Karnataka High Court
Smt. A Sugandramma vs A Venkataramana on 3 March, 2020
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IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 03RD DAY OF MARCH, 2020
BEFORE
THE HON'BLE MR. JUSTICE N.K. SUDHINDRARAO
R.F.A.No.1938/2012
BETWEEN:
Smt. A. Sugandramma
Aged about 60 years
D/o. late A.N.Annayya Reddy
NO.4, 5 & 6, 1st cross
Rathanamma layout
Manarayanapalya
RT Nagar post,
Bangalore - 32
...Appellant
(By Sri.G.Papi Reddy, Advocate)
AND:
1. A.Venkataramana
Major by age
No.41, 12th cross, 4th Main, C.P.layout
Wilson Garden
Bangalore - 560030
2. The Indian Bank
Koramangala Branch
No.512, 4th cross, 6th block
Koramangala
Bangalore - 560 095
Represented by its
Branch Manager
2
3. The Recovery officer
The Indian Bank
Koramangala Branch
No.512, 4th cross, 6th Block
Koramangala,
Bangalore - 560 095
4. Shri. Sathyanarayan Reddy
Aged about 52 years
S/o. Muniswamy Reddy
No.2, 6th cross, Athimananda colony
Sultanpalya, RT nagar post
Bangalore - 560 032
5. M/s. Mahalakshmi Industries
4th cross Gongondanahalli
Mysore Road, Bangalore - 39
Represented by its proprietor
K.N.Balagangadhara Sharma
...Respondents
(By Sri.B.S.Radhanandan, Advocate for R1;
Sri. V.Srinivas Babu, Advocate for R4;
R2 and R3 are served;
V/O. Dt.30.08.2013, notice to R5 is dispensed with)
This RFA is filed under Section 96 of CPC, against the
Judgment and Decree dated 29.04.2012 passed in
O.S.No.27135/2007 on the file of the XXVIII-Addl. City
Civil Judge, Mayo Hall, Bangalore, dismissing the suit for
declaration and injunction.
This RFA Coming on for orders this day, the Court
delivered the following:
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JUDGMENT
Appeal is directed against the order dated 29.08.2012 passed on issue No.5, by XXVIII Additional City Civil Judge, Mayohall Unit, Bangalore City, wherein the suit of the plaintiff came to be dismissed. In the nature and circumstances of the case, it is necessary to mention the parties names as stated in the cause title of appeal memorandum:
Plaintiff - Smt. A.Sugandramma
Defendant No.1 - A.Venkataramana
Defendant No.2 - The Indian Bank
Defendant No.2 - The Recovery Officer
Defendant No.3 - Sri. Sathyanarayana Reddy
Defendant No.4 - M/s. Mahalakshmi Industries
2. Plaintiff filed the suit for declaration seeking that the fourth defendant had no right to create the third party interest with other defendants after 20.04.1990.
3. The contract entered into between the defendants after 20.04.1990 are not binding on the 4 plaintiff in respect of 'A' and 'B' schedule property, they are stated to be residential ones. The plaintiff claims that she is the lawful owner of the schedule property having purchased the same from one A.Bhaskar for valuable consideration under the registered sale deed dated 23.10.2005 and is in possession of the same.
4. The said purchase was made by plaintiff with bonafide intention and the same is absolutely for good reasons. Meanwhile, plaintiff came to know that the vendor of the plaintiff had filed a suit for specific performance on the basis of the agreement of sale deed dated 20.04.1990 against the fourth defendant - Sathyanarayana Reddy.
5. The transactions that are taken place as admitted in the pleading that defendant No.4 - Mr.Sathyanarayana Reddy was the owner of the schedule property. Fifth defendant - M/s. Mahalakshmi Industries represented by its proprietor K.N.Balagangadhara Sharma borrowed loan from second defendant - Indian Bank on 03.01.1991. Fourth defendant is stated to be surety/co- 5 obligant as the owner of the schedule property - Fourth defendant guaranteed for repayment of loan borrowed by fifth defendant and stood as surety by offering the schedule property as security.
6. It is stated that defendant No.5 became a defaulter and the second defendant initiated proceedings before Debt Recovery Tribunal at Bengaluru in O.A.No.663/1995. As the fourth defendant was offered the schedule property as security, it was also subjected to attachment. It is in this background, a suit came to be filed originally on the file of learned XXVIII Additional City Civil Judge at Bengaluru, in O.S.No.16200/2003, by vendor of the present plaintiff by name R.Bhaskar. The learned trial judge decreed the suit of the plaintiff in part.
7. The substance of the present suit is that the plaintiff - Smt. Sugandramma seeks for a judgment and decree to declare that she is not bound by any transaction entered into in respect of schedule property after 20.04.1991. She purchased the schedule property in 6 pursuance of the agreement on the said date from one R.Bhaskar. Main matter of suit for specific performance and statement that was made in O.S.No.16200/2003 by one R.Bhaskar claiming that owner - defendant No.4/M.Sathyanarayana Reddy, has entered into said sale agreement on 20.4.1990 for a sum of Rs.2,25,000/- and it was decreed exparte as M.Sathyanarayana Reddy - defendant No.4 did not contest the matter.
8. The said decree was passed on 23.02.2005, regard being had to the fact that same was filed on 20.09.2003.
9. The plaintiff in O.S.No.27135/2007 claims that she purchased two items as mentioned in the schedule from the said R.Bhaskar. It is under these circumstances, the plaintiff claims that she is a valid and genuine owner of the schedule property.
10. Learned counsel Sri G.Papireddy, for plaintiff- appellant submits that the rights of the plaintiff deserves 7 protection in respect of the suit schedule property. The suit came to be dismissed by virtue of allowing issue No.5 as the defendant No.2 - Bank has contended that suit filed by plaintiff clearly hit under Section 34 of Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, (for short 'SARFAESI Act').
11. Learned counsel would further submit that learned trial judge seriously erred in answering issue No.5 in the affirmative since the Civil Court was competent to try the suit as the right over property of the plaintiff was very much concerned in the said suit when the transaction if any was entered into between defendant No.4 - Sathyanarayana and second defendant - Indian bank, were earlier to initiating the proceedings. Admittedly, the loan from the second defendant was stated to have been borrowed by the fifth defendant on 03.01.1991 which given by the simple calculation excludes the right of either defendant No.2 or defendant No.5, as any amount of right 8 claimed by any person would be subject to the rights of plaintiff under the agreement.
12. It was also submitted that the plaintiff/appellant is a bonafide purchaser and holder of priority right and interest over suit schedule property.
13. Sri B.S.Radhanandan, learned counsel for respondent No.1 would submit that a wrong representation is made deliberately by the plaintiff and her group. Plaintiff or fourth and fifth defendants are in perfect conspiracy in addition to collusion to defeat the rights of the creditor in the process of recovery of amount of loan with interest that was lent by the second defendant to the fifth defendant during the year 1991.
14. Learned counsel also drew the attention of the court to SARFAESI Act. Section 34 of the said Act, contemplates that Civil Court not to have jurisdiction. Section 34 of the SARFAESI Act, reads as under: 9
"34. Civil Court not to have jurisdiction.-No civil court shall have jurisdiction to entertain any suit or proceeding in respect of any matter which a Debts Recovery Tribunal or the Appellate Tribunal is empowered by or under this Act to determine and no injunction shall be granted by any court or other authority in respect of any action taken or to be taken in pursuance of any power conferred by or under this Act or under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (51 of 1993).
15. The borrowing of loan, disposal of suit before the DRT is not disputed. The borrowing of loan by the defendant No.5 from defendant No.2 is not disputed. The ownership of fourth defendant at a particular point of time is also not disputed. The bone of contention is that fourth defendant had entered into an agreement to sell the schedule property to vendor of the present plaintiff who is Mr.Bhaskar and in view of default of defendant No.4, a suit 10 came to be filed for specific performance by said Bhaskar as stated above which ultimately disposed of exparte.
16. Then the decree holder - Bhaskar had sold the schedule property under the registered sale deed dated 23.10.2005 to the plaintiff - A.Sungadramma. Regard being had to the fact that either the original or certified copy of the said sale deed is not produced before this court or before the civil court.
17. Meanwhile, learned counsel for defendant No.1
- A. Venkataramana would submit that he is the person who was affected both directly and indirectly as he purchased the schedule property in the public auction that was brought at the instance of defendant No.2 - Indian Bank for the realization of loan that was borrowed by defendant No.5 from defendant No.2 undertaking to repay the debt and also offered the defendant No.4- Sathyanarayana Reddy as surety along with schedule property. Learned counsel would further submit that understandingly, the defendant No.2 who realized the 11 proceeds is not showing interest. Learned counsel would further submit that even the plaintiff has sold the schedule property, however the details of the sale deed is not furnished. Regard being had to the fact that the plaintiff also has not specifically denied the fact of sale deed by the defendant.
18. In the circumstances of the case the wordings of Section 34 of the act excludes the jurisdiction of Civil Court in respect of any matter which Debt Recovery Tribunal or Appellate Tribunal empowered under the said act to determine and no injunction can be granted by court or other authority in respect of any action to be taken in pursuance of the power conferred by or under this act. The issue No.5 was framed regarding the contentions raised by the first defendant before the trial court which is as under:
"5. Whether this court has no jurisdiction to try the suit?"12
and the said issue was treated as preliminary issue and disposed of in favour of defendant No.1. Consequently the suit came to be dismissed.
19. The wordings under Section 34 of the SARFAESI Act has to be read in its wider scope not only it is civil suit that is barred and the person does not have right to agitate for the remedy that no civil court shall have jurisdiction to entertain any suit or proceeding in respect of any matter which a Debts Recovery Tribunal or the Appellate Tribunal is empowered by or under this Act to determine and no injunction shall be granted by any court or other authority in respect of any action taken or to be taken in pursuance of any power conferred by or under this Act or under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (51 of 1993).
20. In the circumstances, no doubt, it is not the domain of court to go into merit of the suit filed by said Bhaskar against fourth defendant and thereafter Bhaskar selling to the plaintiff.
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21. However, it is in respect of equator things and transaction speak by themselves res ipsa loquitor.
22. Further the present suit is valued under Section 24(b) and 26(c) of the Karnataka Court Fees and Suit Valuation Act and even the framing of the suit made for declaration and permanent injunction having cumulative and negating effect of judgment and decree passed by the court in pursuance of the proceedings ended in favour of defendant No.2 (Bank).
23. The conduct and the sequence of events establish how and why the plaintiff has come to the court for the relief sought, the timing and the date of said agreement by the said Bhaskar filing a suit when there was no opposition, exparte decree in favour of Bhaskar and then sale deed in favour of the plaintiff in the context of date of the sale agreement being 20.04.1990, speak of volumes against the plaintiff and his malafide intentions. The suit apart from being not maintainable lacks grounds 14 for reliefs sought. On going through the materials on hand, I find the very suit apart from violative of Section 34 of the Act, it does not appears to have been filed for good reasons.
24. I find no infirmity, illegality or irregularity and perversity in the order dated 29.08.2012 passed in O.S.No.27135/2007 by XXVIII Additional City Civil Judge, Mayohall, Bengaluru. As the trial judge has answered issue No.5 in a proper manner, therefore, the appeal is liable to be dismissed.
Accordingly, the appeal is dismissed with costs throughout.
SD/-
JUDGE HJ