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 ORIGINAL ORIGINAL CIVIL JURISDICTION CIVIL JURISDICTION CIVIL JURISDICTION JUDGES’ JUDGES’ JUDGES’ ORDER ORDER ORDER NO. 386 OF 2006 NO. 386 OF 2006 NO. 386 OF 2006 IN IN IN SUIT SUIT SUIT NO.2048 NO.2048 NO.2048 OF 1996 OF 1996 OF 1996 Ramesh Ramesh Ramesh Jain & ors Jain & ors Jain & ors .... .... .... Plaintiffs Plaintiffs Plaintiffs vs vs vs Vijay Vijay Vijay Sampat & ors .... Sampat & ors .... Sampat & ors .... Defendants Defendants Defendants Mr.Ramesh Mr.Ramesh Mr.Ramesh Jain Jain Jain with Ms Kusum Jain for Plaintiffs with Ms Kusum Jain for Plaintiffs with Ms Kusum Jain for Plaintiffs Ms Ms Ms Manjiri Shah for Defendant nos.1,3,4,6,7,10 & 11 Manjiri Shah for Defendant nos.1,3,4,6,7,10 & 11 Manjiri Shah for Defendant nos.1,3,4,6,7,10 & 11 CORAM CORAM CORAM : : : SMT R.S.DALVI, J SMT R.S.DALVI, J SMT R.S.DALVI, J DATED DATED DATED : 10th January, 2007 : 10th January, 2007 : 10th January, 2007 P.C. P.C. P.C. 1.1.1. The defendant nos. 1,3,4,6,7,10 and 11 have The defendant nos. 1,3,4,6,7,10 and 11 have The defendant nos. 1,3,4,6,7,10 and 11 have sought sought sought this Judge’s order for permission to bid at this Judge’s order for permission to bid at this Judge’s order for permission to bid at the the the auction to be conducted by the Sheriff of auction to be conducted by the Sheriff of auction to be conducted by the Sheriff of Bombay Bombay Bombay upon the warrant of sale dated 29th July, upon the warrant of sale dated 29th July, upon the warrant of sale dated 29th July, 2005 2005 2005 in respect of the premises at 210/211, Amir in respect of the premises at 210/211, Amir in respect of the premises at 210/211, Amir Industrial Industrial Industrial Estate, Sun Mill Compound, Lower Parel, Estate, Sun Mill Compound, Lower Parel, Estate, Sun Mill Compound, Lower Parel, Mumbai Mumbai Mumbai and and and for adjustment of the decretal amount of for adjustment of the decretal amount of for adjustment of the decretal amount of Rs.90,11,930.37 Rs.90,11,930.37 Rs.90,11,930.37 being being being the principal and interest at the principal and interest at the principal and interest at 24 24 24 % p.a. thereon to mark the decree satisfied to % p.a. thereon to mark the decree satisfied to % p.a. thereon to mark the decree satisfied to that that that extent and if the amount of the bid is higher extent and if the amount of the bid is higher extent and if the amount of the bid is higher than than than the amount due to the defendant, the defendant the amount due to the defendant, the defendant the amount due to the defendant, the defendant no. no. no. 1 be directed to pay over the difference. 1 be directed to pay over the difference. 1 be directed to pay over the difference. 2 2.2.2. The defendants have applied for the aforesaid The defendants have applied for the aforesaid The defendants have applied for the aforesaid reliefs reliefs reliefs because otherwise they, as the party because otherwise they, as the party because otherwise they, as the party defendants defendants defendants would not be entitled to bid at the would not be entitled to bid at the would not be entitled to bid at the auction. auction. auction. They have been allowed to bid. Their bid They have been allowed to bid. Their bid They have been allowed to bid. Their bid has has has been directed to be modified to a small extent been directed to be modified to a small extent been directed to be modified to a small extent by by by increasing the bid. No other party has bid at increasing the bid. No other party has bid at increasing the bid. No other party has bid at the the the auction. The adjustment is sought as the bid auction. The adjustment is sought as the bid auction. The adjustment is sought as the bid amount amount amount is near about the consent decree in favour is near about the consent decree in favour is near about the consent decree in favour of of of the defendants. The consent decree was passed the defendants. The consent decree was passed the defendants. The consent decree was passed on on on 6th March 1997 in terms of the consent terms 6th March 1997 in terms of the consent terms 6th March 1997 in terms of the consent terms signed signed signed by the parties. Under the consent terms, by the parties. Under the consent terms, by the parties. Under the consent terms, shares shares shares of defendant no. 9 were agreed to be sold of defendant no. 9 were agreed to be sold of defendant no. 9 were agreed to be sold toto to the the the plaintiff for the consideration mentioned in plaintiff for the consideration mentioned in plaintiff for the consideration mentioned in consent consent consent terms. The consideration was payable by terms. The consideration was payable by terms. The consideration was payable by the the the plaintiff to the aforesaid defendants. The plaintiff to the aforesaid defendants. The plaintiff to the aforesaid defendants. The share share share certificates were handed over to the certificates were handed over to the certificates were handed over to the plaintiff, plaintiff, plaintiff, but but but the consideration has not been paid. the consideration has not been paid. the consideration has not been paid. The The The aforesaid gala which stands exclusively in the aforesaid gala which stands exclusively in the aforesaid gala which stands exclusively in the name name name of the plaintiff no. 3 was agreed to be of the plaintiff no. 3 was agreed to be of the plaintiff no. 3 was agreed to be handed handed handed over to the receiver with power to take over to the receiver with power to take over to the receiver with power to take vacant vacant vacant possession possession possession thereof after 31st December, 1997 thereof after 31st December, 1997 thereof after 31st December, 1997 and and and to sell the same. Since the amount has to sell the same. Since the amount has to sell the same. Since the amount has remained remained remained unpaid, the defendants have sought to unpaid, the defendants have sought to unpaid, the defendants have sought to execute execute execute the consent decree. the consent decree. the consent decree. 3.3.3. In execution of the consent decree, the In execution of the consent decree, the In execution of the consent decree, the aforesaid aforesaid aforesaid gala was to be sold. For sale of the gala was to be sold. For sale of the gala was to be sold. For sale of the 3 gala, gala, gala, the defendants have bid. They therefore, the defendants have bid. They therefore, the defendants have bid. They therefore, claim claim claim sale of the gala together with sale of the gala together with sale of the gala together with apportionment/adjustment apportionment/adjustment apportionment/adjustment of the decretal amount. of the decretal amount. of the decretal amount. 4.4.4. The decretal amount has been worked out as per The decretal amount has been worked out as per The decretal amount has been worked out as per Exhibit Exhibit Exhibit A-1 to the affidavit in support of the A-1 to the affidavit in support of the A-1 to the affidavit in support of the Judge’s Judge’s Judge’s order. Interest is claimed at the agreed order. Interest is claimed at the agreed order. Interest is claimed at the agreed rate rate rate mentioned in clause 4 and 7 of the connsent mentioned in clause 4 and 7 of the connsent mentioned in clause 4 and 7 of the connsent terms. terms. terms. 5.5.5. The warrant of sale of immoveable property is The warrant of sale of immoveable property is The warrant of sale of immoveable property is dated dated dated 29th July, 2005. The defendants have given 29th July, 2005. The defendants have given 29th July, 2005. The defendants have given notice notice notice of their claim on the aforesaid property on of their claim on the aforesaid property on of their claim on the aforesaid property on 12th 12th 12th September, September, September, 2005 in Execution Application No.59 2005 in Execution Application No.59 2005 in Execution Application No.59 of of of 1999 calling upon the claimants to file 1999 calling upon the claimants to file 1999 calling upon the claimants to file objections objections objections on or before 14th November, 2006. The on or before 14th November, 2006. The on or before 14th November, 2006. The defendants defendants defendants have also given public notices in Free have also given public notices in Free have also given public notices in Free Press Press Press Journal and and Navshakti on 13th September, Journal and and Navshakti on 13th September, Journal and and Navshakti on 13th September, 2005. 2005. 2005. The defendant’s advocate has given notice The defendant’s advocate has given notice The defendant’s advocate has given notice dated dated dated 23rd January, 2006 to the plaintiffs in 23rd January, 2006 to the plaintiffs in 23rd January, 2006 to the plaintiffs in Execution Execution Execution Application No.55 of 1999 to appear Application No.55 of 1999 to appear Application No.55 of 1999 to appear before before before the Commissioner for Taking A/cs on 31st the Commissioner for Taking A/cs on 31st the Commissioner for Taking A/cs on 31st January, January, January, 2006. The notice of proclamation for sale 2006. The notice of proclamation for sale 2006. The notice of proclamation for sale has has has been been been issued by the Commissioner for Taking A/cs issued by the Commissioner for Taking A/cs issued by the Commissioner for Taking A/cs on on on 13th March 2006 calling upon the parties to 13th March 2006 calling upon the parties to 13th March 2006 calling upon the parties to attend attend attend his office for settling the draft his office for settling the draft his office for settling the draft proclamation proclamation proclamation for sale on 31st March, 2006. The for sale on 31st March, 2006. The for sale on 31st March, 2006. The 4 notices notices notices have been sent to the plaintiff no. 1 by have been sent to the plaintiff no. 1 by have been sent to the plaintiff no. 1 by registered registered registered post on 12th March 2006 and to the post on 12th March 2006 and to the post on 12th March 2006 and to the plaintiff plaintiff plaintiff no. 3 on 29th March 2006. Yet, none no. 3 on 29th March 2006. Yet, none no. 3 on 29th March 2006. Yet, none appeared appeared appeared for settling the draft proclamation for for settling the draft proclamation for for settling the draft proclamation for sale sale sale before the Commissioner for Taking A/cs. The before the Commissioner for Taking A/cs. The before the Commissioner for Taking A/cs. The proclamation proclamation proclamation of sale was settled by the of sale was settled by the of sale was settled by the Commissioner Commissioner Commissioner for Taking A/cs on 3rd April, 2006. for Taking A/cs on 3rd April, 2006. for Taking A/cs on 3rd April, 2006. Thereafter, Thereafter, Thereafter, also notices have been sent to the also notices have been sent to the also notices have been sent to the plaintiff plaintiff plaintiff and the defendant no. 9 by registered and the defendant no. 9 by registered and the defendant no. 9 by registered post post post A.D. in newspaper through the Sheriff’s A.D. in newspaper through the Sheriff’s A.D. in newspaper through the Sheriff’s office office office on 30th June, 2006 to remain present for on 30th June, 2006 to remain present for on 30th June, 2006 to remain present for settling settling settling the terms of the proclamation of sale on the terms of the proclamation of sale on the terms of the proclamation of sale on 28th 28th 28th July, 2006. Even there, the plaintiff never July, 2006. Even there, the plaintiff never July, 2006. Even there, the plaintiff never appeared. appeared. appeared. 6.6.6. The defendants have been permitted to bid at The defendants have been permitted to bid at The defendants have been permitted to bid at the the the auction auction auction subject to confirmation by the Court on subject to confirmation by the Court on subject to confirmation by the Court on 8th 8th 8th November, 2006. The property has been put up November, 2006. The property has been put up November, 2006. The property has been put up for for for sale by auction on 9th November, 2006. sale by auction on 9th November, 2006. sale by auction on 9th November, 2006. Intimation Intimation Intimation of this Judge’s order dated 10th of this Judge’s order dated 10th of this Judge’s order dated 10th November, November, November, 2006 came to be given to the plaintiff 2006 came to be given to the plaintiff 2006 came to be given to the plaintiff no. no. no. 3, whose property is required to be sold as 3, whose property is required to be sold as 3, whose property is required to be sold as per per per the auction on 13th November, 2006, that the the auction on 13th November, 2006, that the the auction on 13th November, 2006, that the matter matter matter will appear in this court on 15th November, will appear in this court on 15th November, will appear in this court on 15th November, 2006. 2006. 2006. Thereafter, the matter has been adjourned to Thereafter, the matter has been adjourned to Thereafter, the matter has been adjourned to 5th 5th 5th December, December, December, 2006 and then to 11th December, 2006. 2006 and then to 11th December, 2006. 2006 and then to 11th December, 2006. 5 In In In the meantime, the defendants have raised their the meantime, the defendants have raised their the meantime, the defendants have raised their offer offer offer as per the direction of the Court. as per the direction of the Court. as per the direction of the Court. 7.7.7. The plaintiffs object to the confirmation of The plaintiffs object to the confirmation of The plaintiffs object to the confirmation of the the the sale by passing of the Judge’s order or sale by passing of the Judge’s order or sale by passing of the Judge’s order or otherwise otherwise otherwise on several grounds. on several grounds. on several grounds. 8.8.8. They have disputed the decretal amount as shown They have disputed the decretal amount as shown They have disputed the decretal amount as shown inin in Exhibit A-1. They have not stated what Exhibit A-1. They have not stated what Exhibit A-1. They have not stated what according according according to them, is the correct decretal amount. to them, is the correct decretal amount. to them, is the correct decretal amount. That That That amount can be computed by the registry of this amount can be computed by the registry of this amount can be computed by the registry of this Court/Office Court/Office Court/Office of the Prothonotary and Senior Master. of the Prothonotary and Senior Master. of the Prothonotary and Senior Master. 9.9.9. The plaintiff’s claim that under the consent The plaintiff’s claim that under the consent The plaintiff’s claim that under the consent terms terms terms only gala No. 210 has been agreed to be sold only gala No. 210 has been agreed to be sold only gala No. 210 has been agreed to be sold and and and not gala no.211. That contention is not gala no.211. That contention is not gala no.211. That contention is mischievous. mischievous. mischievous. Gala nos. 210 and 211 are adjacent. Gala nos. 210 and 211 are adjacent. Gala nos. 210 and 211 are adjacent. They They They are not partitioned. They have one entry. are not partitioned. They have one entry. are not partitioned. They have one entry. They They They both stand in the name of plaintiff no.3 both stand in the name of plaintiff no.3 both stand in the name of plaintiff no.3 suince suince suince as as as far as back on 31st August, 2004. Before far as back on 31st August, 2004. Before far as back on 31st August, 2004. Before the the the warrant of sale came to be taken out, the warrant of sale came to be taken out, the warrant of sale came to be taken out, the defendants defendants defendants applied applied applied for and obtained a clarification for and obtained a clarification for and obtained a clarification of of of the consent terms that the gala mentioned in the consent terms that the gala mentioned in the consent terms that the gala mentioned in clause clause clause 7 of the consent terms included gala nos. 7 of the consent terms included gala nos. 7 of the consent terms included gala nos. 210 210 210 and 211 as they were treated as one gala. and 211 as they were treated as one gala. and 211 as they were treated as one gala. Consequently, Consequently, Consequently, the objection of the plaintiff to the objection of the plaintiff to the objection of the plaintiff to 6 that that that effect does not survive. effect does not survive. effect does not survive. 10. 10. 10. It is contended on behalf of the plaintiff It is contended on behalf of the plaintiff It is contended on behalf of the plaintiff that that that the the the amount obtained on the auction is far less amount obtained on the auction is far less amount obtained on the auction is far less than than than the the the market price and that the market price has market price and that the market price has market price and that the market price has considerably considerably considerably risen thereafter. The plaintiff has risen thereafter. The plaintiff has risen thereafter. The plaintiff has not not not shown what is the correct market price. The shown what is the correct market price. The shown what is the correct market price. The amont amont amont has been ascertained only as late as has been ascertained only as late as has been ascertained only as late as November, November, November, 2006. This Judge’s order has been taken 2006. This Judge’s order has been taken 2006. This Judge’s order has been taken out out out itself in November, 2006 immediately when the itself in November, 2006 immediately when the itself in November, 2006 immediately when the property property property was put up for auction. No appreciable was put up for auction. No appreciable was put up for auction. No appreciable increase increase increase in the market price has thereafter taken in the market price has thereafter taken in the market price has thereafter taken place. place. place. The auction sale held otherwise properly The auction sale held otherwise properly The auction sale held otherwise properly and and and in accordance with law and cannot be vitiated in accordance with law and cannot be vitiated in accordance with law and cannot be vitiated within within within a couple of months on the ground of market a couple of months on the ground of market a couple of months on the ground of market increase increase increase in prices of the properties. in prices of the properties. in prices of the properties. 11. 11. 11. It is also contended that the exact area of It is also contended that the exact area of It is also contended that the exact area of the the the premises has not been worked out and hence the premises has not been worked out and hence the premises has not been worked out and hence the computation computation computation per square feet of the area is in per square feet of the area is in per square feet of the area is in correct. correct. correct. It is not known how the plaintiffs can It is not known how the plaintiffs can It is not known how the plaintiffs can conclude conclude conclude that exact area is not worked out. The that exact area is not worked out. The that exact area is not worked out. The valuation valuation valuation report has been shown to the Court. The report has been shown to the Court. The report has been shown to the Court. The exact exact exact area area area of the ground floor premises as also the of the ground floor premises as also the of the ground floor premises as also the mezannine mezannine mezannine floor premises is separately and floor premises is separately and floor premises is separately and meticulously meticulously meticulously worked out. That contention also worked out. That contention also worked out. That contention also cannot cannot cannot survive. The area of the premises orally survive. The area of the premises orally survive. The area of the premises orally 7 stated stated stated by the plaintiff cannot be accepted in view by the plaintiff cannot be accepted in view by the plaintiff cannot be accepted in view of of of the copious measurements taken by the valuer. the copious measurements taken by the valuer. the copious measurements taken by the valuer. 12. 12. 12. It is contended that another decree holder It is contended that another decree holder It is contended that another decree holder IDBI IDBI IDBI has also obtained a decree against the has also obtained a decree against the has also obtained a decree against the plaintiffs plaintiffs plaintiffs and sale of the premises must be and sale of the premises must be and sale of the premises must be proportionately proportionately proportionately disbursed to both the creditors. disbursed to both the creditors. disbursed to both the creditors. ItItIt is is is contended that whereas claim of the defendant contended that whereas claim of the defendant contended that whereas claim of the defendant isisis approximately to the extent of Rs.1 crore, the approximately to the extent of Rs.1 crore, the approximately to the extent of Rs.1 crore, the claim claim claim of IDBI is to the extent of Rs.5 crores and of IDBI is to the extent of Rs.5 crores and of IDBI is to the extent of Rs.5 crores and hence hence hence 80 % of the auction amount is required to be 80 % of the auction amount is required to be 80 % of the auction amount is required to be disbursed disbursed disbursed to IDBI. IDBI who have been separately to IDBI. IDBI who have been separately to IDBI. IDBI who have been separately represented, represented, represented, have obtained a recovery certificate have obtained a recovery certificate have obtained a recovery certificate under under under section 19 (22) of The Recovery of Dues due section 19 (22) of The Recovery of Dues due section 19 (22) of The Recovery of Dues due toto to banks banks banks and Financial Institutions (Amendment) Act and Financial Institutions (Amendment) Act and Financial Institutions (Amendment) Act 2000 2000 2000 on 18th October, 2002. They sought to on 18th October, 2002. They sought to on 18th October, 2002. They sought to withdraw withdraw withdraw the Chamber Summons taken out by them for the Chamber Summons taken out by them for the Chamber Summons taken out by them for pursuing pursuing pursuing that claim under the recovery certificate that claim under the recovery certificate that claim under the recovery certificate on on on 18th January, 2005 to proceed under the 18th January, 2005 to proceed under the 18th January, 2005 to proceed under the aforesaid aforesaid aforesaid Act. They have since not taken out any Act. They have since not taken out any Act. They have since not taken