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2025 DIGILAW 188 (GUJ)

D. H. S. Computer v. State of Gujarat

2025-03-03

PRANAV TRIVEDI, SUNITA AGARWAL

body2025
ORDER : SUNITA AGARWAL, C.J. 1. Heard learned advocate for the applicant and perused the record. 2. The present applications seeking leave to appeal have been filed by the borrower challenging judgment and order dated 5.8.2022 passed by the learned Single Judge in allowing two writ petitions namely Special Civil Application No. 2895 of 2010 and Special Civil Application No. 2898 of 2010 with the following directions:- "14. This Court is inclined to pass the following order to maintain equity between the parties:- (a) The Bank entered into One Time Settlement Scheme in 2011 with the borrower and released the said property, therefore the amount of Ernest Money and 25% amount i.e. Rs.13,15,250/- inclusive of Rs.25,000/- towards Security Deposit which was deposited by the petitioners is directed to be adjusted towards the amount, offered by the petitioners towards the purchase of the said 225 plots. The aforesaid amount is lying with the respondent Bank since the same was deposited. The petitioners have also deposited an amount of Rs.18,50,000/- inclusive of Security Deposit and have offered increase of Rs.10/- per Square Meters, while more than 45% of the said open land is under encroachment, the offer be executed in favour of the petitioners, with a condition that the petitioners shall deposit the balance amount of Rs.52,34,750/- within a period of three months in two equal installments. (b) The liquidator is directed to issue sale certificate on the payment of the entire sale consideration by the petitioners. Mr. V.C. Vaghela, the learned advocate appearing for the petitioners submitted that the respondent liquidator be directed to issue Sale Certificate in the name of the petitioners or in the name of the person(s), as may be suggested by the petitioners, to which, Mr. Brijesh Trivedi, the learned advocate appearing for the respondent Bank has no objection and therefore, if the petitioners were deposit the balance amount within a stipulated time of two months from the date of receipt of this order, the respondent liquidator is directed to issue Sale Certificate in the name of the petitioners or in the name of anyone, whose name is suggested by the petitioners on proper verification. 15. Mr. 15. Mr. V.C. Vaghela, the learned advocate appearing for the petitioners also submitted that while the Special Civil Applications were pending adjudication, as there was encroachment by third party and that the said Special Civil Suit No.129 of 2008, converted to Regular Civil Suit No.44 of 2015 is dismissed and that no appeal is filed by the said plaintiffs. The liquidator may be directed to hand over all the original documents related to the said property and is also directed to prefer appropriate application for removal of encroachment before the appropriate authority, who may, with the help of Police protection, remove such encroachment. 16. Mr. Brijesh Trivedi, the learned advocate appearing for the respondent Bank suggested that the liquidator shall certainly issue an appropriate letter, requesting concerned authorities, including District Superintendent of Police, Bhavnagar District to assist the petitioners in getting the said encroachment cleared, in accordance with law. Mr. Brijesh Trivedi, the learned advocate appearing for the respondent Bank made it clear that it will be for the petitioners to move appropriate application before the concerned authorities and not for the Official Liquidator. 17. Mr. V.C. Vaghela, the learned advocate appearing for the petitioners has fairly accepted that the petitioners are ready and willing to bear the expenses for the removal of the said encroachment, in accordance with law, but the official liquidator may be directed to help in all permissible manner, so that the petitioners can approach the concerned authorities, including District Inspector of Land Records for getting the said land measured. 18. Mr. Brijesh Trivedi, the learned advocate appearing for the respondent Bank submitted that aforesaid exercise can be undertaken, only after the petitioners pay the balance amount, as increased by them and after necessary Sale Certificate is issued in their favour or in favour of the person, as may be suggested by the petitioners, as till then, no rights can be said to have actually accrued in favour of the petitioners or the person, in whose favour the Sale Certificate shall issue. 19. Mr. 19. Mr. V.C. Vaghela, the learned advocate appearing for the petitioners also accepted to deposit the amount as per the enhanced rate as offered by the petitioners within stipulated period of two months from the date of receipt of this order, and such payment being made in time, the official Liquidator is directed to issue Sale Certificate in the name of the petitioners or in the name of the person, as may be suggested by the petitioners and on obtaining such Sale Certificate, the petitioners may move appropriate application to appropriate authorities, as pointed out herein above and the official liquidator is directed to issue appropriate communication/direction, as may be required, so that illegal encroachment can be removed in accordance with law. 20. The aforesaid order is passed in the peculiar facts and circumstances of the present case, the observations made herein above shall not be treated as precedent and the same shall not be cited as precedent , the aforesaid order is passed in the facts and circumstances of the present case. 21. Reliance is placed on decision of the Hon'ble Supreme Court in case of Satish Batra V/s. Sudhir Rawal, reported in (2013) 1 SCC 345 , is not applicable in the facts of the present case as the same law laid done with regard to forfeiture of Ernest Money. 22. With the aforesaid direction, both the petitions are allowed to the aforesaid extent only. 23. Rule is made absolute to the aforesaid extent only. No order as to costs." 3. Pertinent is to note that the present set of appeals had been presented on 6.12.2022 and were got registered on 23.2.2023. The submission of Mr. N.V.Gandhi, learned advocate for the appellant is that the learned Single Judge has committed a grave error in issuing directions to the Official Liquidator to issue share certificates in favour of the petitioners who were auction purchaser that too by extending the time for making the deposit of the bid amount. 4. The submission is that the auction sale was cancelled and the deposits made by the auction purchasers were forfeited for the fault of the auction purchasers in not making the deposit of the entire bid amount within the stipulated time. 4. The submission is that the auction sale was cancelled and the deposits made by the auction purchasers were forfeited for the fault of the auction purchasers in not making the deposit of the entire bid amount within the stipulated time. There was no occasion for the learned Single Judge to take any exception to the said decision of the competent authority affirmed in appeal and revision filed under Section 153 and 155 of the Co-operative Societies Act. 5. It is further argued that the applicant who is the original borrower had entered into a ‘one time settlement’ with the respondent bank in the year 2011, whereunder one of the properties, namely a residential bungalow was released in favour of the borrower/ applicant herein. Once this fact was brought to the knowledge of the learned Single Judge, it was incumbent upon the learned Single Judge to ask the petitioner to implead the borrower. The writ petition could not have been decided behind the back of the borrower as the interest of the borrower was alive on the date when the judgment impugned dated 5.8.2022 was passed. The contention is that a 'no objection certificate' has been issued in favour of the original borrower, namely the applicant herein by the bank and this fact itself is sufficient to grant leave to the applicant to sustain the appeals, assailing the order passed by the learned Singe Judge dated 5.8.2022. 6. With the above submissions, it was vehemently argued by Mr. N.V.Gandhi, learned advocate for the petitioner that the petitioner is entitled for grant of leave so as to sustain the challenge to the decision of the learned Single Judge containing the above noted directions. 7. Considering the above, pertinent is to note that the learned Single Judge has categorically recorded that the auction sale was held pursuant to the public advertisement dated 19.8.2008 wherein the original petitioners were found to be highest bidders. The auction purchaser namely the original petitioners had deposited 25% of the amount within stipulated time. However, in the meantime, it came to the knowledge of the petitioners that a Regular Civil Suit No. 183 of 2007 was filed by the members of the respondent bank against whom the bank had filed Lavad Suit for recovery of the dues and award came to be passed against them. However, in the meantime, it came to the knowledge of the petitioners that a Regular Civil Suit No. 183 of 2007 was filed by the members of the respondent bank against whom the bank had filed Lavad Suit for recovery of the dues and award came to be passed against them. A third party right were created by the bank without the knowledge of the petitioners/ auction purchasers in Regular Civil Suit No. 183 of 2007. 8. It is recorded by the learned Single Judge the petitioners were always ready and willing to deposit the remaining bid amount provided the title of the property put to auction was made clear and marketable. It may further be pertinent to note that on the presentation of the writ petition by the auction purchasers, an interim order dated 6.8.2010 was passed by the learned Single Judge directing to maintain status-quo with respect to the property in question. Inspite of the said fact, the bank had entered into an OTS (One time settlement) with the original borrower without the knowledge of the auction purchasers or the petitioners or taking leave of the Court in the pending writ-petitions. 9. For these reasons, the learned Single Judge has recorded a finding that a strict view is required to be taken against the erring Officers of the respondent bank, the respondent bank without seeking permission of the Court approved ‘One time settlement’ scheme and entered into settlement, which was declared before the writ court at later stage. Faced with the situation where the bank clandestinely entered into ‘One time settlement’ with the original borrower and had released a residential bungalow which was subject matter of auction sale, the learned Single Judge had issued the above noted direction to maintain equity between the parties. The fact remains that the residential bungalow which was released in favour of the original borrower namely the leave to appeal applicant herein inspite of status-quo order passed by this Court in the writ-petitions filed by the auction purchasers, has not been touched by the learned Single Judge. 10. The direction has been issued to issue share certificate with respect to the remaining property which was subject matter of auction sale by giving adequate time to the original petitioners / auction purchasers to make deposit. 10. The direction has been issued to issue share certificate with respect to the remaining property which was subject matter of auction sale by giving adequate time to the original petitioners / auction purchasers to make deposit. There is no dispute about the fact that the directions issued by the learned Single Judge for making the deposit of the remaining bid amount has been complied with and the sale deed has been executed in favour of the auction purchasers pursuant to the order passed by the learned Single Judge in the month of March, 2023. The possession of the property in question, subject matter of auction sale, is with the auction purchaser as on date. Though the appeals were got registered in the month of February, 2023 however, there is no interim order, inasmuch as, leave to Appeal application seeking leave to file appeal has not allowed by this Court till date. The result is that the rights with respect to the property, subject matter of the auction sale, has been settled during the pendency of the present applications seeking leave to appeal. 11. In the above scenario, we do not find any justification to grant leave to the applicant namely the original borrower to challenge the judgment and order dated 5.8.2022 passed by the learned Single Judge. The applications seeking leave to appeal in the connected matters are, thus, been rejected. 12. In the result, the Letters Patent Appeals sought to be filed challenging the judgment and order dated 5.8.2022 passed by the learned Single Judge stand dismissed. All the connected Civil Applications also stand dismissed. No order as to costs.