Rajasthan High Court - Jodhpur
M/S Sun On Mount Hotels Private Limited vs M/S. Jain Bandhu Sneh Resorts Private ... on 4 January, 2020
Bench: Sandeep Mehta, Dinesh Mehta
HIGH COURT OF JUDICATURE FOR RAJASTHAN AT
JODHPUR
D.B. Review Petition (Writ) No. 187/2019
M/s Sun On Mount Hotels Private Limited, Flat No.3, New
Market, Tilak Nagar, New Delhi Through Its Director Shri Ashok
Jambani.
----Petitioner
Versus
1. M/s. Jain Bandhu Sneh Resorts Private Limited, Through
Its Director - Sunil Kumar Jain Son Of Shri Sr, R/o Sneh
Resorts, National Highway 8, Udaipur - Ahmedabad Road,
Udaipur At Present Residing At F-14/71, Model Town,
Delhi - 110009.
2. Rajasthan Financial Corporation, Jaipur, Through Its
Chairman And Director Udhyog Bhawan, Jaipur.
3. General Manager Operation, Rajasthan Financial
Corporation, Udhyog Bhawan, Tilak Marg, Jaipur.
4. Deputy Manager, F.R., Rajasthan Financial Corporation,
Udhyog Bhawan, Tilak Marg, Jaipur.
5. Branch Manager, Rajasthan Financial Corporation, S-1,
MIA, Madri, Udaipur.
----Respondents
For Petitioner(s) : Mr. Ravi Bhansali, Senior Advocate,
assisted by Mr. M.A. Siddiqui
HON'BLE MR. JUSTICE SANDEEP MEHTA
HON'BLE MR. JUSTICE DINESH MEHTA Order 04/01/2020 Per Justice Dinesh Mehta:
1. The present petition under Order XLVII Rule 1 of the Code of Civil Procedure read with Article 226 of the Constitution of India has been filed seeking review of the judgment and order dated (Downloaded on 16/02/2020 at 01:11:44 PM) (2 of 8) [WRW-187/2019] 19.08.2019, passed by a Division Bench of this Court, of which one of us (Justice Dinesh Mehta) was a member.
2. By the order aforesaid, this Court had allowed an intra Court appeal, filed by the appellant (respondent No.1 herein).
3. The respondent No.1 a borrower had filed a writ petition raising various grounds in the writ petition including setting aside of the auction notice dated 16.03.2013. Petitioner had raised a grievance against the respondent - RFC, which had imposed penal interest.
4. During the pendency of the said writ petition, the respondent-Corporation had placed the property of the writ petitioner for auction. M/s. Sun on Mount Hotels Private Ltd. (present review petitioner) was the highest bidder. Vide order dated 28.05.2013, the respondent-Corporation was asked not to confirm the sale. Thereafter M/s. Sun on Mount Hotels Private Ltd.
- the successful bidder was impleaded as party respondent in the writ petition.
5. Since, the writ petitioner failed to clear the dues of the respondent-Corporation, learned Single Judge of this Court did not interfere in the matter in light of judgments of Hon'ble the Supreme Court. Resultantly, petitioner's writ petition was dismissed.
6. Respondent No.1 - borrower preferred an intra Court appeal against the judgment dated 08.03.2018 passed by learned Single Judge.
7. Considering the arguments advanced at the bar and the documents available on record, the Division Bench vide its judgment dated 19.08.2019 held that the confirmation of sale in (Downloaded on 16/02/2020 at 01:11:44 PM) (3 of 8) [WRW-187/2019] favour of respondent No.5 was not proper, inasmuch as, the Financial Corporation had accepted the bid received by the auction purchaser on 25.04.2013, which was initially for a sum of Rs.8.21 crores and thereafter increased to Rs.11.11 crores. The Division Bench was of the view that the competent committee of the Corporation was not justified in confirming the sale on the basis of reserved market price of 2012, that too without considering the attendant factors. It was also held that confirming the sale in the year 2018, without even requiring the successful bidder to pay interest for the period interregnum cannot be countenanced.
8. The operative portion of the judgment dated 19.08.2019 passed by the Division Bench reads thus:-
"A reading of the above minutes makes it abundantly clear that RFC confirmed the sale reckoning the MRV as on 16.11.2012 and had not even asked the successful bidder to increase his bid, given the fact that a period of five years had since elapsed. The successful bidder was not even called upon to pay the interest for the period interregnum (14.06.2013 to 15.01.2018).
20. This Court is of the considered opinion that the Head Office Level Committee mechanically confirmed the sale in favour of the fifth respondent, ignoring the attendant factors which were required to be considered, which has caused loss to the appellant as the Corporation has not factored in the escalation, which might have taken place during this period.
21. In this view of the foregoing discussion, this Court is of the opinion that the confirmation of sale made by the respondent Corporation in favour of the fifth respondent was neither in accordance with law nor in commercial expediency. Surely, in its capacity (Downloaded on 16/02/2020 at 01:11:44 PM) (4 of 8) [WRW-187/2019] as custodian of its debtor's property, the RFC ought to have, in the normal course of its business sought a fresh valuation of the properties, in 2018, when the Court required that negotiations with the successful bidder. This was essential, given that a considerable period (5 years) had elapsed between the date of auction, and the date of the final judgment of the Single Judge."
9. Mr. Ravi Bhansali, learned Senior Counsel appearing for review petitioner contended that the Division Bench was not justified in setting aside the concluded/confirmed sale. It was argued that during the course of hearing the intra Court appeal, counsel for the auction purchaser was assured by the Court that the sale in its favour would not be disturbed, hence , the review- petitioner (respondent No.5 in the appeal) did not inform the Court that during the period interregnum, not only the bid amount has been paid, a huge investment has also been made by it.
10. While inviting Court's attention towards the photographs of the property, it was contended that crores of rupees have been spent for the development of the property.
11. Heard.
12. While taking serious exception to the submissions made on behalf of the review-petitioner, it is hereby clarified that no such impression much less assurance was ever given in the Court. The matter was heard threadbare and then it was decided.
13. It is to be noticed that in support of the review petition, affidavit of Mr. Ashok Jambani, the Director of the review- petitioner has been filed, who has not even shown his presence on (Downloaded on 16/02/2020 at 01:11:44 PM) (5 of 8) [WRW-187/2019] the date, when the matter was argued, yet irresponsible statements have been made in the review petition.
14. Be that as it may. Without going into the assertion made by the review-petitioner, suffice it to mention that the appellant (M/s. Jain Bandhu Sheh Resort Pvt. Ltd.) had raised its grievance not only against levy of penal interest, but also against auction proceedings, which is evident from the following:
(a). Petitioner in its writ petition had raised a contention that the respondent-Corporation has erred in inviting sealed bids. Such contention was however not considered by the learned Single Judge, as he had decided not to interfere in the matter, but the fact remains that grievance was raised qua the process of auction.
(b). During the pendency of the appeal, an additional affidavit came to be filed by the respondent No.1 on 05.02.2019, interalia, indicating that the appellant had made various complaints regarding confirmation of the sale in favour of the respondent No.5. It will not be out of place to reproduce relevant para No.6 of the aforesaid affidavit:-
"6. That from perusal of the reply (Annex.A/2), it is clear that the appellant/writ petitioner-company was chosen and picked up for auction only for the reason that the son of a sitting State Minister, who is also one of the Directors of the private respondent - bidder company is having keen interest to take over the possession of the property in dispute. In this regard, the appellant/writ- petitioner made various complaints to the higher authorities including Central Vigilance Commission, New Delhi. But despite that no action has been taken by the concerned authorities in pursuance to (Downloaded on 16/02/2020 at 01:11:44 PM) (6 of 8) [WRW-187/2019] the said complaints. The copy of one of such complaint dated 26.09.2018 as submitted by the appellant/writ-petitioner is annexed herewith and marked as Annexure-A/6."
(c). An application along with various documents was filed by the appellant on 22.05.2019, interalia, placing on record various documents in support of its claim that the property has been auctioned in favour of respondent No.5, essentially because one of the Director of the auction-purchaser - Mr. Vinit Kriplani was son of Minister of Urban Development. We deem it appropriate to reproduce petitioner's assertion in the said application, which reads thus :-
"1. That by way of filing the present appeal, the appellant has assailed the validity of the order impugned dated 8th March, 2018 passed by the learned Single Judge, whereby the learned Single Judge has dismissed the writ petition. The appellant-
petitioner has challenged the impugned
advertisement/auction notice dated 16th March,
2013, which has been conducted in a most arbitrary and indiscriminate manner. Further, the appellant- petitioner has also submitted that the auction conducted by the respondents is absolutely vitiated for the reason that the same has been sold in much below DLC rates and the same has been done in connivance with the Hon'ble Minister for Urban Development Shri Srichand Kriplani and his son Shri Vinit Kriplani who was one of the Director of the Company i.e. the auction purchaser.
2. ..... ..... .... ....
3. That the appellant is further producing certain documents with regard to the auction, which was (Downloaded on 16/02/2020 at 01:11:44 PM) (7 of 8) [WRW-187/2019] conducted in utter prejudice of the appellant writ petitioners. In order to show that the auction had been conducted in the most arbitrary manner, these documents clearly goes to show that at the behest of son of the then Hon'ble Minister for Urban Development, this auction had been conducted whereby the property had been sold in a very low prices and thereby causing utter prejudice to the appellant-petitioner. The petitioner had also submitted in the memo of appeal that they have already deposited a sum of Rs.5.12 Crores as against the loan of Rs.2.41 Crores and are further ready to pay a sum of Rs.3 Crores to settle the entire amount, which was communicated to the Bank Officials prior to the auction being conducted by them. Despite this, the auction was conducted by the respondents and the respondents being in collusion with each other, gave with the possession of the premises to the respondents despite there was an interim order passed by the Division Bench not to handover the possession till the matter is finally decided by the learned Single Judge. Be that as it may."
(d). Argument advanced and assertions made by the Review petitioner are per se false also manifested from the record of proceedings dated 07.08.2019 of the case.
"07/08/2019 Learned counsel appearing for the respondent RFC shall produce the entire original file containing terms of auction settled prior to the publication dated 16.03.2013 offering property for sale.
The RFC shall also indicate guidelines/circulars which govern the issuance of public auction of such private property and the time limit within which the cost is to be deposited in such cases.(Downloaded on 16/02/2020 at 01:11:44 PM)
(8 of 8) [WRW-187/2019]
List on 09.08.2019."
(e). It is to be noted that on the next date i.e. on 09.08.2019, not only the original record was perused, even arguments in relation to auction proceedings and its finalisation were heard.
15. In light of facts noted above, it is clear that the review petition is based on absolutely incorrect facts and assertions. Petitioner's contention that the appellant-writ-petitioner had not laid any challenge to the auction proceedings and confirmation of sale is, both baseless and factually incorrect.
16. There is no apparent error on the face of record for which this Court is required to review its judgment. The review petition is, thus, dismissed. The findings recorded by this Court were based on record, which was summoned and perused.
17. So far as the amount allegedly spent by the review-petitioner is concerned, without making any observation about the correctness of such assertion, suffice it to observe that the said facts were not brought to the notice of the Division Bench hearing the appeal. That apart, the amount was spent during the pendency of the appeal, i.e. after 2018, the same was obviously subject to final adjudication of the appeal. The review-petitioner will however, be free to take appropriate proceedings for recovery of the amount spent by it on the property (after taking its possession) in accordance with law.
(DINESH MEHTA),J (SANDEEP MEHTA),J
1-Ramesh/-
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