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2024 DIGILAW 371 (JHR)

Daulat Ram Jain, S/o. Lt. Pannalal Jain v. Tulsi Goshwami, S/o. Moti Goshwami

2024-04-09

NAVNEET KUMAR, SHREE CHANDRASHEKHAR

body2024
JUDGMENT : Shree Chandrashekhar, A.C.J. I.A No.1834 of 2024 (in L.P.A No.74 of 2024) and I.A No.1392 of 2024(in L.P.A No.61 of 2024) I.A No.1834 of 2024 has been filed under section 5 of the Limitation Act, 1963 for condonation of delay of 44 days in preferring L.P.A No.74 of 2024 and I.A No.1392 of 2024 has been filed under section 5 of the Limitation Act, 1963 for condonation of delay of 31 days in filing L.P.A No.61 of 2024. 2. In view of the averments made in these applications, we think that sufficient cause has been shown by the applicants for condoning the delay in filing these Letters Patent Appeals and, accordingly, I.A No.1834 of 2024 and I.A No.1392 of 2024 are allowed. L.P.A No.74 of 2024 with L.P.A No.61 of 2024 3. Daulat Ram Jain, who is the Liquidator and the appellant in L.P.A No.74 of 2024, has challenged the writ Court’s observation in paragraph no.14 of the order dated 30th November 2023 passed in WP(C) No. 5168 of 2023. 4. In WP(C) No. 5168 of 2023, the writ Court made the following observations: “14. Under the facts and circumstances of the case, this writ petition is disposed of with the observation that whosoever is in possession of the two properties in question as has already been referred in the foregoing paragraphs of this judgment shall not be dispossessed from the same without adhering to the due process of law.” 5. Mr. S.D. Sanjay, the learned senior counsel appearing for the Liquidator referred to the decisions in “Phatu Rochiram Mulchandani v. Karnataka Industrial Areas Development Board” (2015) 5 SCC 244 and “Bajarang Shyamsunder Agarwal v. Central Bank of India” (2019) 9 SCC 94 and other judgments to submit that the Liquidator is under a legal duty to take steps for the preservation of the subject properties and hand over the vacant and peaceful possession of the properties to the auction sale purchaser. It is contended that the observation by the writ Court in paragraph no. 14 is likely to cause prejudice to the parties inasmuch as the Liquidator may face difficulties in transferring the subject properties to the auction sale purchaser. The learned senior counsel laid emphasis on “Phatu Rochiram Mulchandani” wherein the Hon’ble Supreme Court observed as under : “12. It is contended that the observation by the writ Court in paragraph no. 14 is likely to cause prejudice to the parties inasmuch as the Liquidator may face difficulties in transferring the subject properties to the auction sale purchaser. The learned senior counsel laid emphasis on “Phatu Rochiram Mulchandani” wherein the Hon’ble Supreme Court observed as under : “12. Deprecating the inaction on the part of the Official Liquidator in not filing the appeal and thereby protecting the property of the Company in question the learned Senior Counsel relied upon the judgment in Rajratna Naranbhai Mills Co. Ltd. v. New Quality Bobbin Works, holding that the most important task assigned to the liquidator under the Companies Act, while acting as liquidator of a company ordered to be wound up, is to collect assets of the company and sell them and to distribute the realisation amongst all those who have claims against the company and payment must be made according to priorities fixed by law. This appears to be not only the foremost but the most basic duty of a liquidator of a company ordered to be wound up. Now, if the liquidator in the course of winding up is required to file suit for recovery of properties and assets of the company, one has only to imagine at what length of time winding-up proceedings can be brought to a close.” 6. In L.P.A No.61 of 2024, M/s Carbon Resources Private Limited which is the successful auction sale purchaser has also taken a similar stand to challenge the aforesaid observation by the writ Court. 7. Before the writ Court, Tulsi Goshwami who is the respondent no. 1 in these Letters Patent Appeals made the following prayers. “(i) For issuance of an appropriate writ/order/direction,, including Writ of Mandamus, restraining Respondent No.2 in connivance with Respondent No.4 from forcefully dispossessing the Petitioner from the piece and parcel of the land having total area of 5256.34 decimal and 105 decimal, situated at Mouza Gadi Srirampur and Mouza Manjhiladih, bearing Thans Nos.267 and 268 appertaining to various Khata numbers and Plot numbers, which is in possession of the Petitioner since 15th January, 2011 and the Petitioner is cultivating the land since the said date. (ii) For issuance of further appropriate writ/order/direction including Writ of Declaration, declaring that action of the Official Liquidator i.e. Respondent No.2 in issuing Sale Certificate in favour of Respondent No.4 in plain stamp paper and thereafter facilitating Respondent No.4 to take forceful physical possession of the property in question through the means of musclemen and stooges, is wholly illegal, arbitrary and is contrary to the provisions of Insolvency and Bankruptcy Act, 2016 and Regulations made thereunder.” 8. The respondent no. 1 pleaded that he was in possession of about 5256.34 decimals land in Mouza Gadi Srirampur under Thana No. 267 and about 105 decimals land at Mouza Manjhiladih in Thana No. 268 as a tenant under Sri Bir Ispat Private Limited. At the instance of the Financial Creditor, the matter went in liquidation before the NCLT at Kolkata in CP (IB) No. 1281/KB/2020 and the appellant in LPA No. 74 of 2024 was appointed as the Liquidator. This is also not in dispute that in the auction sale held on 8th April 2023 M/s Carbon Resources Private Limited was declared the highest bidder and the sale was concluded in its favor. The Liquidator has stated that pursuant to the auction sale held on 8th April 2023 the Sale Certificate was issued on 19th May 2023 in favor of M/s Carbon Resources Private Limited. 9. In the aforesaid background, the respondent no. 1 set up a case before the writ Court that on 19th May 2023 the Liquidator in connivance with the auction purchaser dispossessed him from the subject properties. The respondent no. 1 also made an allegation in respect of the Sale Certificate being issued on a plain stamp paper by virtue of which the auction purchaser took forcible possession of the subject properties through musclemen. 10. Before the writ Court, the appellants challenged the maintainability of the writ petition and filed their counter-affidavit. The Liquidator filed I.A No. 9509 of 2023 and the auction sale purchaser filed I.A No. 9441 of 2023 to challenge the maintainability of WP(C) No. 5168 of 2023. The auction sale purchaser also filed I.A No.9442 of 2023 for vacating the interim order which was granted by the writ Court on 27th September 2023. At this stage, we may indicate that the parties produced voluminous records before the writ Court running into about 1100 pages. 11. The auction sale purchaser also filed I.A No.9442 of 2023 for vacating the interim order which was granted by the writ Court on 27th September 2023. At this stage, we may indicate that the parties produced voluminous records before the writ Court running into about 1100 pages. 11. Having regard to the serious dispute on facts, the writ Court formed an opinion that such questions cannot be adjudicated in the writ proceeding. The writ petition being WP(C) No. 5168 of 2023 was disposed of holding as under : “13. Having heard the submissions made at the bar and after going through the materials in the record, the fact remains that a disputed question of fact is involved in this writ petition; as though on one hand the petitioner claims that he is in possession of the two properties in question yet on the other hand, the respondent no. 4 is also claiming that he is in possession of the property in question; as the land was mortgaged to the bank and the official liquidator upon auction made by him, has handed over the possession to the respondent no. 4. As the disputed question of fact is involved in this writ petition, which cannot be adjudicated without the evidence being placed on record by the parties; which is beyond the scope of the writ jurisdiction; this court is not inclined to adjudicate such disputed questions facts in this writ application, hence, this court is not entering into the merits of the writ petition and its maintainability.” 12. Mr. S.D. Sanjay, the learned senior counsel for the Liquidator refers to several provisions under the Insolvency and Bankruptcy Code, 2016 to submit that the writ petitioner who unsuccessfully challenged the auction sale and did not approach the Appellate Tribunal against that order has no rights to remain in possession of the subject properties. Mr. Ajit Kumar, the learned senior counsel who appears for M/s Carbon Resources Private Limited has endeavored to outline the history of litigation which according to him clearly demonstrates lack of bonafide on the part of the writ petitioner. It is submitted that notwithstanding a statutory remedy of appeal, the writ petitioner who claims some sort of right based on a tenancy document allegedly executed with Sri Bir Ispat Private Limited approached this Court with malafide intentions. Mr. S.D. Sanjay and Mr. It is submitted that notwithstanding a statutory remedy of appeal, the writ petitioner who claims some sort of right based on a tenancy document allegedly executed with Sri Bir Ispat Private Limited approached this Court with malafide intentions. Mr. S.D. Sanjay and Mr. Ajit Kumar, the learned senior counsels appearing for the appellants have finally submitted that the appellants shall be satisfied if the observation in paragraph no. 14 is clarified by this Court to the extent that such observation shall not cause prejudice to any party. 13. On the other hand, Mr. Manoj Tandon, the learned counsel for the respondent no. 1 would submit that the observations in paragraph no. 14 of the writ Court’s order dated 30th November 2023 is a simple statement in law exception to which could not have been taken by the Liquidator or by the auction purchaser by filing the present Letters Patent Appeals. 14. As the writ petition was disposed of observing that it involves disputed question of facts, this Court also shall not enter into the realm of the disputed facts. However, we shall clarify that the observation by the writ Court that whosoever is in possession of the subject properties shall not be dispossessed without following the process in law cannot be construed in a manner to prejudice the rival stand which may be set up by the parties. 15. Accordingly, these Letters Patent Appeals are disposed of.