Delhi High Court
Uttar Pradesh Financial ... vs M/S Nalini Sarees & Ors on 5 May, 2010
Author: Rekha Sharma
UNREPORTABLE
* IN THE HIGH COURT OF DELHI AT NEW DELHI
FAO No.12/2008
Date of Decision: May 05, 2010
UTTAR PRADESH FINANCIAL CORPORATION ..... Appellant
through Mr. A.K.Singh, Advocate with
Mr. Gitanju Suraj & Mr. Akhtar, Advocates
versus
M/S NALINI SAREES & ORS ..... Respondents
through Mr. Atul Nigam, Advocate for
respondent No.1.
CORAM:
HON'BLE MISS JUSTICE REKHA SHARMA
1. Whether the reporters of local papers may be allowed to see the
judgment? No
2. To be referred to the reporter or not? No
3. Whether the judgment should be reported in the 'Digest'? No
REKHA SHARMA, J. (ORAL)
Respondent No.1 before me had initially filed the suit in this
Court for a decree of declaration, permanent injunction and specific
performance in respect of property comprising of flat No.102 in
building No.E-544, Greater Kailash, Part-II, New Delhi. Subsequently,
on account of the pecuniary jurisdiction of the High Court having
been raised, the suit was transferred to the Court of the District Judge
for trial. However, while the suit was pending in this Court, the
parties were directed to maintain status-quo in respect of the suit
property.
It is the case of respondent No.1 before the trial Court that it
had entered into an 'Agreement to sell' with M/s Amar House Builders
in respect of the aforementioned flat on May 26, 1981. It is further its
case that the entire sale consideration of the property has been paid
and the respondent is in possession of the property since
July 09, 1985. However, it is alleged that M/s Amar House Builders
and others despite having received the full sale consideration of the
suit property had not executed the sale deed in favour of respondent
No.1 and that is what led to the filing of the suit for specific
performance and for other reliefs.
The case of the appellant, namely Uttar Pradesh Financial
Corporation is that the entire building, i.e. E-544, Greater Kailash,
Part-II, New Delhi in which the flat in question and some other flats
have been built, was mortgaged by the partners of M/s Amar House
Builders with the appellant on May 15, 1996 and the title deeds were
also deposited with it. It is stated that the loan was taken by two
sister concerns of M/s Amar House Builders, namely, M/s Shiv Lok
Investment Private Limited and M/s Regency Tower India Private
Limited, for which the partners of M/s Amar House Builders stood
guarantors. According to the counsel, the loan having not been
repaid, the appellant in view of Section 29 read with Section 46 of the
State Financial Corporation Act, 1951 is entitled to auction the suit
property.
The respondent along with the suit had filed an application
under Order 39 Rules 1 & 2 of the Code of Civil Procedure
(hereinafter referred to as the 'Code') praying for status-quo in
respect of the suit property till the disposal of the suit. As already
noticed above, when the matter was pending before this Court, the
parties were directed to maintain status-quo. However, the
application under Order 39 Rules 1 & 2 of the Code was not finally
disposed of and in the meanwhile, the appellant had also filed an
application under Order 39 Rule 4 of the Code seeking vacation of the
status-quo order. Both these applications were heard by the learned
Additional District Judge who by order dated October 30, 2007 has
allowed the application under Order 39 Rules 1 & 2 of the Code and
has directed the parties to maintain status-quo in respect of the flat in
question. In so far as the application of the appellant under Order 39
Rule 4 of the Code is concerned, the same was dismissed.
It is the aforementioned order of October 30, 2007 which is the
subject matter of challenge before me.
It is submitted by the learned counsel for the appellant that the
suit for specific performance filed by respondent No.1 is, on the face
of it, barred by time, as it is the respondent's own case that the
'Agreement to sell' was entered into between the parties on
May 26, 1981 whereas the suit was filed in the month of April, 1999.
It is also submitted that the property in question being mortgaged
with the appellant and the loan amount having not been paid,
Section 29 read with Section 46 of the State Financial Corporation
Act, 1951 empowers the appellant to auction the property and the
procedure laid down therein gives a right to the respondent to file
objections, if any to such an auction.
Having heard the learned counsels for the parties, I am of the
view that in so far as the question of limitation is concerned, it is for
the trial Court to adjudicate upon the same and it is not for me to
comment either way on whether the suit is within time or barred by
time. As regards the submission that Section 29 read with Section 46
of the State Financial Corporation Act, 1951 empowers the appellant
to auction the suit property, it is again a matter which needs to be and
shall be gone into by the trial Court. The appellant has to first
establish that the loan was taken by M/s Amar House Builders or their
partners from whom respondent No.1 had purchased the suit
property, and has to further establish that the loan amount is still
outstanding. It also cannot be ignored that the order of status-quo
was passed when the matter was pending before this Court. I see no
reason to disturb that order when the parties are still in the process of
trial.
For the fore-going reasons, I find no merit in the appeal. The
same is dismissed. The parties are directed to maintain status-quo
with regard to the suit property. They are directed to appear before
the trial Court on the date fixed. The trial Court is directed to dispose
of the suit as expeditiously as possible, preferably within one year
from now.
REKHA SHARMA, J.
MAY 05, 2010
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