Vinod Aggarwal And Ors. vs State Bank Of Bikaner And Jaipur

Ranjit Singh, J

The appellants being neither the borrowers nor the guarantors need not make any pre-deposit for maintaining the present appeal which is filed against the denial of interim prayer made in the pending appeal before the Tribunal below. The application is accordingly disposed of. The appellants herein filed an application in an appeal for staying the operation of the order dated 28.9.2015 passed by the R.O. for sale of the property --House No. 1142, Sector-15B, Chandigarh (UT) in a pending appeal filed to challenge the order dated 28.9.2015 passed by R.O. The Tribunal below has declined the prayer so made in the application and has listed the appeal for further hearing on 29.12.2015. Aggrieved against this order passed by the Tribunal below, the appellants have filed the present appeal.

The Bank appeared on caveat when the notice was issued on 18.11.2015. Parties were directed to maintain the status quo in regard to possession of the property.

The plea by the appellants is that they are bona fide purchasers having purchased this property in the year 2010 from the grandson of Smt. Champa Garg who had purchased the same through Court auction in the year 2007. The attachment order in regard to the property was passed in the year 2013. The appellants claimed to be bona fide purchasers prior to the order of attachment thus stated that they would have a priority over attachment order.

In the reply filed by the Bank the correct factual position has now been disclosed. The respondent Bank herein had filed an O.A. in the year 1997 and a recovery of Rs. 39,12,77,986.03 was, ordered against M/s. Munak Galva Sheets Ltd., Mr. Vinod Kumar Garg, Mr. Hans Raj Garg and Smt. Vinita Garg. The recovery was allowed with interest @ 20.25% with quarterly rests. Orders against some of the defendants were kept pending. Thereafter, on 30.1.2001, final order was passed against defendants 3 and 4 as well. Demand notice for a sum of Rs. 90,56,13,256.67 was issued to the CDs and they appeared before the R.O. on 15.10.2001. CD-3, Mr. Hans Raj Garg was the owner in possession of the property in question which was mortgaged in favour of Rajasthan Bank Ltd. CD-3 entered into a settlement with Rajasthan Bank Ltd. and as per the terms of the settlement, this mortgaged property was agreed to be sold/transferred in the name of Mr. Vijay Kumar Garg or his nominee. It is pursuant to this settlement that this property was transferred in the name of Smt. Champa Garg who was none other but wife of CD Mr. Hans Raj Garg.

While entering into this settlement, CD Mr. Hans Raj Garg was fully aware of the recovery proceedings pending against him. The further plea by the Bank accordingly is that the money provided for purchase of this property was of the CD as Smt. Champa Garg was only a housewife. Within three months of having purchased this property, Smt. Champa Garg transferred the same in the name of her grandson Mr. Bharat Garg vide registered gift deed dated 28.6.2007. This transfer, according to the respondent Bank, is not genuine transaction and was done to avoid admitted liability of CD Mr. Hans Raj Garg towards the respondent Bank. Mr. Vinod Kumar Garg, acting as attorney of his son Mr. Bharat Garg sold this property to the appellants which, according to the Bank, is to avoid their liability towards the respondent Bank.

By pointing out to the above facts, the Counsel for the Bank would say that the appellants cannot claim to be bona fide purchasers as they had purchased this property without exercising due diligence. If the appellants had carried out proper inquiry, they were bound to know of the pending recovery proceedings against the owner of the property. The Counsel for the Bank would urge that the appellants are the persons who have come forward to help the CDs. Counsel would also contend that the attachment order though passed in the year 2013 would relate back to the demand which was made in the year 2001 and thus no advantage can accrue in favour of the appellants on the ground that they had purchased the property prior to the order of attachment.

It will not be appropriate for this Tribunal to make any comment on priority of rights as the appeal is pending adjudication before the Tribunal below. All these issues in regard to the validity of attachment and its relating back to the date of order are to be considered by the Tribunal below. Any expression of opinion on this ground may prejudice the case of either party. What is to be considered at this stage, is whether a case is made out for staying the action of the R.O. for sale of the property in question. The Counsel for the appellants would contend that the interim arrangement can be ordered to be continued till the disposal of the appeal so as to avoid further complication. That is not what is to be considered while granting the prayer for interim relief. If the operation of the order passed by R.O. is stayed, it would amount to granting main relief claimed in the appeal pending before Tribunal below. Even otherwise, it is to be seen if any prima facie case is made out in favour of the party and where the balance of convenience lie. The facts as noticed would show prima facie that the appellants did not carry out due diligence before purchasing the property. Balance of convenience also may not appear to be in favour of the appellants. Even if the Bank is allowed to go ahead with the action and the appellants are able to show and establish their rights as independent purchasers of the property, then the sale itself can be set aside. The recovery is of a huge amount. The settlement before this Tribunal earlier was for selling the property in the name of Mr. Vijay Kumar Garg or his nominee. The property, however, was sold to Smt. Champa Garg who is the wife of one of the CDs. She has further gifted this property to her grandson. This is after retaining the same for three months. One of the CDs, namely, Mr. Vinod Kumar Garg has sold this property being attorney of his son to the present appellants. To an extent, the order passed by this Tribunal directing the sale of the property in favour of Mr. Vijay Kumar Garg had been violated. All these was done in the year 2007 by the CDs who well knew that recovery ordered against them, arising out of the order passed in the present O.A. It can be said that the borrowers had overreached this Tribunal while getting an order for sale of this property by way of settlement. This sale cannot be termed as auction sale as is being said by the Counsel for the appellants. Apparently, it seems that the borrowers have not been fair.

In view of above, no case for interference in the impugned order is made out. The appeal is accordingly dismissed.