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2020 Supreme(Mad) 1288

IN THE HIGH COURT OF JUDICATURE AT MADRAS
N. SATHISH KUMAR, J.
K. Muthusamy & Others – Appellant
Versus
M/s. Aruna Theatre & Enterprises Pvt. Ltd., represented by its Director S. Venkatachalam & Others – Respondent
Tr.C.S.No.355 of 2014, C.S.Nos. 570 of 2006, 721 of 2010
Decided On : 14-10-2020

Advocates Appeared:
M.S. Krishnan, Senior Counsel, M/s. Sarvabhauman Associates, Umashankar, Viswanatha Rao, Senior Counsel, A.K. Raghavalu, Abdul Hameed, M/s. AAV Partners, Advocates.

Headnote:

The subject matter of the suit was the sale of a property by a company to the plaintiffs. The defendants, who were shareholders of the company, challenged the sale on the grounds that it was sham and nominal, and that the property had been allotted to them under a family arrangement. The court held that the sale was valid and that the defendants had not established their title to the property.

Fact of the Case:

The plaintiffs, who were husband and wife, purchased a property from a company. The defendants, who were shareholders of the company, challenged the sale on the grounds that it was sham and nominal, and that the property had been allotted to them under a family arrangement. The plaintiffs claimed that the sale was valid and that the defendants had not established their title to the property.

Finding of the Court:

The court held that the sale was valid and that the defendants had not established their title to the property. The court found that the company had passed a resolution to sell the property in order to clear its debts, and that the sale had been properly supported by consideration. The court also found that the defendants had not acted upon the alleged family arrangement, and that the document purporting to evidence the arrangement was not admissible in evidence.

Issues: 1. Whether the sale of the property by the company to the plaintiffs was valid. 2. Whether the defendants had established their title to the property.

Ratio Decidendi: The court held that the sale was valid because: * The company had passed a resolution to sell the property in order to clear its debts. * The sale had been properly supported by consideration. * The defendants had not acted upon the alleged family arrangement. * The document purporting to evidence the arrangement was not admissible in evidence.

Final Decision: The court decreed the plaintiffs' suit for recovery of possession of the property and damages for use and occupation. The court dismissed the defendants' suit for a declaration that the sale was null and void.

JUDGMENT :

(Prayer : Plaint filed under Order VII Rule 1 CPC r/w Order IV Rule 1 of the Original Side Rules to pass a judgment and decree against the defendants :

a. directing the 6th and 7th defendants to make payment of a sum of Rs.22,99,680/- being rents payable from 01.09.2003 till date of this suit;

b. for a permanent injunction restraining the defendants their men, agents, servants, employees person or persons acting to or under them or for and on their behalf from in any manner whatsoever putting up construction or making any structural alteration of any nature or otherwise dealing with, parting with possession of the plaint schedule mentioned property;

c. for costs of the suit; and

d. pass such further or other orders as this Court may deem fit and proper in the circumstances of the case and thus render justice.

Prayer :Plaint filed under Order VII Rule 1 CPC r/w Order IV Rule 1 of the Original Side Rules to pass a judgment and decree to :

a. Declaring that the sale deed bearing dated 1.9.2003 Document No.2062 of 2003 S.R.O.Ashok Nagar, in respect of the plaint schedule property executed by the 1st Defendant company in favour of the 2nd and 3rd defendants is sham, void, illegal, invalid and inoperative consequently

b. Restraining the Defendants by perfectual injunction from in any manner interfering with the peaceful possession and enjoyment of the plaint schedule property by the Plaintiffs;

c. Directing the defendants to pay the costs of this suit; and

d. Granting such further or other reliefs as this court may deem fit in the circumstance of the case.

Prayer :Plaint filed under Order VII Rule 1 CPC r/w Order IV Rule 1 of the Original Side Rules to pass a judgment and decree against the defendants directing the defendants :

i. to deliver the vacant possession of the suit property which is more fully described in the schedule to these plaintiffs

ii. to pay a sum of Rs.91,98,720/- being the damages for sue and occupation of the suit schedule property from 19.007.2007 to 19.07.2010 for the three years preceding the suit to these plaintiffs

iii. to pay future damages for use and occupation of the suit schedule property at the rate of Rs.2,55,520/- per month or such other rate fixed by this Court from the date of suit till delivery of the suit property

iv. to pay costs of this suit; and

to pass such further or other orders as this Court may deem fit and proper in the circumstances of the case and thus render justice.)

Common Judgment:

Three suits have been filed for the following reliefs:

1(a) C.S.No.756 of 2004 renumbered as Tr.C.S.355 of 2014 filed for seeking direction to direct the 6th and 7th defendants to make payment of a sum of Rs.22,99,680/- being rents payable from 01.09.2003 till date of the suit and for a permanent injunction restraining the defendants their men, agents, servants, employees person or persons acting to or under them or for and on their behalf from in any manner whatsoever putting up construction or making any structural alteration of any nature or otherwise dealing with, parting with possession of the plaint schedule mentioned property with costs.

1.(b) C.S.570 of 2006, seeking a declaration that the sale deed bearing dated 1.9.2003 Document No.2062 of 2003 S.R.O. Ashok Nagar, in respect of the plaint schedule property executed by the 1st Defendant company in favour of the 2nd and 3rd defendants is sham, void, illegal, invalid and inoperative consequently; Restraining the Defendants by perfectual injunction from in any manner interfering with the peaceful possession and enjoyment of the plaint schedule property by the Plaintiffs and to pay the costs.

1.(c) C.S.No.721 of 2010 filed to deliver the vacant possession of the suit property which is more fully described in the schedule to these plaintiffs; to pay a sum of Rs.91,98,720/- being the damages for sue and occupation of the suit schedule property from 19.07.2007 to 19.07.2010 for the three years preceding the suit to these plaintiffs; to pay future damages for us

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