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2020 Supreme(Mad) 1287

IN THE HIGH COURT OF JUDICATURE AT MADRAS
N. SATHISH KUMAR, J.
T.A.S. Rathnakumar & Another – Appellant
Versus
Karanam Madhu & Others – Respondent
O.A.Nos. 1120 & 1121 of 2019, A.Nos. 628, 1893 & 2156 of 2020
Decided On : 16-10-2020

Advocates Appeared:
For the Applicants :Sharath Chandran, Advocate.
For the Respondents:R1, Set ex-parte, R2, M.L. Ganesh, Advocate.

The main legal point established in the judgment is the entitlement of the plaintiff to a statutory charge for the unpaid sale consideration, and the jurisdiction of the Civil Court to decide on the statutory charge over the property.

Headnote:

Interim Injunction - Amendment of Plaint - Section XIV Rule 8 of Original side Rules r/w Order XXXIX Rule 182 of C.P.C - [Original Application Nos.1120 and 1121 of 2019] - Section XIV Rule 8 of Original side Rules r/w Order VI Rule 17 of C.P.C - [Original Application Nos.1893 and 2156 of 2020] - Section XIV Rule 8 of Original side Rules r/w Order VI Rule 17 of C.P.C - [Original Application No.628 of 2020] - Section XIV Rule 8 of Original side Rules r/w Order VI Rule 17 of C.P.C - [Common Order] - Section 34 of SARFAESI Act and Section 18 of Recovery of Debts and Insolvency Act - [Summary]

Fact of the Case:

The main suit was filed to cancel a sale deed and declare a memorandum of deposit of title deeds null and void due to non-payment of the full sale consideration. The 1st Defendant remained ex-parte, and the 2nd Defendant bank filed an application to reject the plaint on the ground of territorial jurisdiction and under the SARFAESI Act and Recovery of Debts and Insolvency Act.

Finding of the Court:

The court allowed the amendment applications to modify the prayer for declaring a statutory charge with interest for the unpaid sale consideration. The court also dismissed the application to reject the plaint and the applications for interim injunction against the bank.

Issues: The issues included the validity of the suit, the rights of the bank under the SARFAESI Act, and the jurisdiction of the Civil Court to decide on the statutory charge over the property.

Ratio Decidendi: The court found that the plaintiff was entitled to a statutory charge for the unpaid sale consideration and allowed the amendment to reflect this. The court also held that the bank could proceed with the sale of the property, subject to depositing a portion of the sale proceeds until the suit's final disposal.

Final Decision: The court allowed the amendment applications, dismissed the application to reject the plaint, and dismissed the applications for interim injunction against the bank.

JUDGMENT :

(Prayer in O.A.No.1120 of 2019 : Original Application filed under section XIV Rule 8 of Original side Rules r/w Order XXXIX Rule 182 of C.P.C. to grant an interim injunction restraining the Respondents/Defendants, from dealing with schedule property in manner and their men, agents, legal representatives, successors in office or anyone acting on their behalf from interfering with the peaceful possession and enjoyment of the plaintiffs property, pending disposal of the suit.

Prayer in O.A.No.1121 of 2019:Original Application filed under section XIV Rule 8 of Original side Rules r/w Order XXXIX Rule 182 of C.P.C. to grant an interim injunction restraining the Respondents/Defendants or her agents, servants, men, representatives, executors, administrators, assigns, attorneys, etc., from encumbering or alienating the schedule mentioned property in any manner whatsoever, pending disposal of the suit.

Prayer in A.No.628 of 2020:Original Application filed under section XIV Rule 8 of Original side Rules r/w Order VI Rule 17 of C.P.C.to reject the plaint in C.S.No.708 of 2019 on the ground of territorial jurisdiction as well as in terms of Section 34 of SARFAESI Act and Section 18 of Recovery of Debts and Insolvency Act.

Prayer in A.No.1893 of 2020:Original Application filed under section XIV Rule 8 of Original side Rules r/w Order VI Rule 17 of C.P.C.to permit the Plaintiff to amend the plaint in C.S.No.708 of 2019.

Prayer in A.No.2156 of 2020:Original Application filed under section XIV Rule 8 of Original side Rules r/w Order VI Rule 17 of C.P.C. Seeking permission of this Court to amend the plaint in C.S.No.708 of 2019.)

Common Order:

Original Application Nos.1120 and 1121 of 2019 are filed for interim injunctions from interfering with the peaceful possession and enjoyment and from encumbering or alienating the plaintiffs property pending disposal of the suit respectively. Application Nos.1893 and 2156 of 2020 are filed seeking permission to amend the plaint in C.S.No.708 of 2019 and Application No.628 of 2020 is filed to reject the plaint.

2. The prayer in the A.No.2156 of 2020 seeking permission to delete some sentences in paragraph 12 and insert the following:

    “The plaintiff is, therefore, entitled to a statutory charge, as pleaded in paragraph 10, and is entitled to have it declared by way of the unpaid sale consideration. This charge emanates from a separate and distinct contract between the plaintiff and the 1st Defendant and does not concern the 2nd Defendant at all.”

Also seeking permission of this Court to delete the paragraph 17 and insert the following as paragraph 17 in the plaint:

“17. The plaintiff values the suit for the purpose of Court fee and jurisdiction at Rs.2,43,00,000 (Rupees two crores forty three lakhs only) and pays court fee of Rs.2,46,525/- (Rupees two lakhs forty six thousand five hundred and twenty five only) under Section 25(d) of the Tamil Nadu Court Fees and Suit Valuation Act, 1955 read with Appendix IA of the High Court Fee Rules. Tatal Court Fee paid is Rs.3,21,900/- Excess court fee is Rs.78,900/-”

3. The main suit originally filed to cancel the sale deed executed in favour of the 1st Defendant and also to declare the memorandum of deposit of title deeds dated 12.03.2016 executed by the 1st Defendant in favour of the 2nd Defendant, in the office of the 3rd Defendant is null and void. The suit has been filed originally on the ground that the 1st Defendant insisted the Plaintiff to sell the property. Accordingly, he sold the property. However, the amount assured as a sale consideration has not been paid. Cheques issued by the 1st Defendant not honoured. Except Rs.75 lakhs remaining sale consideration of Rs.2,43,00,000/- remains unpaid. Therefore, declaration sought to cancel the sale deed.

4. The 1st Defendant remained ex-parte. 2nd Defendant bank filed an application in A.No.628 of 2020 to reject the plaint on the ground of territorial jurisdiction as well as in terms of Section 34 of SARFAESI Act

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