Madras High Court
Thangarajan vs The Managing Director on 1 September, 2014
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED: 01.09.2014 CORAM THE HONOURABLE MR.JUSTICE S.NAGAMUTHU W.P.(MD)No.14878 of 2010 and M.P.(MD) Nos.1 and 2 of 2010 Thangarajan ... Petitioner Vs. 1.The Managing Director, Tamil Nadu Industrial Investment Corporation, Anna Salai, Nandhanam, Chennai - 35. 2.The Branch Manager, Tamil Nadu Industrial Investment Corporation, No.37, Cap Road, Nagercoil, Kanyakumari District. 3.S.Arul ... Respondents Prayer This Writ Petition is preferred under Article 226 of the Constitution of India to issue a Writ of Certiorarified Mandamus, to call for the records in connection with the Impugned auction cum sale notice as published in daily thanthi on 12.01.2010 and subsequent sale dated 05.03.2010 and to quash the entire proceedings and consequently to direct the respondent to permit the petitioner to pay the dues to the second respondent with regard to the Sreeja Auditorium. !For Petitioner : Mr.S.Murugaiyan For Respondents 1 & 2 : Mr.Suresh for M/s.Aiyar and Dolia Foor 3rd Respondent : Mr.T.Lajapathy Roy :ORDER
The Tamil Nadu Industrial Investment Corporation (respondents 1 and 2) is a Financial Corporation established under Section 3 of the State Financial Corporation Act, 1951. The petitioner had raised a loan from the said respondents to the tune of Rs.11,50,000/-. As per the terms and conditions of the loan, the petitioner has to repay the same in installments. But the petitioner had committed default. While securing the loan, the petitioner has pledged his property in favour of the Corporation. Since the petitioner had committed default, in order to recover the amount due to the Corporation, proceedings were initiated for the sale of the mortgaged property. Accordingly, the said property was brought for sale on 16 occasions. But there was no taker. Finally, in the auction held on 05.03.2010, the third respondent emerged as the successful bidder. Over and above the bid amount, by means of negotiations, the sale amount was fixed finally at Rs.30,00,000/- . The third respondent paid the sum after two months. The sale was also confirmed in favour of the third respondent and possession has also been handed over to the third respondent. Now, the petitioner has come up with this Writ Petition, challenging the auction held on 05.03.2010 and the subsequent proceedings in favour of the third respondent.
2. I have heard the learned counsel for the petitioner and the learned Standing Counsel for the respondents 1 and 2 and the learned counsel for the third respondent and also perused the records carefully.
3. Though very many grounds have been raised in the Writ Petition, the learned counsel for the petitioner made his submissions mainly based on four grounds. First one is that before bringing the property for sale, no upset price was fixed by the Sale Officer. Second ground is that the area of the property which was notified in the auction sale notice is different from the property which was actually sold. The third ground is that the bid amount was only Rs.26,25,000/-, whereas by means of negotiations, the bid amount was raised to Rs.30,00,000/-, in which, the petitioner was not given opportunity. The fourth ground is that the amount was paid belatedly after two months. Hence, the sale conducted is liable to be set aside.
4. The learned Standing counsel for respondents 1 and 2 stoutly opposed the Writ Petition and according to him, the auction was not conducted for the first time on 05.03.2010, but, previously on fifteen occasions, the sale notice was issued and auction was conducted, but there was no taker. Though in some of the proceedings, some persons participated, since the offer was very low, it was not accepted by the Sale Officer. Finally, in the 16th attempt, the sale was made for Rs.26,25,000/-, which was by means of private negotiations, enhanced to Rs.30,00,000/-. It is, therefore, a reasonable market price for the property. It is further pointed out that the sale was conducted strictly by following the procedures expressed in law. There is no violation of either statutory rules or principles of natural justice. The learned counsel further pointed out that the Writ Petition itself is not maintainable since a lot of disputed questions of facts are involved.
5. The learned counsel for the third respondent submitted that the auction was perfectly conducted in accordance with law, in which, the third respondent emerged as a successful bidder. The sale was confirmed, bid amount was paid and the possession was also handed over to the third respondent. Therefore, according to him, nothing survives for adjudication in this Writ Petition and if at all the petitioner has got any grievance in respect the auction sale, he has alternative remedy to work out before the civil Court.
6. I have considered the above submissions.
7. Since the question of maintainability was raised, at the outset, I wish to decide the same.
8. Obviously, there are disputed questions of fact, such as, whether the upset price was really fixed, whether it was reasonable, whether there is any difference in the area notified for sale, whether in the private negotiations and agreement by the third respondent, the petitioner has right to participate or whether he has constructive knowledge and whether the bid amount was paid within time or not. These are all to be decided only on adducing evidence, which is available only in Civil Court. In this writ Petition, these disputed questions cannot be gone into. Therefore, I sustain the objection raised in respect of the maintainability of the Writ Petition.
9. Regarding the other four grounds raised by the learned counsel for the petitioner, I deem it proper not to answer these questions. If I express any opinion regarding that, it may have influence over the Civil Court in the event of Civil Court deciding the matter. Therefore, I left it open for the petitioner to raise all the grounds, if he approaches the appropriate Court, provided that there is also limitation to entertain the suit.
10. In the result, the Writ Petition is dismissed. However, liberty is given to the petitioner to work out his remedy before the competent Civil Court, provided such claim is not barred by limitation. No costs. Consequently, connected Miscellaneous Petitions are also dismissed.
01.09.2014 Index: Yes/No Internet: Yes sj To
1.The Managing Director, Tamil Nadu Industrial Investment Corporation, Anna Salai, Nandhanam, Chennai - 35.
2.The Branch Manager, Tamil Nadu Industrial Investment Corporation, No.37, Cap Road, Nagercoil, Kanyakumari District.
S.NAGAMUTHU,J.
sj W.P.(MD)No.14878 of 2010 and M.P.(MD) Nos.1 and 2 of 2010 01.09.2014