Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2025 Supreme(Online)(MAD) 3271

BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
S. SRIMATHY, J.
V.S. Rethinakumari – Petitioner
Versus
S.R. Ratheesh and Ors. – Respondents
C.R.P(MD)Nos. 2518, 1846 of 2024 and C.M.A(MD)Nos. 1413, 1414, 1349 of 2024 and C.M.P(MD)Nos.10453, 14558, 14450 ,14459, 14463,14465, 14466, 14611, 14615, 14825 of 2024
Decided On : 03-02-2025
Advocates Appeared :
For the Petitioners/Appellants : Mr. P. Prabhakaran
For the Respondents : Mr. M. Natarajan, Mr. K.P. Narayana Kumar, Mr. Parekh Kumar, Mr. C. Satheesh, Government Advocate.

Advocates:
Advocate Appeared:
For the Appellant : Mr.P.Prabhakaran
For the Respondent:Mr.M.Natarajan Mr.K.P.Narayana Kumar Mr.Parekh Kumar Mr.C.Satheesh, Government Advocate

The court ruled that execution proceedings must adhere to statutory duties, emphasizing jurisdictional limits and equitable distribution of assets among creditors, particularly under the TNPID Act.

Headnote:(A) Civil Procedure Code, 1908 - Orders 21 Rule 90, 95, 106, and Section 151 - Tamil Nadu Protection of Interest of Depositors Act, 1997 - Auction sale - Revision petitions against orders regarding setting aside of court auction sale and delivery of possession - The court found that the execution proceedings were mishandled, leading to substantial irregularities and a lack of jurisdiction, thus setting aside the auction sale and restoring possession to the competent authority. (Paras 56(i), 56(ii), 56(iii), 56(iv), 56(v))

(B) Jurisdiction - The Civil Court lacked jurisdiction over matters under the TNPID Act, necessitating transfer of claims to the TNPID Court for appropriate adjudication. (Paras 20, 54)

(C) Equity - The court emphasized the necessity of equitable distribution of proceeds from the sale of properties attached under the TNPID Act to benefit all creditors, including chit subscribers and banks. (Paras 56(v), 57)

ORDER :

(S. SRIMATHY, J.)

The issue in C.R.P.(MD)No.2518 of 2024, C.R.P.(MD)No.1846 of 2024 and C.M.A.(MD)No.1349 of 2024, C.M.A.(MD)No.1413 of 2024 and C.M.A. (MD)No.1414 of 2024 are arising out of common facts. Hence all the cases are tagged together and common order is passed.

2.(i). Heard Mr.P.Prabhakaran, the Learned Counsel appearing for the Revision Petitioner and Mr.M.Natarajan, the Learned Counsel appearing for the 1st respondent, Mr.K.P.Narayana Kumar, the Learned Counsel appearing for the 2nd respondent, Mr.Parekh Kumar, the Learned Counsel appearing for the 3rd respondent, Mr.C.Satheesh, the Learned Government Advocate appearing for the respondents 4, 5, 6 and 7 in CRP(MD)No.2518 of 2024.

2.(ii) Heard Mr.P.Prabhakaran, the Learned Counsel appearing for the Mr.A.R.M.Ramesh, the Learned Counsel appearing for the 3rd respondent, Mr.Dilip Kumar, the Learned Counsel appearing for the 4th respondent, Mr.C.Satheesh, the Learned Government Advocate appearing for the respondents 1, 5, 6 and 7 in CMA(MD)No.1413 of 2024.

3.(i) The C.R.P.(MD)No.2518 of 2024 was filed by the defendant V.S.Rethinakumari (in O.S.No.106 of 2011) against the order, dated 12.12.2023 passed in E.A.No.41 of 2018 in E.P.No.4 of 2016 in O.S.No.106 of 2011. The said E.A.No.41 of 2018 was filed under Order 21 Rule 90 inter alia praying to set aside the court auction sale held on 01.03.2018.

3.(ii) The C.R.P.(MD)No.1846 of 2024 was filed by the defendant V.S.Rethinakumari (in O.S.No.106 of 2011) against the order dated 06.02.2024 passed in E.A.No.8 of 2023 passed in E.P.No.4 of 2016 in O.S.No.106 of 2011. The E.A.No.8 of 2023 was filed by the auction purchaser under Order 21 Rule 95 inter alia praying to delivery of possession of schedule of property through Court Amin.

3.(iii) The C.M.A.(MD)No.1349 of 2024 was filed by the defendant V.S.Rethinakumari (in O.S.No.106 of 2011) against the order, dated 08.07.2021 passed in E.A.No.40 of 2018 in E.P.No.4 of 2016 in O.S.No.106 of 2011. The said E.A.No.40 of 2018 was filed under Order 21 Rule 106 read with section 151 of CPC inter alia praying to set aside the exparte order dated 28.04.2016 passed in E.P.No.4 of 2016 in O.S.No.106 of 2011.

3.(iv) The C.M.A.(MD)No.1413 of 2024 was filed by the respondent V.S.Rethinakumari (in O.A.No.4 of 2015) against the order, dated 31.08.2021 passed in O.A.No.4 of 2015. The said O.A.No.4 of 2015 was filed by the Competent Authority under section 4 of TNPID Act inter alia praying to make absolute the attachment order in G.O.Ms.No.872 Home (Police XIX) Department dated 12.11.2012.

3.(v) The C.M.A.(MD)No. 1414 of 2024 was filed by the respondent V.S.Rethinakumari (in O.A.No.4 of 2015) against the order, dated 31.08.2021 passed in I.A.No.61 of 2016 in O.A.No.4 of 2015. The said I.A.No.61 of 2016 in O.A.No.4 of 2015 was filed by Tamil Nadu Mercantile Bank inter alia praying to declare that the Bank has first charge over the properties schedule in G.O.Ms.No.872 dated 12.11.2012 subject to prior mortgage.

4. FACTS IN C.R.P.(MD)NO.2518 OF 2024, C.R.P.(MD)NO.1846 OF 2024 and C.M.A.(MD)NO.1349 OF 2024: The defendant/Judgment debtor V.S.Rethinakumari in the suit is the revision petitioner herein. The plaintiff/decree holder S.R.Ratheesh in the suit is the 1st respondent herein. The auction purchaser P.Robert Raj is the 2nd respondent herein. Subsequently, respondents 3 to 7, who are Income Tax Officer, District Registrar of Registration Department and Revenue Officials, were impleaded as respondents 3 to 7 as per Order of this Court, dated 30.10.2024 since they are necessary parties for adjudication.

5. The E.A.No.41 of 2018 was filed by V.S.Rethinakumari (the defendant in the suit in O.S.No.106 of 2011) under order 21 Rule 90 and Section 151 of Civil Procedure Code to set aside the Court Auction Sale held on 01.03.2018 and the same was dismissed. Aggrieved over the same the present C.R.P.(MD)No.2518 of 2024 is filed by the defendant in the suit. Along with the above E.A.No.41 of 2018, the Exec

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