Judgement
REPORTABLE
IN
THE SUPREME COURT OF INDIA
CIVIL
APPELLATE JURISDICTION CIVIL APPEAL NO(s).5696 OF 2012 [@Petition(s) for
Special Leave to Appeal (Civil)23150/2012 CC 12128/2012]
M/S.
OPTIEMUS INFRACOM LTD. Appellant(s)
VERSUS
M/S.
ISHAN SYSTEMS PVT.LTD. & ANR. Respondent(s)
WITH CIVIL APPEAL
NO(s).5697 OF 2012 [@Petition(s) for Special Leave to Appeal (Civil)23161/2012
CC 12468/2012]
M/S.PHOENIX
ARC PVT. LTD. Appellant(s)
VERSUS
M/S.
ISHAN SYSTEMS PVT. LTD. Respondent(s)
O R
D E R
1. Two Special Leave
Petitions have been filed against the judgment and order dated 14th February,
2012, passed by the Allahabad High Court, in Civil Miscellaneous Writ Petition
No.8409/2012.
2. The first Special
Leave Petition has been filed by M/S. OPTIEMUS INFRACOM LTD., being SLP(C)......CC
12128/12. the second Special Leave Petition has been filed by M/S. PHOENIX ARC
PVT.LTD., being SLP(C)......CC 12468/12.
3. Delay condoned.
4. Leave granted in
both the Special Leave Petitions.
5. Writ Petition
No.8409 of 2012, was filed by the respondent, M/S.ISHAN SYSTEMS
PVT.LTD.& ANR., against the judgment and order dated 11th April, 2011,
whereunder the property of the respondent/judgment-debtor Co. was put to
auction. An application had been filed by the respondent-company before the Debts
Recovery Tribunal complaining of violation of the statutory rules which
regulate the auction of property.
Other grounds were
also taken, but the same were rejected by the High Court. In fact, the High
Court, after examining the records of the writ petition, had found no good
ground to interfere with the order of the Appellate Authority. Instead of
stopping there, the High Court went on further to give various directions to
the Debts Recovery Tribunal, to proceed and decide the application, which had
been filed by the respondent No.1/petitioner, being S.A.No.714/2011. By another
direction the auction purchaser was restrained from making any further transfer
of the property in question and any construction raised would abide by the
orders to be passed in the pending application before the Debts Recovery
Tribunal. With the aforesaid directions, the High Court disposed of the writ
petition finally.
6. The said judgment
and order of the High Court had been questioned on the ground that having found
no ground to interfere with the order of the Appellate Authority, the learned
Judge of the High Court should not have passed other orders, and, in
particular, an order of injunction, which was to the prejudice of the appellant
before us, without issuing notice or giving the appellant an opportunity of
hearing.
7. Since the writ
petition was disposed of on the very first date, without notice to the
respondents, there was no occasion to consider the competence of the Allahabad
High Court to entertain the writ petition.
Subsequently, another
writ petition was filed by the respondents herein, being No.35215 of 2012,
before the Allahabad High Court, for quashing the order dated 10th July, 2012,
which had been passed by the D.R.T.-III, Delhi, by which the application filed by
the respondents herein under Section 17(1) of the Securitisation and
Reconstruction of Financial Assets and Enforcement of Security Interest Act,
2002 (the SARFAESI Act), was rejected. In the said petition, the question of
jurisdiction was raised and was heard and decided against the respondents
herein. In fact, reference was made in the judgment delivered on 30th July,
2012, to the earlier writ petition and it had been observed that although, the
earlier writ petition had been entertained by the Allahabad High Court, the
issue relating to jurisdiction had not been gone into, since the writ petition
had been disposed of on the first date, without hearing the respondents.
8. Ultimately, the
learned Judge accepted the preliminary objections raised on behalf of the
appellants herein and held that the Allahabad High Court had no jurisdiction to
entertain the writ petition and dismissed the same accordingly.
9. Both, S/Shri
Venugopal and Ranjit Kumar, learned senior advocates appearing for the
appellants in these two appeals, submitted that, although, the order of the
High Court has to some extent been worked out and the sale which had been
effected has been confirmed, the only question which remained to be considered
was the competence of the Allahabad High Court to entertain a writ petition
from an order passed by the Debts Recovery Tribunal, Delhi, and the fact that
the same was disposed of on the very first day, without notice, by issuing
orders and directions which prejudiced the appellants.
10. Mr. Chetan Sharma,
learned senior advocate appearing for the respondents, has tried to impress
upon us that the order of injunction which was passed by the Allahabad High
Court was innocuous and that it did not prejudice or adversely affect the
appellants in any way and since the sale has been confirmed, nothing further
remained to be decided, as far as the said question is concerned.
11. It is true that
the impugned order has more or less worked itself out, but it needs to be
indicated that the practice which was adopted by the Allahabad High Court, is
not only arbitrary, but also contrary to the concept of the principles of
natural justice. Since the writ petition was to be dismissed without issuing
notice, it should have been dismissed without giving any further directions in
the matter.
Instead, certain
positive instructions were given to the respondents and one of the respondents
was restrained from dealing with the property, without any notice to him/them.
If there was any intention on the part of the learned Judge to protect the
properties in question during the pendency of the matter before the Debts
Recovery Tribunal, the proper course of action would have been to issue notice,
and, if necessary, pass interim orders and, thereafter, after hearing the
parties to pass final orders in the matter.
12. We hope that in
future, this kind of order will be avoided in the interest of justice and also
having regard to the principles of natural justice.
13. The appeals are
allowed. The impugned judgment to the extent that it restrains the appellants
from alienating or encumbering the property, is hereby set aside.
14. The appeals are
disposed of, accordingly.
...................J
(ALTAMAS KABIR)
...................J
(J.CHELAMESWAR) NEW
DELHI;
August 01, 2012.
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