1 srk IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION CHAMBER SUMMONS NO. 1169 OF 2009 IN ARBITRATION PETITION NO. 333 OF 2008 Citicorp Finance (I) Ltd. ..... .. Petitioner vs M/s. Sanjay Arts & Ors. ..... .. Respondents and Mrs. Noorjahan Salim Bashah ..... .. Intervenor .. Mrs. S.I. Joshi a/w Mr. S.S. Anabhawane i/b S.I. Joshi & Co. for Petitioner. Mr. S.C. Naidu a/w Mr. Mustafa K. Kachwala i/b M/s. C.R. Naidu & Co. Intervenor. Mr. K.L. Vyas, Court Receiver. .. CORAM: A.S.OKA, J DATE: 13th November, 2009 P.C. 1 As per the administrative order passed by the Hon’ble the Chief Justice, the Chamber Summons is placed for hearing before this court. 2 In terms of order dated 5th November, 2009, Mr. Ansar Ahemad Mohd. Asif has deposited a demand draft in the sum of Rs. 41,00,000/- with the Court Receiver within the time fixed by this Court under the order dated 5th November, 2009. As compliance has been made by the said purchaser, the 2 sale of the machinery made in favour of the said purchaser is hereby confirmed as he had offered the highest bid. The sale is on “as is where is basis”. The Court Receiver will proceed to hand over the possession of the said machinery to the purchaser. It is obvious that the purchaser will be responsible for taking delivery of the possession of the machinery from the place where it is today at his own cost. The possession shall be handover within a period of one week. 3 Now coming to the prayers in the Chamber Summons, in view of the earlier orders prayer (a) gets worked out. As far as the prayer (b) is concerned as the machinery has been sold, the same can be granted. The dispute is about prayers (c) and (d). The learned counsel appearing for the Petitioner stated that the petitioner has deposited a sum of Rs. 30,000/- with the office of the Court Receiver out of which a sum of Rs. 25,000/- is towards the valuation charges. She states that the petitioner has incurred expenditure of Rs. 8,000/- on publication of advertisement. Her submission is that the amount of Rs. 38,000/- be permitted to be recovered by the Petitioner from the sale price. Her submission is that the petitioner must get back a sum of Rs. 30,000/- paid to the Court Receiver and in addition, the Petitioner must get Rs.8,000/- towards publication expenses of the sale. Her submission is that the costs, charges and expenses of the Court Receiver 3 including Commission payable under rule 591 of the Original Side Rules should be recovered by the Court Receiver from the aforesaid amount of Rs. 41,00,000/-. 4 The learned counsel appearing for the Intervenor invited my attention to the clause (2) of the paragraph 15 of the order dated 19th December, 2008 passed by this court and submitted that the said order has been confirmed in appeal by the Division Bench. He, therefore, submitted that the costs, charges and expenses of the Receiver will have to be borne by the petitioner. He submitted that in the event of intervenor succeeding in the proceedings filed by him, he will be entitled to receive the entire amount of Rs. 41,00,000/-. He submitted that the intervenor will suffer prejudice, if the Receiver is permitted to deduct the amounts as suggested by the counsel for the petitioner. 5 The learned counsel appearing for the intervenor submitted that granting relief in terms of prayer clause (c ) and (d) will amount to review of the earlier order passed by this court on 19th December, 2008 which is not permissible in view of the dismissal of the appeal against the said order. Learned counsel appearing for the petitioner submitted that the appeal against the said order is not dismissed on merits but it is dismissed as infructuous by keeping all contention of the petitioner open. 4 6 I have considered the submissions. It must be noted here that the Petitioner was willing to sale the property by inviting private offers. However, this court by order dated 18th September, 2009 directed that the offers received by the parties should be placed before the Receiver. Accordingly a report was submitted by the Receiver, which showed that the highest offer was in the sum of Rs. 32,00,000/- by the Purchaser whose enhanced offer was ultimately accepted. At the intervention of this Court, the offer was enhanced to Rs. 41,00,000/-. 7 It will be necessary to go back to earlier order dated 19th December, 2008 passed by this court. Clauses (2) (ii) to (v) of the said order read thus: (ii) After holding a public auction, the Court Receiver will deposit the sale proceeds with the Prothonotary and Senior Master of this Court after deducting the expenses incurred on the process of sale. It is made clear that costs and charges of the Court Receiver will have to be paid by the petitioner. (iii) It is made clear that no adjudication is made on the rights claimed by the intervenor and it will be open for the intervenor to file appropriate proceedings for 5 establishing her alleged right in respect of machinery which is ordered to be sold. (iv) To enable the intervenor to file appropriate proceedings and to obtain appropriate order, the Prothonotary and Senior Master, High Court, Bombay will allow the petitioner to withdraw the amount of sale proceeds for a period of four weeks from the date of deposit of the sale proceeds by the Court Receiver. (v) In the event no order is obtained by the intervenor as regards the said amount within a period of four weeks from the date of deposit of the said amount with the Prothonotary and Senior Master, it will be open for the petitioner to withdraw the amount deposited with the Prothonotary and Senior Master, High Court, Bombay. 8 The order is very clear that the Court Receiver will have to deposit the sale proceeds with the Prothonotary and Senior Master after deducting the expenses incurred by him on the process of sale. The order makes it clear that the costs and charges of the Court Receiver will have to be paid by the Petitioner. Thus, this court has made a distinction between expenses 6 incurred on the process of sale and the costs and charges of the Court Receiver. The Court Receiver will abide the said order. As the said order indicates, if within a period of four weeks from the date of deposit of the amount in terms of clause (2), the intervenor fails to obtain an appropriate order, the petitioner will be entitled to withdraw the amount of sale proceeds. 9 It is obvious the intervenor will have no right in respect of the sale proceeds if he fails to obtain appropriate order from Competent Court within a period of four weeks. The Petitioner has no objection if all the costs incurred by the Receiver and his commission is deducted by the Court Receiver from the sale proceeds. However, the intervenor has objection for the Court Receiver deducting the cost and charges of the Court Receiver including the Commission which are payable by the Petitioner in terms of the earlier order. 10 Hence, Chamber Summons is disposed of by passing following order: i) The possesion of the machine shall be handed over to the purchaser as observed in paragraph 2 above. ii) Prayer clause (b) is granted. iii)The Court Receiver will deposit the sale proceeds in terms of clause (ii) of paragraph 15 of the order dated 19th December, 2008 with the Protohonotary and Senior Master. 7 iv) If the Intervenor fails to obtain appropriate order within the time stipulated under the said order, the Court Receiver will be entitled to withdraw from the amount deposited, his costs and charges including the commission payable under Rule 591. The balance amount shall be permitted to be withdrawn by the Petitioner. v) The Court Receiver shall refund a sum of Rs. 25,000/- to the Petitioner being the charges of the Valuer deposited by the Petitioner in as much as while depositing the sale proceeds the Receiver will be entitled to deduct the said amount in view of clause (ii) of order dated 19th December, 2008. vi) No costs. Judge.