 655
10. 2011 (1) L.S. 196

COMMON ORDER:    

1.      All these matters arise out of a common issue.
M/s. Laran Sponge & Minerals Private Limited (hereinafter called as borrower)
has availed a loan with Indian Bank by hypothecation of the agricultural land
and also machinery belonging to the company and also the guarantors,
Smt. P. Latha and Sri P. Vara Prasada Raju, who are the Directors of the
Company.  A loan facility of Rs.12,00,00,000/- as M.T.L. loan and O.C.C. Limit
of Rs.5,00,00,000/- and L.C. of Rs.5,00,00,000/- and B.G. Limit of
Rs.40,00,000/- was availed in the year, 2008 and ad hoc Limit of
Rs.3,50,00,000/- in the year, 2009.
As there was default in repayment of the
loan and the loan was classified as Non Performing Asset (N.P.A.) Account and
the Indian Bank being a secured creditor under the provisions of SARFAESI Act,
2002, has taken possession of the property.
A publication was given on
28.08.2010 for auction of the same.  
M/s. United Steel Allied Industries Private
Limited (Auction Purchaser) participated in the auction on 29.09.2010 and 25% of
sale price was deposited.  
Subsequently, on 01.01.2010 S.B.I. Global Factors
Limited has filed company petition for winding up as it is also a secured creditor and the petition was allowed on 18.07.2011 and the Official Liquidator was appointed to take possession of the property.  
After the auction 
a letter
dated 18.10.2010 was addressed by the auction purchaser to the effect that their
participation in the auction is subject to the following conditions:-
1) "Satisfactory legal due diligence and clear marketable title over land, plant
and machinery free from any lien, charge, encumbrances etc.,
2) Indemnity guarantee from the Indian Bank with respect to future litigation,
what so ever in nature, if any,
3) Indian Bank shall put us in the peaceful possession and handling over the
land, plant and machinery and smooth functioning without any obstructions, what
so ever in nature, from any quarter.
In this connection, we would also like to mention that in your above referred
letter you have mentioned that the total available land is about 20 acres,
whereas the land available is only 16 acres.  Further, the land available is not
sufficient to meet the technical requirements of plant.
In view of the above, we have no option, except to reserve our right to with
draw.  We request the Bank to refund the initial bid amount (inclusive of EMD)
of Rs.9.0 Crores deposited with the Bank at the earliest."


2.      It is also to be noted here that after the sale on 29.09.2010 after
deposit of 25% of the sale price, the balance of 75% was not deposited within
fifteenth day.  
Thereafter, on 24.11.2010 a letter is said to have been
addressed by the auction purchaser for grant of loan and accordingly loan was
granted on 07.01.2011 and the balance of sale consideration was adjusted from
that loan and a sale certificate was issued on 18.01.2011.
Thereafter, as
contemplated under the tender agreement, the documents were sent for 
registration. 
At that stage, the Official Liquidator has addressed a letter on
20.09.2011 to the Sub Registrar, Hakundi Village, Ballari District, informing that the borrower company was wound up in C.P.No.215 of 2010 and he was   appointed as Liquidator and the Sub Registrar was requested not to register any
document with regard to the properties of the borrower.
Subsequently,
W.P.No.33655 of 2011 was filed on 14.12.2011 by the Indian Bank for a direction
to the Sub Registrar to register the sale certificate with regard to the
auctioned property.
While, the Writ Petition was pending, the Bank also filed
the COMP.A.No.1972 of 2011 on 27.12.2011 for a direction to the Official
Receiver to clarify his letter, dated 20.09.2011 addressed to the Sub Registrar.
While the matter stood thus as the auction purchaser claimed that the possession
was not given as there was further claims with regard to the auctioned property
and there were dues claimed by the authorities and as the property is not free
from encumbrances and as the Bank threatened to recover the amounts as a  
defaulter and to treat the loan account as Non Performing Asset.  W.P.No.19297
of 2012 was filed by the auction purchaser on 26.06.2012 and interim orders were
passed in W.P.M.P.No.24720 of 2012 in favour of the auction purchaser
restraining the Bank from proceeding and later it was varied in W.P.M.P.No.2850
of 2012 giving the Bank liberty to proceed against the auction purchaser in
accordance with law for recovery of the over due amounts and installments to the
extent of default by the auction purchaser.
As against that W.A.No.17 of 2013
was filed and by order dated 09.01.2013 the modification ordered in
W.P.M.P.No.2850 of 2012 was deleted and the matter was directed to be dealt by
this Court along with W.P.No.33655 of 2011. That is how both the Writ Petitions
were transferred to this Court.
While these matters are pending the auction
purchaser has filed COMP.A.No.421 of 2013 to set aside the sale alleging several
irregularities, suppression of facts and not following due process. It was also
further pleaded that the properties are not properly valued and the encumbrances
were not disclosed and possession was not delivered effectively.  It was also
pleaded that there were several claims of taxes etc., to a large sum of more
than 1 Crore and as such the sale is liable to set aside.
3.      The Indian Bank has denied all the allegations and supported the action
taken under SARFAESI Act. The Official Liquidator claims that this sale is void
under Section 446 as the leave was not obtained and also under Sections 531 and
531 (A) of Companies Act, 1956.  The transfer being void as it was done within
one year from the date of presentation of the winding up petition and the sale
certificate having been issued after the winding up order under Section 531(A).
The sale being fraudulent and undue preference to the one of the creditors,
since it is within six months is not valid under Section 531 and consequently he
has got every right to oppose the registration even without asking for setting
aside the sale as it is void. It is the contention of the S.B.I. Global that it
is also a secured creditor and there was no proper and valid notification or
valuation of the property and since the winding up process has been initiated by
it, the Indian Bank cannot claim any priority.

4.      In view of the above circumstances, the points that arise for
consideration are:-
1) Whether a valid sale has been conducted on behalf of the Indian Bank by the Authorized Officer under SARFAESI Act?  
2)  Whether the sale is void and fraudulent as contended by the Official Receiver?
3) Whether the sale is vitiated for several of the irregularities raised by the auction purchaser and if so it is liable to be set aside?
POINTS:
5.      The contention of Sri S. Ravi, Senior Advocate appearing for the Indian
Bank is that under the statutory provisions of SARFAESI Act, the sale has been
conducted and it is a special enactment and if any party is aggrieved, the
remedy is only to approach the Debt Recovery Tribunal (DRT) as contemplated
under Section 17 of the Act.  According to him, the Company Court does not have
any jurisdiction since SARFAESI Act is later enactment and as held by the
Supreme Court in several decisions.  He relied upon a decision reported in
Mardia Chemicals Limited and others Vs. Union Of India and others1,
whereunder
the constitutional validity of the SARFAESI Act was considered and the remedy
was found before the Debt Recovery Tribunal.  He also relied upon a decision
reported in Official Liquidator, U.P. and Uttarakhand Vs. Allahabad Bank and
others2, 
whereunder the same principle has been reiterated the above decision
shows that if the matter is pending before the Debt Recovery Tribunal then the
Official Receiver should be associated with the actions, if the matter is not
before the Debt Recovery Tribunal it is the Company Court that has to deal with
the validities. He also relied on a decision reported in
Saroj Shivhare and Others Vs. Gaurav Enterprises and others3, 
whereunder it was
held that the issue of the sale certificate itself is a completion of a sale and
no registration is necessary.
According to him, the correspondence and the
admissions of the auction purchaser clearly goes to show that the possession was
delivered.  According to him, when once the possession was delivered, the
subsequent interference is not the duty of the Bank to protect.  He also
contends that it is for the buyer to verify whether there are any encumbrances
or not and if there are arrears of taxes etc., it shall be paid by the auction
purchaser only in substance.  According to him, neither the Official Liquidator
nor the auction purchaser can question the sale before the Company Court and
therefore their claims have to be rejected as the sale having been confirmed.
The Registrar shall be directed to register the property.
6.      On the other hand, the Official Liquidator contends that his attack on the
sales is under Section 531 and 531 (A) of the Companies Act and it is the
exclusive jurisdiction of the Company Court alone and the Debt Recovery Tribunal
has no jurisdiction.
According to him, in the decision relied on by the senior
counsel, the matters were pending before the Debt Recovery Tribunal and before
the sale the part of the Official Liquidator was dealt with.  
But in this case,
the sale was completed and, therefore, the facts are quite different.
According
to him, the question of fraudulent preference cannot be considered by the Debt
Recovery Tribunal.  Further more, if a sale is not void under the Statute, the
remedy is only to approach the forum, which has got jurisdiction to decide the
issue and the later Act does not apply as under Section 37 of the SARFAESI Act,
the provisions of the Company Act are not made inapplicable and they are held to
be only additional.  According to him, if a valid sale is conducted by the
Authorized Officer, even if the contention of the senior counsel is to be
accepted then only the Debt Recovery Tribunal has to be approached, but when the
sale itself is void there being no necessity to be set aside the question of
approaching the Debt Recovery Tribunal does not arise.
7.      The Official Liquidator has relied upon a Division Bench decision of the
Madras High Court reported in
Asset Reconstruction Company (India) Limited Vs. Official Liquidator, High
Court4,
whereunder even under the SARFAESI Act for the sale of the property and
the distribution of the assets, the association of the Official Liquidator is
stressed.  He also relied upon a decision of the Madras High Court reported in
Administrator, MCC Finance Limited Vs. Ramesh Gandhi5,
whereunder the provisions  
of 531, 531-A and 537 of the Companies Act were considered.  He also relied upon
a decision of the Gujarat High Court reported in Official Liquidator of Piramal
Financial Services Limited Vs. Reserve Bank of India6,
 whereunder the instances
of fraudulent preference or transfer have been considered.  He also relied upon
another decision reported in Archean Granites Private Limited Vs. R.P.S. Benefit
Fund Limited and others7,
whereunder the instances of fraudulent preference and
sale of the property for lesser price etc., were considered.
8.      The learned counsel appearing for the auction purchaser has also relied
upon a decision of this Court reported in
India Finlease Securities Limited, Chennai Vs. Indian Overseas Bank, Vijayawada,
Krishna District and Others8,
whereunder the provisions of SARFAESI Act, the
notion of sale and transfer have been considered and opined that the sale is not
complete unless the property for which the price was paid is transferred to the
buyer by a written proceedings.  It was also considering the provisions of
Rule 9 (2) and 9 (4) and found that the confirmation shall be by the secured
creditor and not by the Authorized Officer.  Incidentally, it was held that a
sale certificate is not required to be registered and no registered sale deed is
to be executed after the sale was confirmed by the Banks.  He also relied upon a
decision of the Supreme Court reported in
Haryana Financial Corporation and another Vs. Rajesh Gupta9, whereunder the
defects in the formation of a contract can be agitated by the auction purchaser.
9.      Therefore, in view of the above contentions, it is necessary now to see
the provisions under Section 531, 531A and 537 of the Companies Act:-
531:Fraudulent Preference:- .
1) Any transfer of property, movable or immovable,
delivery of goods, payment, execution or other act relating to property made,
taken or done by or against a company within six months before the commencement   
of its winding up which, had it been made, taken or done by or against an
individual within three months before the presentation of an insolvency petition
on which he is adjudged insolvent, would be deemed in his insolvency a
fraudulent preference, shall in the even of the company being wound up, be
deemed a fraudulent preference of its creditors and be invalid accordingly;
Provided that, in relation to things made, taken or done before the commencement
of this Act, this sub-section shall have effect with the substitution, for the reference to six
months, of a reference to three months.
2) For the purposes of sub-section (1), the presentation of a petition for
winding up in the case of a winding up by [the Tribunal], and the passing of a
resolution for winding up in the case of a voluntary winding up, shall be deemed
to correspond to the act of insolvency in the case of an individual.
531A: Avoidance of voluntary transfer:-  
Any transfer of property, movable or
immovable, or any delivery of goods, made by a company, not being a transfer or
delivery made in the ordinary course of its business or in favour of a purchaser
or encumbrancer in good faith and for valuable consideration, if made within a
period of one year before the presentation of a petition for winding up by [the
Tribunal] or the passing of a resolution for voluntary winding up of the
company, shall be void against the liquidator.
537: Avoidance of certain attachments, executions, etc., in winding up by
Tribunal:- .
1) Where any company is being wound up by the Tribunal- 
(a) any attachment, distress or execution put in force, without leave of the
Tribunal against the estate or effects of the company, after the commencement of
the winding up; or
(b) any sale held, without leave of the Tribunal of any of the properties or
effects of the company after such commencement,  shall be void.
2) Nothing in this section applies to any proceedings for the recovery of any
tax or impost or any dues payable to the Government."
10.     Section 531 deals with the case of fraudulent preference and in such a
circumstance the sale is held to be invalid.
In fact, though several complaints
were made about the nature of the publication and the contents therein, there is no material before the Court as to whether proper publication was given. 
 It
cannot be disputed that the S.B.I. Global is also a secured creditor, if the interest of the other creditors is not taken care of and if it is only for the benefit of single creditor even applying the principles under the Insolvency
Law, the sale is a fraudulent one.
The argument that the Indian Bank is
prepared to place before the Court the amount realized by the sale for
distribution of all the creditors does not hold good, for the reason that if at
the time of the sale, if the auction purchaser is to know that there are other
encumbrances on the property then the price to be quoted will be definitely
different. 
 In fact, there is no material on record as to what was the sale
price quoted by the Authorized Officer and as to whether it was less or more
than the price quoted by the auction purchaser.
11.     There cannot be any doubt of the fact from the dates given earlier that
the transfer was within a period of six months from the date of presentation of
the liquidation proceedings and consequently it is statutorily invalid and the
law does not recognize it.  In fact, an attempt was sought to be made that there
is no reference to sale in either of the Sections and it only refers to transfer
and consequently these provisions can have no application.  It has to be held
that the transfer of interest in immovable property is in consequence of a sale
and therefore the word transfer takes in its fold the very act of sale.
Therefore, by applying Section 531 it is quite clear that the transfer shall be
deemed to be invalid.
12.     Even under Section 531-A it is quite clear if the sale was within a period
of one year from the date of presentation of the liquidation proceedings as
against the Official Receiver who represents the body of the creditors on his
appointment after the winding up proceedings, the sale is void.  Therefore, by
applying Section 531 or 531-A it is quite clear from any angle the sale in this
case is hit by the above provisions and when the sale is statutorily invalid or
void there is no need for a relief to be asked by the Official Receiver to set
aside the sale or approach the Debt Recovery Tribunal, since these two
provisions are to be exclusively dealt by the Company Court alone, which is
rightly contended by the Official Liquidator.             I hold that this Court
alone can decide the binding nature of the transactions under Section 531 or
531(A) of the Companies Act. 
13.     In fact, the amendments made to SARFAESI Act in 2004 deletes the word   
Appeal under Section 17 and only provides for an application to be made to the
Debt Recovery Tribunal.  The right of Appeal is quite different from an
application to be presented before the Debt Recovery Tribunal. The Legislative
intent is not very clear for deleting word "Appeal".  Therefore, it cannot be
said that this Court cannot entertain this application and consider the
objections of the Official Receiver to consider the sale as not binding and his
consequential request for not registering the properties as being without
jurisdiction.
14.     Though no specific pleadings are made by the parties challenging the
procedure of the sale, since the Court is considering the validity of the sale
under the statute, it is the question of law and the Court has to deal with it.
If the provisions of SARFAESI Act have been violated in conducting sale, the
sale cannot be said to be a valid sale.
It is to be noted that the powers
conferred under the SARFAESI Act for the Bank or the Authorized Officer is only in order to avoid the delay of legal proceedings and it does not give any right or advantage to misuse the power of quasi judicial nature in order to convert a
Non Performing Asset and realize the money by adopting improper mode.
Any  
Authorized Officer who is conducting the sale is discharging the quasi-judicial
functions and he has to follow the rules and conduct the sale according to law.
There cannot be an understanding or agreement between the borrower, auction 
purchaser or the creditor by violating mandatory provisions, in order to get
undue benefit to the Creditor Bank.
15.     In this connection, it is useful to refer to Rule 9 (1) (2) (3) (4) and
(5) of SARFAESI Act:- 
Rule 9: Time of Sale, issues of sale certificate and delivery of possession,
etc.:-
1) "No sale of immovable property under these rules shall take place before the
expiry of thirty days from the date on which the public notice of sale is
published in newspapers as referred to in the proviso to sub-rule (6) or notice
of sale has been served to the borrower.
2) The sale shall be confirmed in favour of the purchaser who has offered the
highest sale price in his bid or tender or quotation or offer to the authorised
officer and shall be subject to confirmation by the secured creditor:
Provided that no sale under this rule shall be confirmed, if the amount offered
by sale price is less than the reserve price, specified under sub-rule (5) of
rule 9:
Provided further that if the authorised officer fails to obtain a price higher
than the reserve price, he may, with the consent of the borrower and the secured
creditor effect the sale at such price.
3) On every sale of immovable property, the purchaser shall immediately pay a
deposit of twenty-five
per cent. of the amount of the sale price, to the authorised officer conducting
the sale and in default of such deposit, the property shall be forthwith be sold
again.
4) The balance amount of purchase price payable shall be paid by the purchaser
to the authorised officer on or before the fifteenth day of confirmation of sale
of the immovable property or such extended period as may be agreed upon in
writing between the parties.
5) In default of payment within the period mentioned in sub-rule (4), the
deposit shall be forfeited and the property shall be resold and the defaulting
purchaser shall forfeit all claim to the property or to any part of the sum for
which it may be subsequently sold."
16.     The provisions are akin to the provisions of the Court sale to be
conducted under Order XXI Rule 85 and 86 of Civil Procedure Code. Order XXI,
Rules.85 and 86 reads as under:-

Order XXI, Rules.85 and 86:-
85. Time for payment in full of purchase-money:- The full amount of purchase-
money payable shall be paid by the purchaser into Court before the Court closes
on the fifteenth day from the sale of the property:
Provided the in calculating the amount to be so paid into Court, the purchaser
shall have the advantage of any set-off to which he may be entitled under
Rule.72.
86. Procedure in default of payment:- In default of payment within the period
mentioned in the last proceeding rule, the deposit may, if the Court thinks fit,
after defraying the expenses of the sale, be forfeited to the Government and the
property shall be re-sold and the defaulting purchaser shall forfeit all claim
to the property or to any part of the sum for which it may subsequently be sold.
17.     Under the provisions of Rules 85 and 86, if the full purchase money is not
paid within fifteen days, further steps have to be taken.  But the only
difference under Rule 9 (4) is that the time can be extended by agreement in
writing between both the parties, it evidently means that such an extension
shall be within 15 days period stipulated under Clause 4.  But, in this case no
such thing has happened.
18.     The tender cum bid agreement also stipulates the same, which reads as
under:-
33. Sale is subject to confirmation by the Bank.  Bank will confirm the sale
only after ensuring that initial payment of 25% of sale price is paid/deposited
(on the same date) by way of DD/BPO.
34. The EMD deposited by the successful tenderer shall be held as Security
Deposit for due performance of the contract.  Successful tenderer shall deposit
the balance amount within 15 days of confirmation of the sale by the Bank or
within the extended period as agreed between the parties. Such deposit will be
made in the form of Demand Draft/ Bankers' Pay Order on a Bank, payable at
Hyderabad.
35. No time extension for making the payment after the stipulated period will be
granted nor shall the successful tenderer be allowed to make part payments.
However, the Seller may, in his discretion, entertain and consider request for
extension of time for making payment provided the request has been made in
writing and duly signed by the successful tenderer/representative himself.
Evidently, the above stipulations are keeping in view the provisions under Rule
9 of SARFAESI Act.
19.     To be more clear, the auction was held on 29.09.2010 and the amount has to
be deposited by fifteenth day that comes by 14.10.2010, if both the parties have
agreed between themselves in writing, the extension of the time should have been
given by the Authorized Officer. But, in this case, it did not happen and on the
other hand on 18.10.2010 the auction purchaser has written a letter repudiating
the sale and for refund of the money, which clearly goes to show that no
extension is sought within a period of 15 days.  Therefore, if the rigor under
Rule 9 is to be followed, there is no occasion for the Authorized Officer except
to go for re-auction.  In fact, this is the principle of law even under the
Court sale which has been repeatedly held and in this connection it will be
useful to refer to a decision of this Court reported in V. Vedanda Vyasulu and
Others Vs. K. Purushotam and another10.  The Authorized Officer has no option or
discretion rather than to cancel the sale.
20.     Further, the manner in which the further steps were taken are also
objectionable and it cannot be said to be fair play either by the creditor or
the Authorized Officer, when the sale consideration was not paid.  An
application for loan was given on 24.11.2010, evidently, it is not an
application for loan for purchase of the property. A loan of nearly Rs.19 to 20
Crores was granted on 07.01.2012 and from this loan amount the sale price was
adjusted and the balance was treated as a separate loan account.  It is crystal
clear that the Authorized Officer has violated the mandatory provisions in
conducting a sale, which a civil Court itself cannot violate and, therefore,
facilitated the creditor to grant a loan and thereafter appropriated the same
towards the sale consideration and thereafter the sale certificate was issued on
17.01.2011 without there being a request in writing for extension of the time
within the fifteenth day for payment of balance consideration and an order in
writing granting such extension, as claimed, which are mandatory under Rule 9
and Tender-cum-Bid agreement. The above facts are telltale about the failure of
the Authorized Officer to proceed according to law and the consequential
advantage the creditor bank has got.  It is abundantly fraudulent. When once the
sale fails to have any legal effect by application of Rule 9 it cannot be said
to be a valid sale and neither the auction purchaser nor the creditor can derive
any benefits and such sales are to be ignored.
21.     Therefore, taking any view of the matter, it is quite clear the sale in
this case is statutorily void under Section 531, 531-A and 537 of the Companies
Act and also under Rule 9 of the SARFAESI Act, that being so the creditor cannot
claim any benefits.
22.     It is sought to be contended that there was no need for registration and the sale certificate itself is sufficient probably under the SARFAESI Act it appears to be so. 
But if the parties have contracted to the contrary, the same
cannot be avoided.  In this connection, it is useful to refer to Clause 42, 43
and 44 of the tender given bid documents for sale.
" 42) On confirmation of sale by the Bank and upon payment of the full amount of
price, the Authorised Officer will execute the Sale Certificate in favour of the
Purchaser. The registration charges, payment and stamp duty etc., shall be borne
by the Purchaser.
43) It will be the responsibility of the Purchaser to take all steps necessary
for registration of the Sale Certificate.
44) The cost towards registration if, expenses incurred towards stamp duty,
etc., and any other expenses will be borne by the purchaser.  The seller will
not bear any expenses what so ever."

It clearly goes to show that the parties contemplated registration, but however,
it shall be at the expenses of the purchaser consequently, it cannot be argued
by the creditor.
23.     Therefore, when the auction purchaser wants the sale deed to be executed,
the Authorized Officer or the creditor cannot deny the same.
24.     There is a question about the maintainability of the application by the auction purchaser about the validity of the sale. 
 It is true that on the basis
of the decisions relied on by the learned senior counsel Sri S. Ravi, it may be
correct that the auction purchaser has to approach the Debt Recovery Tribunal.
But, however, it has been fairly well settled that when the proceedings before
the lower authorities are not properly conducted, the Writ jurisdiction of the
High Court is not denied.  The substance of the writ is about the several
irregularities in conducting the sale, which were found to be valid by this
Court and the sale having been held to be void, the right of the auction
purchaser to quick redressal in the writ is sustainable. Though in ordinary
circumstances, if the application is singularly filed by the auction purchaser,
then it may be that he has to approach the Debt Recovery Tribunal, but, however
in this case the other applications challenging the action of the Official
Liquidator and the exclusive jurisdiction of the Company Court under Section 531
and 531(A) of the Companies Act are being considered and the benefit of such
proceedings cannot be denied to the auction purchaser and consequently I hold
that in the particular circumstances of this case, the application filed by the
auction purchaser can be held to be maintainable.
25.     Therefore, I hold that as the sales are statutorily void and the Official
Liquidator has got every right to take possession of the property by ignoring
them, the letter written by him for restraining the registration itself is an
action of assertion that the sale is void.  In fact, such action is being
questioned in the Writ Petition and also Comp.A.No.1927 of 2011. The point in
these cases is the binding nature of the sale on the Official Liquidator and
when once the sales are void and when the decision rests on this aspect, there
need not be any separate application to be filed by the Official Liquidator for
setting aside the sale. If once his letter seeking for stopping of registration
is held to be valid, consequently, it has to be held that as the void sale need
not be set aside, they have to be ignored and challenge made by the Creditor
Bank is not valid.
26.     So far as the auction purchaser is concerned, evidently, he is challenging
the letter written by the Creditor Bank about the pressure for realization of
the amount due under a void sale and the reasons given above clearly goes to
show that the Creditor Bank cannot take advantage of the void sale and
therefore, the necessary relief has to be granted to the auction purchaser
restraining the Creditor Bank enforcing the liability.  So far as it relates to
the auction sale proceedings and the adjustment or payment, which has been 
realized by it, since substantial relief is granted in the Writ filed by the
auction purchaser, the benefit of it cannot be denied in the application to set
aside the sale.
27.     Therefore, for all the above reasons, I hold that the sale as held by the
Authorized Officer on behalf of the Creditor Bank is void and the right of the
Official Receiver in the liquidation proceedings cannot be defeated and as the
sale is void, it goes to the root of the obligations between the auction
purchaser and the Authorized Officer and when once the sale is set aside as
void, it is needless to say that the Creditor Bank cannot take advantage of the
void sale and the auction purchaser shall be restored to the same position prior
to the sale and any amount realized by the Creditor Bank cannot be retained by
it.
28.     Accordingly, W.P.No.19297 of 2012 is allowed granting the reliefs claimed
thereunder.  W.P.No.33655 of 2011 and Company Application No.1972 of 2011 are  
dismissed.  Consequent on the orders holding that the sale as void as it comes
within the purview of this Court, Company Application No.421 of 2013 is also
allowed as a consequence of the sale being held as void under Section 531 and
531 (A) of the Companies Act. No costs.
_____________________________    
N.R.L. NAGESWARA RAO, J    
Dated: 29.04.2013