Delhi High Court
Canara Bank vs Gurmukh Singh & Ors. on 5 October, 1999
Equivalent citations: 1999VIAD(DELHI)635, AIR2000DELHI48, [2001]103COMPCAS751(DELHI), 1999(51)DRJ491, AIR 2000 DELHI 48, (1999) 51 DRJ 491, (2001) 103 COMCAS 751, (2000) 2 CURLJ(CCR) 115, (2000) 2 RECCIVR 45
Author: Vikramajit Sen
Bench: Vikramajit Sen
ORDER Vikramajit Sen, J.
1. In order to appreciate the legal nuances of this case a brief history of the litigation would have to be embarked upon. A suit for the recovery of Rs.1,83,142.97 was filed in 1986. As the Defendants did not appear, they were proceeded ex-parte and eventually on 17.5.1989 the suit was decreed, as prayed for in the plaint. The Decree was against the Defendants/Judgment Debtors Shri Gurmukh Singh, who had availed of the credit facilities, and Nischattar Kaur and Shri Amarjit Singh as the Guarantors. The Execution petition, dated 3.11.1993, was filed almost two months later on 29.1.1994. The facts set out by Shri Rajesh Kumar Gupta and Shri Krishan Kumar Gupta (Objectors) is that they purchased the property sought to be attached and sold in these execution proceedings. vis...B-34, Jhilmail Indl. Area, G.T. Road, Shahdra, Delhi (the said property) from Shri Bhupinder Kumar Jain in October 1988, after an 'Agreement of Sale' had been executed between them on 30.9.1988. The said property was leased out to Late Shri Dayal Singh, by the Perpetual Lease dated 9.12.1966, and was not charged to or encumbered in any manner in favour of the Bank. The only connection appears to be that late Shri Dayal Singh was the father of the Defendants and husband of Smt. Jaswant Kaur.
2. Significantly, the Plaintiff-Bank, after filing of the suit, slumbered in the matter and did not bother to investigate whether the Defendants were in actual possession of the said property. This is critical, since the decree was passed in 1989 i.e. after the Objectors had purchased the property from the said Shri Bhupinder Kumar Jain, who in turn had on 18.11.1985 purchased the property from Smt. Jaswant Kaur, widow of late Shri Dayal Singh. It is relevant that even the suit for recovery had been filed after widow Smt. Jaswant Kaur had sold the property. The Objectors have further stated that the property was mutated in the name of Smt. Jaswant Kaur by DDA letter dated 8.10.1985, (i.e. prior to the filing of the suit) and the superstructure thereon was constructed by her. Although mutation, per se, does not confer title, this fact cannot be ignored since third party interests have crept in. The Objections itself averred that this mutation by the DDA was effected pursuant to Relinquishment Deeds being executed in favour of widow Smt. Jaswant Kaur by her children, who are arrayed as Judgment-Debtors in the present proceedings.
3. Arguments were heard on 23.7.1999, revolving substantially around the question whether these Objections should be heard and disposed of on the basis of the material presently before the Court or, as was argued by counsel for the Objectors, that these Objections could only be disposed off after the reception of evidence. It was contended that after the Amendments carried out to the Civil Procedure Code in 1976, Objections preferred under Rule 58 of Order XXI had to be tried as a suit, and could, therefore, be disposed of only after the Objectors had been given due opportunity to lead evidence in support of these Objections. The learned counsel for the Decree-Holder had contested the correctness of these submissions but fairly conceded to them in the face of the Objector's reliance on M/s. Southern Steelmet and Alloys Ltd. Vs. B.M. Steel, Madras, , Sidramappa Rachappa Chiniwar & Ors. Vs. Shankaralingappa Veerappa Bilagi & Ors.
and Sargunam Vs. Union of India & Ors., .
4. In the case of M/s. Southern Steelmet and Alloys Ltd. case (supra) the Division Bench of that Court had observed as follows:
"The adjudication referred to under 0.21 R.58 C.P.C. (as amended in 1976) is not summary and as it is the intention of Legislature under the amended Civil P.C. that it should be a decision as if rendered in a regular suit resulting in an appealable decree the fuller examination of the rights of the parties has to be held after giving them adequate opportunity to place all relevant materials before the Court so that the court could ultimately decide and adjudicate on all questions including questions relating to title or interest in the property attached".
Although this judgment appears not to have been brought to the notice of the learned Single Judge who decided the case of Sargunam Vs. Union of India, the learned Single Judge after noticing that the provisions had been substantially amended in 1976, observed as under:
"As already stated, certain changes have been effected in R.58 of 0.21, in order to provide a more effective remedy for the parties and to avoid multiplicity of proceedings and to give finality to orders passed under the rule, subject to the limitations contained in the rule, viz., the order being liable to be challenged in appeal etc. The rule does not say anything about the enquiry being of a summary nature. It is open to a party to adduce evidence to prove his claim and there is nothing in the section to make the Court adopt a summary procedure, when dealing with an application under 0.21, R.58. On the other hand, sub-rule (4) of R. 58 makes it clear that the order shall have the status of a decree and on account of that an aggrieved party can file an appeal against the order passed in rejection of the claim. If the claim petition has not been considered on merits, but rejected for some reason or other, the affected party has got a right of suit under sub-rule (5). The learned counsel for the petitioner strangely contends that the right of suit provided under sub-rule (5) is an illusory provision. But except levelling such a charge, he is not able to substantiate his argument with any tangible material.
5. The question that arose before the Karnataka High Court in Sidramappa Rachappa's case (supra) was whether a revision was maintainable under Section 115 of the Code of Civil Procedure against an order disposing of Objections under R.58 of O.XXI and is thus only of oblique applicability. It was held that adjudication so made by the Executing Court would be a decree which would enable the aggrieved party to question the same in an appeal. The availability of revisional relief was denied. Mr. V.K. Srivastava, learned counsel for the Objectors, emphasised that under the Code of Civil Procedure, prior to 1976, the Objectors could either proceed under Order XXI or file a civil suit in order to assail the Decree. Since this option was now not available the proceedings under Order XXI were necessarily in the nature of 'adjudication' rather than 'Investigation'. There is no doubt that after the introduction of the Amendments in 1976, the right to file a civil suit has been taken away, instead of an investigation as was envisaged under the unamended Order XXI, an adjudication is now contemplated. It is now necessary that objections filed under Order XXI Rule 58 should not be disposed off summarily. In my opinion, the provisions of Rule 58 of Order 21 admit of no controversy and wherever objections are filed under these provisions these must be heard and disposed of by following a procedure akin to that which obtains the disposal of suit.
6. Mr. Pradeep Dewan, learned counsel for the Decree-Holder thereupon submitted that even in these circumstances it was not incumbent and expedient, in the circumstances of the present case, that issues should be framed, evidence led and thereafter the Objections be disposed of. He is no doubt correct in stating that the Court is not hampered and Hamstring in any manner or precluded from giving effect to the provisions of Order VII, Rule 11 in disposing of the Objections, if a trial was not called for. He has relied on the decision of the Apex Court in T. Arivandandam Vs. T.V. Satyapal & Anr., AIR 1977 SC 2421 in which it was opined "that the learned counsel must remember that if on a meaningful-not formal - reading of the plaint it is manifestly vexatious, and meritless, in the sense of not disclosing a clear right to sue, the trial Court should exercise its power under O. 7, R. 11, C.P.C. taking care to see that the grounds mentioned therein is fulfillled". Pressing these observations to the fore the learned counsel for the Decree-Holder ably argued that if these Objections are perused and even considered on merits, their dismissal would be justified at this stage itself. It was argued that while the Objectors had placed on record two un-registered Agreements to Sell and documents such as registered General Power of Attorney, significantly, the primary document i.e. the Relinquishement Deed in favour of widow Smt. Jaswant Kaur executed by her children, had not seen the proverbial light of day. The fulcrum of widow Smt. Jaswant Kaur's power to sell the property was this Relinquishement Deed and since the Objections were predicated thereon, this document should necessarily have been filed therewith. He argued that an adverse inference must be drawn by the Court because of the failure to file this document. To this extent he is substantially correct. However, this argu-
ment loses sight of the fact that widow Smt. Jaswant Kaur was, independent of the Relinquishement Deed, at least a 1/4th owner of property, being one of the legal heirs of late Shri Dayal Singh along with her three children; that the property was mutated in her name even prior to the filing of the suit; and that the superstructure is alleged to have been constructed by her. It cannot, therefore, be said at this juncture that she had no right to sell the property to Mr. Bhupinder Kumar Jain who had, in turn, sold it to the Objectors, all of whom are transferee without notice of the Bank's claims. If it is further assumed that the Objectors are owners in respect of at least 1/4th of the property it would be inappropriate to deny them a full opportunity to resist the execution proceedings.
7. The chronology of events needs to be reverted to. As stated above, although the suit was filed in 1986, by which time the said property had been sold to Mr. Bhupinder Kumar Jain, the Plaintiff/Decree-Holder has palpably continued in its somnolence even thereafter. Even though the suit proceeded ex-parte, this did not galvanise it into carrying out a local inspection to ensure that the property was not alienated or sold by the Defendants. While it is understandable that an ordinary individual litigant may not possess the wherewithal to primitively protect his interest in the suit, a Nationalised Bank such as the Plaintiff/Decree-Holder, with all the vast resources available to it, cannot be exonerated from negligently and lethargically handling the litigation in such a manner that third party interests, without notice of the proceedings, have been created. A consideration of the facts, as have been disclosed at this stage, cannot justify the denial to the Objectors of full-fledged defense as is contemplated under Rule 58 of Order XXI, post amendment carried out to the C.P.C. The reason for this failure, I expect, will be unfurled as the Objections are adjudicated. Since the Objectors claim title to the property even prior to the passing of the decree, and to the period of five years between this event and the filing of these execution proceedings, explanation for the delay would also have to be given by the Plaintiff-Bank since third party interests have since intervened. Certainly, a non-diligent Decree-Holder cannot be favoured by a threshold disposal of Objections, where third party interests have been created as the result of the delay.
8. In this view of the matter I reject the contentions of the Decree Holder that the Objections should be dismissed at this preliminary stage. Order VII Rule 11 would not available where treble issues have arisen.
9. Since the pleadings have been completed the parties are directed to file additional documents, if any within four weeks from today.
10. List this matter before Joint Registrar for admission/denial of documents on 17.11.1999. After the admission/denial of documents is complete the matter may be listed before Court for framing of issues.