IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE P.R.RAMACHANDRA MENON FRIDAY, THE 10TH JUNE 2011 / 20TH JYAISHTA 1933 OP.No. 22280 of 1998(B) ---------------------------------- PETITIONER(S): ----------------------- 1. CHENOTH KAYYALAKAGATH AYYESU, D/O.USMAN, MAINAH P.O. KATHERUR, TELLICHERRY TALUK, KANNUR DISTRICT. 2. ITTAMMAL EDARAYIL MOHAMED SHERIF, S/O. UMMERKUTTY, EMPLOYED IN GULF P.O., PAPPINESSERI WEST, KANNUR THROUGH POWER OF ATTORNEY HOLDER E.P. ABDU SAMAD, S/O. UMMERKUTTY, P.O. PAPINESSERI WEST, KANNUR. 3. KUNNURUGATH THEKKEPURAYIL SAINABA, D/O. ALI MUHAMMED, NEAR YOGASHALA, KANNAPURAM, KANNUR THROUGH POWER OF ATTORNEY HOLDER E.P.ABDUL SAMAD, S/O. UMMERKUTTY, P.O. PAPPINESSERI WEST, KANNUR. BY ADV. SRI.A.MOHAMED MUSTAQUE RESPONDENT(S): ------------------------- 1. THE TAHASILDAR, KANNUR. 2. STATE INDUSTRIEAL DEVELOPMENT CORPORATION (SIDCO), KANNUR BY ITS MANAGING DIRECTOR. 3. THE DISTRICT MANAGER, KERALA FINANCIAL CORPORATION, KANNUR. tss OP. NO.22280/1998 *ADDL. R4 IMPLEADED. 4. T.P.SAINABA UMMA, W/O. LATEK.P.MAYANKUTTY, THARAYIL PEEDIKAYIL HOUSE, AZHIKODE AMSOM DESOM, P.O. AZHIKODE DISTRICT KANNUR. ADDL.R4 IS IMPLEADED AS PER ORDER DTD. 22.8.2001 IN CMP.40224/01 R1 BY GOVT. PLEADER SRI.M.H.HARIKUMAR ADV. SRI.M.A.MANHU, SC, SIDCO R2 BY ADV. SRI.R.T.PRADEEP R3 BY ADV. SRI.R.S.KALKURA SRI.E.V.NAYANAR THIS ORIGINAL PETITION HAVING BEEN FINALLY HEARD ON 10/06/2011, ALONG WITH OP NO. 7738 OF 2003 THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: tss OP. NO.22280/1998 APPENDIX PETITIONER'S EXHIBITS P1:- COPY OF THE SALE DEED EXECUTED IN FAVOUR OF THE IST PETITIONER BY THE 3RD RESPONDENT DTD. 8.4.1996. P1(a):- COPY OF THE SALE DEED EXECUTED IN FAVOUR OF THE 2ND PETITIONER BY THE 3RD RESPONDENT DTD. 8.4.1996. P1(b):- COPY OF THE SALE DEED EXECUTED IN FAVOUR OF THE 3RD PETITIONER BY THE 3RD RESPONDENT DTD. 8.4.1996. P2:- COPY OF THE SALE DEED DTD. 20.4.1996 EXECUTED BY THE PETITIONER. P3:- ORIGINAL COPY OF THE AUCTION NOTICE ISSUED BY THE 3RD RESPONDENT TO THE PETITIONERS DTD. CMP. NO.40224/2001 P1:- COPY OF THE AGREEMENT DTD. 21.3.1996 EXECUTED BY ABDUL SAMAD TO THE PETITIONER & OTHERS. P2:- COPY OF THE AGREEMENT DTD. 21.3.1996 EXECUTED BY THE PETITONER & OTHERS TO ABDUL SAMAD. P3:- COPY OF THE PETITION SUBMITTED BY THE PETITIONER & OTHERS TO KFC KANNUR. RESPONDENT'S EXHIBITS R3(a):- COPY OF THE MINUTES OF THE MEETING. R3(b):- COPY OF THE LETTER DTD. 30.3.96 ISSUED BY THE LEGAL HEIRS OF BORROWER TO THE DISTRICT MANAGER. R4(a):- COPY OF THE AGREMENT DTD. 21.3.1996 EXECUTED BY ABDUL SAMAD TO THE 4TH RESPONDENT AND OTHERS. R4(b):- COPY OF THE AGREEMENT DTD. 21.3.1996 EXECUTED BY THE 4TH RESPONDENT AND HER CHILDREN. R4(c):- COPY OF THE PETITION SUBMITTED BY THE 4TH RESPONDENT AND OTHERS TO KFC KANNUR. R4(d):- COPY OF THE PLAINT IN OS. 80/99 OF SUB COURT THALASSERY. R4(e):- COPY OF THE WRITTEN STATEMENT OF ABDUL SAMAD IN OS. 80/99 OF SUB COURT THALASSERY. TRUE COPY P.A. TO JUDGE tss P.R.RAMACHANDRA MENON, J ....................... O.Ps.22280/1998 & 7738/2003 ....................... Dated this the 10th day of June, 2011 JUDGMENT 1.A sum of Rs.47 Lakhs was borrowed by the deceased Mayankutty from the KFC while some other amounts were borrowed from the SIDCO, creating mortgage over the properties in question. The amount due under the loan extended by the KFC was not satisfied on time, whereby steps were taken by the KFC by proceeding against the property belonging to the original owner Mayankutty. In the course of the proceedings, the said owner of the property brought in the petitioners in O.P.22280/1998 to purchase the property and there was an agreement between the parties to the effect that the said petitioners would clear out the entire liability to the KFC and the SIDCO; also agreeing to satisfy a sum of Rs.3 Lakhs to be paid to the legal heirs of the deceased Mayankutty, who had taken his last breath in the meantime. 2.It was pursuant to the consensus as above, that the sale was completed in favour of the petitioners in O.P.22280/1998, whereby they became the owners of the land having an extent of 86 cents. In view of the outstanding liability to the O.Ps.22280/98 & 7738/03 2 SIDCO, quite contrary to the proposal and agreement to have the same cleared by the petitioners in O.P.22280/1998, the liability was not satisfied; under which circumstances, the SIDCO was compelled to proceed against the legal heirs of the deceased Mayankutty. 3.Now, the dispute that remains for consideration is virtually between the daughter of the deceased Mayankutty against whose property, the SIDCO has taken steps for realisation of the due amount and the petitioners in O.P.22280/1998, who have purchased the property of the deceased Mayankutty, completing sale in 1986. The question is, against whom the SIDCO can proceed against, for realisation of the due amount. 4.Rival contentions have been taken by the petitioners in both the cases. The petitioners in O.P.22280/1998 contend that the rights and liberties of the petitioners therein stand concluded and that further dues if any, can be realised only from the legal heirs of the deceased Mayankutty. The petitioner in O.P.7738/2003 contends that the property was conveyed to the petitioners in O.P.22280/1998, subject to the O.Ps.22280/98 & 7738/03 3 specific understanding that the entire liability would be cleared by the latter, which includes the liability of the SIDCO as well. 5.The learned counsel for the SIDCO submits that there were several rounds of negotiations among the parties and now a consensus has been reached, whereby the petitioners in O.P.22280/1998 have come up with the proposal to clear the entire liability within the shortest possible time, so as to solve the issue once and for all. The proposal was considered by the Managing Director of the SIDCO and it has been decided to wipe off the entire liability under the two loan transactions with them, on remitting a total sum of Rs.5,47,761/- which is stipulated to be paid within 15 days. A copy of the relevant letter stated as issued to the petitioner in O.P.7738/2003, who had submitted the proposal, is placed for consideration of this Court. 6.The learned counsel appearing for the petitioners in O.P.22280/1998 submits that the aforesaid liability under the OTS will be cleared by the petitioners, for which, three months' time is sought to be granted, instead of 15 days O.Ps.22280/98 & 7738/03 4 granted by the SIDCO. The learned counsel for the SIDCO submits that. by virtue of the vested rights, they are justified in proceeding against the properties of the petitioners in both cases, if the commitment is not honoured. The learned counsel for the petitioners in O.P.22280/1998 submits that, by virtue of the specific understanding and the assurance given by the petitioners in the other case, and also based on the terms of the agreement as entered into earlier, the SIDCO can be permitted to proceed against the property of the petitioner in O.P.7738/2003 only after proceeding against the properties of the petitioners in O.P.22280/1998, if they turn to be defaulters without honouring commitment, pursuant to the OTS benefit as mentioned above. 7.In the above circumstances, both the writ petitions are disposed of, recording the compromise stated as arrived at, as above. The petitioners in O.P.22280/1998 having agreed to satisfy the entire liabilities by paying Rs.5,47,761/-, they are given time by 'three months'. In case of their failure to satisfy the due amount, the SIDCO will be at liberty to proceed against the property of the petitioners in O.P.22280/1998 and if the sale, if so necessitated, does not O.Ps.22280/98 & 7738/03 5 procure the requisite amount for clearing the liability towards SIDCO, they will be free to proceed against the properties of the petitioner in O.P.7738/2003 as well. 8.It is brought to the notice of this Court that the final figure of Rs.5,47,761/- as mentioned herein before, is yet to be considered by the Board of the SIDCO. The learned counsel for the petitioners in O.P.22280/1998 submits that the Board of SIDCO offered a helping hand by reducing or giving some or other concessions and that the satisfaction of the liability may be subject to the decision, so to be taken by the Board. It is ordered accordingly. It will be open for the petitioners in O.P.22280/1998 to move the Board of the SIDCO for appropriate reliefs. It is made clear that, in any event, the liability shall be cleared by the petitioners in O.P.22280/1998 within three months, as mentioned herein before. Both the writ petitions are disposed of. P.R.RAMACHANDRA MENON, Judge mrcs