A transferee from a judgment debtor during pending execution proceedings has no right to enforce claims against a valid auction purchaser, as the transfer is void under sections of the CPC.

ORDER :

1. This Writ Petition was filed to call for records in E.P. No. 25 of 2003 on the file of the Labour Court-I and to set-aside the order dated 20-12-2006 by allowing the Application of Petitioners and to consequently set-aside the sale in favour of the 3^rd Respondent.

2. Petitioners claim to be the purchasers of Acs.8-00 guntas in Survey No.518 (Part) of Kistapur Village, Medchal Gram Panchayat, Ranga Reddy District from Respondent No.2 Company which was the Judgment Debtor in the impugned proceedings, Respondent No.3 was the auction purchaser of land admeasuring Acs.2-03 guntas situated Survey No.517, Kistapur forming part of Acs.8-00 through auction held on directions of Respondent No.1-Labour Court conducted on 16-10-2004, Respondents 4 to 8 are subsequent purchasers of the subject property from Respondent No.3.

2.1. It is the case of petitioners that their names were mutated in the revenue records vide proceedings of the Mandal Revenue Officer, Medchal Mandal dated 31-08-2005. At the time of sale, it was informed that property was mortgaged to South Indian Bank Ltd., MG Road, Secunderabad against the loan granted to Respondent Company. Petitioners paid loan amount to the said bank on behalf of the company and got released the title deeds. Petitioners also paid the amounts due to workers as well as Sales Tax Department and remitted the amounts due to the workers before the Labour Court; consequently E.P. No. 25 of 2003 was closed on 15-06-2005; property was registered in their names after closure of the Execution Petition by setting aside the auction sale dated 16-10-2004 made in favour of Respondent No.3 by the Labour Court.

2.2. It is further contended that, Respondent No.3 filed Writ Petition No. 13196 of 2005 but failed to implead Petitioners though he was aware of their right and entitlement, therefore, petitioners had taken out the Application to implead themselves as parties. By the time they could enter appearance before this Court, on the same day i.e. 03-03-2006, Writ Petition itself was disposed of remanding the matter to Labour Court to hear the parties and dispose of the case. It is the case of Petitioners that though no notice was served, the 3^rd Respondent suppressed the material facts and obtained an order behind their backs.

2.3. Writ petitioners contend at paragraph 7 that on 07-06-2006, the 3^rd Respondent brought some persons to the property and stealthily, broke the fencing from the backside of the factory run by them and started marking the plot on the ground; on 08-06-2006, petitioners came to know that the 3^rd Respondent by misleading the Labour Court, obtained sale certificate behind their back; on further enquiry, it was revealed that through auction which was conducted on 16-10-2004, the 3rd Respondent had given a cheque dated 16-10-2004, only for part of the amount and had not deposited the balance amount within time; he paid the remaining amount by way of demand draft on 08-06-2005, which is almost nine months after the auction sale. It is stated, accepting such amounts from the 3rd Respondent and confirming the auction sale in his favour itself is an illegality, nevertheless, on 15-06-2005, the entire amount due as auction money together with 5% of impound was duly remitted by the 2^nd Respondent Judgment debtor to the Labour Court and consequently, the Labour Court allowed the Application of the 2nd Respondent in E.A. No. 22 of 2005 and set aside the sale in favour of the 3rd Respondent