Madras High Court
Sunkara Venkateshwara Rao vs Maxworth Orchards (India) ... on 7 August, 2023
2023:MHC:3702
O.S.A.Nos.181 to 183 of 2012 &
315 to 318 of 2013
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 07.08.2023
CORAM:
THE HONOURABLE MR.JUSTICE R.SUBRAMANIAN
and
THE HONOURABLE MR. JUSTICE V.LAKSHMINARAYANAN
O.S.A.Nos.181 to 183 of 2012, 315 to 318 of 2013
and M.P.Nos.1, 1, 1 of 2012 & 1,1,1,1 of 2013
and M.P.No.1 of 2014
O.S.A.Nos.181 to 183 of 2012
Sunkara Venkateshwara Rao .. Appellant
Vs.
1. Maxworth Orchards (India) Limited
No.9, Mahalingam Main Road
Mahalingapuram, Nungambakkam
Chennai-34, Represented by its
Administrator/Provisional Liquidator
Mr.K.Alagiriswami
2. P.Ananthalakshmi
3.Koduru Venkateswara Prasad
Flat No.104, 1st floor
MCH No.13-1-212/104
Sri Balaji Nilayam
Balaji Swarnapuri Colony
Moti Nagar, Hyderabad-500 018.
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1/12
O.S.A.Nos.181 to 183 of 2012 &
315 to 318 of 2013
4.Vajra Farms & Engineers
A Registered partnership firm
Represented by its General Power of Attorney
Shri Raghujie
S/o. S.S.Ganesh
Flat No.3, 1st floor
3-4-768, Canara Apartments
Barkathpura, Hyderabad-27. .. Respondents
5. A.Subbiah .. 5th respondent in
(R5 impleaded vide order of this Court O.S.A.No.181 of 2012
dated 07.08.2023 in M.P.No.1 of 2014
in O.S.A.No.181 of 2012)
Common Prayer in O.S.A.Nos.181 to 183 of 2012: Original Side
Appeals filed under Order XXXVI Rule 9 of O.S. Rules read with Clause
15 of Letters Patent, against the order passed by His Lordship Mr. Justice
P.Jyothimani made in Company Application Nos.1937 to 1939 of 2003 in
C.P.No.57 of 1998, dated 17.09.2010.
O.S.A.Nos.315 to 318 of 2013
Penmatsa Parimala .. Appellant
vs.
1. Maxworth Orchards (India) Limited
No.9, Mahalingam Main Road
Mahalingapuram, Nungambakkam
Chennai-34, Represented by its
Administrator
2.Kamlesh Lohade
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O.S.A.Nos.181 to 183 of 2012 &
315 to 318 of 2013
3.P.Ananthalakshmi
4.Vajra Farms & Engineers
Represented by Managing Partner
R.Arun Kumar
5-9-22 Shapurwadi
Hyderabad – 500 001
State of Andhra Pradesh.
5. Koduru Venkateswara Prasad
6. The Mandal Revenue Officer
Ramachandrapuram, Medak District
State of Andhra Pradesh. .. Respondents
7. T.Mohan (alias) Dhavamani
8. D.Thirumagal .. Respondents 7 & 8
in O.S.A.No.315/2013
(R7 and R8 impleaded vide order of this Court
dated 07.08.2023 made in C.M.P.No.20133
of 2017 in O.S.A.No.315 of 2013)
Common Prayer in O.S.A.Nos.315 & 316 of 2013: Original Side
Appeals filed under Order XXXVI Rule 9 of O.S. Rules read with Clause
15 of Letters Patent, against the fair and decretal order passed by His
Lordship Mr. Justice P.Jyothimani made in Company Application
No.1748 & 1749 of 2005 in C.A.No.63 of 2001, dated 17.09.2010.
Common Prayer in O.S.A.Nos.317 & 318 of 2013: Original Side
Appeals filed under Order XXXVI Rule 9 of O.S. Rules read with Clause
15 of Letters Patent, against the fair and decretal order passed by His
Lordship Mr. Justice P.Jyothimani made in Company Application No.319
& 320 of 2006 in C.P.No.57 of 1998, dated 17.09.2010.
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O.S.A.Nos.181 to 183 of 2012 &
315 to 318 of 2013
In O.S.A.Nos.181 to 183 of 2012
For Petitioner : Mr.Kumarpal R.Chopra
For R1 : Mr.Karthik Seshadri
for M/s.Iyer & Thomas
In O.S.A.No.181 of 2012
For R4 : Ms. Rama Brahma
for Mr.P.Subba Reddy
(newly impleaded party)
In O.S.ANos.315 to 318 of 2013
For Appellants : Mr.N.Surya Senthil
for M/s.Surana & Surana
For R1 : Mr.Karthik Seshadri
for M/s.Iyer & Thomas
For R2, R3
& R6 : No appearance
In O.S.A.No.315 of 2013
For R7 & R8 : Mr.J.Saravanakumar
(newly impleaded parties)
COMMON JUDGMENT
(Judgment of the Court was delivered by R.SUBRAMANIAN,J.)
All these seven appeals have been filed at the instance of the
purchasers of the immovable properties, whose purchases were made
subject matter of the proceedings before the Company Court at the
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O.S.A.Nos.181 to 183 of 2012 &
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instance of the Administrator, who was also nominated as a provisional
liquidator.
2. The Company namely, M/s.Maxworth Orchards India Limited
came up with the novel project of developing Orchards through
community farming. The Company accumulated lands in various places
across the country. In certain cases, the purchases were made in the
names of the employees of the Company and the lands were plotted out in
to small bits of various extents. Those small bits that were plotted out
were sold to gullible buyers with the promise of developing Orchards in
the lands. However, down the line, the project did not take off and the
Company eventually landed in the Company Court for winding up.
3. In the winding up proceedings, a Senior Advocate of this Court
was appointed as an Administrator and he took over the affairs of the
Company, since he found that vast extent of immovable property has been
purchased and employees of the Company were appointed as Power of
Attorney Agents to deal with the properties, in order to protect the
properties of the Company from being swindled by the employees, who
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315 to 318 of 2013
had by then realised that the Company had no future, the Administrator
sought for prohibitory injunction against the employees as well as some
of the purchasers from alienating or encumbering the properties.
Simultaneously, the applications were also moved for cancellation of
various sale deeds that were allegedly executed by the employees of the
Company based on the Powers of Attorney or taking advantage of the fact
that the sale deeds stood in their name. Such applications came to be
allowed by this Court on various grounds.
4. As far as these batch of appeals are concerned, it relates to about
27 acres of land in Kollur and Osman Nagar Villages of
Ramachandrapuram Mandal, erstwhile Medak District of Andhra
Pradesh, now in Sangareddy District of Telangana.
5. Challenge by the Administrator was to the sale deeds dated
17.04.2003 registered as document Nos. 2409 & 2410 of 2003 and the
sale deeds dated 13.08.2003 registered as document Nos.7314 to 7317 of
2003. Injunction was also sought for from restraining the respondents,
who had claimed title under those sale deeds from interfering with the
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possession of the Company. These application numbers were
C.A.Nos.1937 to 1939 of 2003, 1748 & 1749 of 2005, 301 to 303 of
2006, 319 and 320 of 2006 in C.P.No.57 of 1998. In C.A.Nos.1937 of
2003, 303 of 2006, 1748 of 2005, 319 and 320 of 2006, the prayer
sought for was for injunction restraining the respondents from interfering
with the possession of the Company. In the other applications, the prayer
sought for was to set aside the sale deeds referred to supra. All these
applications came to be allowed by a common order of this Court dated
17.09.2010, leading to these appeals by the purchasers.
6. Pending these appeals, a third party has filed an application in
M.P.No.1 of 2014 in O.S.A.No.181 of 2012 seeking to implead,
contending that Yenna Rameshkumar, the vendor has purchased the
properties, the subject matter of the applications referred to above, from
one Ananthalakshmi the owner, under a sale deed dated 18.12.1995
registered as document No.5702 of 1995. It is his further claim that the
said Yenna Ramesh Kumar had sold the said property to the petitioner in
M.P.No.1 of 2014, A.Subbiah on 25.05.2005 under the registered sale
deed bearing document No.5544 of 2005. It is also claimed that the suits
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O.S.A.Nos.181 to 183 of 2012 &
315 to 318 of 2013
filed by the appellant in O.S.A.Nos.181 to 183 of 2012 in O.S.Nos.71 of
2004 (for declaration of title and for consequential injunction) and 463 of
2008 (for permanent injunction) came to be dismissed by the trial Court
viz., the Junior Civil Judge, Medak District, Andhra Pradesh, on
02.05.2016 and 21.05.2016 respectively. It is also stated that the appeals
against the said judgments and decrees are pending before the learned
District Judge at Sangareddy District.
7. In this background, we will have to now examine the correctness
of the order of the Company Court in declaring the sale deeds allegedly
executed by Ananthalakshmi in favour of the appellant in O.S.A.Nos.181
to 183 of 2012 in the year 2003. No doubt, the Company Court has got
very wide jurisdiction under Section 446 of the Companies Act, but such
jurisdiction cannot and will not extend to the properties that did not
belong to the Company Court on the date, when the winding up petition
was admitted. Admittedly, in the case on hand, the winding up petition
came to be admitted on 14.02.1998. So the crucial date would be
14.02.1998. If it is claimed that the property did not belong to the
Company on the date when the winding up petition came to be admitted
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or one year prior to that, the Company Court will not have jurisdiction to
deal with sales relating to such properties.
8. The fact that the sale deeds of the year 1995 were executed by
Ananthalakshmi is not disputed by the counsel for the Administrator.
Therefore, the Administrator proceeded on the basis that the Company
had no title to the property on the date when the winding up petition was
initiated. Moreover, the correctness or validity of the sale deeds executed
by Ananthalakshmi in the year 1995 on the one hand and those sale
deeds allegedly to have been executed by Ananthalakshmi in the year
2005 on the other hand will have to be decided by the competent Civil
Court and not by the Company Court.
9. Unfortunately, none of the parties before the Company Court
including Ananthalakshmi herself, who filed an affidavit stating that she
had not executed the sale deeds in the year 2003 disclosed the fact that
Ananthalakshmi had executed the sale deeds with reference to these
properties even in the year 1995. This led to the Company Court
proceedings on the assumption that the properties belonged to the
Company on the crucial date.
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10. Now it is brought to our notice that the Company itself was not
the owner of the property on the crucial date and Ananthalakshmi in
whose name, the original sale deed dated 16.11.1995 stood is said to have
sold the property even in December 1995 and March 1996. Therefore, the
Company Court did not have jurisdiction to deal with these properties or
the alienations. Admittedly, a Court of competent jurisdiction is seized of
the matter. It is for that Court to decide on the validity of the sale deed.
Therefore, we are of the opinion that the order of the Single Judge setting
aside the alienation of the year 2003 cannot be sustained as it is beyond
the jurisdiction of the Company Court.
11. In view of the above, the following are our conclusions:
(i) All these appeals will have to be necessarily allowed and the
order dated 17.09.2010 setting aside the sale deeds of the year 2003 will
stand set aside.
(ii) Impleading petition in M.P.No.1 of 2014 in O.S.A.No.181 of
2012 will stand allowed.
(iii) We make it clear that we have not decided the validity of either
the sale deeds of the year 1995 or the sale deeds of the year 2003. We
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have only gone on the jurisdiction of the Company Court to set aside the
sale deeds, when there are rival claims to the property by the persons,
who had purchased the property.
(iv) The learned District Judge, Sangareddy District, where the
appeals are pending, will decide the matter on the evidence that placed
before it, without being influenced by any of the observations contained
in the order of the Single Judge, which has been set aside by us today or
in this judgment.
12. All the appeals stand allowed. The parties will bear their own
costs. Consequently, connected Miscellaneous Petitions are closed.
(R.S.M., J) (V.L.N., J)
07.08.2023
Index : Yes / No (2/2)
Internet : Yes / No
Neutral Citation : Yes / No
kj
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O.S.A.Nos.181 to 183 of 2012 &
315 to 318 of 2013
R.SUBRAMANIAN,J.
and
V.LAKSHMINARAYANAN,J.
Kj
To
1. The Assistant Registrar
Original Side
High Court, Chennai.
2. The District Judge
Sangareddy District.
O.S.A.Nos.181 to 183 of 2012, 315 to 318 of 2013
and M.P.Nos.1, 1, 1 of 2012 & 1,1,1,1 of 2013, M.P.No.1 of 2014
07.08.2023
(2/2)
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