:1: IN IN IN THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORDINARY ORDINARY ORIGINAL CIVIL JURISDICTION ORIGINAL CIVIL JURISDICTION ORIGINAL CIVIL JURISDICTION CHAMBER CHAMBER CHAMBER SUMMONS NO. 683 OF 2006 SUMMONS NO. 683 OF 2006 SUMMONS NO. 683 OF 2006 IN IN IN SUIT SUIT SUIT NO. 1284 OF 1986 NO. 1284 OF 1986 NO. 1284 OF 1986 United Bank of India. ... Plaintiff. V/s. Star Machinery Mfg. Co.Ltd. & Ors. ... Defendants. And Star Marketing and Services Ltd. ... Applicants. None for the Plaintiff. Mr. S. J. Thacker i/b. Thakordas & Madgaonkar for the Defendants. ..... CORAM CORAM CORAM : S.C. DHARMADHIKARI,J. : S.C. DHARMADHIKARI,J. : S.C. DHARMADHIKARI,J. 23RD 23RD 23RD OCTOBER 2008. OCTOBER 2008. OCTOBER 2008. P.C. P.C. P.C. : : : . The Chamber Summons is moved by the Applicant to recall the order dated 11th September 1997 and to raise attachment in respect of Flat No.B-12 , Dhanraj Mahal, Chhattrapati Shivaji Maharaj Marge, Mumbai - 400 039. 2. This very Applicant had moved Chamber Summons No. 1094 of 1997 upon which the order dated 11th September 1997 was passed. That order reads thus :- " Heard both sides. It is common ground that execution has been stayed. In view of the controversy raised by way of :2: affidavit in rejoinder, issue of title require evidence to be led by the parties. In view of this, both the Chamber Summons are adjourned to the Court assigned the work of recording evidence. Liberty to apply." 3. Mr. hacker, appearing in support of this Chamber Summons submits that from the date of passing of the order no steps have been taken by parties. There is no evidence recorded. He submits that the matter was adjourned before the Court for recording of evidence but it has never appeared on board. In the mean while, there are several developments which would support the case of the Applicant that the suit flat does not belong to the Judgment Debtor but belongs to the Applicant - Company which is a distinct legal entity. 4. In the affidavit in support a reference is made to the title of the Applicants to the said Flat and reliance is placed on several Documents. It is pointed out that the Chamber Summons is duly served but none is appearing on behalf of the Decree Holder/Bank. He submits that the Documents of Title with regard to the suit flat are presently not available. However, true copies were placed on the last occasion as Shri Thacker states that the said Flat has been mortgaged by the Applicant to Syndicate Bank. The original title deeds were with the Bank and since now the flat is sold they are with the purchaser. :3: The Bank has disposed off the Flat in order to recover its dues from the Applicant. 5. It is in such circumstances, that a detailed order was passed on 6th October 2008 by me granting liberty to the Applicant to place on record a compilation of the documents. 6. Now, a compilation of the documents referred to and relied upon in the Chamber Summons is filed. Similarly, a compilation of the original proceedings which resulted in the decree being passed in favour of the Bank and against the Defendant in the instant suit is also placed on record. 7. In the affidavit in support, the Applicants have stated thus :- 12. I say and submit that the said premises has already been mortgaged by the applicants with the Syndicate Bank in or about October 1992 and the said premises continue to be under the said Mortgage with the Syndicate Bank, Colaba Branch, Bombay. It is pertinent to note that the said Syndicate bank has a registered charge, whereas the said Plaintiff Bank has no charge whatsoever, registered or otherwise. Hereto annexed and marked Exhibits ‘G-1, G-2 and G-3’ are copies of - (i) :4: Memorandum of Entry - for creation of equitable mortgage dated 21st October 1992, (ii) Declaration of Mr. Rohit M. Mehta, Director of the Applicant - Company dated 15th October 1992 and (iii) List of documents and title deeds deposited with Syndicate Bank on 21st October 1992, respectively. 13. From the title of the proceedings, it is clear that the Applicants herein are not the party to the above suit. As a result, it is clear that the said Warrant of Attachment has been issued wrongly against the Applicants and APS Star Industries Ltd. seeking to attach their immovable property belonging to them viz. Flat No.B-12 and C-18 respectively. I say and submit that the Applicants are not party to the present suit nor party to the loan amount granted and sanctioned to the Defendants herein. Needless to say, APS Star Industries Ltd. is also not a party to the Suit. In the Circumstances, I say and submit that both the said premises cannot be attached for the recovery of the debt of the Defendants herein in the present proceedings, since the Applicants are not party not the judgment debtors nor claiming through the Judgment debtors. In fact, it is submitted that the Applicants are an independent body, a public limited company and not a party to the loan transaction, or guarantor for the said :5: loan transaction, subject matter of the present Suit. 14. In support of the contention as set out in the previous affidavit that the said Flat stands mortgaged to Syndicate Bank, I crave leave to reproduce hereunder for the sake of convenience of this Hon’ble Court, the relevant portion of resolution dated 31st December 1990 adopted by the Applicant - Company for creating security. Extract Extract Extract of Resolution dated 31st December 1990 : of Resolution dated 31st December 1990 : of Resolution dated 31st December 1990 : " SUBJECT : CREATION OF SECURITY SUBJECT : CREATION OF SECURITY SUBJECT : CREATION OF SECURITY "RESOLVED THAT subject to the approval of the Shareholders and pursuant to the provisions of Section 293 (1)(a) of the Companies Act, 1956, the Board of Directors hereby approve creation of charge in favour of Syndicate Bank by way of equitable mortgage on the property of the company situated at Flat No.12-Block B, Dhanraj Mahal, CSM Marg, Bombay - 400039, to secure the facility / advance / loans given by the said bank to Star Machinery Manufacturing Company Limited. FURTHER RESOLVED THAT after obtaining the approval of the shareholders, Shri Rohit Mehta and Shri P.J. :6: Mehta, Directors of the Company, be and are hereby authorised to execute the Agreements for hypothecation / Equitable mortgage, undertaking, applications or any other documents as may be required by the bank in this regard." 8. The Applicants in paragraph 18 have stated that the Flat does not belong to the First Defendant or other Defendant but to the Applicants, who are assignees of the sub-lessee. It is further pointed out that the registered office of the First Defendant is situated at Vadodara, Gujarat, the particulars of the share holding of the Defendants in the Applicant is pointed out in para 18 (iv) & (v). It is in these circumstances that in para 20 it is contended that the First Defendant never paid rent or outgoings in respect of the said Flat either to the head lessor or the sub-lessor. Flat No.12 is not described as an asset of the First Defendant in any public documents including the balance-sheet which is annexed at Exhibit ‘J’. It is pointed out that neither in the plaint in the Summary Suit No.1248 of 1986 nor the reply affidavit filed in Chamber Summons No. 1094 of 1997, the First Defendant has contended that the Flat belongs to them or that the Plaintiffs Decree-Holder produced any Documents to support the attachment. 9. It is in such circumstances that the request is to raise the attachment. :7: 10. The affidavit in support of this Chamber Summons is filed as early as on 7th June 2006. It is a very elaborate affidavit filed by the Director of the Applicant. The Director of the Applicant has stated that from the records the above position emerges and he refers to several documents. 11. Now, a compilation of the documents has been handed over. The compilation is taken on record and marked ‘X’ for identification. The title Documents are placed on record including the original lease deed of 1934, sub-lease of 1970 and the deed of assignment dated 31st July 1985. The memorandum entry dated 21st October 1992 is also placed on record. From the copies of the consent decree it is apparent to me that the original Defendants - Star Machinery Manufacturing Company Ltd. has settled the Summary Suit in Appeal before the Appellate Court. There is no question of any security being referred to in the Plaint inasmuch as the Suit was filed under Order 37 Rule 2 of the C.P.C. it is only while executing the consent decree that the attachment has been levied. 12. Despite the Chamber Summons being duly served with all annexures thereto, there is no affidavit in reply. I have no reason to dis-believe the contents of the documents which are placed before me in the compilation. None of the averments and statements have been disputed or :8: denied. In this peculiar case when another Nationalised Bank has attached this Flat to secure its debt and the Plaintiff - Bank being unable to produce any document to show that this Flat belongs to the Defendants/Judgment Debtor that the order passed on the earlier Chamber Summons deserves to be recalled. It is accordingly recalled. 13. In the result, this Chamber Summons is made absolute in terms of prayer Clause (a). It is held that Flat No.B-12 belongs to the Applicants and therefore, the same could not have been attached in execution of the decree passed in favour of United Bank of India. However, it is clarified that the attachment of other properties at the instance of the Plaintiff - Bank will continue and the said properties be dealt with in the execution proceedings in accordance with law. The Chamber Summons is allowed accordingly. 14. Since it is declared that the Applicant is the owner of the Flat and not the Judgment Debtor and therefore, the attachment is raised, no separate order is required to be passed in the earlier Chamber Summons No.1094 of 1997. The same is disposed of accordingly. (S.C. (S.C. (S.C. DHARMADHIKARI,J.) DHARMADHIKARI,J.) DHARMADHIKARI,J.)