Madras High Court
Juliet Arputharaj vs Deputy Superintendent Of Police on 2 March, 2021
C.M.A.No.3491 of 2014
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 02.03.2021
CORAM
THE HONOURABLE MR.JUSTICE S.M.SUBRAMANIAM
C.M.A.No.3491 of 2014
and
M.P.No.1 of 2014
Juliet Arputharaj ..Appellant
Vs.
1.Deputy Superintendent of Police,
Economic Offences Wing II
Tiruchirapalli District.
2.Kanagajothi ..Respondents
Prayer : Civil Miscellaneous Appeal filed under Section 11 of the
Tamil Nadu Protection of Interests of Depositors (In Financial
Establishments Act), 1997, r/w Order XUR1 of CPC., against the Fair
and the Decreetal order dated 20.06.2014 passed in O.A.No.79 of 2010
on the file of the Court of Special Judge under TNPID Act 1997,
Chennai – 104.
For Appellant : Mr.T.Sezhian
For Respondents : R1 – Mr.Y.T.Aravind Gosh
Additional Government Pleader(CS)
JUDGMENT
The Fair and Decreetal order dated 20.06.2014 passed in
O.A.No.79 of 2010 is under challenge in the present Civil
Miscellaneous Appeal.
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C.M.A.No.3491 of 2014
2. The Original Application was filed by the Deputy
Superintendent of Police, Economic Offences Wing II, Tiruchirappalli,
to approve the attachment of properties belongs to the accused by the
Government. The allegations against the 2nd respondent are that he was
running a Financial institution and collected deposits from more than
1561 persons. However, the Finance company could not able to repay
the matured deposits and many of the depositors filed the complaint
before the Police. Investigations were conducted and the 1 st respondent /
Deputy Superintendent of Police, identified the properties and it was
found that one of the property was sold by the accused person in favour
of the appellant. However, the said property was also attached on the
ground that the said sale was done in a calculated manner to defeat the
repayment to the depositors.
3. The Special Court adjudicated the issues with reference to the
documents and the evidences. The trial Court made a finding that the
transaction was made in a calculated manner and it was a malafide
transfer and accordingly, approved the attachment.
4. The learned counsel for the appellant mainly contended that the
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appellant is a bonafide third party purchaser and he purchased the
C.M.A.No.3491 of 2014
property from the 2nd respondent in the year 2006. By borrowing loan
from Bank, the appellant paid the sale consideration and therefore, the
sale deed was executed in a proper manner and there was no fraudulent
activities as alleged. The learned counsel for the appellant reiterated that
the first complaint itself was filed before the Police in the year 2007.
However, the sale deed in his favour was executed in the year 2006. The
sale consideration was also paid. Therefore, such a sale cannot be the
subject matter of attachment and the Special Court committed an error in
made a finding that the transfer was malafide.
5. The learned Additional Government Pleader disputed the said
contentions by stating that all possible circumstances, probabilities as
well as the manner in which the transaction occurred were considered by
the Special Court, based on the investigations conducted by the
Economic Offences Wing. The Special Court considered various
circumstances, which lead to the sale between the appellant and the 2 nd
respondent in order to deny the repayment to the depositors, many
complaints were registered and in fact, the Deputy Superintendent of
Police / P.W.1 deposed before the Special Court that the complaints
were being received from the year 2004 onwards. Even during Cross
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Examination, it was deposed. Therefore, in spite of the fact that the
C.M.A.No.3491 of 2014
complaints were being received from the year 2004, the case was
received based on the complaint given in the year 2007.
6. The learned counsel for the appellant made a submission that
there is no record to establish that the complaint was received in the year
2004.
7. This Court is of the considered opinion that whether the
complaint was received in the year 2004 or 2007, the fact remains that
the appellant is running a Hotel in Velanganni. The 2nd respondent
Finance company is also functioning at Vedaranyam. Both are living in
a nearby place and the transfer of property itself was on mala fide
grounds.
8. The Special Court, during adjudication, categorically made a
finding that it is an admitted fact that the Finance Company willingly
cheated the depositors and sold the property in favour of the appellant.
Thus, it was a malafide transfer. The entire sale consideration had been
passed on to the 1st respondent and the 2nd respondent had no way
connected with the financial institution. Thus, the Special Court arrived
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a conclusion that the transfer of property was on malafide grounds and
C.M.A.No.3491 of 2014
therefore, the attachment cannot be raised. The Special Court further
found that prior to the sale between the appellant and the 2 nd respondent,
there was a sale agreement between the 2nd respondent and one
Mr.Arogyasamy in April 2005. Thus, the 2nd respondent made an
attempt to sell the property even prior to the sale executed in favour of
the appellant. When these all are the facts and circumstances brought to
the notice of the Special Court, the Special Court in the interest of the
public and to protect the depositors, approved the attachment. This
apart, the subject properties had been purchased by the 2nd respondent/
Financier from the income accrued from the depositors amount and the
amount has been utilized for the purchase of the said property. This
being the factum established, the petition filed by the Deputy
Superintendent of Police was allowed and the claim of the appellant was
rejected.
9. This Court is of the considered opinion that the TNPID Act is
enacted to protect the interest of the innocent depositors. When the
Special Court found that certain transfer of properties are fraudulent or
malafide, then the properties are to be attached and only after
adjudication, appropriate decision is to be taken. In the present case, the
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attachment made by the Deputy Superintendent of Police is approved by
C.M.A.No.3491 of 2014
the Special Court. If at all the appellant wants to raise the attachment, he
has to file an application under Section 9 of the Act by providing
Security in lieu of attachment. Contrarily, this Court cannot raise an
attachment, in view of the fact that the findings of the Special Court are
candid and convincing.
10. This being the factum, there is no perversity as such and the
Fair and Decreetal order dated 20.06.2014 passed in O.A.No.79 of 2010
stands confirmed and the Civil Miscellaneous Appeal in
C.M.A.No.3491 of 2014 stands dismissed. No costs. Consequently,
connected miscellaneous petition is closed.
02.03.2021
kak
Index: Yes/No
Internet:Yes/Non-Speaking order
https://www.mhc.tn.gov.in/judis/
C.M.A.No.3491 of 2014
To
The Hon'ble Special Judge under TNPID Act,
Chennai.
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C.M.A.No.3491 of 2014
S.M.SUBRAMANIAM, J.
kak
C.M.A.No.3491 of 2014
02.03.2021
https://www.mhc.tn.gov.in/judis/
