TaxTMI 
TaxTMI 
2008 (1) TMI 941
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....2004 passed by the Debt Recovery Tribunal-2, Chennai, is null and void and not binding on the plaintiff's property described in Schedule A. (b) Declaration that Sale Certificate No.53 of 2006, dated 31.8.2006 issued by the Debt Recovery Tribunal-2, Chennai, is null and void and not binding on the plaintiff's property described in Schedule A and (c) Permanent injunction restraining the fourth defendant, his men, agents, servants or assigns, from in any manner directly or indirectly acting upon the Sale Certificate No.53 of 2006, dated 31.8.2006 issued by the Debt Recovery Tribunal-2, Chennai, and dealing with the said property described in Schedule A, in any manner whatsoever. 3. In the aforesaid suit, the first respondent-plaintiff preferred the following applications: (i) Original Application No.729 of 2007: preferred for interim injunction restraining the fourth respondent/fourth defendant, his men, agents, servants or assigns, from in any manner directly or indirectly acting upon the Sale Certificate No.53 of 2006, dated 31.8.2006 issued by the Debt Recovery Tribunal-2, Chennai, developing and dealing with the property described in Schedule ....
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.... assets, both movable and immovable properties of the firm and acknowledged receipt of advance money. The possession of the property was also handed over and M/s.M.G.Brothers agreed to execute necessary conveyance deed as and when required by M/s.Dhanalakshmi Consolidates Transport Private Limited. Subsequently, the entire sale consideration was given, but no sale deed in favour of M/s.Dhanalakshmi Consolidates Transport Private Limited was executed. The original title deeds were handed over to the said Company by M/s.M.G.Brothers. Schedule B to the agreement refers to various immovable properties. (iii) On 27.11.1987, M/s.Dhanalakshmi Consolidates Transport Private Limited obtained loan from M/s.New Bank of India (subsequently merged with M/s.Punjab National Bank) for carrying on business as transporters. The various properties including the property at Bangalore, were mortgaged by M/s.Dhanalakshmi Consolidates Transport Private Limited, which also handed over the original title deeds to the Bank on 11.2.1988. (iv) M/s.New Bank of India filed a suit on 1st March, 1990 at Bombay High Court, namely C.S.No.650 of 1990 against the borrower for Rs. 1,31,65,122.09 in r....
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....n S.No.43/3, Kaneshamari portion of 502 Hebbal Village, (Kasaba) Hobli, Bangalore North Taluk, with three Sq.Mts. of AC sheet house, bounded by East: Bellary Road, West: private property, North: portion of land sold to Susheelamma and South: portion of land in S.No.43/3, Document No.4692/94. The fifth sale deed was executed by M/s.M.G.Brothers Lorry Service in favour of T.N.Bramresh, in respect of eight guntas of land on the same day in S.No.43/3, Kaneshamari portion of 502 Hebbal Village, (Kasaba) Hobli, Bangalore North Taluk, with three Sq.Mts. of AC sheet house, bounded by East: Bellary Road, West: private property, North: portion of land sold to T.N.Chandra in S.No.43/3, and South: portion of land in S.No.43/3 sold to T.M.Thirumalesh - Document No.4684/94. The sixth sale deed was executed by M/s.M.G.Brothers Lorry Service in favour of T.N.Thirumalesh (plaintiff's vendor's vendor) in respect of eight guntas of land on the same day, with 3 Sq.Mts. AC sheet house in S.No.43/3, Kaneshamari portion of 502 Hebbal Village, (Kasaba) Hobli, Bangalore North Taluk, bounded by East: Bellary Road, West: private property, North: portion of land sold to T.N.Bramresh and South: by V....
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....o.502 presently bearing No.709/801, Hebbal Village, Kasaba Hobli, Bangalore North Taluk, measuring 8712 Sq.Ft. with 3 Sq.Mts. house, bounded by: East: Bellary Road, West: private property, North: property belonging to M/s.Arcus Technology (P) Ltd. and South: property belonging to Chandran. On 19.7.1995, N.Ravi sold to M/s.Arcus Technology (P) Ltd., Doc.No.4337/95land bearing Kaneshamari No.502 presently bearing No.715/801, Hebbal Village, Kasaba Hobli, Bangalore North Taluk, measuring 9256 Sq.Ft. with 3 Sq.Mts. house, bounded by: East: Bellary Road, West: private property, North: property belonging to Rukmani Manoharlal and South: property belonging to Neelakanta Naidu. On 16.8.1995, Smt.Rukmani Manoharlal sold to M/s.Arcus Technology (P) Ltd., Doc.No.4832/95land bearing Kaneshamari No.502 presently bearing No.717/801, Hebbal Village, Kasaba Hobli, Bangalore North Taluk, measuring 9256 Sq.Ft. with 3 Sq.Mts. house, bounded by: East: Bellary Road, West: private property, North: property belonging to Manoharlal K.Narang and South: property belonging to N.Ravi. On 9.8.1995, T.N.Chandra sold to M/s.Arcus Technology (P) Ltd., Doc.No.4695/95land bearing Kaneshamari No.502 present....
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....t CMC Bhataryanaaura ad-measuring 370 feet x 182.5 feet + 253 feet equivalent to 80567.5 Sq.ft. bounded on the East: Bellary Road, West: private property; North: private property and South: private property. (x) In the meantime, a Company Petition in C.P.No.139 of 1991 was preferred, in which, this Court, on 18.10.1997, passed an order to wind up M/s.Dhanalakshmi Consolidates Transport Private Limited and the suit pending in Bombay High Court was ordered to be transferred to this Court and on transfer of the suit pending in Bombay High Court in C.S.No.650 of 1990, it was re-numbered as C.S.No.276 of 1998 before this Court. In the said suit C.S.No.276 of 1998, in the end of 2002, the Bank (now on its merger with Punjab National Bank) filed an application in Appln.No.4602 of 2002 to transfer the suit C.S.No.276 of 1998 pending in this Court to the Debt Recovery Tribunal, Chennai, which was ordered by this Court on 19.11.2002. Pursuant to the same, the case was transferred to Debt Recovery Tribunal-II, Chennai and re-numbered as T.A.No.1 of 2004. (xi) In the suit before the Bombay High Court which was subsequently transferred to this Court and then to Debt Recovery T....
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....espondent-plaintiff preferred Writ Appeal No.62 of 2007, but both the Writ Petition and the Writ Appeal were heard and dismissed on 6.6.2007 with the following observation: 36. In view of our findings holding the writ petition, not maintainable, we left open all other points agitated by both the parties before this Court so as to be decided by an appropriate forum." Thereafter, after the dismissal of the aforesaid Writ Petition and Writ Appeal, the first respondent-plaintiff instead of moving before the Debts Recovery Tribunal (for short, "DRT") or the Debts Recovery Appellate Tribunal (for short, "DRAT"), preferred the suit in question, namely C.S.No.517 of 2007 before this Court, for the relief as noticed above and in the suit, already interim order had been passed and a petition under Order 7 Rule 11 CPC which was preferred by the fourth defendant (the appellant herein), was rejected, giving rise to all these Original Side Appeals. 5. Mr.N.R.Chandran, learned Senior Counsel appearing for the appellant-fourth defendant, mainly took the plea that the suit was not maintainable in the Original Side of this Court under Clause 12 of the Letters Patent, as it is "suit fo....
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....k itself played fraud. Learned Senior Counsel appearing for the first respondent-plaintiff, while referring to the original plaint as was filed before the Bombay High Court, the amended plaint fled before the DRT, copies of one one or other sale deed(s) dated 28.2.1964, the order passed by the DRT on one or other date(s), made the following submissions: (a) The plaintiff having alleged fraud played by the parties before the DRT and the Recovery Officer to obtain one or other order, a suit against such order of the DRT/Recovery Officer is maintainable. (b) The relief sought for in the suit cannot be termed to be the "suit for land". Therefore, this Court from its Original Side, has jurisdiction to decide the issue under Clause 12 of the Letters Patent. (c) The appeal under Section 20 of the 1993 Act against a consent decree, is not maintainable, and therefore, the remedy of appeal under Section 20 of the 1993 Act is not available to the plaintiff. (d) Section 18 of the 1993 Act does not bar a civil Court to give a declaration relating to the fraud, as the DRT is not required to determine such issue under Section 17 of the said Act. (e)....
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.... when the suits were pending. In the valuation report of Karnataka, the land schedule shows that the land measures only 3-1/2 guntas of S.No.43/3, situated at Hebbal Village, (Kasaba), Hubli, Bangalore North Taluk. When the suit in C.S.No.276 of 1998 which was pending before this Court, was subsequently transferred to the DRT, vide order of this Court dated 19.11.2002, the Punjab National Bank filed the so-called amended plaint, without any order of the Court, therein, in all those six places, the area of the land was changed as 2 acres and 3-1/2 guntas in the place of 3-1/2 guntas only, showing the same survey No.43/3 situated at Hebbal Village, Kasaba Hubli, Bangalore (North) Taluk. This is how the fraud was played by the Punjab National Bank before the Tribunal, which amended the plaint without the order of the Court. It is only after the final order was passed by the DRT on 30.8.2006, a petition was filed for amendment of the plaint, which was not permissible. (c) One Devendra, partner of M/s.M.G.Brothers, when notice was sent to him, it returned with a note that the addressee has "left the place". But the said Devendra, partner of M/s.M.G.Brothers suddenly appea....
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....relief as sought for, is maintainable and whether the suit in question is barred by Section 18 of the 1993 Act. 9. For determination of such issues, it is necessary to notice the relevant provisions of law and decisions of High Courts and Supreme Court. 10. Maintainability of the suit under Clause 12 of the Letters Patent: (a) Clause 12 of the Letters Patent (Madras) initially fell for consideration before a Full Bench of this Court in the decision reported in 1929 (Vol.57) MLJ 190 (Vellappa Chettiar vs. Saha Govinda Doss). In that case, the suit was preferred for specific performance. A question was framed having regard to the Indian authorities, "Is a suit by a purchaser of the land situate outside Madras for specific performance of a contract to sell made in Madras by parties resident therein, a suit for land within the meaning of Clause (12) of the Letters Parent, and so not cognizable by the High Court in its Ordinary Original Civil Jurisdiction?" Having noticed the relevant provision, the Court was of the view that in a suit for the acquisition of title to or control over land, if the plaintiff gets a decree for specific performance, he does not get any title to, but....
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....e present case, the plaintiff has not preferred the suit for determination of the title of the land, nor is it a suit for possession of the land. It cannot be stated that if the relief is granted, it would directly affect the title or the possession of the land as no person can claim any right on the basis of a decree, if found to have been obtained by fraud. A declaration with regard to the order passed by the DRT having been sought for, which is alleged to have been obtained by playing fraud on the Tribunal, we hold that the suit is not covered by the expression "suit for land" under Clause 12 of the Letters Patent (Madras) and the suit cannot be dismissed on that ground. 11. Bar of jurisdiction under Section 18 of the 1993 Act :- (a) In the case of Lala Ram Swarup and others vs. Shikar Chand and another, reported in AIR 1966 SC 893, the Supreme Court noticed the observation of the Privy Council in the case of Secretary of State vs. Mask & Co. (67 I.A. 222), wherein, the Privy Council observed that even where jurisdiction is excluded, the civil Courts have jurisdiction "to examine into cases where the provisions of the Act have not been complied with, or the statutory Tribu....
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....n On and from the appointed day, no Court or other authority shall have, or be entitled to exercise, any jurisdiction, powers or authority (except the Supreme Court, and a High Court exercising jurisdiction under articles 226 and 227 of the Constitution) in relation to the matters specified in section 17." From the aforesaid provisions, it would be evident that there is no total ouster of jurisdiction of the civil Court. The ouster is by virtue of Section 18 of the 1993 Act, which sets out that no Court or other authority can try matters of recovery of debts. Insofar as the reliefs which do not pertain to debts, on a plain reading of Section 17 of the 1993 Act, are concerned, there can be no doubt that the civil Court will still retain the jurisdiction (Centurion Bank Ltd. vs. Indian Lead Ltd. (2000) 100 Comp.Cas. 537 ). (e) In the case of Allahabad Bank vs. Canara Bank, reported in AIR 2000 SC 1535, having noticed Sections 17 and 18 of the 1993 Act, the Supreme Court while observing that, "it is clear from Section 17 of the Act that the Tribunal is to decide the applications of the Banks and Financial Institutions for recovery of debts due to them", held as follows: ....
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.... a counterclaim as provided in sub-sections (6) to (8) of Section 19 in applications already filed by the banks or financial institutions for recovery of the amounts due to them. In other words, what is provided and permitted is a cross-action by a defendant in a pending application by the bank/financial institution, the intention being to have the claim of the bank/financial institution made in its application and the counterclaim or claim for set-off of the defendant, as a single unified proceeding, to be disposed of by a common order." (g) While dealing with the question of grant of injunction restraining the enforcement of the orders passed by the Tribunal, in the case of Industrial Investment Bank of India Ltd. vs. Marshal's Power & Telecom (I) Ltd., reported in 2007 (1) SCC 106, the Supreme Court observed as follows:' "8. .... That apart, to grant an injunction restraining the enforcement of orders passed by the Tribunal having jurisdiction to pass such orders cannot normally be granted unless it is a case of fraud or the existence of some such vitiating factors is established or prima facie made out. Even then, the order of injunction as now granted could be grant....
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....by every Court, whether superior or inferior. It can be challenged in any Court even in collateral proceedings." (emphasis supplied). (c) In State of Andhra Pradesh and another vs. T.Suryachandra Rao, reported in 2006 (1) L.W. 547 (SC), the Supreme Court observed as follows: "10. "Fraud" as is well known vitiates every solemn act. Fraud and justice never dwell together. Fraud is a conduct either by letter or words, which includes the other person or authority to take a definite determinative stand as a response to the conduct of the former either by words or letter. It is also well settled that misrepresentation itself amounts to fraud. Indeed, innocent misrepresentation may also give reason to claim relief against fraud. A fraudulent misrepresentation is called deceit and consists in leading a man into damage by willfully or recklessly causing him to believe and act on falsehood. It is a fraud in law if a party makes representations, which he knows to be false, and injury enures therefrom although the motive from which the representations proceeded may not have been bad. An act of fraud on court is always viewed seriously. A collusion or conspiracy with a view to....