Rajesh Yashwant Chiwelkar And 2 ... vs India Home Loan Ltd. And 4 Ors
2022 Latest Caselaw 10560 Bom

          Digitally
          signed by
GAURI     GAURI AMIT
          GAEKWAD
AMIT      Date:                                      1/9               7-IAL-23189-2022.doc
GAEKWAD   2022.10.15
          10:08:36
          +0530
                              IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                                  ORDINARY ORIGINAL CIVIL JURISDICTION
                                    WRIT PETITION NO.2841 OF 2022
                                                WITH
                               INTERIM APPLICATION (L) NO.23189 OF 2022
                                                WITH
                               INTERIM APPLICATION (L) NO.23333 OF 2022
                                                WITH
                               INTERIM APPLICATION (L) NO.24359 OF 2022
                                                WITH
                               INTERIM APPLICATION (L) NO.24654 OF 2022
                                                 IN
                                    WRIT PETITION NO.2841 OF 2022

              India Home Loan Ltd.                     .....Petitioner
                        Vs.
              The State of Maharashtra & Ors.       .....Respondents
                                                   ----
              Mr. Manoj Kumar Mishra for petitioner.
              Ms. Manjiri Parasnis for applicants in IAL/23189/2022, IAL/23333/2022,
              IAL/24359/2022.
              Ms. Pranita P. Hingmire for applicant in IAL/24654/2022.
              Mr. Kedar Dighe, AGP for State - respondent.
                                                   ----
                                                    CORAM : K. R. SHRIRAM &
                                                              A. S. DOCTOR, JJ.

DATED : 12th OCTOBER 2022

P.C. :

1 Petitioner has filed this petition to direct respondents, viz.,

State of Maharashtra, District Magistrate/District Collector, Pune, Tahsildar

and Taluka Executive Magistrate and Deputy Commissioner of Police to

grant required assistance to petitioner in executing the order passed in

SEC/SR/584/2021 by District Magistrate and Collector, Pune on 20 th July

2021 under Section 14 of the SARFAESI Act and for taking possession of the

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mortgaged properties as mentioned in the said order dated 20th July 2021.

2 The order dated 20th July 2021 passed under Section 14 of the

SARFAESI Act annexed to the petition clearly indicates that the application

was made to take possession of the property which is mentioned in

paragraph 3 of the said order. In the petition also there is an averment that

the loan facility to the borrowers, one RPS Property, was secured by way of

mortgage of various properties including 60 flats in RPS Heritage at Survey

No.278, Dighi Road, Said Nagar, Lohegaon, Pune - 411 047.

3 On 5th July 2022 the petition came to be disposed by directing

respondents to assist petitioner in executing the order passed under Section

14 of the SARFAESI Act.

4 On 21st July 2022 an application was moved and applicant

stated that petitioner did not have mortgage of 45 flats out of the

60 flats and certain other galas. On 21 st July 2022 counsel for applicant

submitted that NOC has actually been given by petitioner for 45 units out of

the 60 units, which Mr. Mishra, who appeared for original petitioner,

corrected to say only for 44 units NOC had been granted and not 45 units

(Order passed in Interim Application (lodging) No.2333 of 2022).

Mr. Mishra clarified that NOC has been granted even before application

under under Section 14 of the SARFAESI Act had been filed.

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5                 Therefore, it is quite clear that the declaration/affidavit that

was filed alongwith the application under Section 14 of the SARFAESI Act

contained false averments/statements. Based on such false averments/

statements an order under Section 14 of the SARFAESI Act has been

obtained. The false statements/averments have been continued in the

petition filed before us based on which the order dated 5 th July 2022 was

also obtained.

6 Mr. Mishra states that he has also affirmed reply to Interim

Application (lodging) No.2333 of 2022, copy whereof has been served on

applicant in Interim Application (lodging) No.2333 of 2022 but not filed in

the registry. Registry to take the same on record.

Mr. Mishra states that in the reply he has stated, rather

confirmed the allegation made by Ms. Parasnis that NOC with regard to

44 units had been issued even before filing the application under Section 14

of the SARFAESI Act. This only aggravates the problem for petitioner.

7 This Court in its judgment pronounced on 22nd September 2022

in Writ Petition No.7657 of 2022 (Satishkumar Surendra Shetty V/s. The

District Collector, Thane and Ors.) has in paragraph 12(B) observed as

under :

12(B). Additionally, even both the other contentions raised by Petitioners (a) that the title documents in respect of the said flats were retained with the Borrowers and (b) that there was nothing to demonstrate that Borrowers had deposited the title documents " with intent to create a security thereon " are also

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beyond the scope of the jurisdiction of Respondent No.2 under Section 14 of the SARAFESI Act. It is well settled that the jurisdiction of Respondent No. 4 when considering an Application under Section 14 of the SARAFESI Act is purely ministerial in nature and Respondent No.2 does not have the jurisdiction "to decide" any issues or for that matter even hear a Borrower and/or Third Party. The scope of the jurisdiction under Section 14 of the SARFAESI Act as has been reiterated by this Hon'ble Court in the case of Phoenix ARC Private Limited vs The State of Maharashtra & Ors. Petitioner has accepted this position in the Petition as also in the course of arguments advanced. Proceedings under Section 14 of the SARFAESI Act being ex-parte in nature would necessarily put a higher onus on the Applicant to ensure strict compliance with both content (i.e., truth thereof) and form of the said application and procedure contemplated under Section 14 of the SARFAESI Act. If there is even the slightest hint of an applicant being untruthful in either the content or form prescribed under Section 14 of the SARFAESI Act, the same would render the Application susceptible to challenge by way of Writ Petition. In any event, in the present case we find it most curious that the Petitioner having on the one hand questioned the very creation of a valid mortgage has on the other hand failed and neglected to join as Respondents the Parties between whom the mortgage was created, namely the Borrowers and ICICI. Having said that, we find Petitioner contention that Borrowers had retained possession of the original title deeds of the said flats to also be entirely misplaced and untenable and contrary to a proper reading of the loan agreement and the declaration. In any event, the same has been belied by Petitioner's Advocate being given and taking inspection of the original title documents produced by Respondent No.5. Insofar as Petitioner's contention that there was nothing to show and/or demonstrate the intention of creating a mortgage by Borrowers we find that the same is also beyond the scope of the jurisdiction of Respondent No.2 under Section 14 of the SARAFESI Act.

(emphasis supplied)

8 Therefore, proceedings under Section 14 of the SARFAESI Act

being ex-parte in nature would necessarily put a higher onus on applicant

to ensure strict compliance with both content (i.e., truth thereof) and form

of the said application and procedure contemplated under Section 14 of the

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SARFAESI Act. If there is even the slightest hint of applicant being

untruthful in either the content or form prescribed under Section 14

of the SARFAESI Act, the same would render the application susceptible to

challenge. In this case, it is not just a hint but confirmed that petitioner has

been untruthful in content and form prescribed under Section 14 of the

SARFAESI Act and also in the petition filed in this Court. In our view, it is

rather regrettable to note that petitioner has come to Court with unclean

hands. Based on the averment in the application under Section 14 of the

SARFAESI Act petitioner obtained the order dated 20 th July 2021 and later

from this Court on 5th July 2022.

9 The observations of the Hon'ble Supreme Court in S. P.

Chengalvaraya Naidu v/S. Jagannath (Dead) by LRS 1 are relevant in this

context. The court observed,

"The Courts of law are meant for imparting justice between the parties. One who comes to the Court must come with clean hands ......... We have no hesitation to say that a person whose case is based on falsehood, has no right to approach the Court. He can be summarily thrown out at any stage of the litigation".

10 The Apex Court and this Court have, on many occasions, stated

that if a party comes to the Court with unclean hands, which in this case

petitioner has, the party should be dealt with very strongly and substantial

costs also should be imposed on the party. The conduct of petitioner intends

to impede and prejudice the administration of justice. Judiciary is the

1. (1994) 1 SCC 1

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bedrock and handmaid of orderly life and civilized society. In Sciemed

Overseas Inc. V/s. BOC India Ltd.2 the Apex Court has lamented about the

unhealthy trend in filing of affidavits which are not truthful. Paragraph 2 of

the said judgment reads as under :

"2. A global search of cases pertaining to the filing of a false affidavit indicates that the number of such cases that are reported has shown an alarming increase in the last fifteen years as compared to the number of such cases prior to that. This is illustrative of the malaise that is slowly but surely creeping in. This 'trend' is certainly an unhealthy one that should be strongly discouraged, well before the filing of false affidavits gets to be treated as a routine and normal affair."

11 Kuldip Singh, J. (as he then was) in S.P. Chengalvaraya Naidu

(Dead) by LRS (Supra) in paragraph 5 observed :

"5. ................ We are constrained to say that more often than not, process of the Court is being abused. Property- grabbers, taxevaders, bank loandodgers and other unscrupulous persons from all walks of life find the Court process a convenient lever to retain the illegalgains indefinitely. We have no hesitation to say that a person, who's case is based on falsehood, has no right to approach the Court. He can be summarily thrown out at any stage of the litigation."

12 In Oswal Fats and Oils Limited V/s. Additional Commissioner

(Administrator), Bareilly Division, Bareilly3, the Apex Court followed the

same principal that if a person is found guilty of concealment of material

facts or making an attempt to pollute the pure stream of justice, the Court

not only has the right but a duty to deny relief to such person.

2. 2016 AII SCR 370
3. (2010) 4 SCC 728

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13                 In Dalip Singh V/s. State of Uttar Pradesh and Ors. 4, the Court

bemoaned that a new creed of litigants has cropped up who do not have

any respect for truth and they shamelessly resort to falsehood and unethical

means for achieving their goals. Such a litigant who attempts to pollute the

stream of justice or who touches the pure fountain of justice with tainted

hands, is not entitled to any relief.

14 It will also be useful to reproduce paragraph 1 and 2 of Dalip

Singh V/s. State of Uttar Pradesh and Ors. (Supra) and they read as under :

"1. For many centuries Indian society cherished two basic values of life i.e. "satya" (truth) and "ahimsa" (nonviolence). Mahavir, Gautam Buddha and Mahatma Gandhi guided the people to ingrain these values in their daily life. Truth constituted an integral part of the justice delivery system which was in vogue in the pre-Independence era and the people used to feel proud to tell truth in the courts irrespective of the consequences. However, post Independence period has seen drastic changes in our value system. The materialism has overshadowed the old ethos and the quest for personal gain has become so intense that those involved in litigation do not hesitate to take shelter of falsehood, misrepresentation and suppression of facts in the court proceedings.

2. In the last 40 years, a new creed of litigants has cropped up. Those who belong to this creed do not have any respect for truth. They shamelessly resort to falsehood and unethical means for achieving their goals. In order to meet the challenge posed by this new creed of litigants, the courts have, from time to time, evolved new rules and it is now well established that a litigant, who attempts to pollute the stream of justice or who touches the pure fountain of justice with tainted hands, is not entitled to any relief, interim or final."

15 Petitioner having obtained the order dated 5 th July 2022 based

on false declaration/affidavits, the order dated 5th July 2022 is hereby

4. (2010) 2 SCC 114

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recalled. The order dated 20th July 2021 passed by District Magistrate and

Collector, Pune under Section 14 of the SARFAESI Act with which petitioner

had approached this Court is also hereby quashed and set aside.

16 Petition dismissed with costs in the sum of Rs.1,00,000/-.

Petitioner shall pay this sum of Rs.1,00,000/- to PM Cares Fund and this

amount shall be paid within two weeks from today. The account details are

as under :

Name of the Account : PM CARES Account Number : 60355358964 IFSC : MAHB0001160 Branch : UPSC - New Delhi

Compliance affidavit to be filed within one week thereafter

with copy to advocate for applicants.

17 The District Magistrate and Collector, Pune is directed to

dismiss the Application No.SEC/SR/584/2021 filed by petitioner under

Section 14 of the SARFAESI Act. Registry is directed to forward a copy of

this order to the District Magistrate expeditiously. Applicants in the interim

applications may also forward a copy to the District Magistrate.

18 Whichever flats have been taken possession by virtue of order

that was dishonestly obtained by petitioner shall be returned by

17th October 2022 to those from whom possession was taken.

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19              All interim applications also stand disposed.

20              We, however, feel the borrower should not be allowed to go

scot free. Therefore, we grant liberty to petitioner to approach the

Magistrate with a fresh application under Section 14 of the SARFAESI Act

and be truthful in content and form. This is subject to petitioner paying the

amount mentioned in paragraph 16 above and returning the flats as per

paragraph 18 above.

21 We also direct petitioner not to claim the cost of this petition,

the cost awarded herein or the cost of the Section 14 application being

SEC/SR/584/2021 from the borrower or any other party. These costs will

have to be entirely and solely borne by petitioner.

(A. S. DOCTOR, J.)                                      (K. R. SHRIRAM, J.)




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