Zoom Developers Pvt. Ltd. And ... vs Viral Enterprises And Ors. And ...
2004 Latest Caselaw 358 Bom

ORDER

Anoop V. Mohta, J.

1. This Chamber Summons is taken out for the following main prayer:

(b) that the Auction Purchaser be allowed to get the Conveyance Deed registered in the name of their nominee/sister company viz. M/s Magnificient Construction Pvt. Ltd. having their registered office at 12/2. T.N.T. Market, Indore 452001 and it's corporate office at A-53, MIDC Road No. 1, Andheri East, Mumbai 400093 and the Hon'ble Commissioner be directed to execute the Deed of Conveyance in favour of M/s Magnificient Constructions Pvt. Ltd."

2. By order dated 9th March, 2004, it was directed that the applicants to clarify on Affidavit whether it's nominee/sister company viz. M/s Magnificient Construction Private Limited is actually the sister concern of M/s Zoom Developers Private Limited or not.

3.By Affidavit in Rejoinder dated 17th March, 2004, pursuant to the above direction dated 9th March, 2004, the applicant placed on record additional material in support of their main prayer clause, as reproduced above. The relevant paragraphs of this additional Affidavit are paragraphs 3(i) to 3(v) as follows:

"3(i) The entire equity capital of MCPL is held by the following four parties:

 (a)       Mr. Yogendra Upadhyay                  1%
(b)       Mr. G. P. Agarwal                  1%
(c)       Zoom Developers Private Limited 49%
(d)       Hindustan Peter Qates Pvt. Ltd. 49%
 

3(ii) Mr. Vijay Choudhary and Mr. B, L. Kejriwal are the Directors of ZDPL. Mr. Varun Kejriwal s/o Mr. B. L. Kejriwal and Mrs. Manjri Choudhari w/o Mr. Vijay Choudhary are the Directors of Hindustan Peter Qates Pvt. Ltd.
 

3(iii) Mr. S. K. Kabra and Mr. G. P. Agarwal who are presently the Directors of MCPL were the directors of ZDPL, Mr. G. P. Agarwal is also a shareholder of MCPL as aforesaid, and Mr. S. K. Kabra is working as a Company Secretary of ZDPL.
 

3(iv) The fourth and the last shareholder of MCPL namely Mr. Yogendra Upadhyay is also a shareholder of ZDPL.
 

3(v) Three of the sister concerns of MCPL as namely (1) Magnificient Infrastructure Private Limited, (2) Magnificient Investments Private Limited and (3) Magnificient Hotels Private Limited, also holds more than 50% of the issued share Capital of ZDPL.

Advocate for the respondent, during the arguments, resisted only the power of the Court in view of Rule 571 of the High Court of Judicature at Bombay (Original Side) Rules, 1980. There is no objection in reference to the merits of the matter as referred in the Affidavit in Rejoinder dated 17th March, 2004. The relevant clause of the High Court Rules is reproduced as under :

"571. Substitution of name. -- The name of a principal or sub-purchaser shall not be substituted for that of the person certified to be the purchaser without an order to be applied for on Chamber Summons. The application shall be supported by affidavit, stating the facts; and when it is sought to substitute the name of a sub-purchaser for that of an original purchaser, the affidavit shall also show that there was no collusion or under-bargain between the purchaser and sub-purchaser before the sale was confirmed, or shall disclose the terms of the under-bargain, if any."

4. There is no doubt that Court has power, if case is made out, to pass appropriate order or direction including extension of time as earlier granted by the Court and/or to pass appropriate order including modification of the earlier orders also. In the present case, admittedly, in view of the Affidavit filed on record in support of Chamber Summons No. 418 of 2003, party-respondent M/s Magnificient Constructions Private Limited averred that M/s Zoom Developers (auction purchaser) has been declared as the highest bidder and in pursuance to that, it was further directed to take necessary steps to complete the sale of the suit property in favour of M/s Zoom Developers Private Limited for a consideration of Rs. 3.5 crores on the usual terms and conditions. The sale was also confirmed in favour of the applicant on 5th February 2004. The parties have accordingly deposited the relevant balance money within 30 days, as required. Therefore, the total amount which has been deposited is Rs. 3,50,00,000/- (Rupees Three Crore Fifty Lakh only) by the Auction Purchaser. In paragraph 10 of the said Affidavit, a case is made out to join M/s Magnificient Construction Private Limited being the group company/sister concern of M/s Zoom Developers Private Limited for obtaining the order from this Court that the conveyance of the Chakala property in question, be permitted to be in the name of the group company/sister concern, as referred above and thereby it has been requested to modify the order dated 5th February 2004. The relevant averments are referred in paragraphs 10 and 11. The relevant extract from paragraph 11 is as under:

" .....All the projects relating to the building construction and infrastructure development are individually handled by the nominee/group company of M/s Zoom Developers Pvt. Ltd. This is an internal arrangement between the group/nominee company. I say that the Party respondent company M/s Magnificient Construction Pvt. Ltd. is also one of the nominee/sister company of M/s Zoom Developers Pvt. Ltd. For the internal arrangement and for the 'Administrative Purposes' our company respectfully submit that Learned Commissioner be directed to conclude the Conveyance in respect of the said suit property and further be allowed to execute in the name of the nominee/sister company and the Party respondent herein viz. M/s Magnificient Construction Pvt. Ltd."

5. It was also prayed in the Affidavit that the Commissioner be ordered and directed to adjudicate the stamp duty and registration fees.

6. It may be mentioned here that by order dated March 9, 2004, the same single Judge, in fact, directed to file Affidavit with relevant material on record to support the said change or insertion of the name of the nominee or sister company as mentioned above. The parties accordingly, have exchanged the pleadings. No specific denial to the facts in Affidavit in Reply by other side.

7. After considering the Affidavit and material placed on record, I see no reason not to grant relief, as prayed for in this Chamber Summons by the Auction Purchaser and party respondent. Except the power of the Court, there is no material challenge raised by any party in their respective Affidavits or Rejoinders, opposing the said permission. In my opinion, in the facts and circumstances of the case, no prejudice will be caused to anybody if prayer Clause (b) is granted. The Rule, reproduced above, nowhere bars or puts any restriction on the Court, not to consider such application under any circumstances. On the contrary, the Rule itself provides power to the Court to pass such appropriate orders. That Rule cannot be interpreted or read to mean that such power is available only to transfer the property from purchaser to sub-purchaser. Unless great prejudice or injustice or fraud or collusion or nder- bargain is shown, there is no reason to disallow such an application and settle the sale as early as possible. There is nothing of that sort pointed out and found in the matter. The Commissioner for Taking Accounts, Officer of the Court, has also not raised any objection to this course.

8. Therefore, this Chamber Summons is allowed in terms of prayer Clause (b).

9. So far as prayer Clause (a) is concerned, counsel for the applicant, at this stage, does not want to press the same. However, Mr. Mestha, Commissioner for Taking Accounts wants clarification that he may be directed to encash the amount towards the stamp duty and to pass appropriate orders accordingly. To this, the Auction Purchaser and the party respondent have no objection. Ordered accordingly.

All concerned to act on an ordinary copy of this order, duly authenticated by the Chamber Registrar.

Certified copy expedited.