Smt v. Anjana Devi Wo vs Tandava Krrshna Rao, Occ. Retired, R/o Visakhapatnam

Petition under Section 1 5'l CPC praying that in the orcumstances stated in the affidavit filed in support of the petition. the High Court may be pleased to Stay all further proceedings in pursuance to the orders passed on daleo 1710412019 in l.A. No.990 of 2018 in O.S.No.1703 of 2O14on the file of ll Additional Senior Civil Judge, Ranga Reddy District, pending disposal of the above CRP ./ Counsel for the Petitioner: SRl. R. A. ACHUTHANAND Counsel for the RespondentNo.l : SRI V. RAMU The Court made the following: ORDER f ,/, r) THE HONOURABLE SMT. JUSTICE K. SUJANA CTVIL REVISION PETITION No.385 of 2O2O ORDER: This Civil Revision petition is Iiled by the petitioner/ defendant No.5 aggrieved by the order dated

17.O4.2O19 passed in I.A.No.99O of 2O18 in O.S.No. t7O3 of 2074 on the hle of Il-Additional Senior Civil Judge, Ranga Reddy District. For the sake of convenience, the parties herein after referred to as arrayed in O.S.No. 170 3 of 2014.

2. The petitioner herein who is defendant No.5 in the suit contested the plaintiffs suit seeking declaration of title, cancellation of a General Power of Attorney (GpA), and sale deeds. The plaintiff claims ownership and possession of the propert5r, purchased from the Housing Sociery on 25.1 l. 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,). 2 It is contended that as per Section 34 of the SARFAESI Act the Civil Court lacks jurisdiction, as the auction became hnal and the bank issued a sale certihcate. Furthermore, Section 18 of the SARFAESI Act bars the Courts from trying the matters as specihed 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 ald was now attempting to delay the proceedings by hling this petition. The plaintiff alleged that her properties were sold based on forged docqments, and that defendant Nos. I 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.O4.2O14, requesting them not to fiialize the sale. Despite this, the bank executed a sale deed in favor of defendant No'5 on I1.O4.2O14. It is further stated that the bank ofhcials were ,/ 3 complicit in the fraud and sold the propert5r 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.S 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 oi 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 2Ol4 to inquire about the LR status, they came to know that there are certain entries in the encumbrance of property records, revealing that defendant 4 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 fi1ed a suit seeking declaration of ownership, but defendant No.S filed a rejection application under Order VII Rule 11 (b), (c), and (d) of Code of Civil Procedure (for short 'CPCJ, contending that the suit is undervalued, barred by law, and hopelessly time- barred. Defendant No.S contends that under the SARFAESI Act, the sale..certihcate issued after the sale of propert5r makes the proceedings final, and the suit cannot be filed under Section 34 of the SARFAESI Act. Further under Section 18 of the SAREAESI Act, the proceedings relating to the sale certihcate cannot be questioned' The plaintiffls suit alleges fraud, but fails to provide specifrc particulars as required under Order VI Rule 4 of the CPC. The plaintiff claims that ./ 5 defendant No.l executed a power of attorney in favor of defendant No.2, which led to creation of fake documents and the sale of propert5r to defendant No.3.

7. The plaintiff s suit seeks a declaration of ownership, cancellation of the power of attorney, and cancellation of the saie 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 certihcate 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 (a) of the SARFAESI Act to take possession of the secured asset and sell it to defendant No.5. The bank has foliowed 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.S vests a1l rights 6 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 shali 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 hnal. With regard to court fees, the defendant No.5 submits that the plaintiff did not pay the sufhcient 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.S further contended that the judgment relied on by the court below was relating to a third-part5r declaration, which is not applicable to the ,/ -7 a 7 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 Co;rrt 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 fi[ed written statement did not cross-examine her and the defendant No.5 partly examined the plaintiff on

23.O1.2O2O and thereafter, hled the petition for rejection of plaint only to delay the proceedings. Though the defendant No.S purchased the property in auction under the SARFAESI Act, there is no bar for maintenance of suit. The specihc 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 Ol.O4.2Ol4 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 8 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 othersl, 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 | (2OO4l 4 Supreme Court Cases 31 1 /., -/ 9 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 SARFAtrSI 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 Gautambhai2, wherein suit is hled 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 Others3, wherein is observed that hndue 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, , 201 1 AIR (Gujarat) 27 3 (1976]1 2 Supreme Court Cases 142 10 tr, required to be separately pleaded with specihcity, 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 hled 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 fiiing 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 conhrmed under the SARFAESI Act, the Civil Court has no jurisdiction to entertain ttre 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. Sufhcient 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 Rr. 1 , the other defendants are already set ex 11 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 fiied by the defendant No.S for rejection of plaint on three grounds. The hrst ground is that though suit is hled 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 aly right over the suit propert5r, the defendants 1 to 3 played fraud and executed registered sale deed by impersonating the signature of plaintiff. The plaintiff has also frled a criminal case against the defendants for forging and fabrication of documents. Therefore, the documents executed by defendanti 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 I to 3. Therefore, there is no force in the said contention. The averment in the plaint prima-facie shows required grounds to maintain the 12 d suit and the contention defendant No.S 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 Chenicals 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'S that the Court fee paid by the plaintiff is insufficient and on that ground also suit is liable to be rejected, whereas, insufhcient court fee is a curable defect. If the trial Court comes to the conclusion ' that the court fee paid by the plaintiff is insufhcient it can direct the part5z to deposit the insufhcient 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. 13

74. Accordingly, the Civil Revision petition is dismissed. No costs. closed Miscellaneous petitions, pending, if any, shall stand SD/- A.SREENIVASA R ASSISTANT REGI DY RAR , I I //TRUE COPY// SECTION OFFICER To

1. The ll Additional Senior Civil Judge, Ranga Reddy Oistrict 2. One CC to SRl. R. A. ACHUTHANAND, Advocate IOPUC] 3. One CC to SRl. V. RAMU, Advocate IOPUCI 4. Two CD Copies PSL HIGH COURT DATED:19/03/2025 OROER CRP.No.385 oI 2020 D I S N,I I S S IN (i T I I E C IV I I- I{EV I S I L]N-- P T,f n I ON b ( fi\ .'tA v :- :,4 I I \, ((.(' f ;i ,ipp ,* o \ \': (1 '{-.--*;