State Consumer Disputes Redressal Commission
Mr. Milind Ramesh Tamhane vs Mr. Milind Ramesh Tamhane & Ors. on 20 December, 2008
MAHARASHTRA STATE MAHARASHTRA STATE, MUMBAI Revision Petition No. 453/2008 @ M.A. No. 454& 455/2008 Date of Filing: In Execution Application No. 14/2006 in Complaint No. 287/2004 District Consumer Forum: South Mumbai Date of Order: 20/12/2008 Mr. Milind Ramesh Tamhane, Petitioner R/at- Flat No. 402, Vintage Pearl CHS Ltd. Plot No. 80 , 29th Road, TPS III, Bandra (W), Mumbai- 400 050. V/s 1.Manharla Shah Respondents 2.Nirmala Shah (Org.Complainant 3. Tushar M Shah nos 1 to 6) 4.SaurinM.Shah 5. Vritti T Shah 6. Manika T Shah All are R/at- 11, New Indrabhavan, 101 A, Walkeshawr, Mumbai- 400 006. 7. M/s. Rooft Industries Ltd. (Org.O.P. No.1) Office at 501, Sangli Bank Building, 296 Perin Nariman point, Fort, Mumbai- 400 0001. 8. Mr.Suresh G.Motwani (Org.O.P.No.2) chairman, M/s. Roofit Industries Ltd. 501, Sangli Bank Building, 296 Perin Nariman point, Fort, Mumbai- 400 0001. 9. M/s. J Morgan Stanley, (Org.O.P.No.3) Retail Service Ltd Kamanwala, Chamberss, Ground Floor, P.M.Road, Fort, Mumbai- 400 001. 10. Mr. Kilge, the officer EOW, Crowfort Market Mumbai- 400 001. (Org.O.P. no.4) 11. The Collector and District Manager, Mumbai City, At Old Custom House, Shahid Bhagat singh Road, Fort, Mumbai- 40 001. Corum : Mr.P.N.Kashalkar, Honble Presiding Judicial Member.
Shri S.R.Khanzode, Honble Judicial Member.
Present : Adv. Priti Jagtap for petitioner.
Adv. U.B. Wavikar for the respondents .
-: ORDER :-
Per Shri P.N.Kashalkar, Honble Presiding Judicial Member Being aggrieved by the order passed by District Forum, South Mumbai in recovery proceedings no. 14/06 issuing recovery certificate to attach the property of Shri Milind Ramesh Tamhane dt. 07/10/2006 and directing the Collector to attach the property of said Shri Tamhane under Section 25(3) of Consumer Protection Act, 1986, the said Shri Tamhane has filed this revision challenging the order passed by the District Forum.
There is delay in filing the revision petition. If, calculated from the date of judgement of 12/08/2005 it is of 2 years 5 months and 8 days. However, this delay is nominal one. In the sense that the revision petitioner was not party to the proceedings to the original complaint. He was also not opposite party or nor applicant cited in E.A. No. 14/06. He received Collectors notice under Maharahstra Land Revenue rules, on 27/12/2007 directing him to pay a sum of Rs. 8,52,896/-. Hence, he has filed revision petition. Delay is therefore properly explained. Delay is not deliberate or intentional. Hence, we are inclined to condone the delay for hearing the revision petition on merits. M.A. no. 454/2008 for condonation of delay is therefore allowed.
Coming now on the merits of the case certain facts are required to be mentioned. The decree holders mostly member of Shah Family were complainants in complaint no. 287/2004. They had filed consumer complaint against M/s. Roofit Industries Ltd then against its Chairman, Mr.Suresh Motwani and M/s. J. Morgan Stanley Retail Service Ltd.
They also impleaded Mr.Kilge the officer EOW.
In the said complaint, the complaint was allowed and award was passed against all the opposite parties. Execution proceedings were filed in terms of E.A. No. 14/06 to recover the decreetal amount of Rs. 9,57,960/-. That was filed against M/s. Roofit Industries, Chairman Shri S. Motwani and othrs. In the execution proceedings under Section 25 an application was made for issuing certificate to the Collector by District Forum, South Mumbai. This certificate is of dt. 07/10/2006. In the schedule of properties attached to the said recovery certificate, the name of revision petitioner was shown at serial no.3 and his properties viz flat no. B-402, Vintage Pearl Co.Hsg Society, Plot No. 40, 29th Road, Bandra (W), Mumbai- 400 050 including movable property and his another property flat no. B-5, Shankar Niwar, Agashe Marg, Dadar (w), Mumbai- 28 including moveable property therein were sought to be attached in terms of recovery certificate by the decree holder and as such, recovery certificate was issued by the Forum below and in terms of said certificate notice under Section 178 of Maharshtra Revenue Court was issued by Nayab Tahsildar, Mumbai Suburban District for Recovery of amount as Government dues. It is this order of District Forum sending recovery certificate against petitioner in E.A. No. 14/06 that is challenged by the petitioner.
We heard submission of Adv. Priti Jagtap for petitioner and Adv. Wavikar for the respondents.
We are of the view that the impugned order passed by District Forum directing attachment of property of petitioner is bad in law and can not be allowed to sustain in law. The Forum below exceeded the jurisdiction not vested in it. The Forum below also lost sight of the fact that in the execution proceedings it can only proceed against those persons, who are cited as opposite parties in the original complaint against whom award has been passed. The award was passed in consumer complaint no. 287/2004 against M/s. Roofit Industries and Chairman Shri Suresh Motwani and Mrs. J.Morgan Stanley services Pvt. Ltd and Mr. Kilge. The revision petitioner herein was not opposite party in the original complaint. He was not cited as opposite party/ non applicant/judgement debtor/ in the execution proceedings. It was filed against these four persons. But while issuing recovery certificate to the Collector, the decree holder smartly put the name of Shri M.Tamhane, who was for some time working as Director of M/s. Roofit Industries and his two properties were listed in the schedule of property to be attached by the Collector under Section 25(3) of Consumer Protection Act, 1986 and therefore, recovery certificate had been issued against them by the Collector. District Forum issued recovery certificate since name of petitioner and his two properties mentioned in the schedule of the property to be attached. The Collector/Mumbai Suburban District was pleased to send impugned notice to Shri M.Tamhane under Section 178 Maharashtra Land Recovery Code,1966 to recover dues as arrears of land revenue. Thus, we are finding that the recovery certificate issued by the District Forum including properties of petitioners in the execution application no. 14/06 dt. 7/10/2006 is surely bad in law and is required to be quashed at the threshold itself. We reiterate that in execution proceedings the executing court can take action against only those judgement debtors, against whom award has been passed in the original complaint. It is not permitted to go beyond the original complaint or original award. Execution must be carried out or taken out only against those persons against whom award has been passed and has become final or absolute. In the original complaint as mentioned earlier M/s. Roofit Industies, its Chairman Shri S. Motwani, M/s.J.Morgan Stanley Services Ltd and Mr.Kilge were the parties and they were directed to pay dues of the original complainant (decree holder). Mr.M.Tamhane was not in picture at the time of pendency of the original complaint or at the execution proceedings. Execution proceedings was also filed only against these four persons but while sending the recovery certificate to the Collector under Section 25(3) smartly and intelligently the decree holder included the property of Shri Tamhane and that is why the order came to be passed issuing recovery certificate dt. 07/10/2007 including the revision petitioner or his two flats of Mumbai.
We are therefore of the view that the impugned order passed by District Forum in sending the name of petitioner and his two properties to the Collector along with the recovery certificate dt. 07/10/2007 is surely not in conformity with the provisions of Section 25(3) of Consumer Protection Act, 1986. The Ld.District Forum exercised jurisdiction not vested in it.
In the course of arguments Ld.Adv.Wavikar for the respondent submitted that if company is held liable for the dues of the decree holder, the corporate veil can be lifted and real culprits and erring Directors, who committed fraud with the finances of the company can be brought to book, since at the material time they were Directors of the company managing the affairs of the company. This argument is devoid of any substance. Shri M.Tamhane was the Director of the company during the period between 01/11/1999 to 24/12/2003, on which date he sent resignation letter and form no.32. So from that date i.e. 24/12/2003, Shri Tamhane ceased to be Director of M/s.Roofit Industries. When this is so, in execution proceedings the said person can not be impleaded as Director of the company in the year 2006, when the Forum was issuing recovery certificate including name of properties of petitioner herein since at one point of time he was Director of the company. Theory of Corporate Veil can not be pressed into service while issuing recovery certificate under Section 25(3) of Consumer Protection Act, 1986 in the course of execution proceedings for the first time. Again at the cost of repetition, we may observe that while executing the award in execution proceedings for the he Forum below/executing court can not go beyond the scope of award passed by it. Shri M.Tamhane was not shown as Director of the company in the original complaint or in the original recovery proceedings filed by Decree Holder. To execute the award in the midst of execution proceedings and on one fine morning neither the decree holder nor the Forum below has an authority to implead somebody along with the property and to seek recovery certificate against the said third party. This is obviously not permissible in law. As such, the Forum below committed grave error of law in issuing the recovery certificate against the petitioner and his properties for being attached by the Collector under recovery certificate.
As such the said order of the District Forum deserves to be quashed. We may place on record the fact that Adv.Wavikar has cited some rulings of various High Courts. None of them are applicable to the facts of our case. Hence, we are not bothering ourselves in discussing those rulings for sake of brevity of this judgement. Suffice it to say that the impugned order passed by District Forum issuing recovery certificate against petitioner to the collector is bad in law and can not sustain in law. Hence, we pass following order:-
:-ORDER-:
1.
Revision Petition is allowed.
2. Impugned order passed by District Forum is quashed and set aside. Recovery proceedings against the revision petitioner stands dismissed. The Forum below is directed to proceed against those parties against whom the award has become final.
3. The respondent is directed to pay Rs.4,000/- to the revision petitioner and bear his own costs.
4. M.A.Nos.454 & 455/2008 stands disposed of.
4. Copies of the order herein be furnished to the parties.
(S.R.Khanzode) (P.N.Kashalkar) Judicial Member Presiding Judicial Member. Nbh