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U.P. STATE INDUSTRICAL DEV. COPRN. LTD. GHAZIABAD. versus BOARD OF REVENUE, U.P. AT LKO., & OTHERS

High Court of Judicature at Allahabad

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U.P. State Industrical Dev. Coprn. Ltd. Ghaziabad. v. Board Of Revenue, U.P. At Lko., & Others - WRIT - B No. 3790 of 2000 [2006] RD-AH 15652 (7 September 2006)

 

This is an UNCERTIFIED copy for information/reference. For authentic copy please refer to certified copy only. In case of any mistake, please bring it to the notice of Joint Registrar(Copying).

HIGH COURT OF JUDICATURE OF ALLAHABAD

                                                   Court No.5.                                                                                                                              

Civil Misc. Writ Petition No. 3790 of 2000

U.P. State Industrial Development corporation Ltd. Vs. Board of Revenue U.P. Lucknow & Others

                  A N D

Civil Misc. Writ Petition No. 3799 of 2000

U.P. State Industrial Development  Corporation Ltd. Vs. Board of Revenue, U.P. Lucknow & others.

Hon'ble Janardan Sahai, J

The judgment in these cases was dictated in open court on  31.8.2006. A mention was thereafter made by Sri R.P. Mishra, Advocate that he has filed an application in the registry that the respondent no.7 who had not been heard be heard. The judgment had not been signed till then.  When the application for hearing respondent no. 7 came up before this Court the case was ordered to be put up for today i.e. 6.9.2006. Before dealing with the merits of these petitions it is necessary to say something about the hearing in these petitions and representation of the respondent no.7 in these two cases. The counsel who represented respondent no. 7 in both cases from the beginning is Sri Rajiv Mishra through whom the counter affidavit was filed. On 4.5.2006 counsel for the parties agreed that the writ petition may be disposed of finally and Sri S.K. Verma, learned senior counsel for the petitioner was heard. The parties were also asked to submit written submissions by 15.5.2006 and written submissions were filed by the petitioner. Thereafter when the case was listed for hearing Sri Vishnu Gupta got the case adjourned on behalf of respondent no.7 saying that he has since been engaged but subsequently he filed an application to withdraw from the case as no proper Vakalatnama was given to him and he was not being instructed. The case was adjourned and when it was listed again a mention was made that Sri Shashi Nandan, senior counsel would be appearing on behalf of respondent no.7 and the case was again adjourned. On 23.8.2006 the record of the case was also produced and it was examined by Sri S.K. Verma, learned counsel for the petitioners and by Sri R.N. Singh, learned Senior Counsel appearing for the respondents no.7 in these cases and the learned counsel also referred to certain entries in Register No.4 relating to the payment made by the respondent no.7, which were   noted. The case was then directed to be put up on 31.8.2006. On that date Sri R.N. Singh, learned Senior Counsel who was appearing for the respondent no.7 in both these cases made a statement that as his instructing counsel has failed to turn up he was submitting only points for determination and the case law upon the subject but is not in a position to argue the case. Sri Rajiv Mishra, learned counsel for the respondent no.7 whose vakalatnama is on the record also did not appear. Learned counsel for the petitioners Sri S.K. Verma and the learned counsel for the respondent no. 6 Sri P.M.N. Singh, Senior Advocate assisted by Sri Ashok Nath Tripathi and the learned Standing Counsel were heard in both these cases. After hearing the counsel for the parties the order was also dictated in open court. However, as the judgment had not been signed and an application for hearing arguments on behalf of respondent no.7 has been filed. I have heard Sri R.P. Mishra on behalf of the respondent no.7 in both these cases. Sri S.K. Verma is also present.

                    The facts of the case are that U.P.S.I.D.C. Ltd. in both these writ petitions is the owner of two plots nos. 2/1 and2/2 in industrial estate Sahibabad. The plot no. 2/1 was allotted to M/s. Bromic Suri Pvt. Ltd. and plot no.2/2 was allotted to M/s. Suri Asbestos Pvt. Ltd.  It appears that there were certain dues against M/s. Bromic Suri Pvt. Ltd. and Suri Asbestos Pvt. Ltd. The dues were sought to be recovered as arrears of land revenue and the two plots nos. 2/1 and 2/2 were auction sold on 15.6.1992 and were purchased  respectively by Rakesh Kumar Goel, respondent no.7 in Writ Petition No. 3790 of 2000 and by M/s Moti Board Industries Pvt. Ltd. respondent no. 7 in Writ Petition No. 3799 of 2000.

The auction sale was challenged by separate objections filed by M/s.Bromic suri Pvt. Ltd. and by M/s. Suri Asbestos Pvt. Ltd. The aforesaid sales were also challenged by the petitioner U.P.S.I.D.C. by two separate objections under Rule 285-I  U.P. Zamindari Abolition and  Land Reforms Rules. The objections were dismissed by the Commissioner. Against the order of the Commissioner two revisions were filed by the petitioner, which have been dismissed by the Board of Revenue on 11.10.1999. Aggrieved, the U.P. S. I. D.C. has filed these two writ petitions.

            Sri S.K. Verma, learned senior counsel who appeared on behalf of the petitioner raised several submissions, namely, that the sale was a nullity as ¼ of the bid amount was required to be deposited on 15.6.1992 the date of the sale in view of the provisions of Rule 285-D of the U.P. Zamindari Abolition and Land Reforms Rules whereas the deposit was made on the next day, namely, on 16.6.1992; that the balance ¾ of the amount was required to be deposited by the auction purchaser within 15 days thereafter but the same was not deposited by the respondent no.7; that the auction sale was required to be confirmed after the expiry of 30 days from the date  of the sale as required by Rule 285-G but the confirmation was made within a period of 30 days and therefore the order of confirmation is invalid; that the reserve price for the sale of plot no. 2/1 was  Rs. 25 lacs but it was sold for a throw away price of Rs. 6,30,000/- and the reserve price for plot no. 2/2 was Rs. 200000/- but that plot was sold for a throw away price of Rs. 6,20,000/-; that there was a stay order of the High Court in Writ Petition No. Nil of 1992 filed by Bromic Suri Pvt. Ltd. and the sale held on 15.6.1992 was in breach of the stay order.

          The State has filed counter affidavit and also supplementary affidavits. The record of the case was produced before this Court. The following entries from Register No.4 were noted in the order dated  23.8.2006  in this petition, which is quoted below:

"23.8.2006         Hon'ble Janardan Sahai, J

Register no. 4 of Naib Nazir Tehsil Dadri was produced by the standing counsel. It was also examined by Shri S.K. Verma, learned senior counsel appearing for the petitioner and by Shri R.N. Singh learned senior counsel appearing for respondent no.7.

Standing counsel referred to two entries made at Sl. No.39 and 40 dated 16.6.1992 and one entry at Sl. No. 55 dated 29.6.1992.  Entries made at Sl. No.  39, 40 and 55 in the Register No.4 are quoted hereunder:

39 16.6.1992 ,e0 ,y0 eksrh xks;y Mk;jsDVj eS0 eksrh cksMZ bZ0izk0fy0 )kjk jkedqwekj l0 v0 ckcr eS0 lwjh ,LcsLVl izk0 fy0 dh vpy lEifRr d1 1/4 Hkkx j0 uz0 844499/16.6.1992 155000.00

40 16.6.1992 jkds'k dqekj S/o Jh ytkjke  R/o uo;qx ekfdZV xk0 ckn  )kjk Jh jkedqekj l0 v0 ckcr eS0 czzsfed lwjh l0 v0 dh vpy lEifRr dk 1/4 Hkkxj0 u0 844500/16.6.1992 157500.00

55 29.6.1992 ,e0 ,y0 xks;y Mk;jsDVj eS0 eksrh cksMZ bZ0izk0fy0 lk0 ckn ckcr eS0 lwjh ,LcsLVl izk0 fy0 dh vpy lEifRr d1 3/4 Hkkx j0 uz0 846590/29.6.1992 465000.00

Standing counsel submitted that other than the aforesaid three deposits made on 16.6.1992 and 29.6.1992, there is no other deposit made in respect of 3/4th of the amount by respondent no.7 during the period 15.6.1992 to 1.7.1992. Neither of the counsel could refer to any such entry in the register during this period.

  Put up this case on 31.8.2006"

On the basis of the entries in the Register No.4 it was contended by Sri S.K. Verma, learned counsel for the petitioner that the deposit of the ¼ of the bid amount was not made on 15.6.1992 the date of the sale but was made on 16.6.1992. From the date of deposit entered in the register and that of the receipt also entered therein it is clear that the deposit was made on 16.6.1992. Rule 285-D provides that deposit of the bid amount has to be made by the auction purchaser immediately and if it is not made a re-sale of the property is to be ordered. Emphasis was placed by the petitioner's counsel upon the word ''immediately' occurring in Rule 285-D and it was submitted that the requirement to make the deposit on the very day of the auction sale is mandatory. Reliance was placed upon a decision of the Apex Court in A.W.C. 1995 Vo. 2 Supreme Court 896 Mahmood Ahmad Khan Vs. Ranbir Singh and others. The Apex court held that the failure to deposit the ¼ of the bid amount on the very day of the auction sale is followed by the consequence that the sale shall be held again from which it is implicit that the amount has to be deposited on the very day on which the auction has been held. The Apex Court clarified that although it was not necessary to make the deposit literally on the fall of the hammer and a reasonable time has to be given to the purchaser to make the deposit, the deposit must be made on the date of the sale. The same view has been taken by this Court in Kanchan Lal Vs. Board of Revenue 2003 (6) A.W.C. 5705. The decision of the Gujrat High Court in A.I.R. 1986 Gujrat 141 Nitin Vs. The Executive Engineer relied upon by Sri R.P. Mishra and also by Sri R.N. Singh who had submitted points for determination cannot be relied upon in view of the authoritative pronouncement of the Apex Court in Mahmood Ahmad Khan.

          Although a counter affidavit has been filed  by the State and several supplementary affidavits and much has been said in the supplementary counter affidavit in Writ Petition No.3790 of 2000 about the frauds by  Moti Lal Goel brother of Rakesh Kumar Goel the auction purchaser in several matters but this point about non-compliance of Rule 285-D was not specifically raised. Two enquiry reports against the A.D.M. Ram Bahadur have been annexed with the second supplementary counter affidavit filed by the State. From the version given in the counter affidavit it appears that attempt to protect the auction purchaser was made by the State officials. But for the register no. 4, which was produced in the court it would have been difficult to come to the truth of the matter. In view of the entry  in the Register No.4 it is clear that the deposit of ¼ of the bid money was not made on the day of the auction and the auction sales are a nullity.

       

In the points of determination, which were submitted by Sri R.N. Singh the case law has also been relied upon and Sri R.P. Mishra has pressed the same points today. It is contended that the petitioner has no locus standi to challenge the auction proceedings. The submission does not carry weight. The petitioner is undoubtedly the lessor of the premises of the respondents. The consequence of the failure to deposit the 25% of the bid amount on the date of the sale itself renders the sale a nullity. Such a sale is not merely voidable. Moreover, the auction purchaser cannot be thrust upon the lessor/licensor as a lessee when the sale itself is a nullity. The petitioner, therefore, has sufficient interest in the matter to maintain these writ petitions. The decision 1999 (9) SCC 276 Ram Maurya Vs. Kailash Nath and others that a party objecting to the sale on ground of material irregularity and fraud must plead substantial inquiry as a result of such irregularity is distinguishable as the sales in the present petitions are a nullity.

Sri R.P. Mishra then pressed his next contention, which has also been included in the points for determination submitted by Sri R. N. Singh that the points being raised by the petitioner are new points and cannot be pressed for the first time in the writ petition as these points were not pleaded in the objection under Rule 285-I.           Learned counsel for the petitioner contended in reply that under Articles 226 and 227 of the Constitution of India the High Court has wide power to interfere in an order, which suffers from patent illegality. In support of his submissions learned counsel for the petitioner relied upon the following cases. Standard Chartered Bank Vs. Andhra Bank Financial Services Ltd. and others JT 2006 (11)  Supreme Court 456; AIR 1966  Supreme Court 735 (Vol. 53 C 139),  Bhagwati Prasad Vs, Chandramaul; AIR 1978 Allahabad, 27, Smt. Deepika Alizabeth Couto Vs. Gabriel Anthony Couto. It is true that ordinarily a new point not raised in the pleadings before the courts below can not be raised for the first time before the High Court but if the High Court finds from the record that there is a glaring illegality in the proceedings resulting in injustice to a party the High Court has wide power to interfere. It was contended that fraud has not been pleaded. The view that I have taken in this case is that the sale was a nullity on account of failure on the part of the auction purchaser to deposit the ¼ of the bid amount on the same date. Irrespective therefore of any fraud the failure to deposit ¼ of the bid amount on the same day renders the sale a nullity.

 Sri R.P. Mishra then pressed another point, which has already been taken in the points for determination submitted by Sri R.N. Singh that the question of saleability of the interest of the judgment debtor can not be raised except by the auction purchaser. Upon this point reliance has been placed upon Kadiyala Rama Rao Vs. Gutala Kahna Rao and others 2000  SCC  Vol. 3, 87. The proposition of law laid down by the Apex Court cannot be doubted. However, the sale in the present case has been found to be a nullity. The decision cited therefore does not have any application.

                  It was then submitted that the petitioner has an alternative remedy of filing a suit. In view of the finding already given by me that the sale is a nullity for want of deposit of 25% of the bid amount, which is borne out from the record, it is not necessary to relegate the petitioner to the remedy of a suit. Moreover, as an order under Rule 285-I is final a suit to challenge an auction sale can be filed only on limited grounds such as of fraud as also appears from Rule 285-K.

            A supplementary affidavit has been filed by Mayank Srivastava, the Deputy Manager, U.P. State Industrial Development Corporation, which contains an averment that 3/4th of the amount, which was required to be deposited by Rakesh Kumar Goel was never deposited. The Register No.4, which was produced indicates that between the period 15.6.1992 to 1.7.1992 the deposit of 3/4th of the bid amount by receipt No. 846590 was made on 29.6.1992 on behalf of M/s. Suri Asbestos Pvt. Ltd. There is no entry in the said register to which the counsel may have referred that the balance of the 3/4th amount was deposited by Rakesh Kumar Goel, respondent no.7 in Writ Petition No. 3790 of 2000. The sale in favour of Rakesh Kumar is therefore invalid for this reason also.

      In the result the writ petitions are allowed. The order of the Commissioner dated 5.11.1998 as well as the order of the Board of Revenue dated 11.10.1999 are set aside. The auction sales dated 15.6.1992 in favour of the respondents no.7 in both the petitions is also set aside.

Dt.7.9.2006

S.Wp.3790 of 2000


Copyright

Reproduced in accordance with s52(q) of the Copyright Act 1957 (India) from judis.nic.in, indiacode.nic.in and other Indian High Court Websites

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