Madras High Court
Rikapchand – Died vs Maragadhammal on 10 October, 2022
C.M.S.A.No.7 of 2006
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 10.10.2022
CORAM
THE HON'BLE Ms.JUSTICE P.T.ASHA
C.M.S.A.No.7 of 2006
and C.M.P.No.1026 of 2006
Rikapchand – Died
2.R.Chandra Bai
3.R.Kamal Kumar
4.R.Kishore Kumar
5.R.Prem Kumar
6.Rakhi ... Appellants
[Appellants 2 to 6 brought on record
as Lrs of the deceased sole appellant
viz., Rikap Chand vide Court order
dated 14.08.2019 made in C.M.P.Nos.15179,
15176, and 15184 of 2019
in C.M.S.A.No.7/2006 (TRJ).]
Vs
1.Maragadhammal
2.Thangapandian
3.Selvaraj Nattar
4.Loganathan
5.Babu
6.Nagammal
7.Raja
8.Gunalan
9.Gopi
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C.M.S.A.No.7 of 2006
10.B.Babu
11.Jayalakshmi
12.Govindaraj Naidu
13.Gandhi
14.Murugan
15.D.Ramesh
16.The Official Receiver,
Vellore District,
Office at the Integrated Court Complex,
Sathuvachari, Vellore-632 009.
17.Ganapathiraj
18.V.Subramani
19.Bakthavatchalam
20.Shanmuga Mudaliar
21.B.Babu
22.Ravi
23.Saravanan
24.Prema
25.Maharaniammal
26.Muthammal
27.Amsammal
28.Ramachandra Mudaliar
29.Prakash
30.Vijayalakshmi
31.Bakthavatchalam
32.Jagathambal
33.Jayalakshmi
34.Ragavan
35.Parthiban
36.Chandran
37.Nilavalagan
38.Baby
39.Kumar
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C.M.S.A.No.7 of 2006
40.Karthigeyan
41.Arumugam
42.Subramani Mudaliar
43.Nithyanandam
44.Radhika
45.Karthigeyan
46.Govindaraj Mudaliar
47.Veeramani
48.Vijayakumar
49.Vinayagam
50.Selvam
51.Purushothaman
52.Sarojammal
53.Koteeswari
54.Sowiyya
55.Maheswari
56.Balarama Mudaliar
57.Amsammal
58.Vanitha
[email protected]
60.Parvathy
61.Sekar
62.A.Babu
63.Vimal
64.Thirumagal Chit Financiers
Rep. by its Managing Partner
65.Venkatesan
66.M.T.Balu
67.Shanmugam
68.S.Gopi
69.Jayanthi
70.Thangapandian
71.Rukmaniammal
72.Maragadammal
73.Sumathy
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C.M.S.A.No.7 of 2006
74.Lalithkumar Kataria
75.Ganpathraj
76.Palani
77.Balakrishnan
78.Munirathinam Maisthry
79.Murali
80.Meena
81.Mani
82.Guru
83.Nagaraj
84.Jeyaraj
85.A.Mani
86.Narasimhan
87.Shanmugam
88.Shanmugam
89.Saravanan
90.Shanmugamudaliar
91.Lakshmanan
92.Meerabi
93.Nilavalagan
94.Karunanidhi
95.Chandra, Tea stall
96.Rajeswari
97.Bakthavatchalam
98.Velu
99.Purushothaman
100.Ramamurthy
101.Radhakrishnan
102.Gunasekaran
103.Karunanidhi
104.Pichaimuthu
105.Subban
106.Sambasivam
107.Asokan
108.Ramamurthy
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C.M.S.A.No.7 of 2006
109.Bakthan
110.Maharani
111.Veeramani
112.Purushothaman Naidu
113.Maragadammal
114.Ramamurthy
115.Thangaraj
116.Karthigeyan
117.Ravi
118.Govindaraj
119.P.Gopi
120.Jayaseelan
121.Murugesan
122.Sydali
123.A.Babu
124.Anjaneyan
125.Ravi
126.Gnanasekara Naidu
127.Ganpathraj
128.Lakshmi
129.Prakash
130.Kumar
131.Kadhiravan
132.Muthukumar
133.Maragadhammal
134.Ganpathraj
135.Nithyanandam
136.Ganpathraj
137.Kumar
138.Ravi
139.Ravighandhi
140.Gunalan
141.Soundarrajan
142.Ragavan
143.Shanmugam
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C.M.S.A.No.7 of 2006
144.Anjaneya
145.Anbu
146.Ganpathraj
147.Sundaram
148.Jayalakshmi
149.Amsammal
150.Selvaraj Nattar
151.Dhanasekar
152.Balu
153.Annadurai
154.Tea Shop Kuppan
155.Selvarajnattar
156.Karunanidhi
157.Balachandar
158.Raja
159.Raja
160.Jayalakshmi
161.Selvarajnattar
162.Thangapandian
163.Pannermaisthry
164.Lakshmanan
165.Balakrishnan
166.S.Gopi
167.Sampath
168.B.Murali
169.G.Thenmozhi ... Respondents
PRAYER : This Civil Miscellaneous Second Appeal is filed under
Section 100 of Civil Procedure Code, against the decree and judgment of
Principal District Judge of Vellore made in A.S.No.21 of 2003 dated
12.10.2004 setting aside the decree and Judgment of the Official
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C.M.S.A.No.7 of 2006
Receiver, Vellore in O.R.I.P.No.6 of 2001, dated 22.01.2003 and
directing to conduct fresh sale.
For Appellant : Mr.A. Palaniappan
for Mr.M.V.Krishnan
For Respondents : Notice Served - No Appearance
1,4,5,13 to 15
For Respondents : Mr.R.Subramanian
2,3,6 to 10 and 12 for Mr.T.R.Rajaraman
For Respondents : No Appearance
11 and 16
For Respondents : Given up
17 to 169
JUDGMENT
The auction purchaser is before this Court, challenging the
judgment and decree passed by the learned Principal District Judge,
Vellore in A.S.No.21 of 2003, in and by which, the learned Judge has set
aside the judgment and decree passed by the Official Receiver, Vellore in
O.R.I.P.No.6 of 2001 and directing the Official Receiver to conduct a
fresh sale, after giving proper publication and notice to the creditors.
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C.M.S.A.No.7 of 2006
2. The brief facts which has culminated in filing of this C.M.S.A
are herein below briefly narrated.
The 15th respondent herein had filed I.P.No.2 of 2000 on the file of
the Subordinate Judge, Ranipet to adjudge him as an insolvent under the
provisions of the Provincial Insolvency Act. It was his case that he was
originally a partner in Thirumal and Thirumal Finance Corporation at
Sholinghur. Since he was of a young age and lacked experience, he had
been misled by his own friends, which had resulted in huge business
losses to him. In order to offset the loss, the petitioner had borrowed
extensively from the respondents arrayed in the insolvency petition. That
apart, people who have borrowed from the petitioner have also not repaid
the amounts and some of them have also moved out from the original
address, as a result of which, the 15th respondent was unable to collect
the dues. Consequently, the petitioner would submit that he had become
an insolvent on account of this huge loss and therefore, he had come
forward with the petition in question. The petitioner had stated that his
assets were detailed in “B” schedule and his liabilities were over a sum
of Rs.88,56,500/-/
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C.M.S.A.No.7 of 2006
3. (i) The 167th respondent who is the appellant herein as well
as the auction purchaser had filed a counter inter-alia contending that the
very insolvency petition was a false and vexatious petition. He would
contend that the petitioner continued to be the partner of Thirumal and
Thirumal Finance on the date of the petition. However, the business was
being carried on by one A.G.Anandan and the 15 th respondent's wife,
Vijayarani as partners. The appellant has erred in not impleading the
firm as a party to the proceedings and on this ground, the petition ought
to have been dismissed.
(ii) The appellant would submit that he had subscribed to
several chits with the petitioner's firm to the extent of Rs.8,72,000/- and
these amounts have not been given credit to in the insolvency
proceedings. Apart from that, the 15th respondent had also borrowed from
the 167th respondent, his wife and sons on various dates and these
amounts have not been given credit to. If the two loans are put together,
the 15th respondent owes a total sum of Rs.15,72,500/- to the appellant.
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C.M.S.A.No.7 of 2006
The appellant would further submit that the 15th respondent had
discharged his dues to some of the creditors by giving preference to
them. That apart, he has also sold several properties to third parties in
order to defraud the creditors and these properties and sites are to be
included in the petition. Therefore, it was the contention that the assets
and liability did not contain the true state of affairs.
4. The 15th respondent was adjudged as an insolvent as per the
orders of the Official Receiver, Vellore in O.R.I.P.No.6 of 2001 dated
21.06.2001 and all the estates have been vested with the Official
Receiver. The Official Receiver had taken charge of the assets of the 15th
respondent herein. In the meanwhile, the Official Receiver, namely, the
16th respondent had ordered an auction sale of the properties to be held
on 22.01.2003. Since there were no bidders, the Court has suo-motu
adjourned the sale to 03.06.2003 without any notice to the creditors of
the 15th respondent including the appellant herein. Aggrieved by the
same, the appellant herein had filed O.R.I.P.No.6 of 2001 before the
Official Receiver, Vellore to set aside the sale, which had taken place
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C.M.S.A.No.7 of 2006
with just 7 persons including the auction purchaser and the property was
knocked off at a meagre sum of Rs.5,27,500/-. Challenging the said
order, the creditors had filed an appeal in A.S.No.21 of 2003 on the file
of the Principal District Judge, Vellore. The learned Judge, by her dated
12.10.2004, allowed the appeal and directed the Official Receiver to
conduct a fresh sale, after giving proper publication and notice to the
creditors. Challenging the same, the appellant is before this Court.
6. Heard the learned on either side and perused the materials
available on record.
7. One of the grounds raised by the appellant is that the property
has been sold after giving wide publicity and in the auction, 7 persons
had participated, out of which, the auction purchaser, the appellant herein
had emerged successful. He would submit that even according to the 15th
respondent-Insolvent, the value of the property was a sum of
Rs.8,72,000/- and the highest bid was that of the appellant at
Rs.5,27,000/-. However, in the counter filed by the appellant, he has
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C.M.S.A.No.7 of 2006
himself stated that the value of the property is over a sum of
Rs.25,00,000/-. Therefore, the fact that the bid has been closed at a sum
of Rs.5,27,000/- shows that all is not well with the auction sale. This
doubt is further clarified by the fact that though the Official Receiver had
adjourned the auction sale to 03.06.2003, however suo-motu, on an
advance hearing petition, the hearing was advanced to 22.01.2003. The
order has been passed in the advance hearing petition without notice to
all the creditors and on the date to which the hearing was advanced, the
property had been sold at a very low price. The lower Court has taken
note of the same and has rightly set aside the same. I see no reason to
interfere with the said judgment and decree. Accordingly, this Civil
Miscellaneous Second Appeal is dismissed. No costs. Consequently,
connected miscellaneous petition is closed.
10.10.2022
Index:Yes / No
Speaking Order : Yes /No
srn
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C.M.S.A.No.7 of 2006
To
1. The Principal District Judge,
Vellore.
2. The Official Receiver,
Vellore District,
Office at the Integrated Court Complex,
Sathuvachari, Vellore-632 009.
3. The Section Officer,
V.R. Section, High Court, Madras
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C.M.S.A.No.7 of 2006
P.T.ASHA, J.,
srn
C.M.S.A.No.7 of 2006
10.10.2022
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