A bona fide purchaser without notice of charges or encumbrances is protected under the law.

1. Heard the learned counsel for the petitioner and the learned counsel appearing on behalf of the respondents.

2. It is stated that the petitioner company is one of the highly reputed companies in the business of Information Technology and Software Consulting. The petitioner has executed several turnkey projects for some of the top companies in India and in some foreign countries. As such, the petitioner had procured large tracts of land for setting up a world-class software centre, at Sholinganallur, Chennai.

3. It has been further stated that M/s.Gum (India) Limited, a Public Limited Company had one of its manufacturing facilities at Sholinganallur. Two plots of land, in Survey Nos.408/9, 408/10, situated in Sholinganallur Village, were lying adjacent to the software centre, established by the petitioner company. Therefore, the petitioner company was interested in buying the said plots of land, from M/s.Gum (India) Limited. At the time of the negotiations M/s.Gum (India) Limited had assured the petitioner company that the property in Survey No.408/10, in Sholinganallur Village, measuring an extent of 1.038 acres was free from encumbrances. Two other properties of M/s.Gum (India) Limited, measuring 1.887 acres, in Survey Nos.408/9 and 408/10, had been notified for acquisition by the Tamilnadu Housing Board. The acquisition proceedings had been challenged before this Court. However, the property measuring 1.038 acres, in Survey No.408/10, was not subject to any acquisition proceedings. No cases were pending in respect of the said land.

4. In such circumstances, the petitioner company had entered into an agreement for sale, on 24.1.2001, with M/s.Gum (India) Limited, for the purchase of 1.038 acres, in Survey No.408/10, Sholinganullur Village, for a sum of Rs.28,00,000/-. An advance of Rs.20,00,000/- had been paid on the same day. Later, a sale deed had been registered, on 30.3.2001, by which the property in question had been purchased by the petitioner company, from M/s.Gum (India) Limited.

5. It has been further stated that one of the clauses in the sale deed declared that the property in question does not suffer from any infirmity, as to its title or otherwise, and that it is not subject to any encumbrances, acquisition proceedings, lis pendens, charges, lien or holding of any kind, and that there are no legal proceedings against the vendor, whereby the alienation of the scheduled property is prohibited or impaired.

6. It had also been sated that the petitioner company had made due enquiries before purchasing the land in question. The Special Tahsildar, Tamilnadu Housing Board Schemes, had given a certificate, on 23.10.2000, confirming that the said land did not come under the land acquisition proceedings of the Tamilnadu Housing Board. Further, the encumbrance certificate, upto the period ending 13.9.2000, did not disclose any encumbrance over the property in question. The petitioner company had also applied for the necessary permission from the appropriate authority of the Income Tax department and an order under Section 269 UL (1) of the Income Tax Act, 1961, was also given, on 24.1.2001, stating that there was no objection to the transfer of the property in favour of the petitioner.

7. The petitioner had exercised due diligence and had made the necessary enquiries relating to the land. Only thereafter the petitioner had purchased the property in question, with the bona fide belief that the land was free of all encumbrances, and that there were no proceedings pending against the vendor. Further, as the vendor had stated, at the time of the execution of the sale deed, on 30.3.2001, that a sum of Rs.8,00,000/- was payable to the Employees Provident Fund, the said sum had been paid to the Employees Provident Fund Organization.

8. It has been further stated that the petitioner company has been in possession and enjoyment of the property in question, without any hindrance or claim by third parties. While so, the fi