Delhi District Court
Sh. P.N. Kohli vs Mrs. Seema @ Pinki Anand on 13 July, 2007
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IN THE COURT OF SH. RAJ KUMAR CHAUHAN :
ADDITIONAL DISTRICT JUDGE : DELHI
Date of Institution : 19.12.2006.
Date on which the Order
has been Reserved : 11.7.2007.
Date of Order : 13.7.2007.
In the matter of: -
MCA No. 9/2006.
1.Sh. P.N. Kohli
S/o Sh. Kundan Lal Kohli
2.Smt. Santosh Kohli
W/o Sh. P.N. Kohli
Both residents of: -
D-7/7420, Vasant Kunj,
New Delhi
Appellants through their special
Contd... ... ...
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Attorney Sh. Sanjeev Kohli. ... Appellants.
Vs.
1.Mrs. Seema @ Pinki Anand
W/o Sh. D.K. Anand
2.Sh. D.K. Anand
Both residents of: -
M-111, Laxmi Nagar,
Delhi. ... Respondents.
- : ORDER : -
1.In this appeal u/s 75 of Provincial Insolvency Act 1920 (hereinafter referred as "the act"), the appellant has challenged the order dated 15.11.2006 passed by the Court of Ld. Insolvency Judge, Delhi wherein the objections of the appellants were dismissed.
Contd... ... ...
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2.The brief facts giving rise to the present appeal are that the respondents herein filed the petition u/s 7, 10, 11 and 29 of "the act" for adjudicating the respondents as insolvent;
the appellants herein were jointly impleaded as respondents/creditors in the said petition at serial no. 7; in the list of assets belonging to the respondents which was attached to the petition as annexure B, the property bearing no. A-5/G-7, Cliffton Aopartment, Charmwood Village, Suraj Kund, District Faridabad, Haryana (hereinafter referred as "the property") has been shown to be belonging to the respondents as their immovable assets; the appellants filed objections before the Ld. Trial Court stating that the appellants have purchased "the property"
from the respondent no. 1 who has executed various documents including agreement to sell, GPA, SPA, receipt, will etc. duly registered with the Sub Registrar, Delhi. It was further stated that the respondent no. 1 has also handed over the actual vacant and physical possession of Contd... ... ...
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"the property" to the appellants; the appellants are neither the creditors of the respondents nor "the property" is owned by the respondent no. 1 and as such the petition against the appellants was without any cause of action.
3.Vide impugned order dated 15.11.2006, the Ld. Trial Court dismissed the objections of the appellants.
4.Aggrieved by the said order, the appellants have filed the present appeal on the ground that the Ld. Trial Court has wrongly relied the case of AIR 1987 Delhi 36 holding that the appellants are not the owner of "the property" in question. It is further stated that the Ld. Trial Court has completely over looked the subsequent judgments of the Hon'ble High Court of Delhi specially reported in 2002 (61) DRJ 101 (DB) and 2006 (3) Arbitration Law Reporter 482 Delhi; that the Ld. Trial Court has completely ignored the fact that in view of the latest pronouncements, it has Contd... ... ...
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been held that the concept of power of attorney sales has been recognised as mode of transaction. It is further stated that in the subsequent judgments referred (supra) it has been held that these transactions accompanied with other documents including SPA, GPA, will and affidavit and payment of full consideration has been recognised as legal mode of transfer of interest in immovable property. It is further stated that the appellants have even become the owner of "the property" by virtue of section 53 A of the Transfer of Property Act and as such the Ld. Trial Court has wrongly dismissed the objections of the appellants. It is, therefore, prayed that the impugned order be set aside and the names of the appellants be deleted from the names of the respondents in the insolvency petition pending trial.
5.The notice of the appeal was issued to the respondents. Sh. P.C. Modi, learned counsel representing respondent before the Insolvency Court appeared and stated that he is Contd... ... ...
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not representing the respondents in the appeal but will convey the message to the father of the respondents with regard to this appeal. The notice were sent to the respondents again to be served in the Insolvency Court at Tis Hazari Courts for 12.5.2007 i.e. the date of hearing in the said Court, but the notice remained unserved. The appellants moved an application for service of the respondents by way of publication and, accordingly, the respondents were served by way of publication in the newspaper "National Herald" dated 31.5.2007 but none appeared for the respondents despite service.
6.I have heard the learned counsel for appellants who vehemently argued that because of the subsequent judgments of the Hon'ble High Court of Delhi referred (supra) i.e. 2002 (61) DRJ 101 (DB) and 2006 (3) Arbitration Law Reporter 482 Delhi, the order of the Ld. Trial Court is not sustainable as the Ld. Trial Court has Contd... ... ...
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wrongly relied the case of AIR 1987 Delhi 36 while dismissing the objections of the appellants. Besides, the above two judgments referred (supra), the learned counsel for appellants has also referred 1999 RLR 20 in support of his arguments stating that the power of attorney sales in Delhi is the common mode of sale of immovable properties to get over the legislative restriction on transfer of properties.
7.The learned counsel for appellants further argued that the Ld. Trial Court did not give effective opportunity of hearing so that the appellants could have submitted the above citation before the Ld. Trial Court because the Ld. Trial Court merely heard the parties on the application of section 4 of the Insolvency Act. It is argued that in the reply to the objections of the respondent no. 7 (appellant herein), the respondents in para no. 2 stated that "That the title of the property cannot be determined by this Contd... ... ...
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Hon'ble Court only by way of filing the objections, it can only be decided under section 4 of the Provincial Insolvency Act in the form of a civil suit and therefore the present objection and reply are liable to be dismissed and the same is not maintainable." Hence, the learned counsel for appellants argued that the principal of natural justice has not been followed by the Ld. Trial Court as no hearing was given on the legal proposition on the basis of which the objections have been dismissed by the Ld. Trial Court. The learned counsel for appellants, therefore, prayed that the impugned order be set aside and the objections of the appellants be allowed.
8.I have considered the rival submissions made at bar, gone through the impugned order and other material on record.
While dismissing the objections of the appellants, the Ld. Trial Court has passed the following order: -
Contd... ... ...
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"15.11.2006 Present: None.
Record perused for deciding the objections raised by respondent no. 7 in his written statement. I have already heard counsel for the parties.
The respondents have prayed that they should be deleted from the array of respondents and property bearing no. A-5/G-7, Cliftton Apartments, Charmwood Village, Surajkund Road, Faridabad, Haryana, be deleted from the list of assets belonging to the petitioner by vacating any order or provision passed in respect of the said property. The respondents have also prayed to hold and declare that they are lawful owners in possession of the said property. The case of respondents in their written statement is that the said property was sold by the petitioner to them by virtue of agreement to sale and purchase, special power of attorney and general power of attorney duly registered with Sub Registrar and receipts etc. dated 16.5.1997.
Counsel for the petitioner has relied upon 1991 RLR 19 titled as Prakash Kaur Vs. Everest Construction Company and AIR 1987 Delhi 36 titled as Imtiaz Ali Vs. Nasim Ahmed. In both these authorities, it has been held that a person cannot be an owner of immovable property by purchasing the same on the basis of agreement to sell and power of attorney in the absence of a registered sale deed. Hence, in view of the authorities, it is clear that the respondents are not the owners of the said property. Hence, the Contd... ... ...
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objections have no merits and the same are hereby dismissed.
Put up for further proceedings on 11.1.2007. All the counsel are directed to inspect the file to assist the Court.
I.J./Delhi-15.11.2006"
9.Thus, from the impugned order it is clear that the Ld. Trial Court has passed the order of dismissal of the objections while relying upon 1991 RLR 19 and AIR 1999 Delhi 36. I have also perused the trial court record. The order dated 17.8.2005 shows that the arguments on the objections of the respondent no. 7 (appellant herein) were heard and the matter was listed for orders on 1.9.2006. After that the matter was listed for six date and the Ld. Trial Court did not pass the order on the objections. On 15.11.2006, when the impugned order was passed, the Ld. Trial Court has stated that it has already heard the learned counsel for parties. The order sheets show that no arguments were heard after 17.8.2005 till 15.11.2006 by the Ld. Trial Contd... ... ...
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Court on the objections. On 15.11.2006, the Ld. Trial Court suddenly passed the order on the objections of the appellants herein who was respondent no. 7 in the insolvency petition. In these facts and circumstances, the contention of the learned counsel for appellants wherein it was argued that the Ld. Trial Court has not heard the appellants on the points and the judgments which have been relied by it, is found to be forceful. Thus, it seems that the Ld. Trial Court has not followed the principal of natural justice as in the facts and circumstances discussed above, no effective hearing has been given to the appellants while dismissing their objections by the impugned order. The law laid down in the subsequent judgments which are being referred and relied by the appellants is contrary to the law which have been laid down in the judgments relied by the Ld. Trial Court while dismissing the objections of the appellants. Admittedly, the judgments which are being referred by the appellants Contd... ... ...
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herein has not been referred before the Ld. Trial Court and are not considered by it while dismissing the objections of the appellants. In State of UP & Others Vs. Jeet S. Bisht & Others cited as 2007 (4) Supreme page 362, the Hon'ble Apex Court has held that, when the particular point of law involved in the decision is not perceived by the Court or present to its mind, such decision is called to be passed sub-silentio. For these reasons as well as for the reason that the Ld. Trial Court has failed to follow the principal of natural justice, the impugned order is not sustainable in the eyes of law. The impugned order is, accordingly, set aside. The matter is remanded back to the Ld. Trial Court for hearing the parties afresh on the objections of the appellants and after considering the law referred by the appellants herein, the Ld. Trial Court is directed to pass a fresh order on the objections of the appellants. With these observations the appeal is accepted. Copy of this order be sent to the Ld. Trial Court Contd... ... ...
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alongwith TCR. Appeal file be consigned to record room after due compliance.
Announced in the open Court on 13.7.2007.
(RAJ KUMAR CHAUHAN) ADDITIONAL DISTRICT JUDGE, DELHI Contd... ... ...