Delhi High Court
Arjun Prakash vs Shyam Sahani & Ors on 1 August, 2018
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*IN THE HIGH COURT OF DELHI AT NEW DELHI
Reserved on: 21st February, 2018
Pronounced on: 1st August, 2018
+ FAO(OS) 210/2017 & CM Nos.25124, 33236/2017, 1097/2018
ARJUN PRAKASH ..... Appellant
Through: Mr. J.P. Sengh, Sr. Adv. with
Mr.Sajid, Ms. Manisha Mehta,
Ms.Vaishali Tanwar and Ms.
Mrigna Shekhar, Advs
versus
SHYAM SAHANI & ORS ..... Respondents
Through: Mr. Dinesh C. Pandey with
Mr.Rajeev Gurung and Mr. R.
Madhav Bera, Advs. for R-1
CORAM:-
HON'BLE THE ACTING CHIEF JUSTICE
HON'BLE MR JUSTICE C. HARI SHANKAR
% (JUDGMENT)
C. HARI SHANKAR, J.
1. This appeal, at the instance of Defendant No. 4 in CS(OS)
1134/2008, is directed against para 4 of the order, dated 26th May,
2017, and para 5 of the consequent order, dated 30 th May, 2017,
passed by the learned Single Judge in IA 6909/2017, filed by the
Defendant No. 4 in the aforementioned civil suit.
2. The plaintiff, and Defendants 1 to 4 in CS (OS) 1134/2008, are
all descendants, to a greater or lesser degree, of Niamat Sahni. Niamat
Sahni had one son and daughter. The plaintiff in CS (OS) 1134/2008,
who is the appellant before us, is her son Shyam Sahni. The daughter
of Niamat Sahni, Usha Prakash, died before the filing of CS (OS)
1134/2008. Defendants Nos 1 to 4, in CS (OS) 1134/2008, are Usha
Prakash's husband Sarabjit Prakash, and her three sons, Sanjeev
Prakash, Rajeev Prakash and Arjun Prakash, who is the appellant
before us.
3. The remaining defendants in the suit are purchasers of various
portions of the suit property.
4. A tabular representation depicting the status of the various
parties in CS 1134/2008 may be presented thus:
Name Status in Status in the Relationship
CS(OS)1134/2008 present appeal Status
Shyam Sahni Plaintiff Respondent No. 1 S/o Niamat Sahni
Sarabjit Defendant No. 1 Deceased H/o D/o Niamat Sahni
Prakash (Usha Prakash)
Sanjeev Defendant No. 2 Respondent No. 2 S/o Sarabjit Prakash
Prakash
Rajeev Prakash Defendant No. 3 Respondent No. 3 S/o Sarabjit Prakash
Arjun Prakash Defendant No. 4 Appellant S/o Sarabjit Prakash
Douglas James Defendant No. 5 Respondent No. 4 Buyer from Usha Prakash
Breckenridge
Jhilmil Saxena Defendant No. 6 Respondent No. 5 Buyer from Usha Prakash
Breckenridge
Arif Sahid Defendant No. 7 Deceased Buyer from Usha Prakash
Khan
Anish Wig Defendant No. 8 Respondent No. 9 Buyer from Usha Prakash
Farida Abdulla Not a party (wife Respondent No. 6 W/o Arif Sahid Khan
Khan of Defendant No.
7)
Ali Nawaz Not a party (son of Respondent No. 7 W/o Arif Sahid Khan
Khan Defendant No. 7)
Abid Khan Not a party (son of Respondent No. 8 W/o Arif Sahid Khan
Defendant No. 7)
5. For ease of reference, allusion, to the various parties, would be
as per their status, as plaintiffs or defendants, in CS (OS) 1134/2008.
6. Though the issue in controversy is extremely limited, it is
necessary, in order to adjudicate thereon, to walk, once again, the path
followed by the suit, in the proceedings before the learned Single
Judge.
7. The property at No 68, Friends Colony (West), New Delhi
(hereinafter referred to as "the suit property"), was constructed, by
Niamat Sahni, out of her own funds and resources, on 3000 square
yard freehold plot, also purchased by her. On 3rd January, 2002 a
General Power of Attorney was allegedly executed, by Niamat Sahni,
entitling her daughter Usha Prakash to create third party rights in
respect of the suit property. On the basis thereof, Usha Prakash
executed sale deeds, favouring Defendants Nos. 5 to 8, in respect of
various portions of the suit property, with
(i) Sale Deed, dated 21st March, 2002, having been executed
in favour of Defendant No. 4 in respect of Flat Private D on the
second floor,
(ii) Sale Deed dated 7th August, 2002, in favour of Defendant
Nos. 5 and 6 in respect of Flat Private A on the second floor,
(iii) Sale Deed dated 15th September, 2003, in favour of
Defendant No. 7 in respect of terrace rights over Flat Private D,
(iv) Sale Deed dated 7th October, 2003, in favour of her
husband, Defendant No. 1 in respect of the first floor of the suit
property and
(v) Sale Deed dated 11th January, 2005, in favour of
Defendant No. 4 in respect of Flat Private B.
8. Defendant No. 4 further executed Sale Deed, dated 15th
September, 2003, in respect of Flat Private D in favour of Defendant
No. 7.
9. On 28th April, 2008, Niamat Sahni died.
10. Shortly thereafter, on 31st May, 2008, CS (OS) 1134/2008 was
filed by the plaintiff Shyam Sahni, the son of Niamat Sahni, on the
original site of this Court, for declaration, possession, permanent
injunction and partition, in respect of the suit property. The plaintiff
premised his case, in the suit, on the ground that the ground floor and
the terrace over the second floor of the suit property, along with 50 %
of the land, had been gifted to him by his mother Niamat Sahni vide
gift deed dated 17th July, 2004, and that come by will dated 10th
October, 2003, and codicil thereto, dated 17th July, 2004, Niamat
Sahni had willed the suit property to the plaintiff and his sister Usha
Prakash with a covenant that Usha Prakash would not have any right
to sell any portion of the property to any outsider, without giving first
option of purchase to the plaintiff. It was alleged that, in contravention
of the said documents, and the covenants therein, Usha Prakash, acting
on the basis of the allegedly fictitious General Power of Attorney
dated 3rd January, 2002 (supra) was selling various portions of the suit
property to the various defendants in the suit.
11. Along with CS (OS) 1134/2008, the plaintiff filed IA
7152/2008 under Order XXXIX Rules 1 and 2 of the Code of Civil
Procedure, 1908 (hereinafter referred to as "CPC") for an ad interim
injunction, restraining the defendants in the suit from transferring,
alienating, parting with possession or otherwise altering the status quo
of the suit property pending final disposal of the suit.
12. As against this, Defendant No. 4 (the appellant before us)
contends that there existed an irrevocable family settlement, of 1999,
whereunder the suit property had been fully partitioned by metes and
bounds, and that the plaintiff concealed the same.
13. We may clarify here, that our brief in the present appeal is
limited, and that the inter se rights amongst the parties would be
required to be determined in the suit, which is pending before the
learned Single Judge. Nothing herein contained be considered an
expression of opinion on the merits of the case.
14. On 2nd June, 2008, a learned Single Judge of this Court, taking
stock of the aforementioned allegations contained in the plaint of the
plaintiff, arrived at the opinion that the plaintiff had made out a prima-
facie case for grant of ex parte ad interim injunction in his favour and
that the considerations of balance of convenience and irreparable
injury were also in favour of grant of such injunction. Accordingly,
vide order of the said date, i.e. 2nd June, 2008, the defendants were
restrained from alienating, parting with possession or creating any
third party rights, in respect of the suit property which includes the
first floor thereof, over which the Defendant No. 4 claims ownership
rights, and which is the subject matter of the controversy before us.
15. As it happens, prior to the passing of the above injunctive order
by the learned Single Judge on 2nd June, 2008, the first floor of the suit
property, over which Defendants Nos. 1 and 4 (i.e. the present
appellants) claimed ownership, was mortgaged with the Bank of India
(hereinafter referred to as "the Bank"), by deposit of title deeds,
against a loan of ₹ 4.5 crore extended to M/s. Soul and Attires
Creation Pvt. Ltd, of which Defendant No.1 Sarabjit Prakash was a
director. Sarabjit Prakash, who stood guarantor for the loan,
apparently intended to liquidate the loan by selling the first floor.
These facts stand acknowledged by Defendant No.1 Sarabjit Prakash,
on oath, before the learned Single Judge on 2nd July, 2013 come to
which deposition reference would also be made hereinafter.
16. The spark that fuelled the fire in the present proceedings, as it
were, was the grant of oral consent, by Defendant No.1 and Defendant
No. 4, on 9th October, 2008, to retention, by the Bank, of the title
deeds pertaining to the first floor of the suit property, which already
stood deposited with the said Bank in November, 2007, so as to obtain
enhancement of the working capital limit, against a loan of ₹ 4.25
crores, taken by the appellant and Mr. Sarabjit Prakash, on behalf of
M/s Soul and Attires Creations Private Limited. As a result, the credit
limit extended to M/s Soul and Attires Creations Private Limited stood
enhanced to ₹ 12 crores. The initial deposit of the said title deeds with
the Bank, the appeal would seek to emphasise, was much prior to the
filing of CS(OS) 1134/2008 by the plaintiff.
17. IA 8923/2008 was filed by Defendant No.1 Sarabjit Prakash in
July 2008, and IA 12682/2008 was filed, by Defendant No.8 (Anish
Wig) in October, 2008, under Order 39 Rule 4 of the CPC, for
vacation of the interim injunction granted on 2.6.2008.
18. In the meantime, owing to failure, on the part of Defendant Nos.
1 and 4, to liquidate the loans, advances and credit facilities availed
from the Bank, the aforementioned loan account, of Defendant No. 1
and Defendant No. 4 was declared, by the Bank, as a Non Performing
Asset (NPA) on 30th June, 2009, following which proceedings were
initiated, against Defendant Nos. 1 and 4 under the Securitization and
Reconstruction of Financial Assets and Enforcement of Security
Interest (SARFAESI) Act, 2002. On an application filed by the Bank,
under the said Act, the learned Additional Chief Metropolitan
Magistrate (ACMM), on 13th September, 2011, allowed the Bank to
take actual physical possession of the mortgaged property, i.e. the first
floor of the suit property, and also appointed a receiver for the said
purpose, who took possession, thereof, on 31st October, 2011.
19. Vide a consent order dated 5th December, 2011, IA 7152/2008
(by the plaintiff under Order 39 Rules 1 & 2), IA 8923/2008 (by
Defendant No. 1 under Order 39 Rule 4) and IA 12682/2008 (by
Defendant No. 8 under Order 39 Rule 4) were disposed of in the
following terms:
"IAs 7152/2008(O.39 R.1 and 2 CPC), 8923/08(O.39
R.4 CPC), 12682/08(O.39 R.4 CPC)
After arguments, it has been agreed between the
parties that they shall maintain status quo with respect
to title and possession of first floor, second floor and
terrace of plot No.68, Friends Colony, New Delhi. If any
of the parties wants to deal with any of the aforesaid
portions, he shall be at liberty to apply to the Court for
an appropriate relief. It has also been agreed that the
parties shall also maintain status quo with respect to title
and possession of Flat No.201 constructed on second
floor together with car parking space No.021 on the
ground floor of property known as Kensington Gardens
located at No.13(formerly 1/10) Kensington Road
Bangalore.
These applications stand disposed of in terms of
this consent order."
(Emphasis supplied)
20. Almost simultaneously, on 3rd December, 2011, IA 19801/2011
was filed, by the plaintiff against Defendant No. 1 (Sarabjit Prakash),
under Order XXXIX Rule 2A of the CPC, contending that the grant of
consent, by him, on 9th October, 2008, to the retention of the title
deeds in respect of the first floor of the suit property, by the Bank,
against enhancement of credit limit, was contemptuous of the order
dated 2nd May, 2008, which directed status quo to be maintained in
respect of the suit property. It may be noted that the present appeal
owes its genesis to this IA, and the successive orders passed therein, or
as a sequel thereto.
21. In pursuance of the proceedings initiated by it, against
Defendant Nos.1 and 4 under the SARFAESI Act, the Bank had, in
the interregnum, also filed OA 297/2011 before the learned Debt
Recovery Tribunal (DRT) which, vide judgement dated 26th June, 212,
allowed the OA, and held the Bank of India entitled to recover, from
Defendant Nos.1 and 4 jointly and/or severally, ₹ 15,14,09,709/- with
interest @ 12% per annum w.e.f. 23rd September, 2011.
22. Despite the said order of the learned DRT, and despite the
taking over, by the receiver appointed by the learned ACMM, of
physical possession of the first floor of the suit property on 30th
October, 2011, the consent order, dated 5th December, 2011 (supra)
directing maintenance of status quo in respect of the suit property
stared the Bank in the face, rendering implementation of the said
orders an impossibility. This provoked the Bank to move IA
13833/2012, before the learned Single Judge, under Section 151, CPC,
for being permitted to proceed under the SARFESI Act, by selling the
mortgaged property, i.e. the first floor of the suit property, and to
utilize the sale proceeds for adjusting the amounts due to it.
23. Vide order dated 21st May, 2013, a learned Single Judge of this
Court, adjudicating IA 19801/2011 (supra) (by the plaintiff against
Defendant No 1 under Order XXXIX Rule 2A of the CPC), opined
that the act of Defendant No. 1 Sarabjeet Prakash in consenting to the
first floor of the suit property continuing to remain as security with the
Bank of India was clearly in the teeth of the interim order dated 2 nd
June, 2008 (supra), passed by this Court. Accordingly, Defendant No.
1 was held guilty of violation of the said order and liable to be
punished/proceeded against. Personal presence of Defendant No.1,
along with an affidavit disclosing of his movable and immovable
assets, on 30th May, 2013, was, accordingly, directed.
24. It may be noted, here, that Defendant No. 4 (the present
appellant) and his father Defendant No.1 challenged the
aforementioned order, dated 21st May, 2013, by way of FAO(OS)
4/2014, which was disposed of vide the following order dated 30th
July, 2014:
"Proceedings under Order 39 Rule 2A of the Code of
Civil Procedure have yet to reach their destination. The
view taken by the learned Single Judge may be against
the appellant in the form of a finding returned that the
appellant has breached the terms of an interim injunction
but we find that penalty has not been imposed upon the
appellant.
2. Suffice it to state if the final order is adverse to the
appellant the cause to challenge the said order would
include a right to challenge the impugned order.
3. We dispose of the appeal observing that if a
sentence is imposed upon the appellant by the learned
Single Judge the same shall not be given effect for seven
days to enable the appellant to prefer an appeal.
CM No.108/2014
Dismissed as infructuous."
25. In the meanwhile, Defendant No.1 appeared before the learned
Single Judge on 2nd July, 2013. His statement was recorded which
read thus:
"As I understand, the amount due to the bank is ₹ 12
crore. This loan amount was utilised by a private limited
company, namely, M/s Soul and Attires Creations Pvt.
Ltd. I was the Director of this company. The Company is
not running its business presently. I was a guarantor of
this loan. We are in the process of negotiating with
various people regarding sale of this property and other
assets, and to borrow funds from various sources. I will
sell this property (suit property) with the permission of
the court. I also have a share in another property i.e.
property No. 33, Sunder Nagar, New Delhi. It has three
floo₹ Ground floor of this property is in occupation of
my youngest brother and first and second floor of the
property are given on rent on a simple rent note and not
on any lease deed. I have no other property.
Court Question. Is there any time frame by which the
dues of Bank of India will be cleared?
Answer. We are constantly in touch with the head office
of the Bank in Bombay and I expect that we should be
able to clear this loan amount within a period of six
months."
26. Having recorded the statement of Defendant No.1 as above, the
learned Single Judge went on to pass the following order:
"Vide order dated 21.05.2013 this court had held
defendant No. 1 guilty of violation of the order dated
02.06.2008 and also held him liable to punish/proceed
against therefor. The said order directed defendant No. 1
to personally appear before the Court on 30.05.2013
along with an affidavit disclosing all his movable and
immovable assets. Defendant No. 1 despite the aforesaid
order dated 21.05.2013 did not appear on 30.05.2013
and 31.05.2013 when the matter was listed in court.
Defendant No. 1 has appeared today and is
identified by the counsel for the defendants and his
statement has been record. Defendant No. 1 and his son-
defendant No. 4 who is also present in court today and is
identified by the counsel for the defendants, submit that if
four months time is given to them, they will ensure that
the dues of Bank of India are discharged and the part of
the suit property which is charged with the Bank of India,
namely, first floor of 68, Friends Colony West, New
Delhi shall be freed of all charges/encumbrances. They
further request that an appropriate affidavit to the said
effect will be filed by both of them in court and on filing
of the said affidavit further proceedings in the present
I.A. regarding violation of order of this Court dated
02.06.2008 may be kept in abeyance for a period of four
months. The affidavit will be filed accordingly within one
week from today. They are also agreed to comply with the
directions of this Court passed in para 25 of order dated
21.05.2013.
For directions, renotify for 12.07.2013."
27. Thereafter, on 18th July, 2013, and 16th December, 2013, the
learned Single Judge passed the following orders:
On 18th July, 2013:
"IA. 19801/2011 (u/O 39 R 2A CPC)
The fresh affidavit dated 15.07.2013 of defendants
No. 1 and 4 in compliance to their undertaking given in
this Court on 02.07.2013 has been filed. Learned senior
counsel for the plaintiff submits that the affidavit is not in
order inasmuch as the verification is made stating that
the contents of the affidavit are true and correct to the
best of the deponents' knowledge and belief. He relies
upon the judgment of the High Court in the case of Sapna
Singh Pathania vs. Shri Jagdish Chander Mehta and O₹
reported in 75 (1998) DLT 725 to contend that the
present affidavit is defective and it should not be
accepted.
Learned counsel for defendants no. 1 and 4
submits that the said defendants have made a statement
to abide by the undertaking as contained in the present
affidavit. She further submits that at any further stage of
the proceedings, the said defendants do not intend to
contend that the present affidavit is non-est and void for
any reason whatsoever.
In view of the above statement of the counsel for
defendants No. 1 and 4, the affidavit is taken on record
and defendants No. 1 and 4 shall abide by the
undertaking given to this Court.
Renotify for 16.12.2013."
28. On 16th December, 2013, the following order was
recorded:
"On 02.07.2013 this Court had passed and order
that defendant No.1 and 4, within a period of four
months, will ensure that the dues of Bank of India are
discharged and the part of the suit property charged with
Bank of India, namely, first floor of 68, Friend Colony
West, New Delhi shall freed of all
charges/encumbrances. This undertaking was given
pursuant to order dated 21.05.2013 passed by this Court
whereby this Court held defendant No.1 guilty of
violation of order dated 02.06.2008 and also held that he
is liable to be punished/proceeded against therefor. This
order was passed on account of the fact that despite
restraint order passed by this Court, defendant No.1
consented to continue standing as a security for a higher
amount advanced by the Bank which was contrary to the
order of this Court dated 02.06.2008. Learned counsel
for defendants No. 1 and 4 submits that as of now no
payment has been made to the bank. He has argued that
if the first floor is sold, his client would be able to
comply with the order of this Court dated 18.07.2013. In
view of order dated 21.05.2013 and the subsequent acts
of defendants No. 1 and 4, list for arguments on
03.01.2014 as per the directions contained in para 23 of
order dated 21.05.2013. "
29. IA 13833/2011, filed by the Bank under Section 151, CPC, for
permission to sell the first floor of the suit property so as to be able to
realize his dues, was next taken up for consideration, by the learned
Single Judge, on 25th April, 2014, when the following order was
passed:
"Learned counsel for the defendant submits that an
appeal has been preferred against the order dated
21.5.2013 and has listed before the Division Bench on
30th July, 2014.
Renotify on 12th August, 2014.
IA No. 13833/2011
Learned counsel for the applicant-Bank of India
submits that the defendant approached the bank on
17.2.2014, asking for a one time settlement and has
enclosed therewith photo copy of the pay order in the sum
of ₹12 crores, and thereafter defendant has not
approached the Bank for taking further steps. Learned
counsel for the defendant, on instructions from defendant
No. 4 submits that the pay order was issued by a
Corporation in UK and a photo copy of the pay order
was sent to the defendant with the understanding that in
case clearance from Reserve Bank of India is given, the
said amount shall be transmitted. Learned counsel for the
defendant submits that the clearance has yet not been
given and in case the clearance is given by the Reserve
Bank of India the OTS would be settled.
Renotify on 12th August, 2014."
30. On 13th November, 2014, the learned Single Judge, noting the
fact that undertaking, given by Defendants Nos 1 and 4, to discharge
the Bank and free the suit property of all encumbrances, had not been
honoured, directed them to appear, in person, before the Court, on 16 th
January, 2015.
31. On 16th January, 2015, it was submitted, on behalf of
Defendants Nos 1 and 4, that they had wrongly noted the date of
hearing; accordingly, the matter was adjourned to 21st January, 2015,
with a reiteration of the direction, to Defendants Nos 1 and 4, to
remain present in court on the said date.
32. Unfortunately, the matter could not be taken up for hearing
either on 21st January, 2015, or on the next 2 dates fixed in the matter,
i.e. 5th March, 2015 and 26th March, 2015, as a result of which the
matter was adjourned to 20th May, 2015, reiterating the direction, to
Defendants Nos 1 and 4, to remain present in court, in each order. On
20th May, 2015, the matter was again adjourned to 20th October, 2015.
33. On 9th October, 2015, the plaintiff filed IA 21764/2015, under
Section 151 of the CPC. Grievance was seriously expressed, in the
said IA, about the fact that Defendant No 1 and, despite being aware
of the injunctive, dated 2nd June, 2008, passed by this Court, availed
financial facilities/loans, from the bank, to the tune of ₹ 12 crores, for
the failure to liquidate which the Bank had initiated proceedings under
the SARFAESI Act, and taken possession of the first floor of the suit
property. It was pointed out that this Court had already taken note of
these facts and held Defendants Nos 1 and 4 to be guilty of violating
the order dated 2nd June, 2008. Thereafter, too, it was submitted, the
said defendants had repeatedly been undertaking to clear the bank
dues, but had failed to do so. The dues had, it was pointed out,
accumulated, in the meanwhile, to ₹ 15 crores. The plaintiff further
drew attention to the fact that Defendants Nos 1 and 4 had substantial
share in the property at No 33, Sundar Nagar, New Delhi, which share
itself was worth ₹ 45 crores. Further, attention was invited, in the
application, to an order, dated 4th August, 2015, passed by this Court
in CS (OS) 2506/2000 (Sarabjit Prakash vs Udayjit Prakash), in
which it was recorded, by this Court, that Defendant No 1 had
received a Demand Draft for ₹ 3.5 crores, consequent on settlement,
entered into by Defendant No 1, on 17th August, 2015, with respect to
the said property at No 33, Sundar Nagar. In these circumstances, the
plaintiff sought to contend that Defendants Nos 1 and 4 could not,
very well, plead inability to liquidate the dues of the Bank. The
application, therefore, prayed for issuance of a direction, to
Defendants Nos 1 and 4, to file an affidavit, disclosing complete
details of their movable and immovable properties, as well as details
of the bank account in which the aforementioned amount of ₹ 3.5
crores, stated to have been received by Defendant No 1 consequent on
a settlement, entered into, by him, with respect to the property at No
33, Sundar Nagar, was stashed. Needless to say, a further prayer, for
issuance of a direction, to Defendants Nos 1 and 4, to liquidate the
bank dues, which, by then, add increased to ₹ 15 crores, was also
made.
34. On the next date of hearing, i.e. 20th October, 2015, significant
orders were passed, by the learned Single Judge, in IA 19801/2011
(filed by the plaintiff under Order 39 Rule 2A of the CPC), IA
13833/2011 (filed by the Bank under Section 151, CPC, for
permission to sell the mortgaged first floor of the suit property so as to
liquidate its dues) and IA 21764/2015 (filed by the plaintiff, under
Section 151, CPC, for a direction, to Defendants Nos 1 and 4, to
disclose the details of the amount of ₹ 3.5 crores, stated to have been
received by Defendant No 1 under the settlement already referred to
hereinabove). These orders may be noted, as under:
(i) IA 13833/2011 (by the Bank) was taken up, only once,
thereafter, by the learned Single Judge, on 20th October, 2015,
on which date it was dismissed for default. It has never been
restored.
(ii) In IA 21764/2015, it was directed, by the learned Single
Judge, that the said amount would not be utilized by Defendant
No. 4 except for liquidation of the dues of the Bank, or for the
medical treatment of his father, i.e. Defendant No. 1.
(iii) In IA 19801/2011, it was noted, by the learned Single
Judge, that Defendant Nos. 1 and 4 i.e. the appellant and his
father Sarabjit Prakash, conceded that they were not in a
position to offer any security to secure the rights of the plaintiff
in respect of the suit property, even to the extent of the charge
created by them on the said property, after passing of the
interim order dated 2nd June, 2008. The learned Single Judge
held that such conduct, on his part, justified immediate punitive
action against Defendant No. 1, but chose, nevertheless, to defer
passing any adverse orders, in view of the fact that Defendant
No. 1 was 84 years of age and a possibility of settlement with
the Bank was mooted. The learned Single Judge also noted, in
the said order, the fact that OA 297/2011, filed by the Bank, had
been decreed by the learned DRT and that, thereafter, Recovery
Certificate had also been issued, by that the suit property had
not yet been attached.
35. Eight days later, on 28th October, 2015, Defendant No. 1,
Sarabjit Prakash, expired; however, his LRs already stood impleaded
in the suit.
36. When the matter next came up, before the learned Single Judge,
on 13th July, 2016, notice was taken of the earlier order, dated 20th
October, 2015, which directed that amount of ₹ 3.5 crores, stated to be
available in the bank account of Defendant No. 1, was not to be
utilized except towards payment of the dues of the Bank of India and
the medical expenses of Defendant No. 1. However, learned counsel
for Defendant No. 4 sought to submit that he was not aware of the
amount available in the bank account either of Defendant No. 1 or of
his own client, i.e. Defendant No 4. The plaintiff, thereupon, informed
the learned Single Judge that Defendant No. 4 had already shifted,
with his family, to Singapore, and that he was no longer residing in
Delhi. In the circumstances, the learned Single Judge directed
Defendant No. 4 to furnish his latest address, along with documents
evidencing his proof of residence. The matter was adjourned to 28 th
July, 2016.
37. On 28th July, 2016, Defendant No. 4 i.e. the present appellant,
while accepting, before the learned Single Judge, the fact that
Defendant No. 1 had received ₹ 3.5 crores, under a family settlement,
sought to contend that no part of the said amount had been received by
Defendant No. 4. Defendant No. 4, did not, however, deny the fact
that he was a beneficiary of a part of the estate of the deceased
Defendant No. 1, even if it did not include the amount of ₹ 3.5 crores
or any part thereof. As Defendant No. 4 undertook to liquidate the
amount owed by Defendant No. 1 i.e, his late father Sarabjit Prakash,
to the Bank (erroneously referred to as "the plaintiff" in the order), the
matter was directed to be listed, after two months, on 29 th September,
2016.
38. On 29th September, 2016, in view of the fact that the dues of
the Bank had not yet been liquidated by Defendant No. 4 i.e. the
present appellant, the learned Single Judge directed Defendant No 4 to
appear in person, on the next date of hearing i.e. 4th November, 2016.
39. Despite the said directions, Defendant No. 4 did not appear
before the learned Single Judge on 4th November, 2016, and it was
informed, to the learned Single Judge that, on 1st November, 2016,
Defendant No. 4 had left for the United States. In these circumstances,
the learned Single Judge noted that Defendant No. 4 was avoiding
appearing before this Court, directed the authorities to revoke the
passport of Defendant No. 4, in order to compel his presence before
this Court, especially as Defendant No. 4 had not complied with his
undertaking, as recorded in the order dated 28th July, 2016, to liquidate
"the debt of ₹ 3.5 crores". It appears that the reference to "the debt of
₹ 3.5 crores" is incorrect; the debt, by then, as owed to the Bank (and
not to the plaintiff as noted in the earlier order dated 28th July, 2016)
having increased to ₹ 15 crore. Be that as it may, on the said directions
being issued, learned counsel appearing for Defendant No. 4 again
undertook, before the learned Single Judge, to produce his client in
court on 8th December, 2016 and to file, within one week, the
particulars/details of the passport held by him, so that necessary orders
could be issued, in the event of default, on the part of the Defendant
No. 4, in appearing before the Court on the next date of hearing.
40. The above issue was next taken up for consideration, by the
learned Single Judge, on 13th February, 2017, on which date it was
noted that, in spite of the order, dated 4th November, 2016 (supra),
neither Defendant No. 4, nor his counsel, appeared. Neither, it was
noted, had the particulars of the passport of Defendant No. 4 been
disclosed.
In respect of the contempt committed by the erstwhile
Defendant No. 1 (Sarabjit Prakash) though the proceedings had abated
on the death of Defendant No. 1, his legal representative Sanjiv
Prakash (Defendant No. 2) was directed to file an affidavit, disclosing
the money earned by Defendant No. 1 by sale of the first floor of the
suit property which, on his death, formed part of his estate. IA
21764/2015, was also disposed of, with a direction to Defendant No.2
to explain where the money received, by him, as a result of sale of the
Sunder Nagar property, was located.
41. On the next date of hearing, i.e. 2nd March, 2017, it was noted
that the undertaking, given by Defendant No. 4 to discharge the
encumbrance created in the suit property in violation of the interim
order dated 2nd June, 2008 (supra) passed in respect thereof, had not
yet been cleared/discharged by him, though a contention, by his
counsel, to the effect that a One Time Settlement (OTS) proposal had
been submitted to Bank of India to which the response was awaited,
was noted. Paras 12 to 21 of the said order, which impact these
proceedings to a considerable extent, read thus:
"12. Vide order dated 21st May, 2013, Sarabjit Prakash
was held guilty of violation of the interim order in
CS(OS) No.1134/2008 and the matter was deferred for
imposing punishment on him.
13. The imposition of punishment was got deferred by
the counsel for Sarabjit Prakash and Arjun Prakash
stating on 2nd July, 2013 that they will have cleared /
discharged the encumbrances created on property No.68,
Friends Colony (West), New Delhi in violation of the
interim order in the suit.
14. The said encumbrance has not been discharged /
cleared as yet, though the counsel for Arjun Prakash
states that a One Time Settlement (OTS) proposal has
been submitted to the Bank and response whereto is
awaited from the Bank.
15. I have enquired from the counsel for Arjun
Prakash, as to what is the other property of Arjun
Prakash of which he can give security to comply with his
statement recorded on 2nd July, 2013 and which remains
uncomplied with till date.
16. The counsel for Arjun Prakash states that Arjun
Prakash has no other assets, besides the subject property
to which he lays claim.
17. On 4th December, 2016, when the counsel for
Arjun Prakash had given an undertaking to produce
Arjun Prakash on the next date of hearing, he was also
directed to file a photocopy of the Passport of Arjun
Prakash. The said photocopy has not been filed as yet.
18. Option has been given to the counsel for Arjun
Prakash, for Arjun Prakash to either deposit his Passport
in this Court and to make a statement that he has no
other Passport or suffer an order restraining him from
leaving the country and communication thereof to all the
Airports for compliance.
19. The counsel for Arjun Prakash states that Arjun
Prakash by 1700 hours today will leave his Passport with
the Court Master and by the next date of hearing furnish
security for discharging the encumbrance with respect to
the first floor of the property.\
20. List on 7th March, 2017 as sought.
21. The Court Master to keep the Passport in his
personal custody till then."
42. On 7th March, 2017, learned counsel for Defendant No. 4
offered security, against the debt owed to the Bank, of three properties
owned by his mother-in-law Ms. Rama Khanna at Amritsar, by
depositing the original title deeds with the Court. It was stated that
Defendant No. 4 had no other security to offer. In the circumstances,
the learned single Judge directed Defendant No. 4 to file an affidavit
and to appear before the Registrar on 8th March, 2007, for verification
of the documents of title of the said properties of Ms. Rama Khanna at
Amritsar, and for recording the statement of Ms. Rama Khanna in that
regard. The matter was directed to be renotified in Court on 14th
March, 2007, and the Court Master was directed to retain the passport
of Defendant No. 4 till then.
43. On the next date of hearing, i.e, 14th March, 2017, the learned
Single Judge was informed that the particulars of the amount of ₹ 3.5
crores had yet to be furnished by Defendant No. 4, as directed in the
order dated 20th October, 2015, to which defendant No. 4 replied that
he was not aware of the particulars of the said amount, and was only
one of the legal heirs of Defendant No. 1 Sarabjit Prakash. The
learned Single Judge, in these circumstances, directed Defendant No.
4 and Defendant No. 2 Sanjeev Prakash to file an affidavit in respect
to the said amount of ₹ 3.5 crores and particulars of the utilizations
made out of the said amount. The matter was directed to be renotified
for 22nd March, 2017, till which date the Court Master was directed to
retain the custody of the passport of Defendant No. 4.
44. Defendant No. 4 and Sanjeev Prakash, thereupon, filed
affidavits, submitting that they were unaware of the particulars of
amount of ₹ 3.5 crores. However, Defendant No. 4 undertook to pay
the first instalment, of the One Time Settlement (OTS) entered into,
with the Bank, by 31st May, 2017, and to report compliance, in that
regard, before this Court on 26th May, 2017. Accepting the said
undertaking, the learned Single Judge, vide order dated 22nd March,
2017, directed the Court Master to return, to the appellant, his
passport.
45. On the next date of hearing, i.e. 26th May, 2017, the learned
Single Judge, observing that the appellant had not complied with his
undertaking, to pay the first instalment of the OTS by 31 st May, 2017,
and had, thereby, made a mockery of this Court, passed an order
restraining him from leaving the country, and directed him once again
to deposit his passport with the Assistant Registrar of this Court. Paras
1 to 4 of the order passed by the learned Single Judge i.e. 26 th May,
2017 merit reproduction as under:
"1. This order is in continuation of the orders since
29th September, 2016.
2. Though Arjun Prakash is present in the Court but
he has not complied with the undertaking to pay the first
instalment of the One Time Settlement (OTS) by 31 st
May, 2017.
3. The counsel for Shyam Sahni rightly states that the
said Arjun Prakash has made a mockery of the
undertakings given to this Court.
4. For the time being, Arjun Prakash is restrained
from leaving the country and communication in this
regard along with the passport details of Arjun Prakash
be sent to all the concerned authorities. Arjun Prakash
to also deposit his passport with the Assistant Registrar
of this Court."
(Emphasis supplied)
46. The appellant / Defendant No. 4, thereupon, moved IA
6909/2017, for recall of the order dated 26th May, 2017 (supra) to the
extent it directed his passport to be deposited in this court. It was
submitted, in the said IA, that the appellant had deposited securities
totaling ₹ 4,44,40,000/- and undertaken to be present, on all dates,
before this Court, whereupon this Court, on 22nd March, 2017, ordered
release of his passport. The appellant admitted the fact that he had
been unable to abide by his undertaking to deposit the first installment
of the OTS with the bank by 31st May, 2017, but submitted that this
inability was owing to financial constraints and that, if he were
granted three months time, he would be able to generate the requisite
funds to comply with the undertaking. In these circumstances, the
appellant / Defendant No.4 prayed that the order dated 26th May, 2017,
be recalled and he be permitted to retain his passport, so that he could
travel abroad in connection with business and international projects,
which would, inter alia, facilitate the acquiring by him, of the
requisite funds so as to enable him to honour the OTS.
47. On the next date of hearing, i.e. 30th May, 2017, the appellant
undertook to deposit his passport, with the Registrar of this Court,
forthwith. The said undertaking was recorded by this Court, in the
order passed on the said date. The aforementioned order dated 30th
May, 2017 passed by the learned Single Judge, is reproduced, in
extenso, thus:
"1. This application shall be considered on the applicant
showing his bona fides.
2. List on 19th July, 2017.
3. The counsel for the plaintiff states that Passport has
still not been deposited.
4. The counsel for the applicant Arjun Prakash states that
the application was filed on 26th May, 2017 itself and Arjun
Prakash has not left the country and his Passport will be
deposited with the Registry today itself.
5. The Registry to immediately issue communications to
the various authorities in terms of para 4 of the order dated
26th May, 2017.
6. The counsel for the plaintiff is also given liberty to
write to the various authorities in this regard on his own
letter head.
7. A copy of this order as well as of the order dated 26th
May, 2017 be given dasti under the signature of the Court
Master to the counsel for the plaintiff."
(Emphasis supplied)
48. It is in these circumstances that the present appeal, under Order
XVIII Rule 1 and Section 1 of the CPC read with Section 10 of the
Delhi High Court Act, 1966, has been filed, by Defendant No. 4 in the
suit, challenging para 4 of the order dated 26th May, 2017 (supra) and
paras 5 and 6 of the order dated 30th May, 2017 (supra) passed by the
learned Single Judge in CS(OS) 1134/2008. At the cost of repetition, it
may be noted that the said paragraphs i.e. para no. 4 of the order dated
26th May, 2017 and paras 5 and 6 of the order dated 30 th May, 2017,
restrained the appellant from leaving the country and directed the
appellant to deposit his passport with this Court, and communication,
in this regard along with details of the passport of the appellant, to be
sent to all concerned authorities.
49. It may be noted, even at this juncture, that during arguments
Mr. J. P. Sengh, learned senior counsel appearing for the appellant
categorically stated that his only prayer, in the present appeal was for
lifting the seizure of his client's passport.
50. Mr. Sengh has placed, before us, a compilation, consisting of
various documents which were part of the proceedings in the suit,
including the Will, dated 10th October, 2003, of Niamat Sahni, and the
Codicil, thereto, dated 17th July, 2004, the General Power of Attorney
dated 24th August, 1999, stated to be executed by Niamat Sahni, the
Memorandum of Family Settlement dated 6th October, 1999, the
second Codicil to the Will dated 23rd December, 1992, executed on
25th January, 2001, and others. He has invited our attention to these
documents, in an effort to convince us that the direction, to his client,
to liquidate the dues allegedly owed to the Bank, was unjustified.
51. Mr. Sengh further contended that the observation, in the order
dated 20th October, 2015 supra of the learned Single Judge that, on
account of his being guilty of violation of the interim order dated 2 nd
June, 2008, Defendant No 1 Sarabjit Prakash "could have been
straight away ordered to be arrested and imprisoned" was, clearly,
unjustified and unwarranted, in view of the order, dated 21st May,
2013 supra, in FAO (OS) 4/2014.
52. Appearing for the respondents, Mr. Dinesh C Pandey, learned
counsel, would urge, per contra, that
(i) on 13th July, 2016, the learned Single Judge was informed
that the appellant/Defendant No. 4 had shifted to Singapore,
whereupon the learned Single Judge directed that the fresh
address of the appellant/Defendant No. 4, along with relevant
documents establishing the proof of his residence in Singapore,
be filed,
(ii) in the affidavit, dated 27th August, 2016, filed by the
appellant/Defendant No. 4 purportedly in compliance with the
said direction, it was stated, in a markedly contradictory vein,
that the appellant/Defendant No. 4 was, at that time, residing at
B-334, New Friends Colony, and that, with effect from 1st
September, 2016, he would "shift to the Annexe at 68, Friends
Colony (West) 1st Floor, New Delhi-110065",
(iii) after having undertaken, on 28th July, 2016, to liquidate
the amount owed by his father Defendant No 1 to the Bank, the
appellant/Defendant No. 4 not only defaulted in doing so, but
also flouted the order, dated 29th September, 2016, which
directed him to appear before the court on 4th November, 2016,
by flying to the United States three days earlier; on 1 st
November, 2016,
(iv) in the circumstances, the learned Single Judge was fully
justified in directing revocation of the passport of the
appellant/Defendant No. 4, on 4th November, 2016,
(v) on 14th March, 2017, the appellant/Defendant No. 4 stated
that he was unaware of the particulars of the amount of ₹ 3.50
crores, alleged to be lying in his bank account, and that he was
but one of the legal heirs of his father the late Sarabjit Prakash,
and was not on talking terms with his brother Sanjiv Prakash,
whereupon the learned Single Judge directed the counsel for the
appellant/Defendant No. 4 and Sanjiv Prakash to file, within
one week, an affidavit with respect to the said amount of ₹ 3.50
crores, and the particulars of the monies is utilised out of the
said amount, along with documentary proof,
(vi) the affidavits filed by the appellant/Defendant No. 4 and
Mr. Sanjiv Prakash, purportedly in compliance with the said
direction, however, merely professed ignorance with respect to
the manner in which the amount of ₹ 3.50 crores had been dealt
with, as well as the details of the bank account in which the said
amount had been kept by the late Sarabjit Prakash, as was noted
in the subsequent order dated 22nd March, 2017 which,
however, went on, further, to record the undertaking, of the
appellant/Defendant No. 4, to appear, before the learned Single
Judge, on 26th May, 2017, to report payment of the 1st
instalment of the purported One Time Settlement (OTS),
entered into with the Bank of India, on which undertaking the
learned Single Judge directed that the passport of the
appellant/Defendant No. 4 be returned to him,
(vii) on 26th May, 2017, however, the appellant/Defendant No.
4, though present before the learned Single Judge, had not
complied with the aforementioned undertaking to pay the 1st
instalment of the OTS, to the Bank, by 31st May, 2017,
(viii) it was in these circumstances that the learned Single
Judge restrained the appellant/Defendant No. 4 from leaving the
country and directed communication, in this regard, along with
details of the passport of the appellant/Defendant No. 4, to be
sent to all concerned authorities, further directing the
appellant/Defendant No. 4 to deposit his passport with this
Court, and
(ix) on the next date of hearing, i.e. 30th May, 2017, when it
was seen that the appellant/Defendant No. 4 had still not
deposited his passport, as directed by this Court on 26 th May,
2017, the counsel for the appellant/Defendant No. 4 undertook
to deposit the said passport with the registry of this Court on
that day, i.e. on 30th May, 2017, itself, on which undertaking the
learned Single Judge directed the Registry of this Court to
immediately issue communications to various authorities, in
terms of the impugned para 4 of the earlier order dated 26 th
May, 2017.
53. Mr. Pandey would submit that the aforementioned facts, if
holistically seen in perspective, would completely justify the
impugned directions, passed by the learned Single Judge.
Analysis and Decision
54. We may clarify, at the outset, that we do not propose to enter
into the controversies raised in CS (OS) 1134/2008, which are still at
large before the learned Single Judge. Our brief is limited to
examining the compulsions which propelled the learned Single Judge
to direct the appellant/Defendant No. 4 to deposit his passport in this
Court, and not to leave the country, and whether the said compulsions
could be deemed, legally and factually, to be sufficient to warrant the
issuance of the said directions. As such, we do not propose to enter
into the various issues, relating to the various Wills, and the Codicil,
executed by Niamat Sahni, the Memorandum of Family Settlement, or
the various Sale Deeds, whereunder various portions of the suit
property was sold to Defendants 5 to 8. Any observation by us, on
these aspects of the matter, would invariably imperil the case of one
party, or the other, before the learned Single Judge, which would
frustrate the interests of justice.
55. The facts, as recited hereinabove, in our view, reduce the
controversy in the present appeal to a very narrow conspectus. We are
concerned only with the legality, and the justifiability, of the direction,
by the learned Single Judge, to retain the passport Defendant No. 4
with this court. Of necessity, we would, for this purpose, have to
appreciate the provocation for such an order to have been passed by
the learned Single Judge.
56. We have taken pains to refer to the various orders passed, in
CS(OS) 1134/2008, and the applications filed therein, from time to
time; nevertheless, we deem it appropriate to refer to these orders,
once more, sequentially, thus:
(i) The first order, containing any direction with respect to
the passport of the Defendant No. 4, is the order dated 4 th
November, 2016, in which, after taking note of the fact that
Defendant No. 4 had defaulted in appearing before this court, as
directed on 29th September, 2016, and had, instead, flown to the
United States on 1st November, 2016, the learned Single Judge
proceeded to observe, in para 4 of the Order, as under:
"4. This Court has no option but to direct the
authorities concerned to revoke the passport of
defendant no.4 Arjun Prakash to compel his presence
before this Court particularly when the said defendant
no.4 Arjun Prakash has also not complied with his
undertaking as contained in the order dated 28th July,
2016 to liquidate the debt of Rs.3.50 crores."
The learned Single Judge, in the above extracted paragraph
from the order dated 4th November, 2016, therefore, opined that
issuance of direction, to the authorities, to revoke the passport
of Defendant No. 4, would be necessary in order to compel his
presence before this court. The default, on the part of Defendant
No. 4, in complying with his undertaking, given on 28 th July,
2016, to liquidate the debt of the Bank (which was actually in
the region of ₹ 15 crores, and not ₹ 3.5 crores as mentioned in
the order) was referred to, as an additional justification in this
regard.
(ii) Having entered the above observation in the order dated
4th November, 2016, the learned Single Judge did not proceed,
however, to issue any such direction, to the authorities, to
revoke the passport of Defendant No. 4. Suffice it to reiterate
that this was the first occasion when any action, qua the
passport of Defendant No. 4, was contemplated by the learned
Single Judge.
(iii) In fact, no such direction was, even thereafter, issued at
any stage. As such, it is not necessary for us to opine on the
justifiability of the observation contained in the above extracted
para 4 of the order dated 4th November, 2016, of the learned
Single Judge. The learned Single Judge did, however, direct the
learned counsel appearing for the Defendant No. 4, in para 6 of
his order dated 4th November, 2016, to provide, within one
week, the particular/details of the passport held by Defendant
No. 4, "to enable this court to issue necessary orders if the
Defendant No. 4 Arjun Prakash does not appear on the next
date of hearing also".
(iv) The above issue was taken up for hearing, next on 13 th
February, 2017. It was noted, on the said date, that there was no
appearance either by Defendant No. 4 or by his counsel, and
that the details of passport of Defendant No. 4, too had not been
disclosed. Having noted the said fact, the learned Single Judge
did not, however, proceeded to pass any coercive or restricted
orders, either against Defendant No. 4 or with respect to the
passport held by him, merely directing that "the non-appearing
parties are proceeded against exparte".
(v) On the next date of hearing, i.e. 2nd March, 2017, the
learned Single Judge noted the fact that Defendant No. 4 "who
had disappeared on 13th February, 2017", actually appeared,
through counsel, and had also filed I.A. 2739/2017 for setting
aside the direction to proceed, against him, ex parte, as
contained in the order dated 13th February, 2017 (supra). The
said application was allowed, subject to payment of costs of ₹
10,000/-, along with previous costs. Further, qua the passport of
Defendant No. 4, paras 12 to 19 of the Order, dated 2nd March,
2017, noted the fact that the undertaking, by Sarabjit Prakash
and Defendant No.4, given on 2nd July, 2013, to clear/discharge
the encumbrances created on the first floor of the suit property,
were yet undischarged, and that Defendant No. 4 stated that he
had no other assets. Specifically on the issue of production of
Defendant No. 4 and submitting of a photocopy of his Passport,
it was further noticed that the said photocopy had not been filed;
consequently, the learned Single Judge granted an option to
Defendant No. 4 either to deposit his Passport in the Court or to
suffer an order restraining him to leave the country. At this, the
statement, of learned counsel for Defendant No. 4 was recorded,
to the effect that the Passport of Defendant No.4 would be
deposited in Court at 1700 hours on that day.
(vi) It appears that, in pursuance of the said undertaking,
Defendant No. 4 did deposit his passport with the Court Master
of the learned Single Judge.
(vii) The passport of Defendant No. 4 remained with the Court
Master, till 22nd March, 2017, as directed by the learned Single
Judge in his further orders dated 7th March, 2017 and 14th
March, 2017.
(viii) On 22nd March, 2017, the passport of Defendant No. 4
was directed to be returned to him, in view of the undertaking,
given by him, to pay the first instalment of the OTS, entered
into, with the Bank, by 31st May, 2017.
(ix) On 26th May, 2017, the learned Single Judge once again
directed Defendant No. 4 to deposit his passport with the
Assistant Registrar of this court, in view of the failure, on his
part, to comply with the undertaking to pay the first instalment
of the OTS by 31st May, 2017.
(x) On 31st May, 2017, the said direction was reiterated,
whereupon the Defendant No. 4/the present appellant deposited
his passport with this court.
57. A sequential scrutiny of the aforementioned orders reveals that
the only justification, provided by the learned Single Judge for
directing retention of the passport of Defendant No. 4, with this court,
was the failure, on his part, to comply with his undertaking to liquidate
the first instalment of the OTS entered into, with the Bank. The issue
to be addressed is whether it was legally justifiable, for the learned
Single Judge to do so.
58. We are of the view that, in the facts of the present case, the said
direction cannot be said to be justified.
59. We may observe, immediately, that the Bank was not a party in
the proceedings before the learned Single Judge. There was no direct
reason, therefore, for the learned Single Judge to take
coercive/restrictive measures, against Defendant No. 4, for failure to
honour his commitment qua the Bank.
60. Significantly, IA 13833/2012, filed by the Bank, for permission
to sell the mortgaged first floor of the suit property, so as to recover
the debt owed to it by Defendant No. 1/Defendant No. 4, was
dismissed, in default, on 20th October, 2015, and was never restored
thereafter.
61. The only connection, which such liquidation of the debt owed to
the Bank, had to the subject matter of CS(OS) 1134/2008 could be the
pledging, of the first floor of the suit property, which stood protected
by the order dated 2nd June, 2008, passed by the learned Single Judge,
with the Bank against such debt. The learned Single Judge had, in the
said order, restrained, inter alia, Defendant Nos. 1 and 4 from creating
any third party interest in respect of the suit property, which included
the first floor thereof. The debt owed to the Bank became the subject
matter of controversy, in the proceedings before the learned Single
Judge only because, against enhancement of credit limit, the
Defendant No. 1 agreed to continue the mortgage, of the first floor of
the suit property with the Bank. This resulted in creating an additional
encumbrance on the first floor of the suit property.
62. Two issues according to the learned Single Judge, flowed
therefrom.
63. Firstly, whether the permitting of the creation of such additional
encumbrance itself amounted to a violation of the injunction granted
on 2nd June, 2008, and, therefore, was contumacious in nature; We
need not, however, enter into that aspect of the matter, as the
detention, by the learned Single Judge, of the passport of the
petitioner, has not been directed in the application filed by the plaintiff
under Order XXXIX Rule 2A of the CPC, but de hors the said
application.
64. Secondly, the additional encumbrance thus created, if allowed
to be enforced, would imperil the first floor of the suit property, by
making it subject to alienation to liquidate the debt of the Bank,
thereby infracting the status quo granted by the learned Single Judge
on 2nd June, 2008. It was, therefore, apparently, in order to protect the
first floor of the suit property from such alienation, and, thereby, to
preserve the sanctity of the order dated 2nd June 2008 of the learned
Single Judge and prevent its violation, that that liquidation of the dues
of the Bank became necessary.
65. The question is, however, whether this consideration, legitimate
as it might have been, could justify the direction, by the learned Single
Judge to detain the passport of the Defendant No. 4.
66. In our opinion, it could not, for four reasons.
67. Firstly, the plaintiff, as well as Defendant Nos. 1 and 4 had, by
consent, agreed, on 5th December, 2011, "to maintain status quo with
respect to title and possession of first floor, second floor and terrace of
plot no. 68, Friends Colony, New Delhi". The parties were, by the said
order, required to apply to this Court for direction, in case any of them
wanted to deal with any portions of the suit property. This order, in
our view, more than specifically protected the first floor of the suit
property from alienation, or from any possibility of a third party
interest being created therein.
68. Secondly, as already noted hereinabove, IA 13833/2012 filed by
the Bank, to protect its interest by being permitted to sell the first floor
of the suit property which stood mortgaged to it, was dismissed on 20th
October, 2015, and was never restored. The order, dated 5th December,
2011, also grants, to the Bank, protection, in respect of the first floor
of the suit property inasmuch as where the application filed by the
Bank itself stood dismissed.
69. Thirdly, IA 19801/2011, which was filed by the plaintiff,
against Defendant Nos. 1 and 4, for issuance of direction, to them, to
liquidate the dues to the Bank, was also disposed of vide order dated
13th February, 2017 (supra) of the learned Single Judge. Significantly,
even while doing so, the learned Single Judge clearly expressed his
intention not to proceed, for the said purpose, against the suit property,
which stood protected from alienation, but against the Sundar Nagar
property of Defendant No. 1, and the amount of ₹ 3.5 crores alleged
received, by Defendant No. 1, pursuant to the settlement arrived at,
with respect to the said property. That property was not, however,
even subject matter of CS (OS) 1134/2008. Furthermore, Defendant
No.4 was being faulted for failure to provide details of the said receipt
of ₹ 3.5 crores, when the Defendant No. 4 was insisting that no part of
the said amount had been received by him. The failure to provide such
details could not, therefore, justify seizure, or even retention by this
Court, of his passport.
70. Fourthly, the failure, on the part of Defendant No. 4, to pay the
first instalment of the OTS could not, either, justify issuance of such a
direction as, by doing so, the learned Single Judge would effectively
result in the learned Single Judge converting itself into a forum for
effecting recovery of the dues of the Bank. This was not only entirely
outside the scope of the dispute in CS (OS) 1134/2008 such order
would also not be justified for the reason that the Bank itself was not a
party in the suit before the learned Single Judge. In fact, with great
respect to the learned Single Judge, allowing the allowing the Bank to
obtain, in the proceedings in the suit, enforcement of the Recovery
Certificate issued consequent on the directions of the learned DRT,
which, besides being otherwise impermissible, would also be
unjustified for the reason that the Bank's own application (IA
13833/2012), for the same purpose, stood dismissed, and never
restored. It was not open, therefore, to the learned Single Judge to
take coercive/restrictive measures, against the Defendant No. 4, i.e.
the appellant before us, for failure to liquidate the said dues.
71. In view of these facts, there was no reasonable justification, in
our view, for the learned Single Judge, to impose restrictions on the
movement of Defendant No. 4, by retaining his passport. At the cost
of repetition, the right of the plaintiff stood protected by the order
dated 2nd June, 2008. Alienation, if any, of any portion of the property
thereafter would have to abide by orders of the learned Single Judge.
We may reiterate that the only justification, for the impugned
direction, appears to have been the anxiety to secure the debt owed to
the Bank which, in turn, was necessary in order to maintain status quo
with respect to the first floor of the suit property. That interest,
however, stood amply protected, as already pointed out hereinabove,
so that no further coercive action, therefor, could be said to be
justified.
72. That the Bank also understood the interdiction by the order is
manifested by the fact that it had filed IA 13833/2012 for permission
to deal with the property.
73. In these circumstances, we are convinced that the grievance,
expressed by Mr. Sengh regarding the detention/retention of his
client's passport by this Court, is well justified, and that the direction,
as issued by the learned Single Judge, cannot sustain on facts.
74. Before parting with this case, one more serious legal issue must
be noted. An order directing seizure impounding of a passport is an
extremely serious matter. There must be strict compliance with the
requirements of law. The legislature has enacted the Passports Act,
1967 which provides for all matters relating to issuance, suspension,
impounding as well as revocation of passports. It prescribes the
authorities competent to do so and the procedure to be followed by
them. Sub-section (3) of Section 10 enumerates as many as eight
contingencies in which a passport can be impounded, and, in our view,
no court may, by judicial fiat, impound, confiscate, or even detain, the
passport, of an Indian citizen, on any other ground. If the
circumstances set out in Section 10 of the Passports Act, 1967 are
satisfied, and warrant an order in respect of a passport issued to a
party, the court would be entirely within its authority to draw the
attention of the competent authority to the same directing it to so
proceed in the matter.
75. It is trite that when law prescribes the manner of doing a thing,
it must be so done or not at all (Taylor v. Taylor, (1875) 1 Ch D 476,
Nazir Ahmad v. King Emperor, AIR 1936 PC 253 and Kameng Dolo
v. Atum Welley, (2017) 7 SCC 512).
76. We may also refer, profitably, to para 18 of the judgment of the
Supreme Court in Suresh Nanda v. Central Bureau of Investigation
(2008), 3 SCC 674, which reads as under:
"18. In our opinion, even the court cannot impound a
passport. Though, no doubt, Section 104 Cr.P.C. states that
the Court may, if it thinks fit, impound any document or thing
produced before it, in our opinion, this provision will only
enable the court to impound any document or thing other than
a passport. This is because impounding of a "passport" is
provided for in Section 10(3) of the Passports Act. The
Passports Act is a special law while the Cr.P.C. is a general
law. It is well settled that the special law prevails over the
general law vide G.P. Singh's Principles of Statutory
Interpretation (9th Edn., p. 133). This principle is expressed in
the maxim generalia specialibus non derogant. Hence,
impounding of a passport cannot be done by the court under
Section 104 Cr.P.C. though it can impound any other
document or thing."
(Emphasis supplied)
77. Though the above paragraphs examine, specifically, the power
of a criminal court to impound the passport, in the context of Section
104 of the Code of Criminal Procedure, 1973, we are sanguine with
the same principle would apply, in respect of the powers vested in the
civil court under Section 151 or for that matter in other provision of
the CPC.
78. The above proposition, as enunciated in Suresh Nanda (supra),
stands re-enforced by several subsequent decisions of various High
Courts; we do not, however, propose to burden this judgement by any
detailed reference thereto as, in our opinion, the impugned direction,
of the learned Single Judge, to take custody of the passport of the
petitioner, cannot sustain on facts or the applicable law.
79. We also deem it appropriate to observe that, in ordinary civil
litigations such as the present, interlocutory applications, under one
provision, or the other, of the CPC, proliferate, resulting in the bulk of
the record increasing almost on a daily basis. The proceedings in the
suit, in the result, unfortunately come to a standstill, or are
unreasonably protracted. In such circumstances, it is expected, of the
conscientious litigant, to apprise the Court of the orders passed earlier,
in the proceedings, which could impact the consideration of the
applications of which the Court is seized.
80. It appears that, in the present case, the attention of the learned
Single Judge was never invited to the dismissal of IA 13833/2012,
filed by the Bank, on 20th October, 2015. Even before us, no reference
was made to the said order. We have had to ferret it out, by poring
through the records of the suit. Had the said order been shown to the
learned Single Judge, we might, possibly, have been spared the
necessity of embarking upon such a painstaking exercise.
81. Resultantly, we set aside the impugned direction of the learned
Single Judge, contained in para 4 of the order dated 28 th May, 2017
and paras 5 and 6 of the order dated 30 th May, 2017, directing the
appellant to deposit his passport in court, and permitting the court to
take custody thereof. The passport of the appellant is, accordingly,
directed to be returned to him forthwith.
82. The appeal stands allowed to this extent, without any order as to
costs.
83. We make it clear that our observations, and findings,
hereinabove, are restricted to consideration of the issue of whether the
passport of the petitioner ought to have been detained by this court,
Mr Sengh having specifically limited his challenge, in court, to the
said aspect. We have not considered, examined, or opined, directly or
indirectly, on any other aspect of the proceedings, before the learned
Single Judge which, therefore, would continue and be determined
uninfluenced by any of the observations, or findings, contained in this
judgement.
C.HARI SHANKAR, J
ACTING CHIEF JUSTICE
AUGUST 1, 2018
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