Bangalore District Court
Hmg Ambassador Property vs U.Madhav Kini on 6 December, 2016
IN THE COURT OF THE XXIV ADDL.CITY CIVIL &
SESSIONS JUDGE BANGALORE CITY (CCH-6)
This the 6th day of December, 2016
Present: Smt. ROOPA NAIK,
B.Sc.,MA,LLM,PGD (Human Rights)
th
24 Addl. City Civil & Sessions Judge,
Bangalore City.
O.S.No.487/2007
PLAINTIFFS: 1. HMG Ambassador Property
Management Private Limited,
A company registered under
Provisions of Indian Companies
Act with its registered office at
Mezanine Floor, # 137,
Residency Road, Bengaluru- 25,
(Represented by its Director
& Authorised Signatory
Mr. V.N.Hegde.
2. Tower Land Developer
Private Limited, No.94,
Maker Chambers VI,
Nariman Point,
Mumbai- 400021.
3. Panna Financial & Real Estate
Developers Private Limited,
No.94, Maker Chambers VI,
Nariman Point, Mumbai-400021
(Plaintiffs 2 & 3 represented by its
Director and authorised signatory
& GPA Holder V.N.Hegde.
(By Sri.Anant Mandgi, Advocate)
Vs.
2 O.S.487/2007
DEFENDANTS: 1. U.Madhav Kini, Major,
F/o U.Jeevananda Kini,
No. D, 202, 2nd Floor,
Brigade Regency, 8th Main,
Malleshwaram, Bengaluru.
2. Roopa Kini, Major,
W/o Late U.Jeevananda Kini,
No. D, 202, 2nd Floor,
Brigade Regency, 8th Main,
Malleshwaram, Bengaluru.
3. Ramdas pai, Major,
F/o late Rajesh Pai,
746, 2nd Main, 2nd Stage,
Rajajinagar, Bengaluru- 10.
4. Poornima Pai, Major,
W/o late Rajesh Pai,
746, 2nd Main, 2nd Stage,
Rajajinagar, Bengaluru- 10.
5. Indian Overseas Bank
(represented by its Manager)
No.162, 10th Main Road,
15th cross, Opp: MES College,
Malleshwaram, Bengaluru- 3.
6. Lakshmi Vilas Bank Limited
(represented by its Manager),
B.V.K.Iyengar Road Branch,
Chickpet, Bengaluru.
7. Vijaya Bank, (represented by its
Manager) Corporate Banking
branch, Trinity Circle, M.G.Road,
Bengaluru.
8. M/s. GMR Ulundurpet
Expressways Pvt. Ltd.
(Rep. by its Director)
3 O.S.487/2007
9. GMR Jadcherla Expressways
Private Limited,
(Rep. by its Director)
10. GMR Pochanpalli Expressways
Private Limited,
(Rep. by its Director)
Defendant Nos.8 to 10 are
R/at No.701 to 704, 7th Floor,
HMG Ambassador, 137,
Residency Road, Bengaluru.
11. Appshop Solutions (India)
Private Limited,
(Rep. by its Director)
Now known as USi Internet
Working Solutions Pvt. Ltd.,
No.801 to 804, 8th floor,
HMG Ambassador, 137,
Residency road, Bengaluru.
Vide Court order dated
9.12.2010, defendant No.11 is
deleted from the cause title.
12. Sri.Kishore Budharani
Father name not know to plaintiff,
No.137, Residency Road,
Bengaluru- 560 052.
Also at Sri.Kishore Budharani,
No.94, Maker Chambers,
IX, Nariman Point,
Mumbai- 400 041.
Defendant No.12 is impleaded
as per the order of Hon'ble
High Court dated 22.9.2010.
By Sri.Vinod Gowda, Adv. for D.1 & 2
Sri. S.S.Vasan, Adv. for D.5
4 O.S.487/2007
Sri. C.K.Annice, Adv. for D.7
Sri.N.S.Sathyanarayana Gupta, Adv. for D.6
Sri. B.N.Prakash, Adv. for D.11.
Date of institution of the suit: 17.01.2007
Nature of the suit: Declaration & Injunction
Date of commencement of 30.08.2011
recording of evidence:
Date on which Judgment was 06.12.2016
pronounced:
Duration Days Months Years
29 10 09
JUDGMENT
Present suit is filed by plaintiffs against defendants for declaration that plaintiff No.1 is owner of suit schedule properties and for declaration that registered sale deeds dated 29.12.2004 in respect of suit schedule 'A' 'B' and 'C' properties are null and void and not binding on plaintiffs and for cancellation of the same and also for permanent injunction restraining defendants from interfering with plaintiffs' peaceful possession of suit schedule properties and from creating any rights in favour of third parties. 5 O.S.487/2007
2. a) It is contended by plaintiffs that they are companies registered under Provisions of Indian Companies Act and have common interest in subject matter of dispute. Subject matter of dispute in present suit are two fabricated, bogus, void, false and collusive sale deeds dated 29.12.2004 executed by and imposter calling himself as Kishor Bhudrani in collusion with and in favour of two tricksters and frauds namely U.Jeevananda Kini and Rajesh Pai. Said sale deeds are in respect of four commercial units bearing No.701 to 704 at present bearing khatha No.137/18 to 137/21 totally measuring 10100 square feet located on 7th floor and four commercial units bearing No.801 to 804 at present bearing khatha Nos.137/22 to 137/25 totally measuring 9500 square feet located on 8th floor of the building called as HMG Ambassador Property Management Private Limited situated at Residency Road, Bangalore, more fully described in plaint schedule.
b) It is contended that plaintiff No.1 is owner of suit schedule properties and plaintiff Nos. 2 and 3 are 6 O.S.487/2007 part of same group of companies. Plaintiff Nos. 2 and 3 are share holders and promoters of plaintiff No.1 company and have been allotted right to enjoy suit schedule properties on the basis of their share holdings in plaintiff No.1 company. During 1986 a partnership firm by name "HASCO Associates" was formed under partnership deed dated 10.9.1986 and HASCO acquired property bearing Municipal No.137 situated at Residency Road, Bangalore. At present building is known as HMG Ambassador. It belongs to plaintiff No.1. The partnership firm HASCO Associates wanted to develop suit schedule 'A' property. It entered into development agreement with two companies M/s. HMG Industries Limited and M/s. HMG Engineering Private Limited. Under the scheme of development, a prospective purchaser of an office unit in said commercial complex would be required to enter into two separate agreements, one with HASCO for the purpose of proportionate undivided share of land and another with HMG under which HMG would build respective portion of the building.
7 O.S.487/2007
c) It is further contended that accordingly plaintiff No.2 and 3 entered into agreement to sell with HASCO Associates and also agreement to build four units on 7th and 8th floors. Various prospective purchasers of the building along with plaintiff Nos. 2 and 3 became partners of HASCO Associates. Partners of HASCO Associates proposed to convert partnership firm into a company under provisions of Companies Act. A scheme was muted wherein partners proposed to become shareholders of the company. Accordingly plaintiff No.1 company "HMG Ambassador Property Management Private Limited" came into existence vide certificate of incorporation dated 31.5.2004. Thus erstwhile partners of HASCO Associates became shareholders of plaintiff No.1 Company after its incorporation. Thus plaintiff Nos. 2 and 3 are shareholders and original promoters of plaintiff No.1 Company. Plaintiff Nos.2 and 3 have leased out schedule 'A' and 'B' properties to various tenants. Plaintiffs have been exercising their right of ownership over suit schedule property.
8 O.S.487/2007
d) It is further contended that during early part of 2004, plaintiff Nos. 2 and 3 intended to sell schedule 'A' and 'B' properties by selling their shareholdings in plaintiff No.1 company. One of the brokers introduced one Mr.Jeevananda Kini- son of defendant No.1 to plaintiffs as proposed purchaser of properties in question. Plaintiff Nos. 2 and 3 held several negotiations with him regarding various aspects of matter including sale consideration. Said Jeevananda Kini would always be accompanied by Rajesh Pai son of defendant No.3 and Prassanna Pai- Chartered Accountant. Plaintiff Nos. 2 and 3 had handed over copies of various documents of title to those persons as they informed them that they wanted to seek legal opinion regarding title of schedule 'A' and 'B' properties. On 26.11.2004 Mr. Jeevananda Kini issued letter by representing himself as proprietor of R.J.Estates and properties and informed plaintiff Nos. 2 and 3 that he was intending to purchase both schedule 'A' and 'B' properties along with another property situated in Diamond District, Airport Road, Bengaluru. 9 O.S.487/2007 In his letter dated 26.11.2004 he had clearly informed plaintiffs that said letter was only an expression of his intention and that no party shall have any legal obligation or owe any legal duty to each other until such time as definite agreements would be executed by authorised representatives of the parties.
e) It is further contended that nothing materialized and there was no further interaction between the parties for nearly nine months. In the month of August 2005, son of defendant No.1 started fresh negotiations for purchasing aforesaid properties and informed plaintiff Nos. 2 and 3 that he was about to conclude his tie up with different banks for funding. To show his bonafides, he offered to pay refundable deposit of Rs.50,00,000/- each for schedule 'A' and 'B' properties as token in order to facilitate further negotiations. He handed over two drafts bearing Nos. 080852 and 080855 dated 7.8.2005 for Rs.50,00,000/- each drawn on Canara Bank, Mahalakshmi Layout, Bengaluru Branch. Plaintiff Nos. 2 and 3 had informed 10 O.S.487/2007 him that if negotiations did not materialize into concluded contract within two months, it would come to an end. As such the negotiations did not materialize into concluded contract within two months and plaintiff Nos. 2 and 3 returned the amounts vide draft No.811922 and 811923 dated 7.12.2005 for Rs.50,00,000/- each drawn in favour of R.J.Estates and properties along with letter informing him about end of negotiations in respect of schedule 'A' and 'B' properties. Said drafts were encashed by him through his bankers on 8.12.2005. On 25.12.2005 by way of abundant caution, plaintiff Nos. 2 and 3 issued public notice in local dailies stating that they were absolute owners of schedule 'A' and 'B' properties and that they have not sold or authorised any person to deal with said properties.
f) It is further contended that plaintiffs continued to enjoy the right and interest as the absolute owners of suit schedule properties. On 11.12.2006 plaintiff Nos. 2 and 3 were informed by their lessees that 11 O.S.487/2007 officials of defendant No.5 Indian Overseas Bank, Malleswaram Branch visited and informed them that the properties occupied by them were mortgaged to them by one Jeevananda Kini and Rajesh Pai. On 12.12.2006 representatives of plaintiff Nos. 2 and 3 visited Bengaluru and through paper reports learnt that both Mr. Kini and Pai had committed suicide on 7.12.2006. Plaintiff Nos. 2 and 3 initiated search of records at the Office of Sub-Registrar, Shivajinagar and were shocked to learn about two bogus sale deeds dated 29.12.2004, which were registered showing Jeevananda Kini as purchaser of schedule 'A' property belonging to plaintiffs and one Mr.Rajesh Pai as purchaser of schedule 'B' property belonging to plaintiffs. In the sale deeds, plaintiff No.1 was shown as vendor and plaintiff Nos.2 and 3 as confirming parties and one imposter claiming himself to be Kishor Bhadrani had executed the two sale deeds as authorised signatory of plaintiff No.1 company and as Director of plaintiff Nos. 2 and 3.
12 O.S.487/2007
g) It is further contended that there is no person by name Kishor Bhadrani, who is Director of plaintiff Nos. 2 and 3 or an authorised representative of plaintiff No.1 Company. One Mr. Ganesh and one Mr.Shashidhar had attested as witnesses and sale deeds were stated to have been drafted by one Advocate by name A.Srinivasa. On verification, it was found that no such persons existed in said addresses. In the bogus sale deeds, it was mentioned that plaintiff No.1 Company had allegedly conveyed extraordinary general body meeting on 9.11.2004 and the board had passed resolution permitting sale of property by plaintiff Nos. 2 and 3 and had authorised one Kishor Bhadrani to sign on their behalf. No such meeting had ever been convened and said resolution is fabricated document by concocting company's letterhead. The alleged sale deeds were registered as a result of fraud and collusion between the persons, who have attested their signatures to said documents. No right, title or interest has been conveyed in favour of alleged purchasers as there is no concluded contract between 13 O.S.487/2007 the parties. Immediately on 14.12.2006 plaintiff Nos. 2 and 3 issued paper notification in all local dailies informing public at large that they are absolute owners and have not sold the properties to anybody. On 19.12.2006 a public notice was also published through their Advocate informing public at large regarding fraud played by Rajesh Pai and Jeevananda Kini.
h) It is further contended that the officials of defendant No.4 called plaintiff Nos. 2 and 3 on 19.12.2006 and informed them that fictitious accounts were opened in name of plaintiff No.3 with State Bank of Mysore, Cunningham Road branch and that in name of plaintiff No.2 with Oriental Bank of Commerce, Thippasandra Branch and proceeds of alleged sale deeds had been encashed by tricksters. On 21.12.2006 plaintiff Nos. 2 and 3 have lodged FIR with Ashok Nagar Police Station and on 23.12.2006 they sent letter to defendant banks and Sub-Registrar, Shivajinagar and Ward Officer, Shivajinagar informing about fraud played by Jeevananda Kini and Rajesh Pai. 14 O.S.487/2007 Plaintiffs have learnt that defendant banks have advanced loans to Jeevananda Kini and Rajesh Pai on the basis of forged sale deeds. It is obvious and clear that defendant banks have not been diligent enough in investigating title of the properties in question before advancing public money. Collusion between officers of defendant banks and trickster is very obvious.
i) It is further contended that the defendant banks seem to have advanced loans without verification of original sale deeds. Plaintiffs are not bound by alleged sale deeds dated 29.12.2004. Therefore, they are constrained to file present suit. It is prayed that suit may be decreed as prayed.
3. The plaint schedule reads as follows:
SCHEDULE-A Commercial office units bearing No.701, 702, 703 and 704 situated on the seventh floor of HMG Ambassador, 137, Residency Road, Bengaluru- 560 025, the said building having a super built-up area of about 10,100 square feet along with four covered car parking space in the basement 15 O.S.487/2007 and four open car parking in the ground floor along with an extent of 2575 square feet of undivided share in the land and bounded by:
East by: Property bearing No.136:
West by: Property bearing No.138;
North by: Residency Road;
South by: Property bearing No.2,
Richmond Road.
Along with 2375 square feet undivided share in suit schedule 'C' property.
SCHEDULE-B All that piece and parcel of commercial office units bearing No.801, 802, 803 and 804 situated on the eight floor of the said building HMG Ambassador, 137, Residency Road, Bengaluru- 560 025 having the super built up area of 9500 square feet along with covered car parking spaces for 4 cars in the basement and open car parking space for 4 cars in the ground floor along with an extent of 2375 square feet of undivided share in the land and bounded by:
East by: Property bearing No.136:
West by: Property bearing No.138;
North by: Residency Road;
South by: Property bearing No.2,
Richmond Road.
Along with 2575 square feet undivided share in suit schedule 'C' property 16 O.S.487/2007 SCHEDULE-C All the piece and parcel of the land with building and other constructions thereon formerly known as "Ebrahim Villa" and now known as HMG Ambassador and property bearing Municipal Corporation No.137 and situated at Residency Road, Division No.60, Bengaluru and bounded on the:
East by: Property bearing No.136, Residency Road and measuring on that side 210 feet (64.02 mtrs); West by: Property bearing No.138, Residency road and measuring on that side 207 feet (63.28 mtrs); North by: Residency Road and measuring on that side 116 feet (35.36 mtrs);
South by: Property bearing No.2, Richmond Road, measuring on that side 113 feet (34.45 Mtrs).
4. In pursuance of suit summons issued, except defendant Nos.3, 4 and defendant No.12, remaining defendants appeared through their counsel. Except defendant Nos. 1, 2, 5 to 7, other defendants did not file any written statement.
5. Defendant No.1 has filed written statement contending that defendant Nos. 1 and 2 are not aware about transaction taken place between Jeevananda Kini 17 O.S.487/2007 and plaintiffs. If at all he had any transaction, the same is legal and valid. The claim of plaintiffs is false and incorrect. Defendant Nos. 1 and 2 have not inherited any properties estate or movable or immovable properties left behind by late U.Jeevananda Kini. Hence, they are not liable for claim of plaintiffs. It is prayed that suit may be dismissed.
6. Defendant No.2 has filed memo adopting the written statement filed by defendant No.1.
7. Defendant No.5 has filed written statement denying plaint averments and has contended that they had also advanced loan to M/s. R.J.Agro Partnership Firm of Sri.Jeevananda Kini and Rajesh Pai. R.J.Agro has availed other facilities and mortgaged other properties also. The charge created by Jeevananda Kini and Rajesh Pai in favour of the bank is valid and enforceable. It is prayed that suit may be dismissed.
8. Defendant No.6 has filed written statement denying plaint averments and has contended that the sale transaction dated 29.12.2004 in respect of 'B' and 18 O.S.487/2007 'C' schedule properties are valid and in order. They have advanced goods loan A/c No.1 of Rs.20.00 Crores and Goods Loan A/c No.2 of Rs.20.00 Crores. As on this day, a total sum of Rs.38,28,87,696.20 is outstanding. Plaintiffs and defendant Nos. 1 to 4 have colluded to avoid payment of amounts. It is prayed that suit may be dismissed.
9. Defendant No.7 has filed written statement contending that suit of plaintiffs is not maintainable. They had advanced V Rent Loan to U.Jeevendra Kini and Rajesh Pai on security of 'A' and 'C' schedule properties and said loan was closed by borrowers as on 27.11.2006. They are in no way connected to interference. It is prayed that suit may be dismissed.
10. Based on the above pleadings of the parties, my learned predecessor has framed following issues:
1. Whether the plaintiffs prove that plaintiff No.1 is the absolute owner of the suit schedule property?
2. Whether the plaintiffs prove that the sale deed dated 29.12.2004 registered 19 O.S.487/2007 as document No.4880 in respect of schedule 'A' property is null and void and not binding on the plaintiffs?
3. Whether the plaintiffs prove that the sale deed dated 29.12.2004 registered as document No.4879 in respect of schedule 'B' property is null and void and not binding on the plaintiffs?
4. Whether the plaintiffs prove the interference of the defendants?
5. Whether the plaintiffs prove that they are entitled for the relief of declaration, permanent injunction and cancellation as sought in the plaint?
6. Whether the suit is bad for non-joinder of necessary parties?
7. What order or decree?
11. In support of the case of the plaintiffs, PW.1 was examined and he got marked Ex.P.1 to P.122. DW.1 to 3 were examined on behalf of defendants. They have got marked Ex.D.1 to D.25.
12. Heard both sides and perused the records.
13. My findings on the above issues are:
Issue No.1: In affirmative.
Issue No.2: In affirmative.
Issue No.3: In affirmative.
20 O.S.487/2007
Issue No.4: In affirmative.
Issue No.5: In affirmative.
Issue No.6: In negative.
Issue No.7: As per the final order
for the following;
REASONS
14. Issue Nos.1 to 3: At the outset, I would like
to point out admitted and undisputed facts in present case. In present case, it is admitted that plaintiffs were original owners of suit schedule properties. It is undisputed that alleged sale deeds at Ex.P.50 and Ex.P.51 were executed on behalf of plaintiff No.1 by one Kishor Bhudrani in favour of Sri. Jeevananda Kini and Rajesh Pai in respect of suit schedule 'A', 'B' and 'C' properties under two separate registered sale deeds dated 29.12.2004. It is also admitted that U.Jeevananda Kini and Rajesh Pai raised loans from different banks mortgaging suit schedule 'A', 'B' and 'C' properties. It is undisputed that when enquiry was held by the Banks, both Jeevananda Kini and Rajesh Pai committed suicide on 7.12.2006. It is also undisputed that present plaintiffs filed criminal 21 O.S.487/2007 complaint against Rajesh Pai, Jeevananda Kini, Vidhyadhar M.Nayak @ Ramarao son of Gopoal Rao, Srinivas.A- Advocate, Ganesh C. Shashidhara F and that the case was handed over to CBI and that on the basis of said complaint, CBI carried out investigation and submitted charge sheet against Vidhyadhar M.Nayak and others. It is also admitted that case was registered in C.C.No.17181/2009 Under Section 419, 420, 467, 468 and 471 r/w Section 120-B of IPC. It is also undisputed that it was found by CBI during investigation that one Vidhyadhar M.Nayak @ Ramarao son of Gopal Rao impersonated himself as Kishor Bhudrani and colluding with Jeevananda Kini and Rajesh Pai submitted false and forged documents in respect of present suit schedule 'A', 'B' and 'C' schedule properties and that sale deeds got registered in favour of Jeevananda Kini and Rajesh Pai and that Shashidhar and Ganesh being employees of Jeevananda Kini signed as witnesses to absolute sale deeds knowing fully well. It is also undisputed that C.C.No. 17181/2009 ended in conviction of Vidhyadhar 22 O.S.487/2007 M.Nayak @ Ramarao son of Gopal Rao, Ganesh and Shashidhar. It is also undisputed that during investigation by CBI, Officials and officers of defendant banks gave statements against Jeevananda Kini, Rajesh Pai, Vidhyadhar Nayak and others and that during trial also, officials of various banks had given evidence against accused in C.C.No.17181/2009 and so also against Jeevananda Kini and Rajesh Pai. It is also admitted that defendant No.6 Lakshmi Vilas Bank, who is main contesting defendant in present case, had also filed complaint against Rajesh Pai, Jeevananda Kini, Ganesh.C, S.Shashidhara, V.R.Sharma- Branch Manager, P.H.Ashwath- Branch Manager, M.S.Nagarajan- Branch Manager and that in said case, charge sheet was filed against accused under Section 418, 465, 468, 471, 120-B, 420 r/w Sec. 34 IPC and that said case is numbered as C.C.No.16607/2010 and is still pending.
15. At the thresh-hold, I would like to point out that present suit is for declaration and for consequential relief of perpetual injunction and cancellation of sale 23 O.S.487/2007 deeds. Heavy burden is cast on plaintiffs to prove that they are the absolute owners of suit schedule properties and that they had never authorised anybody to execute sale deeds in respect of suit schedule 'A', 'B' and 'C' properties and that sale deeds dated 29.12.2004 are fake, created and therefore, null and void and not binding on them.
16. Per contra, defence of defendant banks, who are contesting defendants, is two folded, 1) the charge created by Jeevananda Kini and Rajesh Pai in favour of the banks is valid and enforceable and 2) that the sale transaction dated 27.12.2004 in respect of 'A', 'B' and 'C' schedule properties are valid and in order.
17. PW.1 reiterates the plaint averments and has mainly relied on Ex.P.1 to P.122 in order to prove the contentions in plaint.
18. PW.1 states in his evidence that plaintiffs are owners of suit schedule 'A' to 'C' properties and that plaintiff Nos. 2 and 3 had intended to sell schedule 'A' 24 O.S.487/2007 and 'B' properties by selling their share holdings in plaintiff No.1 company. They were introduced to one Jeevananda Kini as proposed purchaser of schedule 'A' and 'B' properties. Said Jeevananda Kini would always be accompanied by one Rajesh Pai and Prassanna Pai, Chartered Accountant. There were several negotiations between plaintiff Nos. 2 and 3 and said Jeevananda Kini and plaintiff Nos. 2 and 3 handed over copies of documents of title to Jeevananda Kini in order to facilitate him in obtaining legal opinion. On 26.11.2004 Jeevananda Kini issued a letter representing himself as proprietor of R.J.Estates and Properties and in his letter dated 26.11.2004 he had clearly informed plaintiffs that said letter was only an expression of his intention and that no party shall have any legal obligation or owe any legal duty to each other until such time as definite agreements would be executed by authorised representatives of the parties.
19. PW.1 further states that nothing materialized and there was no further interaction between the parties for nearly nine months. In the month of August 2005, 25 O.S.487/2007 Jeevananda Kini started fresh negotiations for purchasing aforesaid properties and informed plaintiff Nos. 2 and 3 that he was about to conclude his tie up with different banks for funding. To show his bonafides, he offered to pay refundable deposit of Rs.50,00,000/- each for schedule 'A' and 'B' properties as token. He handed over two drafts bearing Nos. 080852 and 080855 dated 7.8.2005 for Rs.50,00,000/- each drawn on Canara Bank, Mahalakshmi Layout, Bengaluru Branch. Plaintiff Nos. 2 and 3 had informed him that if negotiations did not materialize in to concluded contract within two months, it would come to an end. As such the negotiations did not materialize into concluded contract within two months and plaintiff Nos. 2 and 3 returned the amounts vide draft No.811922 and 811923 dated 7.12.2005 for Rs.50,00,000/- each drawn in favour of R.J.Estates and properties along with letter informing him about end of negotiations in respect of schedule 'A' and 'B' properties. Said drafts were encashed by him through his bankers on 8.12.2005. On 25.12.2005 by way of 26 O.S.487/2007 abundant caution, plaintiff Nos. 2 and 3 issued public notice in local dailies stating that they were absolute owners of schedule 'A' and 'B' properties and that they have not sold or authorised any person to deal with said properties.
20. PW.1 further states that plaintiffs continued to enjoy the right and interest as the absolute owners of suit schedule properties. On 11.12.2006 plaintiff Nos. 2 and 3 were informed by their lessees that officials of defendant No.5 Indian Overseas Bank, Malleswaram Branch visited and informed them that the properties occupied by them were mortgaged to them by one Jeevananda Kini and Rajesh Pai. On 12.12.2006 representatives of plaintiff Nos. 2 and 3 visited Bengaluru and through paper reports learnt that both Mr. Kini and Pai committed suicide on 7.12.2006. Plaintiff Nos. 2 and 3 initiated search of records at the Office of Sub-Registrar, Shivajinagar and were shocked to learn about two bogus sale deeds dated 29.12.2004, which were registered showing Jeevananda Kini as 27 O.S.487/2007 purchaser of schedule 'A' property belonging to plaintiffs and one Mr.Rajesh Pai as purchaser of schedule 'B' property belonging to plaintiffs. In the sale deeds, plaintiff No.1 was shown as vendor and plaintiff No.2 and 3 as confirming parties and one imposter claiming himself to be Kishor Bhudrani had executed the two sale deeds as authorised signatory of plaintiff No.1 company and as director of plaintiff Nos. 2 and 3. There is no person by name Kishor Bhudrani, who is Director of plaintiff Nos. 2 and 3 or an authorised representative of plaintiff No.1 Company. One Mr. Ganesh and one Mr.Shashidhar had attested as witnesses and sale deeds were stated to have been drafted by one Advocate by name A.Srinivasa. On verification, it was found that no such persons existed in said addresses.
21. PW.1 further states that in the bogus sale deeds, it was mentioned that plaintiff No.1 Company had allegedly convened extraordinary general body meeting on 9.11.2004 and the board had passed resolution permitting sale of property by plaintiff Nos. 28 O.S.487/2007 2 and 3 and had authorised one Kishor Bhudrani to sign on their behalf. No such meeting had ever been convened and said resolution is fabricated document by concocting company's letterhead. The alleged sale deeds were registered as a result of fraud and collusion between the persons, who have attested their signatures to said documents. No right, title or interest has been conveyed in favour of alleged purchasers as there is no concluded contract between the parties. Immediately on 14.12.2006 plaintiff Nos. 2 and 3 issued paper notification in all local dailies informing public at large that they are absolute owners and have not sold the properties to anybody. On 19.12.2006 a public notice was also published through their Advocate informing public at large regarding fraud played by Rajesh Pai and Jeevananda Kini.
22. PW.1 further states that the officials of defendant No.4 called plaintiff Nos. 2 and 3 on 19.12.2006 and informed them that fictitious accounts were opened in name of plaintiff No.3 with State Bank of Mysore, Cunningham Road branch and that in name of plaintiff 29 O.S.487/2007 No.2 with Oriental Bank of Commerce, Thippasandra Branch and alleged sale proceeds had been encashed by tricksters. On 21.12.2006 plaintiff Nos. 2 and 3 lodged FIR with Ashok Nagar Police Station and on 23.12.2006 they sent letter to defendant banks and Sub-Registrar, Shivajinagar and Ward Officer, Shivajinagar informing about fraud played by Jeevananda Kini and Rajesh Pai. Plaintiffs learnt that defendant banks had advanced loans to Jeevananda Kini and Rajesh Pai on the basis of forged sale deeds. The defendant banks seem to have advanced loans without verification of original sale deeds. Plaintiffs are not bound by alleged sale deeds dated 29.12.2004.
23. I have carefully perused cross-examination of PW.1 and have no hesitation to say that nothing is elicited in his cross-examination showing that both the impugned sale deeds are genuine.
24. In support of the case of the plaintiffs, they mainly relied upon following documents Ex.P.1 to Ex.P.122.
30 O.S.487/2007
Ex.P.1 is partnership deed dated 27.4.2004. Ex.P.2 to P.9 and Ex.P.64 to P.72 are katha extracts pertaining to suit schedule properties showing name of HASCO Associates.
Ex.P.10 to 17 and Ex.P.56 to P.63 are katha certificates pertaining to suit schedule properties showing name of HASCO Associates.
Ex.P.18 to P.33 are various agreements of sale entered into between HASCO Associates and its partners.
Ex.P.34 to P.36 are various news papers, under which present plaintiffs had issued public notice stating that they were owners of suit schedule properties.
Ex.P.37 is partnership deed dated 10.9.1986. Ex.P.40 is letter dated 26.11.2004 written by Jeevananda Kini expressing his interest to purchase suit schedule properties.
Ex.P.38 and P.39 are letters dated 7.12.2005 written by Tower Land Developers to R.J.Estates and Properties stating that they are not interested in said proposal and returning Rs.50,00,000/- each vide draft No.811922 and 811923 dated 7.12.2005.
Ex.P.41 to P.47 are postal acknowledgements. 31 O.S.487/2007 Ex.P.48 is certificate of incorporation and memorandum of association of HMG Ambassador Property Management Private Limited.
Ex.P.49 is FIR in Crime No.608/2006 of Ashok Nagar Police Station.
Ex.P.50 and Ex.P.51 are impugned sale deeds dated 29.12.2004 in favour of Jeevananda Kini and Rajesh Pai alleged to have been got executed by them through imposter.
Ex.P.52 to P.54 are authorization letters issued by plaintiffs in favour of PW.1.
Ex.P.55 is agreement dated 15.6.1994 between HASCO Associates and others.
Ex.P.73 to P.112 are all Tax paid receipts. Ex.P.113 and Ex.P.114 are details of Directors issued by Secretary of the Company.
Ex.P.115 is details of Directors issued by Chartered Accountant of the Company.
Ex.P.116 is certified copy of order sheet in C.C.5063/2009. Ex.P.117 is certified copy of Charge sheet in C.C.5063/2009.
32 O.S.487/2007
Ex.P.118 is certified copy of order sheet in C.C.No.17181/2009. Ex.P.119 is certified copy of charge sheet filed in C.C.17181/2009 by CBI. Ex.P.122 is certified copy of Judgment dated 30.6.2012 passed by Special Court for CBI in C.C.No.17181/2009.
Ex.P.120 is certified copy of order sheet in C.C.No.16607/2010. Ex.P.121 is certified copy of charge sheet in C.C.No.16607/2010.
25. At the cost of repetition, I would like to say that there is no dispute regarding partnership firm, partnership agreements, agreements of construction and other agreements interse between plaintiffs and it is also not under dispute that plaintiffs were original owners of entire schedule 'A', 'B' and 'C' properties and that their names were entered as owners of suit schedule properties.
26. Now in the light of above circumstances and admitted facts, I would like to find out whether plaintiffs have proved that impugned sale deeds dated 29.12.2004 certified copies of which are produced at Ex.P.50 and P.51 are fake and created as contended by them.
33 O.S.487/2007
27. Ex.P.50 is certified copy of alleged sale deed said to have been executed by one Kishor Bhudrani on behalf of plaintiff No.1 Company and said to have been confirmed by Tower nd Developers Private Limited and Panna Financial and Real Estate Developers Private Limited and which is alleged to have been executed in favour of Jeevananda Kini on 29.12.2004 in respect of 'A' and 'C' schedule properties.
28. Ex.P.51 is certified copy of alleged sale deed said to have been executed by one Kishor Bhudrani on behalf of plaintiff No.1 Company and said to have been confirmed by Tower land Developers Private Limited and Panna Financial and Real Estate Developers Private Limited and which is alleged to have been executed in favour of Rajesh Pai on 29.12.2004 in respect of 'B' and 'C' schedule properties.
29. Ex.P.113 and Ex.P.114 details of Directors issued by Secretary of the Company, Ex.P.115 details of Directors issued by Chartered Accountant of the 34 O.S.487/2007 Company show that no person by name Kishor Bhudrani was at any time Director of the Company.
30. Ex.P.49 is FIR in Crime No.608/2006 of Ashok Nagar Police Station, which was issued on the basis of complaint filed by PW.1 and Goutham Bhudrani against Rajesh Pai, Jeevananda Kini, Kishor Bhudrani, Srinivas.A- Advocate, Ganesh.C and Shashidhar. It has also come in record that it came to notice of Reserve Bank of India that Jeevananda Kini and Rajesh Pai raised huge loans from various banks mortgaging suit schedule 'A', 'B' and 'C' properties and that documents produced by them before various Banks were also the same and Reserve Bank of India called meeting and asked Managers of different Banks to enquire into the matter and that when Banks started enquiring, Jeevanandi Kini and Rajesh Pai committed suicide and the case was handed over to CBI by then Government for investigation of the huge scam. Ex.P.119 is certified copy of charge sheet filed in C.C.17181/2009 by CBI for offences punishable Under 35 O.S.487/2007 Section 419, 420, 467, 468, 471 r/w Section 120-B of IPC finding all the accused guilty during investigation. Ex.P.118 is certified copy of order sheet in C.C.No.17181/2009. Ex.P.122 is certified copy of Judgment dated 30.6.2012 passed by Special Court for CBI in C.C.No.17181/2009 under which the Court had found all the accused guilty and convicted all the accused for offences punishable Under Section 419, 420, 467, 468, 471 r/w Section 120-B of IPC. It is to be kept in mind that all these facts are undisputed. No materials are forthcoming to show that Judgment passed in C.C.No.17181/2009 is stayed or set aside.
31. It is also borne out from records that present defendant No.6 had also filed complaint against Rajesh Pai, Jeevananda Kini, Ganesh.C, S.Shashidhara, V.R.Sharma- Branch Manager, P.H.Ashwath- Branch Manager, M.S.Nagarajan- Branch Manager and charge sheet was filed by against accused under Section 418, 465, 468, 471, 120-B, 420 r/w Sec. 34 IPC. It is significant to note that said case was given number 36 O.S.487/2007 C.C.No.16607/2010. Ex.P.120 is certified copy of order sheet in C.C.No.16607/2010. Ex.P.121 is certified copy of charge sheet in C.C.No.16607/2010. If at all sale deeds Ex.P.50 and P.51 were genuine, Jeevananda Kini and Rajesh Pai would not have committed suicide. Circumstances stated by me above, undisputed facts and Ex.P.49, P.113 to P.115, P.118 to P.122 show that Ex.P.50 and P.51 were created by Jeevanandi Kini and Rajesh Pai in collusion with Vidhyadhar M. Nayak @ Ramarao son of Gopal Rao, C.Ganesh, Shashidhar and that said Jeevananda Kini and Rajesh Pai raised huge loans from different Banks on basis of Ex.P.50 and P.51 sale deeds colluding with Bank Officials and Managers. It is crystal clear that Ex.P.50 and P.51 were created by above stated persons only with an intention to raise huge loans from different Banks behind back of plaintiffs. Therefore I am of the considered opinion that Ex.P.50 and P.51 are not sustainable.
32. Defendant No.5 has contended that the charge created by Jeevananda Kini and Rajesh Pai in favour of 37 O.S.487/2007 the banks is valid and enforceable. Defendant No.6 has contended that the sale transaction dated 27.12.2004 in respect of 'B' and 'C' schedule properties are valid and in order.
33. Now I would like to find out whether defendant Nos. 5 and 6 Banks have placed any material to show that Ex.P.50 and P.51 are genuine.
34. Administrative Officer of defendant No.6 bank is examined as DW.1. In his cross-examination, he admits that officers of their bank had visited Palladam Wear House for verification of collateral security and they had filed report dated 11.12.2006 stating that Manager of the Wear House had informed them that the materials in the Wear House did not belong to Jeevananda Kini and Rajesh Pai and that they belonged to M/s. P.C. Institution, New-Delhi. He has further admitted that on 12.12.2006 Managers of Whitefield and Kaithal Wear House had informed their bank that receipts given as collateral security were created. He further admits that Divisional Manager of their bank 38 O.S.487/2007 Ravi was suspended in respect of said case and further admits that they did not try to verify alleged authority letter given in favour of Kishor Bhudrani. He further admits that Indian Overseas Bank has also filed criminal case against Rajesh Pai and Jeevananda Kini and others.
35. In order to prove his contentions, DW.1 has relied on Ex.D.1 to Ex.D.19. Ex.D.1 is certified copy of tax paid receipt showing name of Rajesh Pai; Ex.D.2 is Encumbrance certificate showing that Rajesh Pai had purchased schedule properties from plaintiff No.1; Ex.D.3 is nil encumbrance certificate. Ex.D.4 and D.5 are Valuation reports; Ex.D.6 and D.7 are opinions of legal expert; Ex.D.8 and D.11 both are impugned sale deeds dated 29.12.2004; Ex.D.9 is katha certificate showing name of Rajesh Pai; Ex.D.10 is katha extract showing name of Rajesh Pai; Ex.D.12 is Katha extract showing name of Jeevananda Kini; Ex.D.13 katha extract showing name of Rajesh Pai; Ex.D.14 is tax paid receipt showing name of Jeevananda Kini. 39 O.S.487/2007 Ex.D.15 is encumbrance certificate showing that Jeevananda Kini had purchased the property from plaintiffs; Ex.D.16 and D.17 are Memorandum of deposit of title deeds; Ex.D.18 is certified copy of plaint in O.A.49/2007 and Ex.D.19 is certified copy of Judgment in O.A.49/2007.
36. DW.2 is Assistant General Manager of Defendant No.7 bank and has stated that Jeevananda Kini and Rajesh Pai had taken loans from their bank and later on they had closed said loan accounts. She is not cross-examined by plaintiffs as it is contended by the bank that loan accounts with their bank were closed by Jeevananda Kini and Rajesh Pai. She has relied upon Ex.D.20 to D.23. Ex.D.20 is letter dated 24.11.2006 written by Rajesh Pai and Ex.D.21 is letter dated 24.11.2006 written by Jeevananda Kini showing their intention to close loan accounts. Ex.D.22 is letter dated 24.11.2006 written by R.J.Agro Company for request of loans and issuance of no-due certificate. Ex.D.23 and D.24 are copies of bank account extracts. 40 O.S.487/2007
37. DW.3 is Assistant General Manager of defendant No.5 bank, who states that sale transaction dated 29.12.2004 in respect of schedule 'A' and 'B' properties are valid and in order. In his cross-examination, DW.3 states that he does not know whether Chief Manager Vaidhyanathan had filed complaint against Jeevananda Kini and Rajesh Pai alleging that they had taken loans from defendant No.5 bank on the basis of fake documents. He further states that he has not produced any document showing that Kishor Bhudrani had special power to act on behalf of plaintiff No.1 Company. He further states that his examination-in- chief was written without going through legal opinion. He goes on pleading his ignorance about all the suggestions put to him. It is significant to note that he does not deny these suggestions. It is very strange to see that DW.3 being responsible officer has given irresponsible answers in his cross-examination. Ex.D.25 is order passed in R.A.29/2012 by Debt Recovery Appellant Tribunal, Chennai. 41 O.S.487/2007
38. I have carefully perused evidence of DW.1 to DW.3 and Ex.D.1 to D.25. It is significant to note that all the documents like tax paid receipts, katha certificates, katha extracts, encumbrance certificates etc. in the names of Jeevananda Kini and Rajesh Pai were issued on the basis of Ex.P.50 and P.51 corresponding documents Ex.D.8 and D.11. Therefore, they are not of any use to defendant banks to prove genuineness of the sale deeds. Careful perusal of oral and documentary evidence of defendants shows that there is nothing on record showing that sale deeds at Ex.P.50 and P.51 i.e. Ex.D.8 and D.11 are genuine as contended by defendants. Therefore I am of considered opinion that story of defendant banks that sale deeds dated 29.12.2004 are genuine has not seen light of the day.
39. It is very astonishing to see defendant Nos. 5 and 6 banks to take up contention that impugned sale deeds are genuine, when they themselves had filed criminal complaints against Rajesh Pai and Jeevananda 42 O.S.487/2007 Kini and others. Probably the Banks are now trying to cover up the fact that their officials and officers are also responsible for said scam to some extent and are trying to recover the debt by hook or crook. Their contention regarding non-maintainability of present suit in view of proceedings before Debt Recovery Tribunal etc. do not hold any water as present plaintiffs were neither added as parties to said proceedings nor filing of criminal cases and charge sheets were brought to notice of Debt Recovery Tribunal in said cases.
40. For all the above stated reasons, I answer issue Nos.1 to 3 in 'affirmative'.
41. Issue No.6: There is stray contention in written statement that suit is not maintainable for non-joinder of necessary parties. But defendants have not put forth any material in support of this contention. Therefore, I answer issue No.6 in 'negative'.
42. Issue No.4: When defendants are contending that impugned sale deeds dated 29.12.2004 are valid, 43 O.S.487/2007 their contentions are sufficient to hold that there is interference from their side. Therefore, I answer this issue in 'affirmative'.
43. Issue No.5: When issue Nos. 1 to 4 are answered in 'affirmative' and I have already held that plaintiffs have successfully proved that impugned sale deeds dated 29.12.2004 are null and void and are fake and created, plaintiffs are entitled for reliefs of declaration, permanent injunction and cancellation of the sale deeds as prayed. Accordingly I answer issue No.5 in 'affirmative'.
44. Issue No.7: In view of the findings on issue No.1 to 6, I proceed to pass the following:
ORDER The instant suit filed by the plaintiffs against the defendants is hereby decreed with costs.
It is hereby declared that plaintiff No.1 is owner of suit schedule properties.44 O.S.487/2007
It is further declared that the registered sale deed vide No. 4879 dated 29.12.2004 in favour of Rajesh Pai and registered sale deed vide No.4880 dated 29.12.2004 in favour of Jeevananda Kini in respect of suit schedule 'A', 'B' and 'C' properties are null and void and not binding on plaintiffs. Said sale deeds are hereby cancelled.
Defendants or anybody on their behalf are permanently restrained from interfering with plaintiffs' peaceful possession of suit schedule properties and from creating any rights in respect of suit schedule properties in favour of third parties.
(Dictated to the Judgment Writer on-line, print out taken thereof is corrected, signed and pronounced by me in Open Court on this 6th day of December, 2016).
(ROOPA NAIK) XXIV ADDL.CITY CIVIL & SESSION JUDGE, BANGALORE CITY.
ANNEXURE List of witnesses examined for the plaintiff:
PW.1: Mr.V.N.Hegde.45 O.S.487/2007
List of documents marked for the plaintiff:
Ex.P.1: Partnership deed dated 27.4.2004.
Ex.P.2 to Khatha extracts. P.9: Ex.P.10 to Khatha certificates. P.17: Ex.P.18 to Sale agreements dated 28.10.1995. P.21: Ex.P.22 to Construction agreements dated P.25: 28.10.1995. Ex.P.26 to Sale agreements dated 28.10.1995. P.29: Ex.P.30 to Construction agreements dt. 28.10.1995. P.33: Ex.P.34: Paper publication in Vijaya Times.
Ex.P.34(a): Relevant portion in Ex.P.34. Ex.P.35: Paper publication in Deccan Herald. Ex.P.35(a): Relevant portion in Ex.P.35. Ex.P.36: Paper publication in Prajavani. Ex.P.36(a): Relevant portion in Ex.P.36. Ex.P.37: Partnership deed dated 10.9.1986. Ex.P.38 & Letters written to R.J. Estates & Properties P.39: by plaintiff No2 and 3 respectively . Ex.P.40: Letter written by R.J. Estates & Properties. Ex.P.41 to Postal acknowledgements. P.47:
Ex.P.48: Certificate of incorporation & Memorandum of Association. Ex.P.49: Copy of FIR in Cr.No.608/2006.
Ex.P.50 & Certified copies of sale deed dated
P.51: 29.12.2004.
Ex.P.52 to Authorisation letters issued by plaintiffs.
P.54:
Ex.P.55: Agency agreement dated 15.6.1994.
Ex.P.56 to Khatha certificates.
P.63:
Ex.P.64 to Khatha extracts.
P.72:
Ex.P.73 to Tax paid receipts.
P.112:
46 O.S.487/2007
Ex.P.113 & Certificates issued by company Secretary.
P.114:
Ex.P.115: Certificate issued by Chartered
Accountant.
Ex.P.116: Copy of order sheet in C.C.5063/2009.
Ex.P.117: Copy of charge sheet in C.C.5063/2009.
Ex.P.118: Copy of order sheet in C.C.17181/2009.
Ex.P.119: Copy of Charge sheet in C.C.17181/2009.
Ex.P.120: Copy of order sheet in C.C.16607/2010.
Ex.P.121: Copy of charge sheet in C.C.16607/2010.
Ex.P.122: Copy of Judgment in C.C.17181/2009.
List of witnesses examined for the defendants:
DW.1: M.M.Thangavel DW.2: T.S.Gayathri Devi. DW.3: V.Jagannathan.
List of documents marked for the defendants:
Ex.D.1: Certified copy of tax paid receipt. Ex.D.2 & Nil Encumbrance Certificates. D.3:
Ex.D.4 & Valuation reports.
D.5:
Ex.D.6 & Legal expert opinion.
D.7:
Ex.D.8: Certified copy of sale deed dated
29.12.2004.
Ex.D.9: Khatha certificate.
Ex.D.10: Copy of khatha extract.
Ex.D.11: Certified copy of sale deed dated
29.12.2004.
Ex.D.12: Khatha certificate.
Ex.D.13: Khatha extract.
Ex.D.14: Tax paid receipt.
Ex.D.15; Encumbrance Certificate.
Ex.D.16 & Memorandum of title deeds.
D.17:
Ex.D.18: Certified copy of plaint in O.A.49/2007.
Ex.D.19: Certified copy of Judgment in OA 49/2007.
47 O.S.487/2007
Ex.D.20: Letter dated 24.11.2006 by Rajesh Pai.
Ex.D.21: Letter dated 24.11.2006 by Jeevananda
Kini.
Ex.D.22: Letter dated 24.11.06 by R.J.Agro
Company.
Ex.D.23 & Copies of bank account extracts. D.24:
Ex.D.25: Order passed in R.A.29/12 by DRT, Chennai.
(ROOPA NAIK) XXIV ADDL.CITY CIVIL & SESSION JUDGE, BANGALORE CITY.