IN THE HIGH COURT OF JUDICATURE AT MADRAS
SATHI KUMAR SUKUMARA KURUP, J.
Dinesh Kumar Jain - Appellant
Versus
N. Ramesh - Respondent
C.R.P (NPD). Nos. 2414 & 2285 of 2021
Decided On : 12-08-2022
SARFAESI - Property Auction - Section 144 C.P.C
Fact of the Case:
The tenant participated in a property auction and was the successful bidder. The landlord subsequently entered into a sale agreement with another party and filed a suit to declare the sale certificate in favor of the tenant as null and void. The tenant filed a counter claim objecting to the withdrawal of the suit, which was dismissed, and the counter claim was allowed. The tenant sought possession of the property under Section 144 of C.P.C.
Finding of the Court:
The court found that the tenant, as the successful bidder in the public auction, should be protected under the principles of equity and good conscience. The court set aside the order dismissing the tenant's petition and directed the lower court to pass orders in favor of the tenant within a specified period.
Issues: The issues involved the validity of the sale certificate, the rights of the successful bidder in a property auction, and the application of Section 144 of C.P.C.
Ratio Decidendi: The court held that the auction purchaser should be protected under the principles of equity and good conscience, and the dismissal of the tenant's petition was found unacceptable.
Final Decision: The Civil Revision Petitions were allowed, and the impugned orders were set aside. The lower court was directed to pass orders in favor of the tenant within a specified period.
JUDGMENT
(Common Prayer: These Civil Revision Petitions have been filed under Article 227 of the Constitution of India to set aside the impugned fair and decreetal order dated 18.08.2021 passed in E.A.Nos.51 & 52 of 2021 in E.P.Nos.73 & 74 of 2011 in RCOP Nos.22 & 23 of 2010 on the file of the learned Additional District Munsif, Vellore.)
Common Order
1. Both the Civil Revision Petitions have been filed under Article 227 of the Constitution of India seeking to set aside the impugned fair and decreetal order dated 18.08.2021 passed in E.A.Nos.51 & 52 of 2021 in E.P.Nos.73 & 74 of 2011 in RCOP Nos.22 & 23 of 2010 on the file of the learned Additional District Munsif, Vellore.
2. It is the submission of the learned Counsel for the Petitioner that Petitioner had been a tenant under the landlord. While so, the landlord had obtained loan from the Indian Bank. He had committed default. Therefore, as per the SARFAESI provisions, the property was brought to public auction. The Petitioner who was a tenant under the landlord participated in the public auction and he was the successful bidder. Therefore, Sale Certificate issued to him, he had taken possession. At that stage, the erstwhile landlord who had not cleared the mortgage had entered into Sale Agreement with the Respondent had executed Sale Deed in his favour. The Respondent herein, had instituted a Suit to declare the Sale Certificate in favour of the Petitioner herein as null and void. Subsequently, he filed a Petition to withdraw the Suit. The Petitioner herein as Respondent filed counter claim objecting to the withdrawal of Suit to withdraw the Suit in O.S.No.242 of 2010. The Petition was dismissed and counter claim was allowed. Against the order of dismissal of I.A.No.49 of 2018 in O.S.No.242 of 2010, Civil Revision Petition in C.R.P.No.3234 of 2018 had been filed. In that Civil Revision Petition also, the order of the trial Judge dismissing the Petition to withdraw the Suit, allowing the counter claim was confirmed. The Respondent had approached the Hon'ble Supreme Court of India by way of Special Leave Petition (Civil) Nos.18915 to 18923 of 2021 against the common order passed by this Court in C.R.P.(NPD) Nos.2723 & 2724 of 2015 and C.R.P.(PD) Nos.3361 & 3362 of 2015, and the same was also dismissed. Therefore, the Petitioner herein had approached Execution Court seeking possession of the property to permit the Petitioner under Section 144 C.P.C by filing a Petition in E.A.No.51 of 2021 in E.P.No.73 of 2011 and the same was dismissed. Therefore, the Petitioner had approached this Court by way of Revision Petition. The Section 144 C.P.C is extracted hereunder:
144.Application for restitution - 1)Where and in so far as a decree ( or an order ) is (varied or reversed in any appeal, revision or other proceedings or is set aside or modified in any suit instituted for the purpose, the Court which passed the decree or order) shall, on the application of any party entitled to any benefit by way of restitution or otherwise, cause such restitution to be made as will, so far as may be, place the parties in the position which they would have occupied but for such decree (or order) or (such part thereof as has been varied, reversed, set aside or modified) and, for this purpose, the Court may make any orders, including orders for the refund of costs and for the payment of interest, damages, compensation and mense profits, which are properly ( consequential on such variation, reversal, setting aside or modification of the decree or order).
[Explanation - For the purposes of sub-section (1), the expression "Court which passed the decree or order" shall be deemed to include –
a) Where the decree or order has been varied or reversed in exercise of appellate or revisional jurisdiction, the Court of first instance;
b) where the decree or order has been set aside by a separate suit, the Court of first instance which passed such decree or order;
c) where the Court of first instance ha
The main legal point established is that the auction purchaser should be protected under the principles of equity and good conscience.
The main legal point established is that valid reasons for failing to contest proceedings, such as the petitioner's purchase under the SARFAESI Act, can influence the court to set aside orders and di....
Parties must be duly involved in SARFAESI appeal proceedings to ensure fair hearing and due process.
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