Case: Paul Brothers (Tailoring Division)And Ors. Etc Vs. Ashim Kumar Mandal And Ors. Etc

SE appeals arise as a sequel to certain directions of this Court in the famous Sanchaita case. The Sanchaita Investment Company was a firm which was controlled and run, primarily, bv three persons Sambhu Prasad Mukherjee, Bhihanlal Murarka, and Swapan Kumar Guha. It had been able, by dint of a tremendous advertise merit Campaign, to collect deposits amounting to several crores of rupees from thousands of depositors spread all over India by holding out attractive terms of interest. The firm initially prospered and its deposits steeply mounted to astromical figues. The firm, however, began to acquire, or deal in, movable and immovable propories in various cities of India in the names, net only of the firm, but of relatives and benamidars of various persons who were in main agement (of) its affairs. A sizeable portion of the firms funds being thus tied up or sillhoned away from its coffers for the private benefit of the individuals running it, the tirm eventually. began making defaults in its obligations to the depositors. The depositors, thereupon,- approached the High Court and eventually the matters came up to this Court in W. P. Nos. 638 and 755-800 of 1983. With a view to safeguard the interests of the depositors, arrange for a return to them of as much of their deposits as possible and ensure that the properties of the firm were duly identified and the full and due benefit of the funds diverted from its coffers was restored to the firm, this Court, by its order dated 4-5-83, appointed a retired District Judge as a Commissioner to take charge of all the assets, documents and papers of the firm and of its agents, subagents, transferees and benamidars. Directions were given to the Commissioner to look into the claims of depositors and to devise a scheme whereby persons who had deposited sums not exceeding Rs. 25,000/ - could be repalid expeditiously. By a subsequent order dated 27-9-83, certain directions were given to enable the Commissioner to gather in all the assets of the firm. It is necessry to quote a portion of this order. It read :"The Commissioner may attach such assets and properties which, in his prima facie opinion, are of the ownership of the firm Sanchaita Investments, or of the ownership of any of its partners. Such assets and properties may be put to sale by the Commissioner if no objection is received to the attachment thereof within one month of the date of attachment. All objections received to the attachment of such assets or properties will be forwarded by the Commissioner to the Prothonotary of the High Court of Calcutta. We request the learned Chief Justice of the Calcutta High Court to nominate a Division Bench of the High Court for the purpose of jurisdiction upon such objections. The Division Bench will dispose of the objections on merits after hearing all interested parties. "CE must also be made to another order of this Court dated 23-9-85 in C. M. P. No. 38589/85. By this order, this Court directed"After hearing counsel for the parties we consider it necessary to empower the Commissioner, Sanchaita Investment, to remove all unauthorised persons and trespassers from possession of the property proposed to be sold by the Commissioner under the orders of this Court and to hand over vacant possession to the rightful purchasers. The Commissioner is authorised to take the assistance of the police for the purpose of obtaining possession and handing it over to the rightful purchasers. "IN pursuance of these directions, the Commissioner attached a large number of properties situate all over the country which, he had reason to believe, were properties which belonged to the firm though acquired in the names of others. When the properties were so attached and sought to be sold, objections were lodged by persons claiming title or possession of the property in their own right and these objections were adjudicated upon by the designated Division Bench of the Calcutta High Court.NE of the properties that were thus attached by the Commissioner was house No. 51 / 1 / 1 B, Surendra Nath Banerjee Road, Calcutta 14. (There is a slight discrepancy in the door number of this property as appearing in various documents but that is not material for our purposes ). This property stood on land of the small extent of about 800 sq. ft. and comprised of five rooms in the ground floor (three in front and two at the back), a first floor and a second floor but, being business premises in a busy commercial locality, is of considerable value today. The Commissioner found that this property had been acquired in the name of Mahamaya Devi, an aunt of Sambhu Prasad Mukherjee, for Rs. 85,000. 00on 4-10-1977. Apparently the Commissioner was of the opinion that the property was really that of the firm acquired in the name of Mahamaya Devi. He, therefore, attached this property by a public notice taken out, inter alia, in "the Statesman" dated 27-5-84 to the following effect:"The public are hereby informed that in exercise of the authority and power vested in me under the order of the Honble Supreme Court of India passed and made on 4-5-83 and 27-9-83. . . I had attached or I had taken possession of or I am hereby taking possession of (as the case may be) the following properties (specified in the schedule below) including flats, lands, cars, launch, business, shares in companies and partnership firms and house properties. The persons in which names these properties stand are hereby warned that they shall not lease out, assign, sell, mortgage, transfer or otherwise encumber or deal with them until further orders from me. Anybody dealing with such properties would do so at his own risk or responsibilityIT appears that there were also other similar notices issued by the Commissioner. In response to one of these notices, Smt. Mahamaya Devl put forward her claim to the ownership of the property but her claim was rejected be the Division Bench of the Calcutta High Court on 29-3-1985 in Case No. 23 of 1984. Sri Kapur, learned counsel for the respondents states that a positition for special leave to appeal to this Court preferred by her was also rejected sometime in 1985. This is not contradicated by the petitioners. We may, therefore, proceed, for the purposes of this case, on the footing that, though standing in the name of Mahamaya Devi, the property in question belongs to the firm Sanchaita.LY the property was brought to sale by the Commissioner. Sealed tenders were invited for the purchase of the properties specified in the schedule, by a notice published in "the Statesman" on 7-386, on an "as is where is basis". The notice specifically mentions that the possession of only three of the six items mentioned in the notice was with the Commissioner and the property presently in question was not one of them. Asit Kumar Mandal and two others (the respondents before us, hereinafter compendiously referred to as the Mandals) offered, on 22-5-86, to purchase the property for Rs. 1,26,000. 00 in lump sum subject to negotiations in the matter. They undertook to deposit 25 Per Cent of the price on the acceptance of the offer and the balance "at the time of giving us the physical possession of the said premises". After a discussion with the Commissioner, they deposited Rs. 31,500 on 11-6-1986 and stated in their letter of the samedate to the Commissioner:  We shall deposit the balance amount as and when called upon to do so. Thereafter, on will hand over to us the possession of the said premises free from illegal trespassers.  On 12-6-86, the Commissioner accepted the offer of the Mandals subject to the following conditions, namely:(a) That the proposed sale in you favour under the conditions mentioned herein below is approved by our advisory Board.  (b) That 1/4th (i. e. Rs. 31, 500/-) of the total consideration money is at once paid by you to the Commissioner, Sanchaita Investments, through bank draft or pay order.  (c) That the balance of the consideration money is paid within 30/06/1986.  (d) That in default of payment of the consideration money as stated above, the earnest money (Rs. 31,500/-) to be paid by you through bank draft or Pay Order as mentioned above shall stand forfeited.  (e) That the aforesaid sale is made on "as is where is basis".  (f) That on payment of the full consideration money as above within the date fixed you may take steps for obtaining possession of the said entire premises and the Commissioner will help you for the said purpose. "The Mandals, thereafter, paid Rs. 31,500 on 27-6-86 and Rs. 63,000 on 18-7-86 and wrote to the Commissioner as follows:"please send us the draft sale certificate in respect of the above property for our approval on behalf of our clients and arrange immediately to-give our clients vacant possession of the property as agreed upon.  Please inform us if any objection was received by you in respect of the property pursuant to your advertisement in the Statesman dated 7/03/1987. "The Commissioner referred the purchasers to his lawyer in regard to the preparation of the sale certificate and a certificate of sale dated was eventually issued in favour of the Mandals on 10-4-1987. The certificate referred to the orders of the Supreme Court, the satisfaction of the Commissioner, the fact of attachment and the absence of any objections from Mahamaya Devi and conveyed the property to the Mendals.8 )HAVING thus purchased the property, the Mandals requested the Commissioner to give them vacant possession of the property but there was no response.

Court's reasoning:
RI Kapur laid considerable stress on the aspect that, unless vacant possession can be had, no one will purchase any property at the auction sales conducted by thecommissioner as no one would like to face further litigation to secure possession of the property. He submitted that the object which the Court had in mind was to effectuate sales of Sanchaita properties by assuring vacant possession with a view to secure maximum price therefor and to ensure expeditious return to the Sanchaita investors of as much of their deposits as possible and that this object would be totally frustrated if people were encouraged to put in hurdles in the way which will depreciate the value of the property. This contention proceeds, only partially, on a correct basis. It is true that there should be a quick and expeditious realisation of the properties that really belong to Sanchaita. That is why the Court empowered the Commissioner to attach and a all properties that, in his opinion, really belong to Sanchaita though ostensibly held in the names of others and also devised a quick and summary method for adjudication upon claims and removal of obstructions. But this order cannot be availed of to ride rough-shod over the rights and interests of others in the properties which have been created bona fide. If bird parties who have acquired real interests 1 in the property, either independent of, or even through, Sanchaita cannot be called upon to give up their rights. To do so would be to do more than merely realise what rightfully belongs to Sanchaitas; it would amount to conferring on Sanchaita a better title than it had, in fact, acquired. The depositors or investors in Sanchaita cannot claim any such rights. It is, therefore, difficult to accept the ground urged by Sri Kapoor as entitling the Mandals to an interest that can ignore or override all manner of rights and interests in the auctioned propertiesOR the above reasons, we are unable to accept the plea that the Mandals are entitled to get vacant possession of the premises, irrespective of the nature of the interests the claimants had therein and that,on this ground alone, we should uphold the order of the Division Bench. We shall, therefore, proceed to consider how far the claim of each one of the appellants before us to continue in possession of the property, unless and until evicted in due course by process of law, is maintainableWE have carefully considered the contentions of the parties. It is true that, some of the grounds of criticism of the evidence produced by the claimants are valid. A certain amount of difficulty has been caused by the uncertainty as the nature of the proceedings conducted by the High Court in pursuance of the order of this Court. It appears that the Court has produced to consider the issues in a summary manner on the basis of the affidavits of the claimants and on prima facie consideration of the documents formally as well as informally. produced in support thereof. The enquiry has been somewhat analogous to the procedure which used to be adopted in disposing of petitions by obstructors under theCode of Civil Procedure, 1908, (before its amendment in 1976) which concluded in a tentative finding leaving it open to the parties to file a suit and establish their right to possession. On the other hand, if these are taken to be in the nature of proceedings for the execution of a decree under the amended code, there will have to be a more detailed trial with full opportunity to parties to lead evidence and to examine and cross-examine witnesses, as a finding reached in these proceedings would be final and conclusive. In the present case, the application has been disposed of somewhat summarily and informally. At one stage, therefore, we were inclined to think that the matter, so far as the Pauls are concerned, should be remanded to the High Court for fresh disposal. But, on further consideration, we have come to the conclusion that there is sufficient material placed on record by the claimants to show that Paul Bros. have been in the premises as tenants since long and that no such remand is necessary. Taking all the documents collectively, it is difficult to say that one could reasonably arrive at the conclusion that the Pauls were trespassers or unauthorised occupants. The Mandals have done nothing positive to establish this but to barely deny the genuineness of the various documents put forward on behalf of the claimantsNE direct piece of evidence is the extract from the municipal records. It was suggested that the photostats produced could not be relied upon and that the entries therein could have been reproduced by some process of superimposition. However, it has been found that, apart from the photostat copies, the original records were summoned and certified extracts produced by the reference to Mihir Paul and, admittedly, have been taken on record. These extracts which relate to the relevant period show the Paul Bors. as tenants in the three shops. It Is true that the estate of Avamayee Paul has been shown as the landlords but the entry contains a reference to Mihir Paul and, admittedly,. Mahamaya Devi purchased the property from Dilip and Mihir. Letters calling for attornment and rent receipts galore have been produced. Though one cannot eschew the possibility of these being got up documents, some foundation must be laid by the Mandals to reject them other than a mere assertion that they are not genuine. The discrepancies suggested are few and minor and do not warrant the summary rejection of the large number of receipts. The electricity bills, phone bills, tax department correspondence likewise prima facie support the claim of the appellants. The mistakes pointed out in the telephone and electricity bills are insignificant. The bills are made out not in the name of M. S. Paul but M/s. Paul Brothers and D. P. Paul is said to be an uncle of the Pauls. These, together with the partnership deeds and municipal licences and correspondence the genuineness of which cannot be rejected straightway, support the claim. No doubt there is a slight discrepancy in that the 1961 deed is not referred to in the 1974 deeds but this cannot entail the rejection of the 1961 deed. We do not wish to elaborate on every one of the other points made by the counsel for the Mandals. It is true that Mahamaya Devi did not refer to them in her objections but she was concerned about saving "her" property from attachment and sale as that of Sanchaitas and the issue about her having let out the property was irrelevant for the decision of her objections. We are satisfied that even in the face of the evidence produced before the High Court (which has been supplemented in some respects before us) it is difficult to treat the Paul Bros. as trespassers or unauthorised occupants in the property.