Sadhu Ram Gupta and Ors vs.golden Forests India Limited - Court Judgment

SooperKanoon Citationsooperkanoon.com/1204369
CourtDelhi High Court
Decided OnNov-24-2016
AppellantSadhu Ram Gupta and Ors
RespondentGolden Forests India Limited
Excerpt:
$~11 * in the high court of delhi at new delhi decided on:24. 11.2016 % + w.p. (c) 219/2016, cm appl.884/2016 sadhu ram gupta and ors ........ petitioners through: ms. anjana gosain with mr. pradeep desodaya and mr. rahul singhal, advocates. versus golden forests india limited ..... respondent through: ms. suruchi aggarwal, advocate for committee-gfil. coram: hon'ble mr. justice s. ravindra bhat hon'ble mr. justice najmi waziri s.ravindra bhat, j.(oral) 1. the writ petitioner seeks a direction for the quashing of the order/decision of the committee for golden forests (india) ltd. group of companies which had been constituted by the supreme court in terms of its orders. these proceedings emanate from the writ petition preferred in the supreme court which was ultimately transferred to the file of this court for further proceedings.2. the petitioner claims ownership of house no.570, sector-12, panchkula, haryana which he purchased through a sale deed dated 09.02.2010. briefly, the property was originally allotted by haryana urban development authority (huda) to lt. col. thakur chander raj for an w.p.(c)219/2016 page 1 allotment price of `30,451/-; conveyance deed dated 22.03.1988 was executed by huda in that regard. the property was later sold to shri amrit lal syal, the grandfather of nikhil syal and madhurima syal on 11.02.1994 for a consideration of `1,95,000/-. the petitioner relies upon the non- encumbrance certificate dated 22.09.2009 issued by the huda to state that title of the property was clear. in the meanwhile, the committee for gfil had on 5.2.2010 written to the huda authorities stating that the real owner of the property was gfil and that no further steps towards conveyance/registration ought to be taken. the petitioner had earlier approached this court by filing w.p.(c)1502/2011 whereby a direction was sought to the committee not to obstruct in the registration of the property. on that occasion, this court had by an elaborate order relegated the matter for a considered decision by the committee. the court disposed of that writ petition with a direction that the committee for gfil should examine the matter and the evidence and particularly orally examine nikhil and madhurima syal before pronouncing its verdict. the relevant portion of the court’s order disposing of the writ petition reads as follows: on the contrary, the counsel for the petitioners has argued that the petitioners are the bona fide purchasers of the property aforesaid for value and are already the owners thereof by virtue of the sale deed executed in their favour and are in possession of the property and were constrained to move this petition only for the reason of the mutation of the property in their favour having been held up owing to the objection raised by gfc. it is further submitted that the petitioners would be unable to prove the source of consideration for purchase of property by sh. nikhil kant syal and ms. madhurima syal. it is further contended that since gfc is now in control and custody of books of account and records of gfil and its other associate companies, gfc ought to have produced proof of w.p.(c)219/2016 page 2 consideration for purchase of the said property in the name of sh. nikhil kant syal and ms. madhurima syal having flowed from the coffers of the company.10. mr. shailendra bhardwaj, the counsel for the ex- management of the gfil states that a copy of the petition should be directed to be given to him and the ex-management be permitted to file a reply to the application.11. we however find that the gfc in the present case has not had an opportunity to adjudicate the claim of the petitioners and to return its findings thereon. mr. h.k. arora, advocate for the gfc states that the occasion therefor did not arise since the petitioners instead of approaching the gfc, chose to directly file this writ petition in this court.12. this court is to only exercise the powers of review over the decisions / orders of the gfc. in the present case there is none. we are of the view that instead of this court adjudicating the said claims, it is appropriate in the first instance that the gfc looks into the matter and considers whether there is any occasion for treating the property aforesaid as the property of gfil or its associate companies. only if it so found, would the gfc be entitled to object to the mutation of the property in the name of the petitioners. as far as the request of the ex- management is concerned, we direct the ex-management of gfil also to participate in the inquiry to be so conducted by the gfc and if the stand of the exmanagement is that the property aforesaid belonged to sh. nikhil kant syal and ms. madhurima syal and gfil and its associate companies have nothing to do with it, to submit proof thereof before the gfc.13. the petition is accordingly disposed of with the direction aforesaid and with a further direction to the petitioners to make their claim / representation before the gfc within 15 days of today and the gfc to decide and pass a reasoned order on the said application / representation within two months thereof.” w.p.(c)219/2016 page 3 3. subsequent to the order by the court, the committee conducted hearings, called for the records from state bank of india and examined the depositions of nikhil syal. on the basis of these materials, the committee concluded that the syals had not been able to establish through any concrete evidence that the money used for purchasing the property by amrit lal syal was not from the account of the gfil group of companies and that in spite of state bank of india’s statement that none of its old records were available, the inference to be drawn was that the gfil group of companies’ monies were used for the purchase of the property by amrit lal syal. on the basis of these conclusions, the committee for gfil held that the property belonged to the erstwhile gfil group and, therefore, the transfer in favour of the petitioner could not be operative.4. it is argued that the basis for the committee’s conclusions that nikhil and madhurima syal who were at that stage minors could not have legitimately given the ownership of the property; it is based entirely on conjectures. learned counsel urges that the inference drawn on the basis of absence of records pertaining to the account from which consideration for the property was paid and rbi circular which barred issuance of demand draft beyond `50,000/- if they were cash based, could not be conclusive for findings that in fact the ownership of the property was that of the gfil group of companies. learned counsel also relied upon the provisions of section 3 and 4 of the benami transactions (prohibition) act, 1988 to submit that even if it were to be assumed that the monies were not paid by nikhil and madhurima syal, there was no legal method whereby it could be said to have been owned by the gfil group of companies; in any case there was no evidence to that effect. w.p.(c)219/2016 page 4 5. counsel for the committee of gfil urged that this court should sustain the findings and also stated that the absence of any evidence to connect the payment of sale consideration for the property in 1994 as well as the prohibition in the rbi circular conclusively established that the consideration in fact was paid by the gfil group of companies. in these circumstances, this asset would have to be treated as one belonging to the company pool of the gfil group of companies which could not have been transferred or sold in the year 2010.6. it is quite evident from the above narration that the property was purchased by the original allottee in the year 1988; it was conveyed to the grandfather of nikhil and madhurima syal in the year 1994. ordinarily as to whether this finding of title was valid or whether the ownership vested with amrit lal syal would be a matter that could be agitated by the civil court through appropriate declaratory suit.7. however, the added peculiarity in this case is that since the committee had laid claim on the property not on the basis of the title vesting with the company itself but on the basis that some alternative director’s children are owners, it assumed jurisdiction. the order of this court in the previous writ petition is quite clear that unlike in the case of properties owned by gfil group of companies or those directly connected with its directors etc or those empowered to have held on its behalf such as power of attorney holders, the transaction here took place much before the events that led to the winding up proceedings i.e., 23.09.1998. the earliest order of injunction against the gfil group of companies was made on 23.09.1998; this was confirmed later by two orders of the supreme court. w.p.(c)219/2016 page 5 8. it is not in dispute that the owners of the property were in continuous possession and continuation of unchallenged possession of the property for a period of 16 years, i.e., 1994-2010, they held it as owners and as against the entire world. therefore, the question of whether they had originally the good title or the subsequently prescribed title too would be in issue. undoubtedly, this court had required the committee to examine the materials and conclude in one way or the other whether the petitioner is a bona fide subsequent purchaser who could be said to have a valid title. at the same time, that determination in the opinion of the court would only be tentative. that itself would not mean that the matter is conclusive because the committee has been only empowered to examine the claim vis-a-vis company properties - whether this property could be said to have ever been part of the company’s assets is itself in the opinion of this court indeterminate. the order of the committee impugned in this case shall in no manner be treated as conclusive as regards the question of validity of the petitioner’s title.9. in these peculiar circumstances, the court is of the opinion that the petitioner is at liberty to agitate the issue of title through appropriate declaratory suit before the court of competent jurisdiction. in the event, the petitioner or any individual acting on his behalf does file such suit, the proceedings should implead the committee for gfil and such other parties as are essential for fuller adjudication. since the petitioners were agitating their claims continuously before this court for almost five years’ period, first by filing w.p.(c)1502/2011 and further with another directions dated 11.8.2014 in w.p.(c)411/2014, the court is also of the opinion that if a suit is filed within six weeks, the court may consider the question of applying w.p.(c)219/2016 page 6 section 14 of the limitation act reasonably having regard to overall circumstances.10. the writ petition is disposed of in the above terms.11. all rights and contentions of the parties are kept open. s. ravindra bhat (judge) najmi waziri (judge) november24 2016 /vikas/ w.p.(c)219/2016 page 7
Judgment:

$~11 * IN THE HIGH COURT OF DELHI AT NEW DELHI DECIDED ON:

24. 11.2016 % + W.P. (C) 219/2016, CM APPL.884/2016 SADHU RAM GUPTA AND ORS ........ Petitioner

s Through: Ms. Anjana Gosain with Mr. Pradeep Desodaya and Mr. Rahul Singhal, Advocates. versus GOLDEN FORESTS INDIA LIMITED ..... Respondent Through: Ms. Suruchi Aggarwal, Advocate for Committee-GFIL. CORAM: HON'BLE MR. JUSTICE S. RAVINDRA BHAT HON'BLE MR. JUSTICE NAJMI WAZIRI S.RAVINDRA BHAT, J.(ORAL) 1. The writ petitioner seeks a direction for the quashing of the order/decision of the Committee for Golden Forests (India) Ltd. group of companies which had been constituted by the Supreme Court in terms of its orders. These proceedings emanate from the writ petition preferred in the Supreme Court which was ultimately transferred to the file of this Court for further proceedings.

2. The petitioner claims ownership of House No.570, Sector-12, Panchkula, Haryana which he purchased through a sale deed dated 09.02.2010. Briefly, the property was originally allotted by Haryana Urban Development Authority (HUDA) to Lt. Col. Thakur Chander Raj for an W.P.(C)219/2016 Page 1 allotment price of `30,451/-; conveyance deed dated 22.03.1988 was executed by HUDA in that regard. The property was later sold to Shri Amrit Lal Syal, the grandfather of Nikhil Syal and Madhurima Syal on 11.02.1994 for a consideration of `1,95,000/-. The petitioner relies upon the Non- Encumbrance Certificate dated 22.09.2009 issued by the HUDA to state that title of the property was clear. In the meanwhile, the Committee for GFIL had on 5.2.2010 written to the HUDA authorities stating that the real owner of the property was GFIL and that no further steps towards conveyance/registration ought to be taken. The petitioner had earlier approached this Court by filing W.P.(C)1502/2011 whereby a direction was sought to the Committee not to obstruct in the registration of the property. On that occasion, this Court had by an elaborate order relegated the matter for a considered decision by the Committee. The Court disposed of that writ petition with a direction that the Committee for GFIL should examine the matter and the evidence and particularly orally examine Nikhil and Madhurima Syal before pronouncing its verdict. The relevant portion of the Court’s order disposing of the writ petition reads as follows:

On the contrary, the counsel for the petitioners has argued that the petitioners are the bona fide purchasers of the property aforesaid for value and are already the owners thereof by virtue of the Sale Deed executed in their favour and are in possession of the property and were constrained to move this petition only for the reason of the mutation of the property in their favour having been held up owing to the objection raised by GFC. It is further submitted that the petitioners would be unable to prove the source of consideration for purchase of property by Sh. Nikhil Kant Syal and Ms. Madhurima Syal. It is further contended that since GFC is now in control and custody of books of account and records of GFIL and its other associate companies, GFC ought to have produced proof of W.P.(C)219/2016 Page 2 consideration for purchase of the said property in the name of Sh. Nikhil Kant Syal and Ms. Madhurima Syal having flowed from the coffers of the company.

10. Mr. Shailendra Bhardwaj, the counsel for the ex- management of the GFIL states that a copy of the petition should be directed to be given to him and the ex-management be permitted to file a reply to the application.

11. We however find that the GFC in the present case has not had an opportunity to adjudicate the claim of the petitioners and to return its findings thereon. Mr. H.K. Arora, Advocate for the GFC states that the occasion therefor did not arise since the petitioners instead of approaching the GFC, chose to directly file this writ petition in this Court.

12. This Court is to only exercise the powers of review over the decisions / orders of the GFC. In the present case there is none. We are of the view that instead of this Court adjudicating the said claims, it is appropriate in the first instance that the GFC looks into the matter and considers whether there is any occasion for treating the property aforesaid as the property of GFIL or its associate companies. Only if it so found, would the GFC be entitled to object to the mutation of the property in the name of the petitioners. As far as the request of the ex- management is concerned, we direct the ex-management of GFIL also to participate in the inquiry to be so conducted by the GFC and if the stand of the exmanagement is that the property aforesaid belonged to Sh. Nikhil Kant Syal and Ms. Madhurima Syal and GFIL and its associate companies have nothing to do with it, to submit proof thereof before the GFC.

13. The petition is accordingly disposed of with the direction aforesaid and with a further direction to the petitioners to make their claim / representation before the GFC within 15 days of today and the GFC to decide and pass a reasoned order on the said application / representation within two months thereof.” W.P.(C)219/2016 Page 3 3. Subsequent to the order by the Court, the Committee conducted hearings, called for the records from State Bank of India and examined the depositions of Nikhil Syal. On the basis of these materials, the Committee concluded that the Syals had not been able to establish through any concrete evidence that the money used for purchasing the property by Amrit Lal Syal was not from the account of the GFIL group of companies and that in spite of State Bank of India’s statement that none of its old records were available, the inference to be drawn was that the GFIL group of companies’ monies were used for the purchase of the property by Amrit Lal Syal. On the basis of these conclusions, the Committee for GFIL held that the property belonged to the erstwhile GFIL group and, therefore, the transfer in favour of the petitioner could not be operative.

4. It is argued that the basis for the Committee’s conclusions that Nikhil and Madhurima Syal who were at that stage minors could not have legitimately given the ownership of the property; it is based entirely on conjectures. Learned counsel urges that the inference drawn on the basis of absence of records pertaining to the account from which consideration for the property was paid and RBI Circular which barred issuance of demand draft beyond `50,000/- if they were cash based, could not be conclusive for findings that in fact the ownership of the property was that of the GFIL group of companies. Learned counsel also relied upon the provisions of Section 3 and 4 of the Benami Transactions (Prohibition) Act, 1988 to submit that even if it were to be assumed that the monies were not paid by Nikhil and Madhurima Syal, there was no legal method whereby it could be said to have been owned by the GFIL group of companies; in any case there was no evidence to that effect. W.P.(C)219/2016 Page 4 5. Counsel for the Committee of GFIL urged that this Court should sustain the findings and also stated that the absence of any evidence to connect the payment of sale consideration for the property in 1994 as well as the prohibition in the RBI Circular conclusively established that the consideration in fact was paid by the GFIL group of companies. In these circumstances, this asset would have to be treated as one belonging to the company pool of the GFIL group of companies which could not have been transferred or sold in the year 2010.

6. It is quite evident from the above narration that the property was purchased by the original allottee in the year 1988; it was conveyed to the grandfather of Nikhil and Madhurima Syal in the year 1994. Ordinarily as to whether this finding of title was valid or whether the ownership vested with Amrit Lal Syal would be a matter that could be agitated by the Civil Court through appropriate declaratory suit.

7. However, the added peculiarity in this case is that since the Committee had laid claim on the property not on the basis of the title vesting with the company itself but on the basis that some alternative Director’s children are owners, it assumed jurisdiction. The order of this Court in the previous writ petition is quite clear that unlike in the case of properties owned by GFIL group of companies or those directly connected with its Directors etc or those empowered to have held on its behalf such as Power of Attorney holders, the transaction here took place much before the events that led to the winding up proceedings i.e., 23.09.1998. The earliest order of injunction against the GFIL group of companies was made on 23.09.1998; this was confirmed later by two orders of the Supreme Court. W.P.(C)219/2016 Page 5 8. It is not in dispute that the owners of the property were in continuous possession and continuation of unchallenged possession of the property for a period of 16 years, i.e., 1994-2010, they held it as owners and as against the entire world. Therefore, the question of whether they had originally the good title or the subsequently prescribed title too would be in issue. Undoubtedly, this Court had required the Committee to examine the materials and conclude in one way or the other whether the petitioner is a bona fide subsequent purchaser who could be said to have a valid title. At the same time, that determination in the opinion of the Court would only be tentative. That itself would not mean that the matter is conclusive because the Committee has been only empowered to examine the claim vis-a-vis company properties - whether this property could be said to have ever been part of the company’s assets is itself in the opinion of this Court indeterminate. The order of the Committee impugned in this case shall in no manner be treated as conclusive as regards the question of validity of the petitioner’s title.

9. In these peculiar circumstances, the Court is of the opinion that the petitioner is at liberty to agitate the issue of title through appropriate declaratory suit before the court of competent jurisdiction. In the event, the petitioner or any individual acting on his behalf does file such suit, the proceedings should implead the Committee for GFIL and such other parties as are essential for fuller adjudication. Since the petitioners were agitating their claims continuously before this Court for almost five years’ period, first by filing W.P.(C)1502/2011 and further with another directions dated 11.8.2014 in W.P.(C)411/2014, the Court is also of the opinion that if a suit is filed within six weeks, the court may consider the question of applying W.P.(C)219/2016 Page 6 Section 14 of the Limitation Act reasonably having regard to overall circumstances.

10. The writ petition is disposed of in the above terms.

11. All rights and contentions of the parties are kept open. S. RAVINDRA BHAT (JUDGE) NAJMI WAZIRI (JUDGE) NOVEMBER24 2016 /vikas/ W.P.(C)219/2016 Page 7