Telangana High Court
P. Satyanarayana vs Smt. V. Anjana Devi And 4 Others on 19 March, 2025
THE HONOURABLE SMT. JUSTICE K. SUJANA
CIVIL REVISION PETITION No.385 of 2020
ORDER:
This Civil Revision Petition is filed by the
petitioner/defendant No.5 aggrieved by the order dated
17.04.2019 passed in I.A.No.990 of 2018 in O.S.No.1703 of
2014 on the file of II-Additional Senior Civil Judge, Ranga
Reddy District. For the sake of convenience, the parties
herein after referred to as arrayed in O.S.No.1703 of 2014.
2. The petitioner herein who is defendant No.5 in the suit
contested the plaintiff's suit seeking declaration of title,
cancellation of a General Power of Attorney (GPA), and sale
deeds. The plaintiff claims ownership and possession of the
property, purchased from the Housing Society on 25.11.1990.
The plaintiff alleges that defendant Nos.1 to 3 manipulated,
created and fabricated fake documents. However, defendant
No.5 asserts that he acquired the property through a sale
conducted by the State Bank of India-defendant No.4 under
the Securitization and Reconstruction of Financial Assets and
Enforcement of Securities Interest (for short 'SARFAESI Act').
It is contended that as per Section 34 of the SARFAESI Act the
Civil Court lacks jurisdiction, as the auction became final and
the bank issued a sale certificate. Furthermore, Section 18 of
the SARFAESI Act bars the Courts from trying the matters as
specified in Section 17 of the SARFAESI Act. The defendant
No.5 also claims that the suit is undervalued, as the plaintiff
has not valued the property on the sale consideration
mentioned in the sale deed sought to be cancelled. Therefore,
requested the Court to reject the plaint.
3. The respondent/plaintiff filed a counter affidavit,
denying the petition allegations. It is contended that the
defendant No.5 had already filed a written statement and was
now attempting to delay the proceedings by filing this petition.
The plaintiff alleged that her properties were sold based on
forged documents, and that defendant Nos. 1 to 4 had
colluded and committed fraud. It is also stated that a criminal
complaint was lodged against defendants 1 to 4 and plaintiff
also issued a legal notice to the bank on 01.04.2014,
requesting them not to finalize the sale. Despite this, the bank
executed a sale deed in favor of defendant No.5 on
11.04.2014. It is further stated that the bank officials were
complicit in the fraud and sold the property without proper
title, and the documents created by the defendants were
fraudulent, Section 17 of the SARFAESI Act is not applicable.
Therefore, the civil court had jurisdiction to try the suit. The
plaintiff contended that she valued the suit correctly and
sought cancellation of fraudulent documents. Hence,
requested the court to dismiss the petition. After hearing both
sides, the trial Court dismissed the petition.
4. Heard Sri R.A.Achuthanand, learned counsel for the
petitioner/defendant No.5 and Sri V.Ramu, learned counsel
for respondent No.1/plaintiff.
5. The contention of learned counsel for defendant No.5 is
that the plaintiff alleges that her name is Vangipurapu Anjani
Devi D/o.V.T.Krishna Rao, instead of Vangipurapu Anjani
Devi W/o.V.T.Krishna Rao, that she was living in
Visakhapatnam due to her employment. Her husband had
applied for a LRs application on 31.12.2012 and when he
visited Hyderabad in January 2014 to inquire about the LR
status, they came to know that there are certain entries in the
encumbrance of property records, revealing that defendant
No.1 had sold the property by executing a power of attorney in
favour of defendant No.2 on 16.07.2012 who in turn sold the
property to defendant No.3 on 31.10.2012. The plaintiff
alleged that defendant Nos.1 to 3 colluded to create fake
documents, and defendant No.4 extended loan to defendant
No.5 without following proper procedure. The plaintiff claims
that she is the rightful owner of the property and that a fraud
was committed to deprive her rights.
6. Learned counsel further contended that plaintiff filed a
suit seeking declaration of ownership, but defendant No.5 filed
a rejection application under Order VII Rule 11 (b), (c), and (d)
of Code of Civil Procedure (for short 'CPC'), contending that
the suit is undervalued, barred by law, and hopelessly time-
barred. Defendant No.5 contends that under the SARFAESI
Act, the sale certificate issued after the sale of property makes
the proceedings final, and the suit cannot be filed under
Section 34 of the SARFAESI Act. Further under Section 18 of
the SARFAESI Act, the proceedings relating to the sale
certificate cannot be questioned. The plaintiff's suit alleges
fraud, but fails to provide specific particulars as required
under Order VI Rule 4 of the CPC. The plaintiff claims that
defendant No.1 executed a power of attorney in favor of
defendant No.2, which led to creation of fake documents and
the sale of property to defendant No.3.
7. The plaintiff's suit seeks a declaration of ownership,
cancellation of the power of attorney, and cancellation of the
sale deeds executed by defendant Nos.2 and 3 in favor of
defendant Nos.4 and 5, respectively. The plaintiff also seeks
perpetual injunction, for which the defendant No.5 objects to
the suit, citing the sale certificate was issued by the bank
under the SARFAESI Act, which is registered and free from all
encumbrances, as provided under Rule 9 (6) of the SARFAESI
Rules. The Supreme Court has defined "free from
encumbrances" to mean that the property is vested in the
buyer without any charge or burden. In this case, the bank
has exercised its powers under Section 13 (4) of the SARFAESI
Act to take possession of the secured asset and sell it to
defendant No.5. The bank has followed the requisite
procedure under Section 13 (4) (1) of the SARFAESI Act, which
allows the secured creditor to bid for the immovable property
on behalf of the secured creditor at any subsequent sale. The
transfer of the secured asset to defendant No.5 vests all rights
in the transferee as if the transfer had been made by the
owner of the secured asset. The defendant No.5 contends that
the suit is barred by law, and the court lacks jurisdiction to
try the suit under Section 34 of the SARFAESI Act. This
section states that no civil court shall have jurisdiction to
entertain any suit or proceedings in respect of any matter that
a Debts Recovery Tribunal (DRT) or an Appellate Tribunal is
empowered to determine and no injunction shall be granted.
Learned counsel further contended that DRT has the power to
determine matters related to the sale of secured assets, and
the civil court cannot entertain suits or proceedings in respect
of such matters. It is also contended that the plaintiff failed to
exercise her right under Section 17 of the SARFAESI Act,
making the proceedings final. With regard to court fees, the
defendant No.5 submits that the plaintiff did not pay the
sufficient court fee for the relief sought. The plaintiff sought
declaration, cancellation of documents, and possession, but
did not pay separate court fees for each relief.
8. Learned counsel for defendant No.5 further contended
that the judgment relied on by the court below was relating to
a third-party declaration, which is not applicable to the
present case. The plaintiff is a party to the instrument and
seeks cancellation, so the court should have valued the relief
independently. As such, prayed this Court to set aside the
order impugned by allowing this revision.
9. On the other hand, learned counsel for the plaintiff filed
counter contending that suit is filed in the year 2014,
respondent Nos.2 to 4 herein were set exparte, the defendant
No.4 though filed written statement did not cross-examine her
and the defendant No.5 partly examined the plaintiff on
23.01.2020 and thereafter, filed the petition for rejection of
plaint only to delay the proceedings. Though the defendant
No.5 purchased the property in auction under the SARFAESI
Act, there is no bar for maintenance of suit. The specific
averment in the plaint that a fraud was played against the
plaintiff by the defendants and the documents are fabricated
and the Bank has extended loan to defendant No.3 on
fraudulent and created documents of defendant Nos.1 to 3,
the bank without considering the notice dated 01.04.2014 has
finalized the sale, thereby perpetuated the fraud in collusion
with defendant Nos.1 to 3 and plaintiff is neither directly or
remotely connected with the transactions that took place
between the defendants and plaintiff is victim in the hands of
defendants. It is further contended that a plain reading of
the plaint itself shows that fraud was played against the
plaintiff and respondents 2 to 5 sold the property basing on
impersonated documents. The investigation of police also
reveals that the addresses furnished by the defendants
including the pan cards are found to be fake. Even the
plaintiff made efforts to trace out the address of defendant
Nos.2 to 4 by approaching the municipal authorities and
income tax authorities through Right to Information Act and
the authorities responded that address are not in existence.
It is further contended that being effected party and owner of
the suit schedule property and in view of judgment of the Apex
Court in Mardia Chemicals Ltd., and others Vs Union of
Indian and others 1, wherein to a limited extent jurisdiction of
civil Court can also be invoked, where for example the action
of the secured creditor is alleged to be fraudulent or their
claim may be so absurd and untenable which may not require
any probe, whatsoever or to say precisely to the extent the
scope is permissible to bring an action in the civil Court in the
1 (2004) 4 Supreme Court Cases 311
cases of English Mortgages. Hence, there are no grounds to
reject the plaint and prayed to dismiss this revision petition.
10. Having regard to the submissions made by both the
counsel and the material on record, the contention of learned
counsel for defendant No.5 is that suit itself is not
maintainable, in view of the provisions of SARFAESI Act, the
civil Court has no jurisdiction in the matters of Debt Recovery
Tribunal under Sections 17, 18 and 34 of the SARFAESI Act
and under the Recovery of Debts Due to Banks and Financial
Institutions Act, 1993. In support of his contention, learned
counsel relied on the judgment in Chandrakant Kantilal
Jhaveri Vs Madhuriben Gautambhai 2, wherein suit is filed
for declaration of sale deed as null and void on the ground of
fraud, no particulars are mentioned to show fraud played by
the defendants and also relied on the judgment in Afsar
Sheikh and another Vs Soleman Bibi and Others 3, wherein
it is observed that 'undue influence', 'fraud',
'misrepresentation' are cognate vices and may, in part, overlap
in some cases, they are in law distinct categories, and are, in
view of Order VI Rule 4, read with Order VI Rule 2 of C.P.C,
2 2011 AIR (Gujarat) 27
3 (1976) 2 Supreme Court Cases 142
required to be separately pleaded with specificity, particularity
and preclusion. A general allegation in the plaint, that the
plaintiff was a simple old man of ninety who had reposed great
confidence in the defendant, was much too in-sufficient to
amount to an averment of undue influence.
11. In the present case the main contention of defendant
No.5 is that the suit is filed on the ground of fraud. No
particulars are mentioned in the plaint to show the fraud
played by defendants 1 to 4. When fraud is the ground for
filing suit, the particulars have to be mentioned. As such, the
suit is liable to be rejected. The other ground raised by
defendant No.5 is that as sale is confirmed under the
SARFAESI Act, the Civil Court has no jurisdiction to entertain
the suit.
12. Per contra, learned counsel for the respondent/plaintiff
would submit that the particulars are sufficient or not is not a
ground for rejection of plaint. Sufficient grounds are shown in
the plaint to prove fraud and it cannot be a ground for
rejection of plaint. The suit is at the stage of cross-
examination of Pw.1, the other defendants are already set ex
parte and only the defendant No.5 who is the petitioner
herein, is the contesting party, is also examined in part.
Therefore, there is no illegality in the order of trial Court.
13. The petition is filed by the defendant No.5 for rejection
of plaint on three grounds. The first ground is that though
suit is filed for cancellation of registered sale deed on the
ground of fraud, there are no recitals in the plaint to show
that fraud is played. Under Order VI Rule 4 of C.P.C, while
dealing with rejection of plaint the Court has to consider the
averments in the plaint. The plaint averments show that
without any right over the suit property, the defendants 1 to 3
played fraud and executed registered sale deed by
impersonating the signature of plaintiff. The plaintiff has also
filed a criminal case against the defendants for forging and
fabrication of documents. Therefore, the documents executed
by defendants 1 and 2 in favour of defendant No.3 are liable to
be cancelled. The Bank also without verifying the documents
gave loan and sold the property in auction which averments
pertains to the fraud played by defendants 1 to 3. Therefore,
there is no force in the said contention. The averment in the
plaint prima-facie shows required grounds to maintain the
suit and the contention defendant No.5 is not tenable. The
other contention of the defendant No.5 is that there is a bar of
jurisdiction under Section 18 of the SARFAESI Act. The
present suit is filed on the ground that there is fraud and in
view of the observations made in Mardia Chemicals Ltd.,
wherein it was held that when the action of secured creditor is
alleged to be fraudulent and untenable and when the
controversy is beyond the jurisdictional measures taken by
the Bank, the Civil Court can entertain the suit. Therefore,
suit cannot be rejected on the ground that it is barred by
jurisdiction in view of Section 18 of the SARFAESI Act. The
third contention of learned counsel for defendant No.5 that
the Court fee paid by the plaintiff is insufficient and on that
ground also suit is liable to be rejected, whereas, insufficient
court fee is a curable defect. If the trial Court comes to the
conclusion that the court fee paid by the plaintiff is
insufficient it can direct the party to deposit the insufficient
court fee and if plaintiff fails to obey the direction of the Court,
then it is liable for rejection. As such, that is also not a
ground to reject the plaint at this stage. Viewed from any
angle, there are no merits in this petition and the revision is
liable to be dismissed.
14. Accordingly, the Civil Revision Petition is dismissed. No
costs.
Miscellaneous petitions, pending, if any, shall stand
closed.
_______________
K. SUJANA, J
Date :19.03.2025
Rds
