SupremeToday Landscape Ad
Back
Next
Judicial Analysis Court Copy Headnote Facts Arguments Court observation
Listen Audio Icon Pause Audio Icon
judgment-img

2000 Supreme(Raj) 464

Rajasthan High Court
Honble AMARESH KU. SINGH, J.
M/s. O.K. Gaur & Company & Another - Appellant
Versus
Rajasthan Finance Corporation - Respondents
S.B. Civil Misc. Appeal No. 243 of 1999
Decided On : July 11, 2000

Advocates Appeared:
D.C. Sharma, for Appellant S.G. Ojha, for Respondent

Headnote:State Finance Corporation Act, 1951, Sec. 32(9) and 31(1)(aa) – Application for recovery of outstanding amount – Trial Court passed decree against the appellant with the direction to make auction of land property and machinery for recovery of the decretal amount – Appeal – Held – The reliefs which can be granted u/Sec. 32 are against the property whereas a money decree is to be passed by the Civil Court against judgment debtor – Decree for money cannot be passed on appellant u/Sec. 31 of the Act – Remanded the application to dispose of in accordance with law. (Paras 9 & 11)

       

Honble SINGH, J.–Heard the learned counsel for the appellants and the respondent.

(2). This appeal has been filed u/S. 32(9) of the State Financial Corporation Act, 1951 against the decree dated 24.02.1994 passed by the Additional District and Sessions Judge No. 3, Jodhpur in Civil Misc. Case No. 4A/1993 Rajasthan Financial Corporation vs. M/s. O.K. Guar and Company and Another.

(3). A perusal of the record of the lower court shows that an application u/S. 31(1) (aa) of the State Financial Corporation Act, 1951 was filed by the respondents in the Court of Additional District and Sessions Judge No.3, Jodhpur with the prayer for reliefs enumerated in para No. 16 of the application. Reply was filed by the non-applicant-appellant. Issues were framed and after hearing the parties, the Additional District and Sessions Judge No. 3, Jodhpur passed the judgment dated 24.2.1994. The Additional District and Sessions Judge No. 3, Jodhpur passed the decree against the appellants for the sum of Rs. 64, 855/- with interest at the rate of 22% per annum with quarterly rest. It was also directed by the Additional District and Sessions Judge No. 3, Jodhpur that plaint, machinery and land property which had been hypothecated in favour of the applicant shall be auctioned for the recovery of the decretal amount.

(4). Feeling aggrieved by the impugned decree dated 24.2.1994, this appeal has been filed. The main contention of the learned counsel for the appellant is that while dealing with the application filed under Sec. 31 of the State Financial Corporation Act, 1951, a decree for money cannot be passed because the jurisdiction conferred by Sec. 31 and 32 of the State Financial Corporation Act, 1951 is limited to conducting enquiry under Sec. 32 and passing order in accordance with the provisions of Sec. 32. In support of his submission that an application under Section 31 of the State Financial Corporation Act cannot be treated as plaint nor a decree for money can be passed on such application, the learned counsel for the appellant has placed reliance on the decision given in the following cases:-

(1) M/S. Kiril Fine Art, Chandrapur and others vs. Maharashtra State Financial Corporation (1);

(2) M/s. Amar Cold Storage & Ice Factory vs. Punjab Financial Corporation (2);

(3) The Maharashtra State Financial Corporation vs. M/s. Jaycee Drugs and Pharmaceuticals (P) Ltd. and Others. (3) and

(4) M/s. Prakash Playing Cards Munufacturing Co. vs. Delhi Financial Corporation (4).

(5). In the last case M/s. Prakash Playing Cards Manufacturing Co. vs. Delhi Financial Corporation (supra), their lordships of the Delhi High Court held that an application u/S. 31 cannot be properly described as a suit in view of the decision of the Supreme Court in Gujarat State Financial Corporation Case (5). It was further held that in an application u/S. 31(1) the Corporation does not and cannot pray for a decree for its outstanding dues. It can make an application for one of the three reliefs, none of which, if granted, results in a money decree, or decree for recovery of outstanding loan or advance.

(6). In M/s. Kiril Fine Art, Chandrapur and others vs. The Maharashtra State Financial Corporation (supra), it was held that on a application u/S. 31 of the State Financial Corporation Act, the reliefs mentioned in clauses (a), (aa), (b) and (c) can be claimed but there is nothing in Sec. 31 to indicate that the court has any power of passing any order in the nature of the decree for the payment of any amount and Sec. 31(1) of the Act is clear enough to exclude the power on the part of the District Judge to order any payment to be made to the Corporation by way of an independent relief and all that can be done by the District Judge in passing an order for the sale of the property pledged, mortgaged or hypothecated or for enforcement of any liability or a surety and under the wider clause(c), District Judge could grant ad interim injunction restraining the industrial concern from transferr







Click Here to Read the rest of this document

1
2
3
4
5
6
7
8
9
10
11
SupremeToday Portrait Ad
supreme today icon
logo-black

An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers

Please visit our Training & Support
Center or Contact Us for assistance

qr

Scan Me!

India’s Legal research and Law Firm App, Download now!

For Daily Legal Updates, Join us on :

whatsapp-icon Back to top