J U D G M E N T

The appellants herein are the 3rd parties in O.A.No.35 of 2013 filed by the first respondent under Section 4(3) and 4(4) of the Tamil Nadu Protection of Interests of Depositors (In Financial Establishments) Act 1997, Tamil Nadu Act No.44/97, seeking relief of attachment with regard to the scheduled mentioned properties and the same was allowed on 04.10.2001, which was challenged by the 3rd parties, who are the bonofide purchasers of the property, filed this appeal.

2. Points for consideration:

(i) Whether the Special Judge, Chennai, without perusing the revenue records with regard to the question of the property erroneously and ordered ad-interim attachment?; (ii) Whether the Special Judge, Chennai erred in passing order of attachment without following the natural justice and acting against the provisions under Section 3 and 7 (6) of TNPID Act?;

(iii) Whether the trial Judge failed to observe that the application filed by the first respondent herein is beyond period of limitation?.

3. The facts reveal that originally a house plot bearing number

85 measuring 2450 sq.ft., in S.F.No.236/11 of Nallur Village, Tiruppur Taluk, belonged to one K.Venkatachalam by means of a registered sale deed dated 12.06.1991. Later, he settled the above property in favour of his wife viz., Leelavathy, by means of a registered deed of settlement dated 18.09.1998. On 25.02.2000, the said Leelavathy executed a Power of Attorney in favour of one Nithyakalyani to sell the above property. The said power agent has sold the property in favour of one P.Ramakrishnan dated 10.04.2000. The appellants purchased the property from him for a valuable consideration. In such circumstances, the appellants came to know that through the encumbrance certificate on 30.10.2015, their property has been attached by virtue of G.O.Ms.No.558, Home (Courts II-A) Department, dated

14.06.2001. On verification, it is brought to the notice of the appellants that the property has been attached by the first respondent and the same was allowed on 28.11.2013. No notice has been issued to the appellants and since the property is belonging to the appellants, they preferred the present appeal challenging the order of attachment passed in O.A.No.35 of 2013, on the file of the Special Judge, TNPID Court, Coimbatore.

4. At the time of the arguments, the learned counsel for the appellants submitted that the appellants are the bonofide purchasers and they purchased the property for valid consideration and they are not connected with any of the activity of the accused and their vendors. But, without giving proper notice, the Special Judge attached the property under Section 7(1) of the act. For that he relied upon the decision of the High Court of Madras in the case of S.Lakshmi Bai Vs.District Revenue Officer and others [(2019 SCC Online Mad 14696)] (W.P.No.21876 of 2008), which reads as follows:

13. As seen from the aforesaid Section of TNPID Act, statutory requirements have to be complied with by the competent authority before effecting the attachment. The Special Court will have to issue show cause notice to the property owner, prior to attachment. On receipt of the show cause notice, the property owner has ben given the right to raise objections regarding the said show cause notice.

14. In the case on hand, as seen from the counter affidavit filed by the first respondent/competent authority, there is no reference to the issuance of any show cause notice to the petitioner by the Special Court. The first respondent/competent authority has also not produced before this Court the show cause notice that may have been sent to the petitioner prior to attachment. Sufficient time was also given to the respondents to produce the same, if they had sent one such show cause notice to the petitioner. Therefore, it can be inferred that the first respondent/competent authority has bot issued any show cause notice to the petitioner prior to attachment of petitioner's property under the TNPID Act,