2013 Supreme(Mad) 3631

High Court of Judicature at Madras
R. SUDHAKAR, J.
Vishadra Charitable Trust rep by its Trustees Vijayakumar Lohia, Managing Trustee
O.P. No. 209 of 2013
Decided On : 23-10-2013

The Court has the discretion to confirm the sale in favor of the successful bidder who failed to deposit the balance sale consideration within the stipulated time.

Headnote:

The Court conducted a public auction for the sale of a trust property and accepted the highest bid. The successful bidder failed to deposit the balance sale consideration within the stipulated time. The Court, in exercise of its discretion, condoned the one day's delay and confirmed the sale in favor of the successful bidder. The Court also directed the Registrar General to issue a Sale Certificate in favor of the successful bidder or his nominee and directed the petitioner/Trust to execute the sale deed in favor of the successful bidder or his nominee.

Fact of the Case:

The petitioner trust filed an Original Petition seeking permission to sell the petition schedule property to Mr. P. Rajasekar, by way of one or more sale deed/s for a total sale consideration of Rs. 4,00,00,000/- (Rupees Four Crores only) as per the sale agreement dated 25.11.2012 and to deposit the sale proceeds in a nationalized bank, viz., M/s. Vijaya Bank, Anna Nagar Branch, Chennai-40 in A/c No.304401010001599 belonging to "VISHADRA CHARITABLE TRUST". The Court appointed an advocate commissioner for sale of the trust property. The advocate commissioner caused publication regarding sale of the schedule mentioned property in one issue of English Daily, namely, "News Today" and one issue of Tamil Daily, namely, "Makkal Kural" on 1.4.2013 calling for bids as per the Rules, clearly indicating that the matter would be taken up on 3.4.2013. It should be specified that all prospective buyers can submit their bids to Mr. P.N. Swaminathan, Advocate Commissioner. The advocate commissioner is at liberty to fix the earnest money deposit and call for the same from the bidders in the publication itself as per procedure. Thiru P. Rajasekar, the agreement holder herein is at liberty to file his bid before the Advocate Commissioner. The advocate commissioner shall submit the bids with sealed cover with his detailed report before this Court on 3.4.2013. Pursuant to the above order, in addition to Thiru P. Rajasekar, the agreement holder one M/s. Egberts India Private Limited, have offered to purchase the schedule property for a sum of Rs. 5,02,00,000/-.Considering both offer, this Court by order dated 3.4.2013 passed the following order: (1) Petitioner is permitted to sell the trust property mentioned in para 3 of this order and described in the petition schedule. (2) This Court accepts the offer made by M/s. Egberts India Private Limited at Rs. 5,02,00,000/- (Rupees Five Crores and Two Lakhs only). (3) The petitioner is permitted to sell the property to M/s. Egberts India Private Limited for Rs. 5,02,00,000/- (Rupees Five Crores and Two Lakhs only) less the Earnest Money Deposit of Rs. 20,05,000/- (Rupees Twenty Lakhs and Five Thousand only) submitted. (4) The Trust shall furnish all original title documents for verification to M/s. Egberts India Private Limited. It shall also provide photocopies of all the documents of title of the property to the purchaser M/s. Egberts India Private Limited on or before 8.4.2013 (5) The trust shall facilitate the survey of the property if required by the purchaser M/s. Egberts India Private Limited. (6) Thereafter on completion of verification M/s. Egberts India Private Limited is directed to pay the entire sale consideration less the earnest money deposit of Rs. 20,05,000/- (Rupees Twenty Lakhs and Fifty Thousand only) within one month. (7) The trust is directed to execute the sale deed in favour of M/s. Egberts India Private Limited immediately, hand over the original title deeds together with vacant possession at the time of receipt of the sale consideration. (8) The sale proceeds received by the petitioner trust shall be deposited in M/s. Indian Bank, Madras High Court Branch for a period of six months in the name of the Trust by way of fixed deposit and the trust is entitled to use the interest component for the benefit of the trust. (9) The Assistant Registrar, Original Side-I shall receive the EMD Rs. 20,05,000/-given by M/s. Egberts India Private Limited, keep the same in a sealed cover in safe custody and produce the same before this Court on 9.4.2013 for further instruction. (10) The counsel for the petitioner trust shall collect the Earnest Money Deposit submitted by Mr. P. Rajasekar and return it to the said person on proper acknowledgment.

Finding of the Court:

The Court found that the sum of Rs.20 lakhs has not been deposited by Mrs. Vasantha Surana in Court. There is none to claim the sum of Rs.20 lakhs so far, despite the matter being listed before Court for several occasions. In view of the fact that the sum of Rs.20 lakhs was tendered in the course of Original Petition proceedings and there is no claim for the said amount, the Court has no other option except to pass order for utilization of the said amount.

Issues: Whether the Court can confirm the sale in favor of the successful bidder who failed to deposit the balance sale consideration within the stipulated time.

Ratio Decidendi: The Court held that it can confirm the sale in favor of the successful bidder who failed to deposit the balance sale consideration within the stipulated time, in exercise of its discretion.

Final Decision: The Court directed the Registrar General to issue a Sale Certificate in favor of the successful bidder or his nominee and directed the petitioner/Trust to execute the sale deed in favor of the successful bidder or his nominee. The Court also directed the Registrar General to transfer the amount of Rs.20,00,000/- (Rupees Twenty Lakhs) only now lying in court deposit in O.P.No.209 of 2013 to the Madras High Court Chief Justice Relief Fund, immediately and report.