Calcutta High Court (Appellete Side)
Sri Debjyoti Bhattacharjee vs Pegasus Assets Reconstruction Private ... on 20 April, 2023
Author: Harish Tandon
Bench: Harish Tandon
04 20.04.23 In the High Court at Calcutta
Civil Appellate Jurisdiction
Ct. No. 37
Commercial Division
Akd
F.M.A.T. 170 of 2023
CAN 1 of 2023
Sri Debjyoti Bhattacharjee
Vs.
Pegasus Assets Reconstruction Private Limited & Ors.
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Mr. Sakya Sen, Mr. Sudipta Kumar Bose, Mr. Subhajit Sen, Ms. Lipika nath, Mr. Gourav Singha.
... for the appellant.
Mr. Surajit Nath Mitra, Mr. Rajarshi Dutta, Mr. Deepak Kumar Jain.
... for the respondent.
Re: CAN 1 of 2023 The ex parte ad interim order for attachment before the judgement under the provisions of Order XXXVIII Rule 5 of the Code of Civil Procedure is refused by the Commercial Court, as the said provision invites a drastic remedy and, therefore, to be exercised with great caution and circumspection and not in a routine manner. The Commercial Court further highlighted that without giving an opportunity to disclose the defence by the contesting respondents, it would not be proper to pass an ex parte order in this regard.
The facts emerged from the pleadings is alarming and raises several issues which are of seminal importance under trade and commerce and/or the banking activities in securing and/or extending loan facilities upon deposit of Title Deeds as security and standing as a guarantor.
2The appellant is admittedly the owner of Premises No. 37/B, Block-B, New Alipore, Kolkata-53 and at one point of time intended to transfer, alienate and sell the said property to the proforma respondent nos. 5 and 6. An agreement was entered into and in furtherance thereof the original Title Deed of the said property was handed over to the aforesaid intending purchaser. Subsequently a proceeding was initiated by the UCO Bank before the Debt Recovery Tribunal seeking release of the amount advanced as a loan against a third party. The default had taken place and an attempt was made to realize the amount and as the Title Deed of the said property was allegedly put as a collateral security and/or mortgage with the Bank, the appellant sought for his impleadment in the said proceeding.
Pursuant to such intervention at the instance of the appellant, an order was passed upon the said respondent nos. 5 and 6 to produce the original Title Deed, which was handed over by the appellant in pursuance of the agreement for sale. The said Title Deed was produced before the Debt Recovery Tribunal and was kept on record. To protect the said Deed a suit was instituted by the appellant where an order of temporary injunction was granted not go give such Title Deed to anybody. The said suit ultimately culminated into dismissal for default, but it is a specific stand of the appellant that the said Title Deed was subsequently handed over to him and he is in possession thereof.
Interestingly, the appellant was served with a notice under Section 13(4) of the Securitisation and Reconstruction of Financial Assets and Enforcement 3 of Security Interest Act, 2002 alleging that being a guarantor and having deposited the Title Deed of the said property he is jointly and severally liable for the loan amount advanced to the principal borrower; that led the appellant to take immediate steps by lodging a First Information Report alleging that the original Title Deed which is in their possession was never handed over nor put as a collateral security or mortgaged with the Bank for securing the loan in favour of the third party.
Since no progress could be seen on the basis of the said First Information Report as no investigation was contemplated, the approach was made to this Court by filing a writ petition. It appears from the record that during contemplation to initiate a proceeding at the behest of the respondent no. 1 being an assignee of the United Bank of India, the appellant in order to protect the ancestral property deposited a sum of Rs.1,46,00,000/-. In the writ petition before the Division Bench the aforesaid fact was disclosed and after noticing that a serious fraud has been committed, the direction was passed upon the police administration to investigate the issue as disclosed in the First Information Report filed by the appellant and simultaneously a liberty was granted to the appellant to file a suit for recovery of amount, which was deposited with the respondent no. 1.
Our attention is drawn to the final report submitted by the Investigating Officer, wherein it is categorically held that the Deed submitted with the United Bank of India is forged and fabricated, but astonishingly the case was dropped, as the identity of the person being a beneficiary of the loan amount 4 could not be traced out. The moment the Investigating Officer arrived at the conclusion that the Deed relied upon by the Bank (UBI) is forged and fabricated, the present suit was filed for realization of the amount, which was deposited with the respondent no. 1 as assignee of the United Bank of India.
Such being the startling facts revealed from the record of the instant case, we do not find any justification in the stand of the Commercial Court that no interim protection can be granted at the ex parte stage until the defendants disclosed their stand; in other words, it is held that the provisions contained under Order XXXVIII of the Code of Civil Procedure is drastic in nature and, therefore, the Court should not be swayed by the ipsi dixit of the pleadings filed by the plaintiff unless the defence is disclosed by the contesting defendants.
There is no quarrel to the proposition that the provisions contained under Order XXXVIII of the Code of Civil Procedure are extraordinary and to be exercised in exceptional circumstances more particularly at the ex parte stage. It does not take away the right of the Court in deserving cases to pass an order protecting the interest of the parties if circumstances warrant so. The investigation revealed that the Deed deposited with the United Bank of India is forged and a fraud has been committed upon the Bank, yet the appellant, who has shown his bona fide in depositing a sum of Rs.1,46,00,000/- to protect the said residential house, is deprived of the said amount when admittedly he has no role to play in commission of such fraud or forgery.
5It has been categorically averred in the said application that the respondent no. 1 being an assignee of United Bank of India only extends the financial assistance and does not have a requisite amount as all the Fixed Deposit have been charged with the Bank in order to secure the overdraft facilities. Such being the fact, disclosure of the assets or to put a security would not be construed to be an adequate remedy required at this stage. Equally we cannot overlook the fact that the protection of an amount is also required in view of the facts disclosed hereinabove. There is no fetter on the part of the Court to convert the application under Order XXXVIII of the Code into an application under Order XXXIX of Code provided the ingredients required for consideration are pleaded therein.
However, in the instant case we find that an alternative order of injunction was sought so that the amount, which is lying in the hands of the respondent no. 1, may not be dissipated nor can be dealt with pending final adjudication.
We, therefore, find a strong prima facie case is made out for an order of injunction. Therefore, the amount lying in the Overdraft account being A/c. No. 50200056041810 with the HDFC Bank, Mumbai Branch, to the extent of Rs.1,46,00,000/- is required to be protected.
Accordingly, the respondent no. 1 is restrained from using, withdrawing or dealing with the money lying in the aforesaid Account to the extent of Rs.1,46,00,000/-, which shall remain intact in the said Account for a period of eight weeks from date or 6 until further order/orders of this Court, whichever is earlier.
For the purpose of clarity it is made clear that any amount in excess of the said amount of Rs.1,46,00,000/- can be dealt with or utilized by the respondent no. 1 from the said Account. The concerned Bank is directed to take note of the order of injunction passed therein and shall act accordingly. Liberty is granted to the appellant to communicate this order to the said Bank.
The learned Advocate for the appellant is directed to serve a copy of the application upon the respondents by speed post in course of this day and shall file the affidavit of service on the returnable date.
The application is made returnable after three weeks.
(Harish Tandon, J.) (Prasenjit Biswas J.)