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2015 Supreme(Pat) 1057
IN THE HIGH COURT OF JUDICATURE AT PATNA
I.A. ANSARI & SAMARENDRA PRATAP SINGH, JJ.
Sun Biotechnology Limited – Appellant
Versus
Bihar State Financial Corporation and Others – Respondents
L.P.A. No. 756, 1517 of 2014 & C. REV. No. 235 of 2005 & C.W.J.C. No. 3578 of 2012
Decided On : 15-09-2015
For the Appellant : Mr. Suraj Samdarshi and Mr. Vikram Mehta.
For the Respondent: Mr. Anil Jaiswal, Mr. Y.V. Giri and Mr. Nikhil Kumar Agrawal.
Headnote:Limitation Act, 1963 – Section 5 – Condonation of delay of nine years in filing the appeal – Explanation for delayed filing of appeal submitted by the Party seeking condonation of delay not totally unworthy of reliance and appellant not entirely negligesnt in the matter, but pursued its legal remedy – delay deserves condonation – More over, if a Civil Review application is dismissed Civil Review application is dismissed against the original order, which, if challenged, later on the limitation would run from the date of original order. (Paras 21 and 24)
(2010)8 SCC 685 – Referred.
Rules of the High Court of Judicature at Patna, 1916 – Appendix E, Clause 10 – Writ petition u/A 226 of Constitution – Maintainability – Writ petition filed u/A 226 – not maintainable u/A 226 of the Constitution of India – instant writ petition had all the trappings of a writ petition filed u/A 226 of the Constitution – so no intra court appeal against the order passed exercising power u/A 227, would be ammenable in view of clause 10 of the Letters Patent of Patna High Court. (Paras 27 & 28)
(2015)5 SCC 423 – Relied upon.
(2003)6 SCC 675 – Overruled.
Financial and Debt Laws – Auction sale – Sale of excess land to auction purchaser by B.S.F.C. – BSFC being an instrumentality of the State, had a duty to be fair even in commercial and contractual matter transactions – making misrepresen-tation of fact to the purchaser and selling the land without being the owner of the entire land, amounted to commission of the offence of cheating – Parties, who are willing to settle their dispute, permitted to settle their dispute. (Paras 33 & 34)
State Financial Corporation Act, 1951 – Section 29 – Original promoter failed to repay the loan taken from BSFC and declared lock out in the year 1982 – BSFC put the assets of original promoter on auction – Original promoter was informed about the auction sale and was given an offer of making a matching amount for taking prosession of the assets – Original promoter, only on the basis of "No dues Certificate" issued by Branch Manager in the year 2011 can not undo the auction sale finalised in the year 2001 – Appeal dismissed. (Para 42)
Civil Review 235/2005 – Upheld.
CWJC 6910/2005; IA 9444/2014 – Referred to.
1. The appellant, who is an auction purchaser, has filed this appeal under Letters Patent of Patna High Court against the order, dated 06.08.2010, dismissing the Civil Review No. 235 of 2005, preferred against the order, dated 27.09.2005, passed in C.W.J.C. No. 6910 of 2005, which was disposed of with observations and directions contained therein. Subsequently, the appellant filed I.A. No. 9444 of 2014 praying therein for leave to assail the original order, dated 27.09.2005, passed in the writ petition, on the ground that inadvertently, the said prayer could not be incorporated in the first paragraph of the memorandum of appeal as well as in the relief portion thereof.
2. The writ application was filed against the order passed by the learned Sub-Judge-I, Katihar, in Title Suit No. 46 of 2002, and the order of the Appellate Court, passed in Miscellaneous Appeal No. 7 of 2004, refusing to accede to prayer of injunction of the appellant-petitioner and also the prayer for appointment of a Surveyor to ascertain the actual area of the land not handed over to the auction purchaser in terms of sale notice as well as the present mortgage value of the area of land sold in auction to the auction purchaser and to restrain the Bihar State Financial Corporation (hereinafter referred to as the BSFC) from realizing the installments without ascertaining the actual area of land, the possession whereof have been handed over to the auction purchaser and the value thereof.
3. During the pendency of writ application, the appellant filed a number of Interlocutory Applications. For instance, I.A. No. 8549 of 2014 was filed for condonation of delay of 3 years 90 days in filing the appeal against the order, dated 16.8.2010, passed by a learned single Judge rejecting Civil Review No. 235 of 2010. I.A. No. 8550 of 2014 was filed seeking a direction to maintain status quo. I.A. No. 8593 of 2014 was filed for stay of operation of the letter, dated 12.11.2014, issued by the BSFC threatening to sell the premises purchased by the appellant for default in payment of installment.
4. Both the BSFC and the Industrial Financial Corporation of India (hereinafter referred to as IFCI), who are respondents in this case, have filed their respective counter affidavits.
5. Apart from the merit of the case, they have opposed the appeal on the ground of (i) maintainability and (ii) limitation.
6. Before we consider the grounds of resistance by the BSFC and the IFCI and the reply of the appellants in support of their case, it would be apposite to notice the facts of the case.
(a) M/s. Katihar Jute Mills Ltd. is a company incorporated in the year 1934 under the Indian Companies Act, 1930. It owned various properties including a Jute Mill at Katihar known as Katihar Jute Mill. Respondent No. 1 is a body corporate constituted under the State Financial Corporation Act, 1951. Respondent No. 2 is its officer and Respondent No. 3 is also a company incorporated under the Indian Companies Act, 1930. Both respondent Nos. 1 and 3 are financial institutions and authority within the meaning of Article 12 of the Constitution of India.
(b) M/s. Katihar Jute Mills Limited took loan from B.S.F.C. amounting to Rs. 24 lacs and odd, between 1972 to 1974, for which the company executed a mortgage with respect to 77.07 acres of land along with its machinery. The said unit, Katihar Jute Mills, also took loan of Rs. 28.25 lacs from the IFCI.
(c) The Unit defaulted in repayment of loan on account of which a sum of Rs. 200 lacs became due, on 31.03.1998, to the BSFC and a sum of Rs. 345 lacs, as on 07.04.1998, to the IFCI. As the loan was not being repaid, the Board of Directors of BSFC decided to take possession of the mortgaged land as well as hypothecated assets of Katihar Jute Mill. The BSFC accordingly advertised for sale of the mortgaged assets under Section 29 of the State Financial Corporation Act, 1951.
(d) The Board of Directors of BSFC in its meeting, dated 27.3.2000, approved the
