Reserve Bank Of India vs Ms Jvg Finance Ltd.
2018 Latest Caselaw 4501 Del

$~CP-12
*    IN THE HIGH COURT OF DELHI AT NEW DELHI
%                                           Date of decision: 02.08.2018
+      CO.PET. 265/1998
       RESERVE BANK OF INDIA                          ..... Petitioner
                        Through      Ms.Manisha Singh, Ms.Swati Setia
                                     and Mr.Gautam Kumar, Adsv. For
                                     RBI
                 versus
       MS JVG FINANCE LTD.                            ..... Respondent

Through Ms.Aneeta Sharma, AR of the Ex.

Directors Mr.Anvi Aggarwal, Adv. for UOI Mr.Aman Vaccher Mr.Ashutosh Dubey, Mr.Abhishek Chadha and Mr.Arun Nagar, Advs.

for Hyderabad Mr.Harsh Ahuja and Mr.Kunal Kumar, Advs. for applicants in CA 233-234/2012 Mr.Kunal Sharma, Adv. for the OL Mr.Aman Nandrajog and Mr.Arjun Nanda, Advs.

for Manasvi Security Services

CORAM:

HON'BLE MR. JUSTICE JAYANT NATH

JAYANT NATH , J.(ORAL) CA 2080/2014

1. This application is filed by Mrs.G.Bharathi Devi seeking a direction to the OL to hand over possession of the plot No.E-313, measuring 300 sq.yds. in the survey No.94, 96 and 97 situated at Kondhapur village, Hyderabad. It has been pleaded that the applicant is a bona fide purchaser for value and is registered owner of the said plot bearing No.E-313 situated

in the above area vide sale deed dated 15.5.1998 executed by Mr.Col.M.J.Ganapathy the authorised signatory of various JVG group of companies. It is stated that from the year 1995 onwards, JVG group of companies started booking plots under various schemes and payment option in respect of the land situated at JVG Hills Layout. The applicant is said to have deposited the amount due as per agreed terms with the respondent company. It has also been pleaded that the applicant was informed by representatives of M/s.JVG Finance that the Hyderabad Development Authority on 23.10.1997 had revalidated the draft layout approved earlier on 27.07.1993. On 5.6.1998 the OL was appointed as the Provisional Liquidator by this court. The OL has somewhere down the line after about 5 years has taken symbolic possession of the entire area of land comprising of roughly 58 acres including the plot of land in question. Hence, the present application.

2. This court by its order dated 22.7.2004 appointed Mr.G.P.Thareja, One Man Committee to scrutinise the claims of various applicants who were having alleged registered title in their favour. The said committee started verifying the claims of the various applicants. The applicant also appeared before the Committee in support of its submission that the plot E-313 be released to the applicant. On 3.6.2011 Mr.J.P.Aggarwal the then Presiding Officer of the JVG Committee constituted by this court filed his report whereby he accepted the claim of the applicant. Hence, it is pleaded that the title of the applicant had been upheld by the report of the One Man Committee constituted by this court. It is prayed that the plot be released by the OL.

3. I have heard learned counsel for the parties. Learned counsel for the

OL has opposed the present application on broadly two grounds. He firstly submits that as per the report of the One Man Committee the OL was to examine the original sale deed, receipt and other relevant documents for handing over possession of the plot to the applicant. He submits that the applicant has failed to place on record any resolution of the Board of Directors of the respondent company authorising Col.Ganapathy for executing the sale deed.

4. He further submits that when the sale deed was executed on 15.5.1998 there was no demarcation of the plot in existence. It is pleaded that hence the plot allegedly sold to the applicant, namely, E-313, never existed. Hence, no such sale could have ever been made.

5. Mrs.Aneeta Sharma, Authorised Representative of the Ex. Directors, who is present in court, states that payments in this case have not been received by the respondent company and hence the transaction cannot be held to be bona fide. She further submits that even if for some reason this court is of the view that the transaction is genuine and bona fide the area in question where the plots are situated comprises of 58 acres. She submits that it would be in the interest of the respondent company that the genuine buyers be given plots in a particular consolidated area to help get a better price for the balance area which is left. She submits that a larger plot would fetch a far better price and would enable this court to pay the dues of various creditors of the respondent company.

6. Learned counsel appearing for the applicants have refuted the contentions of the respondent. He has strongly pointed out that the demarcation had taken place at the time when the sales were made. He also submits that there was a provisional demarcation in place and this was

subsequently confirmed by the Hyderabad Development Authority in 2003. He also relies upon the judgment of the Hyderabad High Court dated 22.7.2000 passed in W.P.(C)9478 and 9485/1999. The above judgment was also upheld by the Division Bench whereby directions were passed to Hyderabad Development Authority to confirm the layout.

7. I may first look at the report of the One Man Committee which reads as under:-

"262nd REPORT OF THE COMMITTEE

Claim No. 94 in respect of Plot bearing no. E-313 measuring 303 Sg yds. in Sy nos. 94 to 97 & 189 Kondapur Village, Hyderabad, AP

Smt. G. Bharathi Devi D/o Sh. G. Krishna Rao has prayed that a plot bearing no. E-313 measuring 300 Sq yds. in Sy Nos. 94, 96 and 97 situated at Kondapur Village, Ranga Reddy District, Hyderabad purchased by her from JVG Group of Companies may be excluded from the liquidation proceedings as it does not belong to the company (In Liqn).

The brief facts of this case are that Smt. G. Bharathi Devi booked a plot of 300 Sq yds. in JVG Hills, Kondapur, Hyderabad on 11/09/1997. Vide letter dt 14/11/1997 Smt. G. Bharathi was informed by the company that the booking is confirmed and her registration number is 355/Hills/HYD (Ext P-1).

That on 15/05/1998 Col M. J. Ganapathy an authorized signatory of JVG Group of Companies executed the sale deed in favour of Smt. G. Bharathi Devi in respect of E-313 for a total sale consideration of Rs. 1,20,000/- stating that the vendee has already paid the entire sale consideration of Rs.1,20,000/- by way of cheque/cash. The photocopy of sale deed dt.15/05/1998 is placed on the record (Ext P-6). The photocopy of the Agreement to Sell is not placed on record.

That as per record the claimant deposited a total sum of Rs.2,70,000/- towards the sale consideration. An amount of Rs. 10,000/- was deposited on 11/09/1997, Rs; 30,000/- on 22/12/1997, Rs. 1,20,000/- on 03/05/1998 and again Rs. 1,10,000/- on 03/05/1998. The photocopies of the receipts of the amount paid towards sale consideration are placed on the record. (Ext P-2 to P-

5).

That on 19/10/2004 Sh. G. Krishna Rao husband of the claimant appeared before the. committee and stated on oath that "I booked the plot with M/s JVG Finance LTD. on 11/09/1997 and paid Rs. 10,000/-. I paid to JVG Projects Rs. 2,60,000/-. The plot no. E-313 has been registered in my name. I file the photocopy of the receipts and the documents and also EC certificates. I have nothing more to say".

Col. M. J. Ganapathy an authorized signatory of JVG Group of Companies executed a sale deed in respect of plot bearing no. E-313 measuring 300 Sq yds. belonging to the company (In Liqn.) on 15/05/1998 within six months before the commencement of its winding up. That in the present case on the petition filed by the RBI on 04/06/1998 for winding up of the company namely M/s JVG Finance Ltd. the Hon'ble Court appointed a Provisional Liquidator vide order dt 05/06/1998. Section 531 of the Companies Act, 1956 provides that any transfer of property movable or immovable, delivery of goods, payment, execution or other act relating to property made taken or done by or against a company within six month before the commencement of its winding up ................ shall in the event of the company being wound up, be deemed a fraudulent preference of its creditors and be invalid accordingly. That in this case the claimant booked the plot measuring 300 Sq yds. and deposited a sum of Rs. 10,000/- on 11/09/1997 towards the booking amount. She further deposited Rs. 30,000/·, Rs. 1,20,000/- and Rs.1,10,000/- towards the sale consideration.

That in view of the· facts of this case it seems that the transaction of plot no. E-313 does not fall within the ambit of Section 531 of the Companies Act as the plot was booked prior to the period of six months before the commencement of the winding up of the

company. There is nothing on record to show that the vendor gave a preferential treatment to the vendee over the other persons similarly placed. The plot was transferred by the vendor in the ordinary course of its business and for valuable consideration. Accordingly to me the transaction in respect of plot no. E-313 is valid.

The claim of Smt. G. Bharathi Devi is disposed of with the following observations:-

a. That the claimant is entitled to an allotment and possession of plot no. E-313 measuring 300 Sq yds. in JVG Hills Layout, Kondapur Village, Hyderabad.

b. The Official Liquidator will examine the original sale deed, receipts and other relevant documents before handing over the possession of the said plot to the claimant.

The claim of Smt. G. Bharathi Devi is, accordingly, disposed of

-signed-

(J.P.Aggarwal) (Presiding Officer) JVG Committee Constituted by Hon'ble High Court of Delhi Date 3.6.2011 Place: New Delhi"

8. Facts that can be seen from the above report are that the plot was booked by the applicant on 11.9.1997. A letter to that effect is available on record of M/s.JVG Finance Ltd. Some payments have been made in cash to various group of companies including JVG Group of Companies. A sum of Rs.1,10,000/- is shown to have been paid by cheque on 3.5.1998 for which a receipt is on record. A registered sale deed was executed in favour of the applicant on 15.5.1998.

9. I may also have a look at the report of the SFIO. The SFIO has in its report confirmed that Col.Ganapathy till the date of winding up of

respondent company had sold 72 plots. These plots were not part of the assets of the respondent company on the winding up date and the title of these plots are registered with the plot holders. 12 plots out of the 72 belonged to the family members of Col.Ganapathy.

10. A conjoint reading of the report of the JVG Committee; the documents placed on record and the report of SFIO lead to a conclusion that the applicants have bonafidely purchased the plot in question prior to the winding up process commenced against the respondent company.

11. The plea of the OL that there was no board resolution in favour of Col.Ganapathy has no meaning keeping into view the documents which have been placed on record, namely, receipts showing payments of consideration and the fact that the sale deed was registered before the Sub Registrar. A payment of Rs.1,10,000/- has been clearly made by cheque in favour of the JVG Companies. The SFIO also did not come to a conclusion that Col.Ganapathy was not authorised to execute the sale deeds.

12. At this stage, learned counsel for the petitioner has pointed out to the statement that was recorded of Mr. V.K.Sharma, The Ex.Chairman of the respondent company before the OL where Mr.V.K.Sharma had said that some plots of JVG Group of Companies under the scheme JVG Hills were sold and consideration was received. This statement also confirms the facts recorded by the JVG Committee.

13. Regarding the plea of the OL and Authorised Representative about allocating plots in favour of the applicants and other similarly situated applicants in a particular area this issue would be gone into at a later stage. Direction to release possession will be given on the next date.

14. List on 14.08.2018 for further directions.

CA Nos.2104-06/2014, 2107-09/2014,2318-22/2014, 2093-95/2014, 2096-98/2014, 2085-87/2014 & 2088-90/2014 The facts stated in the present applications and the relief sought are substantially similar to CA No.2080/2014. This court has today already passed an order in CA No.2080/2014. These applications are also disposed of in terms of the said order passed in CA 2080/2014. CA 2091-92/2014 List on 3.8.2018.

CA 2066/2017 List on 14.8.2018.

CO.PET. 265/1998 List on 5.10.2018.

JAYANT NATH, J.

AUGUST 02, 2018 n