Mrs.Rosline v. The Official Assignee

IN THE HIGH COURT OF JUDICATURE AT MADRAS

DATED: 01.11.2016

CORAM

THE HON'BLE MR.SANJAY KISHAN KAUL, CHIEF JUSTICE and THE HON'BLE MR. JUSTICE R.MAHADEVAN O.S.A.Nos.154 to 156 of 2015 O.S.A.No.154 of 2015:

Rosline .. Appellant vs 1.The Official Assignee, High Court, Madras.

2.S.M.Maria Dorch .. Respondents O.S.A.Nos.155 & 156 of 2015:

Rosline .. Appellant vs 1.The Official Assignee, High Court, Madras.

2.S.M.Maria Dorch 3.Annie Medona .. Respondents Original Side Appeals filed under Order XXXVI, Rule 9 of Original Side Rules read with Clause 15 of Letters Patent against the order in Application Nos.256 of 2013; 141 of 2013 & 119 of 2014 in I.P.No.94 of 2010, dated 01.06.2015. Application No.256 of 2013: Application praying to issue appropriate directions to the 1st Respondent to execute and register a sale Deed in respect of the property morefully described in the schedule to the judges summons in farom of the applicant. Application No.141 of 2013: Application praying to grant stay of the public auction fixed on 27.08.2013 in respect of the property morefully described in the schedule to the Judges summons.

Application No.119 of 2014: Application praying to condone the

delay of 1247 days in filing the petition to setaside the adjudication order dated 21.10.2010.

For Appellant .. Mr.V. Ayyadurai For Respondents .. Mr.K.V.Ananthakrushnan for R1 Mr.T.Mohan for M/s.A.Suresh Sakthi Murugan for R2 COMMON JUDGMENT (Judgment of the Court was delivered by The Hon'ble Chief Justice) Ms.S.M.Maria Dorch, respondent No.2, an employee of ONGC, contrary to the terms of the engagement with its employer, apparently engaged in business, ran into losses and then claimed insolvency. We may note that ONGC had issued an office memo to the second respondent and major penalty proceedings were initiated, resulting ultimately in imposition of major penalty of reduction to a lower stage of pay for a period of four years without yearly increments during that period and on expiry of such period, the reduction not to have the effect of postponing his future increments.

2. The aforesaid, ofcourse, is another story, as we are concerned with the effect of adjudication of the second respondent and his wife as Insolvents. This adjudication order dated 21.10.2010 was sought to be recalled by the appellant on account of it having a direct impact on her by reason of the proposed action of the sale of the property of the second respondent, being house plot No.J-10, admeasuring 2400 square feet situated at First Cross Street, Govindan Nagar, Palavakkam, Chennai, against which the loan is stated to have been raised. The second respondent having come into debt which he could not repay, agreed to sell the property to the wife of the tenant in that property under agreement to sell dated 06.1.2010. It is the case of the appellant that out of the stated consideration in the agreement of Rs.80.00 lakhs, Rs.69.

00 lakhs was paid and she was put in possession (husband was already in possession) and the endeavour to pay the balance amount of Rs.11.00 lakhs by a Bank Draft dated 04.2.2010 was wilfully refused. In fact, the case of the appellant is that the second respondent, in order to defeat the effect of the agreement, has claimed insolvency alleging various creditors. This application was however filed with a delay of 1247 days, which was sought to be condoned. The application for condonation of the delay has been dismissed by the impugned order dated 01.6.2015, where it was found that there is lack of sufficient grounds to condone the delay.

3. We are informed that a suit for specific performance was filed by the appellant in January, 2011 itself, which was now numbered as C.S.No.397 of 2013. Thus, the lis inter se the parties qua the effect of entering into an agreement for sale was already pending for quite some time, though it is post the adjudication order dated 21.10.2010. We are also informed that the Official Assignee has now been impleaded as a party in the suit, which is listed for settlement of Issues.

4. The learned counsel appearing for the Official Assignee really does not seriously dispute that the trial of the suit for specific performance can adjudicate the controversy in so far as the property is concerned, a submission made by the learned Senior Counsel for the appellant at the inception itself. Thus, it is the submission of the learned counsel for the Official Assignee that all the defences as are available in law will be taken before the suit Court.

5. Surprisingly, the opposition has come from the learned counsel for the second respondent, the creator of the problem. It is his submission that the appellant having invoked the jurisdiction seeking recall of the adjudication order and seeking relief of registration of the sale deed in her favour, the application for condonation of delay having been dismissed, there was no sufficient cause shown or being shown even now to set aside the said order and that too, in an appeal.

6. On hearing the learned counsel for parties, we are of the view that the adjudication has only been on the issue of condonation of the delay in seeking recall of the adjudication order. No doubt, some observations on merits have been made. But in our view, they can hardly prejudice the trial of the suit. The second respondent having pocketed Rs.69.00 lakhs for liquidation of his debts now really seeks to oust the appellant to stand in a queue along with the so called other creditors possibly to get a portion of that amount, while simultaneously being deprived of the property.

7. We cannot accept this plea and we are unequivocally of the view that the rights of the appellant should actually be determined in the suit filed by her, in which both the respondents are parties and the issue arising from the suit can be claimed therein.

8. We, thus, dispose of the appeals in the aforesaid terms, leaving the parties to bear their own costs.

Sd/- Assistant Registrar //True Copy// Sub Assistant Registrar bbr To The Sub Assistant Registrar, Original Side, High Court, Madras.

+2cc to Mr. V. Ayyadurai , Advocate, S.R.No.61836 +1cc to Mr.King and partridge, Advocate, S.R.No.61978 +1cc to Mr. A. Suresh Askthu Murugan, Advocate SR.No.62444 +1cc to Mr. K.V. Ananthakrushnan, Advocate Sr.No.61840 (28/12/2016) sai (CO) md (09/11/2016) O.S.A.NoS. 154 to 156 of 2015