National Investors Forum vs Golden Forests India Ltd.
2013 Latest Caselaw 5074 Del

*      IN THE HIGH COURT OF DELHI AT NEW DELHI
                                                  Decided on: 06.11.2013

+      W.P.(C) 1399/2010, C.M. APPL. 3279/2013, 3988/2013 &
       5733/2013
       NATIONAL INVESTOR FORUM REGD.           ..... Petitioner

                                versus

       GOLDEN FORESTS INDIA LTD.                      ..... Respondents

+ W.P.(C) 1400/2010 NATIONAL INVESTORS FORUM ..... Petitioner

versus

GOLDEN FORESTS INDIA LTD. ..... Respondents

Through: Sh. Akshat Goel, Advocate, for Resp. No.1 in C.M. No. 3279/2013 in W.P.(C) 1399/2010.

Sh. Harpawan Kumar Arora, Advocate, for the Committee.

Sh. Ajay Pal and Sh. Vishal Yadav, Advocates, for Resp. Nos. 1, 2 and 4.

Sh. Rajeev Sharma, Sh. Sahil Bhalaik and Sh. Uddyam Mukherjee, Advocates.

CORAM:

HON'BLE MR. JUSTICE S. RAVINDRA BHAT HON'BLE MR. JUSTICE NAJMI WAZIRI

MR. JUSTICE S. RAVINDRA BHAT (OPEN COURT) %

C.M. APPL. 5733/2013

1. This application has been filed by the Court-appointed

W.P.(C) 1399/2010 & 1400/2010 Page 1 Committee in respect of Golden Forests (India) Limited. The Committee seeks confirmation of an order dated 17.04.2013 in respect of land measuring 40 kanal 11 marla situated in Village Kot, Tehsil and District Panchkula (Haryana) bearing H.B. No. 238, Khewat No.658/762, Khasra No.121/4(40-11). The order states that the property was sought to be sold to Mrs. Manisha Rani, W/o Satish Kumar and Mrs. Suman Rani, W/o Ajay Kumar. The erstwhile GFIL, whose assets and affairs were placed under the control of the Committee by the Supreme Court's order - had, according to these individuals, resolved to sell those properties owned by it. The resolution relied upon by the vendees was of 11.03.2000 (of the GFIL) and the sale deed executed was dated 03.04.2000. Apparently, the property was subsequently sold to one Rohdal, S/o Mangtu by a registered sale deed dated 29.12.2000. Rohdal in turn sold the said land to one Manpreet Singh through a registered sale deed dated 19.08.2002. The Committee stated that it became aware of this transaction and thereafter issued notices to the vendees asking them to show cause why the sale deed of 03.04.2000 and subsequent transfers be not treated as void and not binding upon the GFIL. In the proceedings before the Committee, Sukh Ram, grandson of Rohdal stated that he did not wish to say anything nor contest the proceedings. Mrs. Manisha Rani and Mrs. Suman Rani did not appear; accordingly the latter were proceeded ex-parte. The proceedings were contested in these circumstances by the last predecessor - Manpreet Singh. After considering the materials and contentions put forth on behalf of Manpreet Singh, the Committee

W.P.(C) 1399/2010 & 1400/2010 Page 2 concluded that the transfer was null and void and could not bind the company.

2. Notice on this application was issued. Sh. Manpreet Singh, the original vendee and subsequent last vendee in the chain of transfers were represented. It is contended that the order of the Committee should not be confirmed since the resolution of 11.03.2000 which authorized the sale in question was perfectly valid and binding and that the sale deed dated 03.04.2000 was without any blemish and relied upon the resolution dated 11.03.2000. The property was acquired for valuable consideration by the vendees who thereafter sold it. The title was successfully passed in a valid and legal manner and that Manpreet Singh was also entitled to hold the property. Learned counsel emphasized upon the fact that pursuant to the sale deed as well as the resolution, the mutation of the property was carried out in the relevant revenue records and that all these circumstances clarified that there is no defect in the title and that the said vendees were innocent third party purchasers.

3. The Court has considered the submissions as well as the materials on record. The relevant reasoning in this regard with respect to the Committee's order of 17.04.2013 is as follows:

"7. The resolution dated 11.03.2000 alleged to have been passed by the Company GFIL and the subsequent sale of the property pursuant to the above said resolution of the Company by Raj Kumar Kapoor to Manisha Rani & Suman Rani and the subsequent successive sales are clearly in violation of the restraint order passed by the Bombay High Court and the Delhi High Court and are collusive and an act of fraud. The restraint order by the

W.P.(C) 1399/2010 & 1400/2010 Page 3 Delhi High Court and the Bombay High Court were passed in October & November, 1998 and the resolution of the Company is alleged to have been passed on 11.03.2000, thereafter, three sales in quick succession by itself a relevant fact casting doubts on the bonafides and genuineness of the passing of the resolution and the sale of the land. A conclusion could be drawn that the alleged resolution and the sales are sham and fictitious and made to overcome the restraint order passed on the Company GFIL and its directors. The entire sale consideration of Rs.4,80,000/- under the sale deed dated 03.04.2000 is stated to have been received at the house prior to the execution of the sale deed and no particulars what so ever of such payments are contained in the sale deed. The payment of such a huge amount in cash is not believable, particularly in the matter of sale of a property by the Company. The payment in cash at the house is totally unbusinesslike, the least care taken would have been to make the payment by Cheque or Bank Draft and if in cash before the Sub Registrar. It is also not understood why Raj Kumar Kapoor an employee of the company GFIL would be authorized to sign the sale documents to transfer the land. Smt. Manisha Rani & Smt. Suman Rani further just within a short period of 9 months sold the land to Sh. Rohdal (deceased) for a consideration of Rs.8,00,000/-, the sale deed in favour of Sh. Rohdal also recites that the sale consideration of Rs.8,00,000/- has been received at the house. Rohdal further sold the property to Manpreet Singh for a consideration of Rs.11,10,000/- on 19.08.2002. Further, Sh. Manpreet Singh also was in the process of selling the property when the illegal sale of the property on the basis of the resolution dated 11.03.2000 was found out and the present proceedings initiated for the recovery of the property owned by the Company GFIL. The resolution dated 11.03.2000 and the multiple sales of the land subject matter of the resolution clearly prove an attempt to conceal the illegal transfer of the property of

W.P.(C) 1399/2010 & 1400/2010 Page 4 the Company (GFIL).

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9. It be noticed here that the managing director and other directors of the company GFIL were arrested on 24th December,2000. The Golden Group of Companies shut the business by the end of December, 2000. The Company GFIL had purchased large areas of land in Villages Kot, Billa, Jaswantgarh and an number of other surrounding villages. The Golden Group of Companies were passing through a very serious financial crisis. A number of cases were filed against the Company GFIL for its liquidation in the Punjab & Haryana High Court. The Bombay High Court, the Delhi High Court and Punjab & Haryana had passed a restraint order prohibiting the Company and its directors from alienating the property of the Company GFIL. The public at large and in particular the residents of villages Kot, Billa and Jaswantgarh etc. very well knew of the difficult times the company was going through. The public also was aware of the restraint order imposed on the Company GFIL by the various of High Courts. The alleged purchasers fully knowing of all these facts went on to deal with the property of the Company GFIL. It is certainly a calculated and collusive move to deprive the company of the property."

4. The Committee thereafter took notice of various orders made by the Supreme Court as well as this Court and concluded that the transfers were not binding.

5. This Court notices that the Bombay High Court in proceedings as far back as on 23.11.1998 directed the erstwhile Golden Forest, the GFIL and its group companies not to part with any properties since the concerns voiced by numerous investors was seized by the Court.

W.P.(C) 1399/2010 & 1400/2010 Page 5 Despite this order which was held to be binding subsequently on the company and also upon all interested parties by the Supreme Court's order dated 05.09.2006, apparently sale deeds were executed. The resolution of 11.03.2000 is part of such series of transactions which were clearly meant to defeat the rights of investors and ostensibly confer title and rights upon third parties. The Committee has noticed - and this Court is aware that in previous proceedings, based upon identical facts and circumstances, transfers based upon resolutions made by the Company were held to be not binding upon it and the Committee was, therefore, authorized to sell such property. This order was made by the various benches - in C.M. No. 18353/2011 (Ram Rattan and Ors.), decided on 01.11.2012; C.M. No. 19571/2012 (Narata Ram and Ors.) and C.M. No. 19572/2012 (Jagir Singh and Anr.), decided on 14.12.2012 and C.M. No.59596/2013 (Krishna Devi and Ors.), decided on 01.04.2013. In the present case, the reasoning of the Committee that the transfers were under suspect circumstances and did not ostensibly disclose when the sale consideration was paid, is a comprehensive one. There is no answer to this ground. Apparently, the books and other materials of GFIL also do not disclose that such amounts were ever received by the company. The vendees were also unable to show any receipt or document evidencing payment of consideration said to have been given for the land.

6. In view of these considerations, the Court is of the opinion that the set of facts in this case are different from the others which this Court had occasion to deal with while confirming the order of the Committee - in C.M. 18353/2011, 19571-72/2012 and 59596/2013.

W.P.(C) 1399/2010 & 1400/2010 Page 6 Consequently, the application is allowed. The order of the Committee dated 17.04.2013 is hereby confirmed. The respondent Manpreet Singh as well as Manisha Rani, W/o Satish Kumar and Suman Rani, W/o Ajay Kumar are directed to hand-over possession of the property to the Committee within six weeks from the date of this order. In the event of its non-compliance or obstruction by either Manpreet Singh, Mrs. Manisha Rani, W/o Satish Kumar and Mrs. Suman Rani, W/o Ajay Kumar, Sukh Ram or anyone else, claiming title or any possessory right to them, it is open to the Committee to seek reasonable help from the Deputy Commissioner, Panchkula as well as the local police. The application is allowed in the above terms.

Order dasti.

C.M. Appl.3279/2013 & 3988/2013 List on 12.12.2013.

W.P.(C) 1400/2010 List along with W.P.(C) 1399/2010 on 12.12.2013.

S. RAVINDRA BHAT (JUDGE)

NAJMI WAZIRI (JUDGE) NOVEMBER 6, 2013

W.P.(C) 1399/2010 & 1400/2010 Page 7