Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2021 Supreme(Bom) 54

IN THE HIGH COURT OF JUDICATURE AT BOMBAY
R.D. DHANUKA, V.G. BISHT, JJ.
M/s. Priyesh Land Developers a Partnership Firm - Appellant
Versus
The Pen Co-operative Urban Bank Ltd. - Respondent
Writ Petition No. 13001 of 2016, Civil Application No. 3128 of 2016, Writ Petition (STAMP) No. 5832 of 2021
Decided on : 07-04-2021

Advocates:
Advocate Appeared:
Mr. Virag Tulzapurkar, Senior Advocate a/w Mr. V. P. Sawant, Senior Advocate i/by Mr Prabhakar M Jadhav, Mr. Kirit J. Hakani a/w Mr. Rahul Hakani and Ms. Niyati Hakani, Mr. Manish Bohra i/by Singhania, Mr. S.S. Kulkarni i/by Mr. Sachin Chavan, Mr. Rajan S. Pawar, Mrs. Ashwini A. Purav, Mr. V. P. Sawant, Senior Advocate a/w Mr. P. M. Jadhav, adv.

Point of Law: Default in repayment of loan - Issue of stamp duty not paid as payable on execution of Conveyance Deed - Provisions of the MCS Act and more particularly under section 78 (4) to make payment of Rs.22,48,04,507/- being surplus sale proceeds of the property together with interest – Section 96 of MCS Act would apply in case of contested matter. Co-operative Court in that case cannot pass an award awarding interest at rate lower than contractual rate of interest.

Headnote:
Code of Civil Procedure, 1908 - Order 23 - Rule 1, sub rule 4 - Maharashtra Co-operative Societies Act, 1960 - Section 100(1), 78 and 96 - MCS Rules - Rule 85(13) – Constitution of India, 1950 - Article 226 - Recovery of amount by sale of mortgaged property - Transfer of ownership of mortgaged property - Writ Petition is filed by the said bank inter-alia praying for declaration that Deed of Conveyance whereby operating as absolute transfer of ownership of mortgaged property mentioned in the Consent Award passed by Maharashtra State Co-operative Appellate Court in Appeal so as to constitute said bank as absolute owner thereof - Said bank has also prayed in alternative prayer clause (a) for a writ of certiorari for quashing and/or setting aside Deed of Composition - Petitioner also seeks a writ of mandamus against Maharashtra State Co-operative Appellate Court to modify Consent Award by providing for contractual rate of interest i.e. interest @ 18% p.a. to be compounded quarterly on decretal amount from date of consent award till date of recovery of amount by sale of mortgaged property.
Finding of the Court: There is however, no bar in the parties, agreeing to reduce rate of interest or any rate lower than contractual rate of interest by - agreement before Co-operative Court. Parties may agree and vary existing terms prescribed in agreement by entering into fresh agreement or by modifying the terms. The Court cannot refuse to pass an award or decree based on fresh agreement arrived at by parties by applying the provisions of Section 96 of the MCS Act - Respondent no.l had not paid stamp duty payable under Article 25 on said consent award or on Deed of Composition. It is an admitted position that the stamp duty under Article 25 ofSchedule to Maharashtra Stamp Act was paid only on the sale deed executed by respondent no.1 in favour of auction purchaser. Court cannot grant any reliefs in favour of the Bank also for the reason that sale of the said property has been already confirmed in favour of the auction purchaser long back. He has already paid the entire consideration to the Bank long back and has become exclusive owner of the said property. He is in exclusive possession of the said property - Said auction purchaser is not a party in any of these petitions - Court inclined to accept the statement made in paragraph 31 of the writ petition and also the statement made by the learned senior counsel for the petitioner across the bar that if the respondent no.1 makes payment to the petitioner of the said amount after these proceedings are decided in favour of the petitioner, the petitioner would withdraw the civil suit.
Result: Writ Petition dismissed.

JUDGMENT :

R.D. Dhanuka, J.

By Writ Petition No. 13001 of 2016 filed under Article 226 of the Constitution of India, the petitioner prays for an order and direction against the State of Maharashtra, the Commissioner for Co-operation and the Registrar of Co-operative Societies and the Divisional Joint Registrar, the respondent nos. 2, 3 and 4 respectively to make payment of Rs.22,48,04,507/- being surplus sale proceeds of the suit property together with interest @ 17% p.a. thereon from 1st March, 2014 till the payment of realization (hereinafter The Pen Co-operative Urban Bank Limited is referred to as ‘the said bank’) (for short The Maharashtra Co-operative Societies Act, 1960 is referred to as ‘the said MCS Act’).

2. The Writ Petition (Stamp) No. 5832 of 2021 is filed by the said bank inter-alia praying for declaration that the Deed of Conveyance whereby operating as absolute transfer of the ownership of the mortgaged property mentioned in the Consent Award dated 7th February, 2002 passed by the Maharashtra State Co-operative Appellate Court in Appeal No. 13 of 2002 so as to constitute the said bank as the absolute owner thereof. The said bank has also prayed in the alternative prayer clause (a) for a writ of certiorari for quashing and/or setting aside the Deed of Composition dated 12th February, 2002. Petitioner also seeks a writ of mandamus against the Maharashtra State Co-operative Appellate Court to modify the Consent Award dated 7th February, 2002 by providing for contractual rate of interest i.e. interest @ 18% p.a. to be compounded quarterly on the decretal amount of Rs.12,52,95,492.65/- from the date of the consent award till the date of recovery of the amount by sale of the mortgaged property.

3. Though several petitions were on board along with these petitions, since the parties to these petitions concluded their arguments finally in these two petitions and the parties to the other petitions did not commence their arguments though opportunity was given immediately after closure of the arguments in these two petitions, we have proceeded with the judgment in these two petitions. Even otherwise these two petitions are not interconnected with the other petitions and can be disposed off without hearing the other matters. The other petitions are adjourned for a period of four weeks. Some of the relevant facts for the purpose of deciding these two petitions are as under :-

4. The petitioner had taken loans and advances from the said bank and had executed and registered a Simple Mortgage Deed in respect of its property being piece and parcel of land admeasuring 595402.04 sq. mtrs. bearing Survey No.38/1 and Survey No.44 (Part), Village Tumb, Sanjan, Taluka Umbergaon, Dist. Valsad, Gujarat on 8th February, 1999. The two Gut numbers were subsequently consolidated and was given new Survey No.44/1.

5. It is the case of the said bank that the petitioner committed default in repayment of the said loan obtained from the said bank. The said bank filed three disputes against the petitioner and also against the sister concern of the petitioner, its partners and guarantors to the said loan transaction being Case Nos. 34 of 2001, 35 of 2001 and 36 of 2001 in the Co-operative Court at Raigad on 22nd January, 2001. Case No.34 of 2001 was filed against M/s. Anuj Land Developers Pvt. Ltd. and others for recovery of sum of Rs.1,79,05,981/- with interest @ 18% p.a. Case No. 35 of 2001 was filed against the M/s. Priyesh Land Developers i.e. the petitioner for recovery of sum of Rs.2,44,78,553/- with interest @ 18% p.a. Case No. 36 of 2001 was filed against the petitioner and others for recovery of sum of Rs.2,52,85,401/- with interest @ 18% p.a.

6. It is the case of the said bank that during the pendency of the said three disputes filed by the said bank, Mr. Bharat Shah and M/s. Pilgrim Mercantile Private Limited applied to the Co-operative Court for their impleadment as party opponent in the said disputes. The Co-operative Court impleaded those tw

Click Here to Read the rest of this document

2021 Supreme(Bom) 54

Cases Referred (1)