Mona Hotels Pvt Ltd vs Gujarat State Financial Corporation
2024 Latest Caselaw 3922 Guj

Gujarat High Court

Mona Hotels Pvt Ltd vs Gujarat State Financial Corporation on 1 May, 2024

Author: Sunita Agarwal

Bench: Sunita Agarwal

                                                                             NEUTRAL CITATION




     C/CA/1856/2024                           ORDER DATED: 01/05/2024

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     IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

 R/CIVIL APPLICATION (FOR CONDONATION OF DELAY) NO.
                       1856 of 2024
     In F/MISC. CIVIL APPLICATION NO. 33393 of 2023
                           With
       F/MISC. CIVIL APPLICATION NO. 33393 of 2023
                            In
            F/FIRST APPEAL NO. 33392 of 2023
                           With
            F/FIRST APPEAL NO. 33392 of 2023
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                      MONA HOTELS PVT LTD
                              Versus
           GUJARAT STATE FINANCIAL CORPORATION & ORS.
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Appearance:
MR RIDDHESH TRIVEDI(6581) for the Applicant(s) No. 1
for the Respondent(s) No. 1,2,3
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 CORAM:HONOURABLE THE CHIEF JUSTICE MRS. JUSTICE
       SUNITA AGARWAL
       and
       HONOURABLE MR. JUSTICE ANIRUDDHA P. MAYEE

                         Date : 01/05/2024

                      ORAL ORDER

(PER : HONOURABLE THE CHIEF JUSTICE MRS. JUSTICE SUNITA AGARWAL)

1. Having heard learned counsel for the appellant and perused the records, we may note that the in the instant appeal, there is a reported delay of 162 days in the presentation of the appeal on 01.11.2023 and the report of the Deputy Registrar indicates that there were some objections, which were intimated to the learned counsel for the appellant. The report further states that the

NEUTRAL CITATION

C/CA/1856/2024 ORDER DATED: 01/05/2024

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objections were removed only on 02.04.2024 and thereafter, the matter has been registered on 04.04.2024. In this manner, the date of presentation of the appeal filed along with an application under Order XLIV and supported by delay condonation application is reported as 05.03.2024 and the registration date is 04.04.2024.

2. The appeal is, thus, delayed by approximately one year, for which we do not find any plausible explanation from the petitioner.

3. On the asking of the Court as to why the learned counsel for the appellant took so much time to remove the objections reported by the Registry, it was submitted that there was some confusion about filing of the delay condonation application. However, the fact remains that the learned counsel for the appellant neither removed the objections nor moved any application before the Court for listing of the matter, in case there was any differences with the Registrar.

4. The submission of the learned counsel for the appellant that the delay in filing of the appeal be computed up to 01.11.2023 i.e. the date of presentation of the appeal, which remained pending for removal of office objection, therefore, cannot be accepted.

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C/CA/1856/2024 ORDER DATED: 01/05/2024

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5. Coming to the merits of the case, the instant appeal has been filed to challenge the judgment and order dated 13.03.2023 passed by the Commercial Court in Commercial Civil Suit No. 468 of 2021, which has been filed by the appellant / plaintiff for the relief of declaration, permanent injunction and recovery of possession against the defendants, by declaring the action of the Defendant no.1, Corporation in acquiring plaintiff's property, bearing Survey No. 36/1 and Final Plot No. 332 paiki sub-plot No. 8 admeasuring about 650 sq.mts. situated at Near Choice Restaurant, Swastik Cross Road, C. G. Road, Ahmedabad, as illegal, fradulent, with the further relief to declare the sale of the suit property as illegal, improper,unequitable and in violation of principles of natural justice, equity and good conscience. Further relief was sought for damages to the tune of Rs. 2,04,87,676/- to plaintiff towards loss of property by sale.

6. In the Order impugned, the Commercial Court has dismissed the suit after framing seven issues, returning findings thereon. To challenge the findings returned by the Commercial Court, only this much was argued by the learned counsel for the appellant that the property in question was sold in an auction at throw-away prices. The fact that the property was under-valued, is sufficient to set aside the auction and return the same to the appellant. The submission is that the entire auction

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C/CA/1856/2024 ORDER DATED: 01/05/2024

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sale was fraudulent to provide undue benefit to the private respondents. Apart from the above two submissions, no other contention has been made.

7. To deal with the above, suffice it to note that the property in question has been auctioned in a public auction by publishing a Notice dated 31.10.1996. It is noted by the Trial Court that pursuant to the aforesaid notice, the son of the appellant was declared highest bidder as he offered Rs.5,00,00,000/-, but his offer was rejected as he did not pay the bid money. The request for grant of time to pay substantial money was rejected by the appellant. The suit property was sold to defendant no. 2, who was the highest bidder for a sum of Rs.2,75,00,000/- in a public auction that took place for the second time, for which public notice was published in the newspaper on 05.07.1997. The Trial Court recorded the contention of the learned counsel for the plaintiff that the suit property was valued at Rs. 5,00,00,000/- and odd but it was sold to the defendant no. 2 at a meager price of Rs. 2,00,00,000/- and odd, and noted that the plaintiff has failed to prove the Valuer Report dated 02.08.1997 in accordance with the provisions of the Indian Evidence Act, inasmuch as, he did not get the valuer examined, the said report was, therefore, bound to be rejected.

8. It was further noted that the plaintiff during the

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C/CA/1856/2024 ORDER DATED: 01/05/2024

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entire proceedings, has not been able to prove any discrepancy in the auction process conducted by the Defendant no. 1 till the execution of the sale deed in favour of the Defendant no. 2. It is also noted that an MOU dated 27.11.1996 was executed between the plaintiff and defendant no. 2, the auction purchaser wherein, Clauses (5) and (7) provided that in the event the dispute between the plaintiff and defendant no. 1 is not settled, the agreement shall stand terminated and the disputes would be regarded as settled only when the Corporation withdraws proceedings under Section 29 of the Act and restores back possession of the property to the Company. Since the aforesaid terms and conditions enumerated in the MOU were never satisfied, the argument of the learned counsel for the plaintiff to set aside the same based on the said MOU was turned down. The categorical finding of fact recorded by the Trial Court about the sale of property held in the second auction sale could not be assailed successfully by the learned counsel for the appellant.

9. It may further be noted that in the first auction, it seems that the plaintiff had made efforts to frustrate the same by putting up his son as the highest bidder, who had offered Rs. 5,00,00,000/- for purchase, but did not come forward to pay the bid money despite being declared as highest bidder. Thereafter, in a writ petition, namely Special Civil Application No. 8176 of 1996, the appellant

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C/CA/1856/2024 ORDER DATED: 01/05/2024

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was given an offer to deposit the amount of Rs.60,00,000/- by the Order dated 05.11.1996, however the said amount was also not deposited.

10. There is no dispute about the outstanding amount on the date of auction. It is, thus, evident that the appellant instead of coming forward to pay the dues of the Corporation, tried to get the sale frustrated by hook or crook and when he did not succeed, the suit was filed for cancellation of auction sale and permanent injunction.

11. Considering the submissions made by the learned counsel for the appellant, we do not find any flaw in any of the findings and conclusions drawn by the Trial Court on the issues about the validity of the auction sale and the price fetched by auction of the property in question.

ORDER IN MISC. CIVIL APPLICATION No. 33393 of

1. In the Civil Application under Order XLIV Rule 1 of the Code of Civil Procedure for declaring the appellant as an indigent person, only averment made is that the appellant has no source of income to provide the requisite court fee and that he is residing with his son, who is

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C/CA/1856/2024 ORDER DATED: 01/05/2024

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bearing all his expenses. For the mere fact that the appellant is 84 years old and is not gainfully employed as on date, the appellant cannot qualify for being declared as 'indigent person' as per Order XLIV Rule 1 of the Code of Civil Procedure.

2. Apart from the bald averments, no material has been brought on record to substantiate the submission that the appellant has no source of income. Even otherwise, as per own case of the appellant, he is residing with his son. There is complete silence about the occupation of the son of the appellant and his source of income. The appellant has also not disclosed his status in the society. It is, thus, difficult for us to accept the prayer made in the application to declare the appellant as an indigent person, condoning the payment of the court fee required in this appeal.

3. It may also be noted that the appellant was a businessman and look loan for running a hotel busines, which is the property in question, sold in the year 1997. However, there is a no whisper in the application about the occupation / profession / business of the appellant after the year 1996. It is not disclosed as to how the appellant had survived after closure of hotel business, which was put to auction in the year 1997.

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C/CA/1856/2024 ORDER DATED: 01/05/2024

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4. For the above, we do not find any merit in the application seeking for declaration of appellant as an 'indigent person'. The application is, accordingly, rejected.

5. The appellant has to pay the requisite court fee within the period of two weeks from today, or else proceedings for recovery of the court fee be initiated against him strictly in accordance with law.

6. With the above, the application seeking for condonation of delay, the application under Order XLIV Rule 1 of the Code of Civil Procedure to declare the appellant as an indigent person, as also the Appeal itself are DISMISSED being devoid of merits.

(SUNITA AGARWAL, CJ )

(ANIRUDDHA P. MAYEE, J.) SAHIL S. RANGER