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2008 Supreme(SC) 455

2008(2) Supreme 572
Supreme Court of india
Dr. Arijit Pasayat & C.K. Thakker & Lokeshwar Singh Panta, JJ.
Uttar Gujarat S.R.V. Sangh Ltd. — Petitioner
versus
M/s. Mehsana Dist. Cent. Co-op. Bank Ltd & Ors. — Respondents
Appeal (civil) 1892 of 2008
(Arising out of SLP (C) 1374 of 2006)
Decided on : 11.03.2008

Headnote:Principles of natural Justice – Non grant of opportunity of being heard-effect – Pursuant to order of restraint passed by Board of Nominees, Ahmedabad Division , defendant No. 2 appellant was restrained from giving or making payment to defendant No.1 – Though appellant was a party i.e. Respondent. 2 in the Special Civil Application, matter was disposed of without hearing appellant- In the Review Application Single Judge of High Court proceeded on entirely erroneous premises – The ultimate result was that appellant, without getting an opportunity of being heard and/or presenting its case had been saddled with liability – Impugned order set aside and matter remitted back to High Court for fresh disposal in accordance with law – Appeal allowed. (Paras 9 to 11)

       Facts of the Case :

       1.Certain bales of cotton belonging to Respondent No. 3 were pledged with the respondent no. 1 herein in the instant case. However, respondent no. 3 had handed over said goods to respondent no. 2 for ginning. Respondent no. 2 had ginned cotton but they were not having any facility of pressing. Therefore, said goods were given to Ashok Nagar Cooperative Society. Ashok Nagar Cooperative Society had pressed and made bales and same were supplied to appellant to be sold in market. Said goods were accordingly sold by appellant after approval was granted by respondent no. 1 on condition that sale proceeds of goods would be paid to respondent no. 1. Accordingly appellant handed a part of sale proceeds to respondent no. 1.

       2.For the remaining amount, the appellant was, about to hand over said money. In the meantime, Suit was filed by respondent no. 3, before Court of Board of Nominees against respondent. 2, and appellant claiming a sum of Rs. 77,786/- being the sale proceeds of the goods sold. Thus appellant though having money and prepared to pay said money to respondent no.1 was prevented from paying same by injunction order obtained by respondent no.3 against appellant. Said suits were decreed by common order and it was ordered that amount of Rs.77, 786/- lying with appellant be paid to respondent no.3 with interest at rate of 18% per annum. .The appellant was thus saddled with large amount of interest though it was holding money as per court’s direction only and for no reason of its own or for any dispute with any of the Respondents.

       3.The aforesaid order of Court of Board of Nominees was challenged before the Cooperative Tribunal by way of Appeal Nos. 243/94 and 216/94. The said appeals were dismissed by the Cooperative Tribunal.

       4.Thereafter the appellant filed a review application on the ground that no notice was served and hence no opportunity of hearing was given to it. The said review application was dismissed by the present impugned order on the ground that no ‘adverse order’ was passed against appellant.

       5.Present appeal has been filed against said order of High Court.

       Findings of the Court :

       The Court held that pursuant to order of restraint passed by Board of Nominees, Ahmedabad Division, defendant No. 2 appellant was restrained from giving or making payment to defendant No.1. Though appellant was a party i.e. Respondent. 2 in the Special Civil Application, matter was disposed of without hearing appellant. In the Review Application Single Judge of High Court proceeded on entirely erroneous premises. The ultimate result was that appellant, without getting an opportunity of being heard and/or presenting its case had been saddled with liability. Impugned order was set aside and matter was remitted back to High Court for fresh disposal in accordance with law. Appeal was allowed.

       Result : Appeal allowed.

judgment

Dr. Arijit Pasayat, J. —

1.Leave granted.

2.Challenge in this appeal is to the order passed by learned Single Judge of the Gujarat High Court in Special Civil Application No. 5660 of 1998 and Misc. Civil Application No. 231of 2005.

3.Background facts as projected by appellant in a nutshell are as follows :

Certain bales of cotton belonging to Respondent No. 3 were pledged with the respondent no. 1. However, the respondent no. 3 had handed over the said goods to the respondent no. 2 for ginning. The respondent no. 2 had ginned the cotton but they were not having any facility of pressing. Therefore, the said goods were given to Ashoknagar Cooperative Society. Ashoknagar Cooperative Society had pressed and made bales and the same were supplied to the present appellant to be sold in the market. The said goods were accordingly sold by the appellant after approval was granted by the respondent no. 1 on the condition that the sale proceeds of the goods would be paid to the respondent no. 1. Accordingly the appellant handed a part of the sale proceeds to the respondent no. 1. For the remaining amount, the appellant was, about to hand over the said money. In the meantime, Civil Suit No. 1808/1990 was filed by the respondent no. 3, before the Court of Board of Nominees at Mehsana against the respondent no. 2, and the present appellant claiming a sum of Rs. 77,786/- being the sale proceeds of the goods sold. In the said suit, Respondent No. 3 obtained an order of injunction against the appellant thus preventing the appellant from handing over the said amount to Respondent No. 1. Similarly, Civil Suit No. 1809 of 1990 was filed by the respondent No. 1, against the appellant and the respondent No.3 herein before the Court of Board of Nominees at Mehsana. Both the suits were tried together. Thus the appellant though having money and prepared to pay the said money to respondent no.1 was prevented from paying the same by the injunction order obtained by respondent no.3 against the present appellant. According to appellant it has no privity of contract with the respondent no.3. The goods were handed over by Ashok Nagar Cooperative Society to the appellant. Therefore, the appellant has nothing to do with either the respondent no.3 or with the respondent no.2. Therefore, in both the suits, the appellant did not remain present.

The said suits were decreed by common order dated 18.7.1994 and it was ordered that the amount of Rs.77, 786/- lying with the appellant be paid to the respondent no.3 with interest at the rate of 18% per annum. The appellant was thus saddled with large amount of interest though it was holding money as per court’s direction only and for no reason of its own or for any dispute with any of the Respondents.

The aforesaid order of the Court of Board of Nominees was challenged before the Cooperative Tribunal by way of Appeal Nos. 243/94 and 216/94. The said appeals were dismissed by the Cooperative Tribunal by its order dated 31.5.1998 and order of the Court of Board of Nominees was confirmed. Against the said order of the Cooperative Tribunal, Respondent no.1 and Respondent no.2 moved Writ Petitions before the High Court of Gujarat. In the said Writ Petition, even though the appellant was impleaded as a party respondent, it was not served with notice and therefore the appellant could not remain present at the time of hearing of the Writ Petitions. Both the Writ Petitions were heard and dismissed by a Single Judge of the High Court of Gujarat by order dated 2.12.2004.

Thereafter the appellant filed a review application in the High Court of Gujrat bearing No. Misc. Civil Application (Stamp No. 231/2005) interalia on the ground that no notice was served and hence no opportunity of hearing was given to it. The said review application was dismissed by the present impugned order dated 13.5.2005 on the ground that no ‘adverse order’ was passed against the appellant.

After the review petition was dismissed Respondent No. 3 filed execu











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