Branch Manager, State Bank Of India, ... vs Chinigepalli Lathangi And Ors. on 25 November, 2005

[Cites 10, Cited by 9]

Andhra HC (Pre-Telangana)

Branch Manager, State Bank Of India, ... vs Chinigepalli Lathangi And Ors. on 25 November, 2005

Equivalent citations: 2006(1)ALD798, 2006(1)ALT20, III(2007)BC35, [2006]68SCL532(AP)

2. The Order, dated 16th November 2004, passed by the II Additional District Judge (Fast Track Court), Ongole, in I.A. No. 2282 of 2003 in O.S. No. 40 of 2003, filed under Order 39, Rules 1 and 2 C.P.C., is being assailed in this appeal.

3. Defendants 5 and 6 in the suit, who are respondents in the I.A., are the appellants herein.

4. For convenience sake, in this judgment, parties will be referred to according to their array in the suit.

5. Plaintiffs filed the suit for partition of suit schedule property into 16 shares and to put them in separate possession of five such divided shares and also for mesne profits, as against defendants 1 to 4. It appears, plaintiffs also filed the present I.A. No. 2282 of 2003 under Order 39, Rules 1 and 2 C.P.C. seeking temporary injunction against defendants 5 and 6 restraining them from proceeding in any manner with their 5/16th share in the suit schedule property pending disposal of the suit.

6. According to the plaintiffs, the cause of action for filing the present suit was that defendants 1 to 4 did business incurring heavy debts without any benefit to the joint family and since they are also the members of the said Hindu Joint Family they sought for partition and separate possession of their respective shares from out of the joint family property.

7. It is not out of place to mention at this juncture that defendants 2 to 4 are the sons of the first defendant, and the plaintiffs are the children of D-2 to D-4 and grand-children of D-1.

8. The case of the plaintiffs is that they came to know that D-1 to D-4 were contemplating to contract additional debts burdening the plaintiffs without any use or purpose to the Hindu joint family. Plaintiffs alleged that D-1 to D-4 indebted to D-5 and D-6 (State Bank of India, Commercial Branch, Ongole and State Bank of India, Main Branch, Ongole, respectively) and since the debts incurred by D-1 to D-4 are not for the benefit of the Hindu Joint Family, much less to the benefit of the plaintiffs, the said debts incurred by D-1 to D-4 are not binding on the plaintiffs. Hence, plaintiffs filed the suit for partition and separate possession of their share and for other reliefs.

9. The case of the plaintiffs in I.A. No. 2282 of 2003, filed under Order 39, Rules 1 and 2 C.P.C., also appears to be the same as that of the plaint averments. But, according to the plaintiffs, the cause of action for filing I.A. No. 2282 of 2003 was that defendants 5 and 6, who are the Bankers (two different branches of the State Bank of India, Ongole) are proceeding against the properties of the Hindu Joint Family, which were mortgaged to the Bank by D-1 to D-4. Hence, pending the suit for partition, in order to see that the suit schedule property is not disturbed and also in order to get their legal 5/16th share therein, the said I.A. No. 2282 of 2003 was filed.

10. The court below, considering the material placed before it, including the documents, and also the other circumstances passed the impugned order ordering I.A. No. 2282 of 2003 injuncting defendants 5 and 6 (appellants-herein) from selling away the shares of the plaintiffs in the suit schedule property in order to discharge the debts due to defendants 5 and 6.

11. Challenging the said order passed by the court below, defendants 5 and 6 in the suit filed the present appeal.

12. Having heard the learned Counsel appearing for defendants 5 and 6 (appellants herein) as well as the learned Counsel appearing for the plaintiffs (respondents herein), we have perused the impugned order passed by the court below as also the other material placed on record.

13. From the impugned order, it could be seen that the suit and I.A. No. 2282 of 2003 were filed in the year 2003 and the impugned order was passed on 16th November, 2004. It could be further seen from the impugned order that defendants 1 to 4 were set exparte (probably in the suit since they do not appear to have been made party-respondents to I.A. No. 2282 of 2003).

14. In LA. No. 2282 of 2003, the 5th Defendant filed counter-affidavit contesting the same.

15. In this appeal, it is the contention of the learned Counsel appearing for defendants 5 and 6 (appellants herein) that the court below ought not to have allowed I.A. No. 2282 of 2003 filed by the plaintiffs under Order 39, Rules 1 and 2 C.P.C.; that defendants 5 and 6 are the 'secured creditors' as defined under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short "the Act"); that there is an efficacious alternative remedy provided to the plaintiffs under Section 17 of the Act and hence I.A. No. 2282 of 2003 was not maintainable in the court below and, consequently, the impugned order cannot be countenanced; that the suit was a collusive one; in fact, the suit was expressly barred under the Act and, more particularly, no injunction can be granted against the secured creditors as per Section 34 of the Act:

16. Repudiating the aforesaid contentions urged on behalf of defendants 5 and 6 (appellants herein), learned Counsel appearing for the plaintiffs (respondents herein), while supporting the impugned order passed by the court below, contended that if no relief under Order 39, Rules 1 and 2 C.P.C is granted to the plaintiffs, the plaintiffs will be deprived of their right to have 5/16th share in the Hindu Joint Family property which would result in great hardship to the plaintiffs.

17. Having regard to the relative rival contentions of the parties, the points that arise for consideration are:

(1) What is the effect of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short "the Act")?

(2) Whether the plaintiffs/respondents are entitled to have the relief of temporary injunction?

(3) To what relief?

18. Point No. 1: In order to appreciate in a better way the scope of the Act (i.e., The Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002), it is relevant to notice certain provisions thereof.

19. Section 34 of the Act reads thus:

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).

(underlining is ours. Emphasis supplied)

20. Section 13 of the Act, to the extent relevant, reads thus:

13. Enforcement of security interest:- (1) Notwithstanding anything contained in Section 69 or Section 69-A of the Transfer of Property Act, 1882 (4 of 1882), any security interest created in favour of any secured creditor may be enforced, without the intervention of the court or tribunal, by such creditor in accordance with the provisions of this Act.

(2) Where any borrower, who is under a liability to a secured creditor under a security agreement, makes any default in repayment of secured debt or any instalment thereof, and his account in respect of such debt is classified by the secured creditor as non-performing asset, then, the secured creditor may require the borrower by notice in writing to discharge in full his liabilities to the secured creditor within sixty days from the date of notice failing which the secured creditor shall be entitled to exercise all or any of the rights under Sub-section (4).

(3) The notice referred to in Sub-section (2) shall give details of the amount payable by the borrower and the secured assets intended to be enforced by the secured creditor in the event of non-payment of secured debts by the borrower.

(3-A) If, on receipt of the notice under Sub-section (2), the borrower makes any representation or raises any objection, the secured creditor shall consider such representation or objection and if the secured creditor comes to the conclusion that such representation or objection is not acceptable or tenable, he shall communicate within one week of receipt of such representation or objection the reasons for non-acceptance of the representation or objection to the borrower.

Provided that the reasons so communicated or the likely action of the secured creditor at the stage of communication of reasons shall not confer any right upon the borrower to prefer an application to the Debts Recovery Tribunal under Section 17 or the Court of District Judge under Section 17-A. (4) In case the borrower fails to discharge his liability in full within the period specified in Sub-section (2). the secured creditor may take recourse to one or more of the following measures to recover his secured debt, namely:-

(a) take possession of the secured assets of the borrower including the right to transfer by way of lease, assignment or sale for realizing the secured asset;

(b) take over the management of the business of the borrower including the right to transfer by way of lease, assignment or sale for realizing the secured asset:

Provided that the right to transfer by way of lease, assignment or sale shall be exercised only where the substantial part of the business of the borrower is held as security.

Provided further that where the management of whole, of the business or part of the business is severable, the secured creditor shall take over the management of such business of the borrower which is relatable to the security or the debt.

(c) appoint any person (hereafter referred to as the manager), to manage the secured assets the possession of which has been taken over by the secured creditor;

(d) require at any time by notice in writing, any person who has acquired any of the secured assets from the borrower and from whom any money is due or may become due to the borrower, to pay the secured creditor, so much of the money as is sufficient to pay the secured debt.

(Underlining is ours. Emphasis supplied).

21. Section 17 of the Act reads thus:

17. Right to appeal:- (1) Any person (including borrower), aggrieved by any of the measures referred to in Sub-section (4) of Section 13 taken by the secured creditor or his authorised officer under this Chapter, may make an application along with such fee, as may be prescribed to the Debts Recovery Tribunal having jurisdiction in the matter within forty-five days from the date on which such measures had been taken:

Provided that different fee may be prescribed for making the application by the borrower and the person other than the borrower.

Explanation:- For the removal of doubts it is hereby declared that the communication of the reasons to the borrower by the secured creditor for not having accepted his representation or objection or the likely action of the secured creditor at the stage of communication of reasons to the borrower shall not entitle the person (including borrower) to make an application to the Debts Recovery Tribunal under Sub-section (1) of Section 17.

(2) The Debts Recovery Tribunal shall consider whether any of the measures referred to in Sub-section (4) of Section 13 taken by the secured creditor for enforcement of security are in accordance with the provisions of this Act and the rules made thereunder.

(3) If, the Debts Recovery Tribunal, after examining the facts and circumstances of the case and evidence produced by the parties, comes to the conclusion that any of the measures referred to in Sub-section (4) of Section 13, taken by the secured creditor are not in accordance with the provisions of this Act and the rules made thereunder, and require restoration of the management of the secured assets to the borrower or restoration of possession of the secured assets to the borrower, it may by order, declare the recourse to any one or more measures referred to in Sub-section (4) of Section 13 taken by the secured assets as invalid and restore the possession of the secured assets to the borrower, as the case may be, and pass such order as it may consider appropriate and necessary in relation to any of the recourses taken by the secured creditor under Sub-section (4) of Section 13.

(4) If the Debts Recovery Tribunal declares the recourse taken by a secured creditor under Sub-section (4) of Section 13. is in accordance with the provisions of this Act and the rules made thereunder, then, notwithstanding anything contained in any other law for the time being in force, the secured creditor shall be entitled to take recourse to one or more of the measures specified under Sub-section (4) of Section 13 to recover his secured debt.

(5) ...

(6) ...

(7) ...

(Underlining is ours. Emphasis supplied)

22. From a careful reading of the above provisions of the Act, the Scheme of the Act, broadly, appears to be that the Financial Institutions shall not be unnecessarily subjected to lengthy and arduous procedure for the recovery of monies lent by them to the borrowers. In fact, there are several other statutes, covering different financial Institutions (e.g., State Financial Corporation Act) for expeditious recovery of debts. The reasons, perhaps, are mainly two-fold-firstly, the borrowers may be trying to delay or evade repayment of the amounts borrowed from the Financial Institutions/Banks. Monies of the Financial Institutions/Banks is the money of the public. Therefore, while dealing with public money, particularly for the purpose of recovering the monies lent by such financial institutions/banks, stringent measures have to be permitted and for that purpose statutory sanctions have been accorded to such institutions. Precisely that is the reason why the procedural law under the Civil Procedure Code, i.e., filing of a suit in a civil court was expressly barred under the Act. The impact and seriousness of such step is more visible from the language employed in Section 34 of the Act while debarring the ordinary civil courts from granting any orders of injunction. Obviously, this is intended only to safeguard the public monies, despite which, it is common knowledge that the Banking Institutions are unable to effect recoveries of the monies lent to borrowers at the expected rate and pace.

23. Secondly, despite various other laws being enacted and enforced, an imperative necessity had been felt by the Legislature, in its wisdom, to enact another statute in the present fashion, viz., The Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002.

24. In this regard, our view is fortified by the judgment of a three-judge Bench of the apex Court in Mardia Chemicals Ltd. etc. etc. v. Union of India and Ors. 2004 (4) ALT 4 : 2004 (3) ALD 50 (SC).

25. In that judgment, their Lordships of the apex Court, while upholding the Constitutional validity of the Act, made certain pertinent observations, and we would do no better than to reproduce the same, which run thus: (paragraphs 34, 36, 80 and 81):

34. Some facts which need be taken note of are that the banks and the financial institutions have heavily financed the petitioners and other industries. It is also a fact that a large sum of amount remains unrecovered. Normal process of recovery of debts through Court is lengthy and time taken is not suited for recovery of such dues. For financial assistance rendered to the industries by the financial institutions, financial liquidity is essential failing which there is a blockade of large sums of amounts creating circumstances which retard the economic progress followed by a large number of other consequential ill effects. Considering all these circumstances, the Recovery of Debts Due to Banks and Financial Institutions Act was enacted in 1993 but as the figures show it also did not bring the desired results. Though it is submitted on behalf of the petitioners that it so happened due to inaction on the part of the Government in creating Debt Recovery Tribunals and appointing Presiding Officers for a long time. Even after leaving that margin, it is to be noted that things in the concerned spheres are desired to move faster. In the present day global economy it may be difficult to stick to old and conventional methods of financing and recovery of dues. Hence, in our view, it cannot be said that step taken towards Securitization of the debts and to evolve means for faster recovery of the NPAs was not called for or that it was superimposition of undesired law since one legislation was already operating in the field namely the Recovery of Debts due to Banks and Financial Institutions Act. It is also to be noted that the idea has not erupted abruptly to resort to such legislation. It appears that a thought was given to the problems and Narasimham Committee was constituted which recommended for such a legislation keeping in view the changing times and economic situation where after yet another expert committee was constituted then alone the impugned law was enacted. Liquidity of finances and flow of money is essential for any healthy and growth oriented economy. But certain, what must be kept in mind is that the law should not be in derogation of the rights which are guaranteed to the people under the Constitution. The procedure should also be fair, reasonable and valid, though it may vary looking to the different situations needed to be tackled and object sought to be achieved.

36. In its Second Report, the Narasimham Committee observed that the NPAs in 1992 were uncomfortably high for most of the public sector banks. In Chapter VIII of the Second Report the Narasimham Committee deals about legal and legislative framework and observed:

8.1. A legal framework that clearly defines the rights and liabilities of parties to contracts and provides for speedy resolution of disputes is a sine qua non for efficient trade and commerce, especially for financial intermediation. In our system, the evolution of the legal frame work has not kept pace with changing commercial practice and with the financial sector reforms. As a result, the economy has not been able to reap the full benefits of the reforms process. As an illustration, we could look at the scheme of mortgage in the Transfer of Property Act, which is critical to the work of financial intermediaries....

One of the measures recommended in the circumstances was to vest the financial institutions through special statutes, the power of sale of the asset without intervention of the Court and for reconstruction of the assets. It is thus to be seen that the question of non-recoverable or delayed recovery of debts advanced by the banks or financial institutions has been attracting the attention and the matter was considered in depth by the committees specially constituted consisting of the experts in the field. In the prevalent situation where the amount of dues are huge and hope of early recovery is less, it cannot be said that a more effective legislation for the purpose was uncalled for or that it could not be resorted to. It is again to be noted that after the report of the Narasimham Committee, yet another committee was constituted headed by Mr. Andhyarujina for bringing out the needed steps within the legal framework. We are therefore, unable to find much substance in the submission made on behalf of the petitioners that while the Recovery of debts due to Banks and Financial Institutions Act was in operation it was uncalled for to have yet another legislation for the recovery of the mounting dues. Considering the totality of circumstances the financial climate world over, if it was thought as a matter of policy, to have yet speedier legal method to recover the dues, such a policy decision cannot be faulted with nor it is a matter to be gone into by the Courts to test the legitimacy of such a measure relating to financial policy.

80...

2. As already discussed earlier, on measures having been taken under Sub-section (4) of Section 13 and before the date of sale/auction of the property it would be open for the borrower to file an appeal (petition) under Section 17 of the Act before the Debt Recovery Tribunal.

3. That the Tribunal in exercise of its ancillary powers shall have jurisdiction to pass any stay/interim order subject to the condition at it may deem fit and proper to impose.

4. In view of the discussion already held on this behalf, we find that the requirement of deposit of 75% of amount claimed before entertaining an appeal (petition) under Section 17 of the Act is an oppressive, onerous and arbitrary condition against all the canons of reasonableness. Such a condition is invalid and it is liable to be struck down.

5. As discussed earlier in this judgment, we find that it will be open to maintain a civil suit in Civil Court, within the narrow scope and on the limited grounds on which they are permissible, in the matters relating to an English mortgage enforceable without intervention of the Court.

81. In view of the discussion held in the judgment and the findings and directions contained in the preceding paragraphs, we hold that the borrowers would get a reasonably fair deal and opportunity to get the matter adjudicated upon before the Debt Recovery Tribunal. The effect of some of the provisions may be a bit harsh for some of the borrowers but on that ground the impugned provisions of the Act cannot be said to be unconstitutional in view of the fact that the object of the Act is to achieve speedier recovery of the dues declared as NPAs and better availability of capital liquidity and resources to help in growth of economy of the country and welfare of the people in general which would subserve the public interest.

26. From a conjoint reading of the provisions of the Act, extracted above, and the observations of the apex Court in Mardia Chemicals' case (supra) noticed above, it is obvious that having taken away the jurisdiction of the civil court, the Legislature did not fail in their duty to accord necessary safeguards to the aggrieved parties/persons, such as the plaintiffs in this case, by way of approaching the Debt Recovery Tribunal, in which event, the Tribunal is couched with the duty under Sub-section (3) of Section 17 of the Act whereby the Tribunal is authorized to pass any interim orders as deemed fit and proper.

27. Therefore, when a notification had been issued by the Bank (defendants 5 and 6), exercising their jurisdiction under Section 13(4) of the Act, the only course open to the aggrieved persons, including the borrowers, the guarantors or any person/persons aggrieved thereof, is to proceed under Section 17 of the Act.

28. Furthermore, notwithstanding the nature of the suit, the Act expressly prohibited the civil court from granting any order of injunction against the secured creditors when such secured creditors exercised the jurisdiction under the Act.

29. In our considered view, the impugned order passed by the court below is contrary to the express statutory prohibition contained under Section 34 of the Act. We are of the further view that the court below is totally oblivious of the existence and the implications of the provisions of Section 34 of the Act.

30. In view of the observations made by the apex Court in Mardia Chemicals' case (1 supra), the jurisdiction of the State Bank of India (defendants 5 and 6) to invoke the provisions of Section 13(4) of the Act and the interests of the aggrieved persons also are well-safeguarded.

31. An incidental question may crop up to the effect as to whether the prohibition incorporated in Section 34 of the Act regarding granting of injunctions would be only in relation to matters that arise under the Act for the purpose of recovery of the money by the Banks/Financial Institutions?

32. In this context, it is again necessary to look into the language employed by the Legislature in Section 34 of the Act. A second reading, though not the first reading of Section 34 of the Act, makes it abundantly clear that the civil court has no jurisdiction to entertain not only a suit but also a 'proceeding'in respect of any matter, which the Debt Recovery Tribunal or the Appellate Tribunal is empowered to deal with.

33. In the instant case, the relevant and noteworthy factor is that the order of interim injunction, under Order 39, Rules 1 and 2 C.P.C, was passed by the court below, injuncting defendants 5 and 6/appellants herein to proceed with the notification issued under Section 13(4) of the Act, which means that the State Bank of India (defendants 5 and 6/appellants-herein) had already invoked its statutory jurisdiction provided under Section 13(4) of the Act and, as a result of which, the subject-matter of dispute with regard to the schedule property was brought into the fold of the Act and when such proceedings under the Act were initiated by the Bank under Section 13(4) of the Act, which is a special enactment, the same cannot be injuncted/interdicted by the civil court, which is explicit from the unambiguous language employed in Section 34 of the Act.

34. In other words, notwithstanding the nature of the suit and the reliefs sought for in the suit, if proceedings are initiated by the secured creditors (Banks/Financial Institutions) under the Act, invoking the provisions of Section 13(4) thereof, the same shall not be subjected to an order of injunction by the civil court.

35. To put it in a different way, the suit, if not covered by the provisions of the Act, i.e., for a different relief, other than for recovery of money, would and should have a logical conclusion in the civil court.

36. Point No. 1 is answered accordingly.

37. Point No. 2: It is on record that the State Bank of India in this case (defendants 5 and 6/appellants herein) issued notice under Section 13(2) of the Act on 23-10-2003. The exact date of filing of the suit is not made available to us nor the Counsel is able to furnish us the particulars thereof. But, however, from the copy of the plaint supplied to the Court as a material paper, it could be seen that the suit was filed in the month of December 2003.

38. From the notification issued by the State Bank of India, published in "Andhra Jyothi" daily vernacular (Telugu) dated 7-8-2004, Prakasam District Edition, it is clear that consequent upon the failure of the borrower-Sri Vasavi Agencies, represented by its Proprietrix, Chinegepalli Padmini, Ongole and the Guarantors-(1) Chinegepalli Satyanarayana, S/o Seshaiah, (2) Chinegepalli Seshagiri Rao, S/o Satyanarayana, (3) Chinegepalli Umamaheswara Rao, S/o Satyanarayana, and (4) Chinegepalli Chandrasekhar Rao, S/o Satyanarayana, to pay the amount of Rs. 48, 35,847-55 ps with interest from 5-3-2004 and costs in spite of issuance of notice, under Section 13(2) of the Act, dated 23-10-2003, possession of the property shown in the schedule of the said paper notification was taken-over by the Bank on 6-8-2004 itself, in exercise of the powers conferred upon it by Section 13(4) of the Act.

39. From the aforesaid paper notification, it could be further seen that consequent upon such taking-over of possession of the property by the Bank, the principal borrower and the guarantors, who are no other than defendants 1 to 4 in the suit, were informed by the Bank not to deal with the property in any manner whatsoever.

40. Further, a perusal of the impugned order would reveal that it was passed on 16th November, 2004. The inevitable conclusion is that the impugned order of injunction was passed by the court below much subsequent to the initiation of the proceedings under the Act by the Bank/Defendants 5 and 6, both under Section 13(2) and under Section 13(4) of the Act, whereby notice was issued to defendants 1 to 4 and consequently possession of the schedule property was also taken over by the Bank in accordance with the provisions of the Act.

41. In other words, as on the date of passing of the impugned order by the court below, possession of the property in question had gone into the fold of the Bank/defendants 5 and 6, by statutory and necessary implication.

42. Therefore, it is clear that as on the date of passing of the impugned order, proceedings under Section 13(4) of the Act have already been initiated by the Bank and possession of the property was also taken over by the Bank.

43. However, it is not clear from the material placed before us as to whether this fact was brought to the notice of the court below or not. But, the fact remains that the Bank was in constructive possession of the property as on the date of passing of the impugned order, in which event, the latter part of Section 34 of the Act regarding the prohibition to grant injunctions would become operable.

44. Even otherwise, it could be seen from the paper notification published on 7-8-2004, possession of the schedule property was taken-over by the Bank on 6-8-2004 and that Sri Vasavi Agencies, rep. by its Proprietrix Chinegapalli Padmini, Ongole is the borrower and defendants 1 to 4 are the guarantors of the Bank in respect of a loan transaction.

45. It is significant to note that the Proprietrix of Sri Vasavi Agencies, Ongole, is no other than the wife of the 4th defendant in the suit, which fact was again not disclosed by the plaintiffs either in the plaint or in the affidavit filed by them in support of the application filed by them seeking temporary injunction. Moreover, the fact that defendants 1 to 4, in the capacity of guarantors, created mortgage over their property in favour of the Bank/defendants 5 and 6 was not disclosed anywhere in the plaint averments. The entire assertion of the plaintiffs is that defendants 1 to 4 have been doing business, entered into contracts and borrowing monies which are not beneficial to the Hindu Joint Family more particularly to the plaintiffs which prompted the plaintiffs to file the present suit for partition.

46. We are of the prima facie view that the plaintiffs have deliberately suppressed material facts while filing the suit as well as the interlocutory application seeking temporary injunction. We are of the further prima facie view that eventhough the material facts were brought to the notice of the court below by the 5th defendant in its counter-affidavit filed in I.A. No. 2282 of 2003, the court below ignored to take them into consideration and passed the impugned order of temporary injunction. Therefore, the finding recorded by the court below that the plaintiffs have made out a prima faciecase and balance of conveniences lies in their favour is baseless and incorrect.

47. We are of the further view that suppression of material fact-which is vital-itself is a ground to reject any relief to the plaintiffs.

48. Our view is further concretized by the plaint averments wherein it was stated that defendants 1 to 4, who are no other than the grand-father and parents of plaintiffs, were doing business and incurring debts which are not beneficial to the Hindu Joint Family. When that is the specific case of the plaintiffs in the plaint, the revelation of the fact by the Bank in the paper notification, to the effect that the property was mortgaged by defendants 1 to 4 in favour of the bank as guarantors, falsifies the very basic foundation of the suit of the plaintiffs. However, we are conscious of the fact that we should not enter too much into the arena of factual aspects or the merits of the suit. Hence, for the aforementioned reasons, point No. 2 is answered in favour of defendants 5 and 6/ appellants herein and against the respondents/plaintiffs.

49. Point No. 3:- It cannot be forgotten that the instant suit filed by the plaintiffs is for partition, specifically alleging that defendants 1 to 4 have been acting contrary to the interests of the Hindu Joint Family. As a general principle, in a suit for partition, in all the proceedings, it is imperative to add all the parties to the suit as parties to all the proceedings in the suit. But, surprisingly, having made averments in the plaint against defendants 1 to 4 for seeking partition and making the alleged commissions and omissions of defendants 1 to 4 as the basis for filing the suit for partition, the plaintiffs / respondents did not choose to add them (defendants 1 to 4 in the suit) as party-respondents to I.A. No. 2282 of 2003, for the best reasons known to them. Curiously, the court below recorded in the impugned order that defendants 1 to 4 were set ex parte. Again no particulars are forthcoming as to at what stage defendants 1 to 4 were set ex parte. What is more, either the cause-title of I.A. No. 2282 of 2003 filed by the plaintiffs or the cause title of the impugned order passed by the court below does not contain the names of defendants 1 to 4 as party-respondents.

50. Even assuming that defendants 1 to 4 were set ex parte initially, still, we are of the view that defendants 1 to 4 ought to have figured as respondents in I.A. No. 2282 of 2003, for the simple reason that apparently the said I.A. and the suit were filed almost simultaneously in the year 2003. Therefore, the conduct of the plaintiffs/respondents herein in not arraying defendants 1 to 4 in the suit as party-respondents to I.A. No. 2282 of 2003, more so, when it is the specific averment/allegation of the plaintiffs that the property in question is the property of the Hindu Joint Family is highly reprehensible. Added to that, the Bank/appellants herein had brought to the notice of the Court below by way of a counter-affidavit that defendants 1 to 4, at the time of mortgaging the property in favour of the bank, as guarantors of the borrower, furnished a declaration to the bank that the property in question is their self-acquired property. Therefore, the presence of defendants 1 to 4 in I.A. No. 2282 of 2003 is very-much essential and the non-joinder of such necessary parties as party-respondents in the said I.A. also led to our recording findings on points 1 and 2 supra.

51. We may observe that the Court while considering an application under Order 39 C.P.C. is expected to find out, prima facie, whether the given case falls within the four corners of Order 39 C.P.C. or not.

52. It is not even the case of the plaintiffs, either in the plaint or in the affidavit filed in support of the temporary injunction application I.A. No. 2282 of 2003, that they have no knowledge about the transaction between D-1 to D-4 and D-5 until the issuance of paper notification on 7-8-2004.

53. The Bank specifically took the stand in the counter-affidavit filed in I.A. No. 2282 of 2003 that the property in question is the self-acquired property of D-1 to D-4, and that D-1 to D-4 have furnished a declaration to that effect to the Bank at the time of the loan transaction. No attempt has been made by the plaintiffs to refute the said stand taken by way of filing any rejoinder to the counter-affidavit of D-5.

54. The plaintiffs have not even filed any third-party affidavit or any scrap of paper to prima facie indicate that the property in question is the joint family property of plaintiffs' family in which they are also having a share. Not even a verified petition is filed by the plaintiffs.

55. We have to remind ourselves the basic principle that in a suit for partition, when the plaintiffs allege and aver in the plaint that the property is the joint family property, the initial burden lies on the plaintiffs to establish that the property in question is the joint family property. Of course such burden may, in a given case, shift on to the defendants to establish the contra, depending upon the facts and circumstances. Also for the purpose of obtaining temporary injunction or any other incidental/interim order, primarily the plaintiffs have to-(1) make out a prima facie case that the property in question is the joint family property; (b) that they are also having a share in the property in question; (c) that they would suffer irreparable loss or injury in case injunction is not granted and that the defendants are likely to alienate or cause damage/waste to the property.

56. In the instant case, we are of the view that the court below ought to have examined the prayer made in I.A. No. 2282 of 2003 on the touch stone of Order 39, Rule 1 C.P.C. as also the provisions of Section 34 of the Act.

57. We are conscious of the fact that the scope of this appeal is very limited, viz., to examine whether the court below is justified in granting temporary injunction in favour of the plaintiffs or not. We have examined the impugned order of the court below to that limited extent.

58. We make it clear that we have not expressed any view on the merits of the suit for partition. What we have stated in this judgment is our prima facie view of the matter and our observations, if any, shall not be construed as binding and conclusive findings. The court below is free to decide the suit in accordance with law, uninfluenced by this judgment, on its own merits.

59. In the result, and for the aforementioned reasons, this appeal is allowed, the impugned order is set aside, and I.A. No. 2282 of 2003 in O.S. No. 40 of 2003 on the file of II Additional District Judge (Fast Track Court), Ongole, is dismissed. Consequently, the injunction granted by the court below is vacated. There shall be no order as to costs.

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Andhra HC (Pre-Telangana)