P.K.Sengodan v. The Branch Manager

IN THE HIGH COURT OF JUDICATURE AT MADRAS DATE : 06.07.2011CORAMTHE HONOURABLE MR. JUSTICE A.ARUMUGHASWAMYA.S. NO. 469 OF 2008P.K.Sengodan.. Appellant/Plaintiff- Vs -1. The Branch Manager Tamil Nadu Industrial Investment Corporation Ltd. Dr. Sankaran Road Namakkal.2. The Divisional Manager Special Recovery Branch Tamil Nadu Industrial Investment Corporation Ltd. Door No.3/3, Valmiki Street Subramanian Nagar Salem Town... Respondents/DefendantsAppeal filed under section 96 of CPC against the judgment anddecree dated 28th Sept., 2007, made by the Additional District Judge,Fast Track Court, Namakkal in O.S. No.234 of 2004. For Petitioner : Mr. R.SubramanianFor Respondents: Mr. R.P.Kabilan, SC, for M/s. R.KrishnaswamiJUDGMENTThe plaintiff filed the suit for specific performance against thedefendants for the relief of sale of the land as shown in thedescription, i.e., 15,788 sq.ft., together with an ACC superstructuremeasuring 1140 sq.ft. for a sum of Rs.5,43,107/-. The suit has beenfiled by the plaintiff on the strength that he was the successfulbidder in the auction, for an amount of Rs.7,25,000/=. According tothe plaintiff, he has also paid the 10% amount, i.e., Rs.72,500/=immediately and the balance amount was to be paid within a period of30 days therefrom. However, after bidding in the auction, theplaintiff applied for an encumbrance certificate, which showed thatthere is an encumbrance of an extent of 5300 sq.ft., which has beenear-marked for public purpose and that the plaintiff would be soldonly the balance portion of 15788 sq.ft. However, the said fact was https://hcservices.ecourts.gov.in/hcservices/ not mentioned in the publication and, since there wasmisrepresentation in the publication, the plaintiff filed the suitpraying for a decree for specific performance of sale of 15,788sq.ft. alone for a total sale consideration of Rs.5,43,107/=.2. The defendant contended the suit stating that the plaintiffcannot contend that he can pay only for 15788 sq.ft., as he haspurchased the land in public auction. Further, the plaintiff has notpaid the balance bid amount within the time stipulated and,therefore, cannot raise the plea that he cannot be asked to pay forthe 5300 sq.ft., area that has been ear-marked for public purpose.It was also contended that the publication carries the informationthat the land is being auctioned in 'as is where is' condition andthe plaintiff should have satisfied himself before bidding in theauction and cannot at a later stage contend that he cannot be made topay for the 5300 sq.ft. of area, which has been ear-marked for publicpurpose, as he has purchased the land in the public auction. Hence,it was contended that the suit has to be dismissed and the judgmentand decree of the trial court has to be confirmed.3. On the side of the plaintiff, P.W.s 1 and 2 were examined andExs.A-1 to A-12 were marked. The defendants examined D.W.1 andmarked Exs.B-1 to B-4. Witness exhibits X-1 and X-2 were alsomarked. On the basis of both oral and documentary evidence, thetrial court dismissed the suit against which the plaintiff haspreferred the present appeal.4. The point that arises for consideration in this appeal is :-“If the publication is a misconceived one, whetherthe plaintiff is entitled for the relief of specificperformance less 5300 sq.ft. of land out of the totalextent of 21088 sq.ft.?”5. The plaintiff is the appellant. It is not in dispute that thedefendant advanced loan to the company, M/s.Shine Granites and theowner of the property is the guarantor for the said debt.Publication was issued by the defendant for auctioning the propertyof an extent of 21088 sq.ft., along with a superstructure of 1140sq.ft., The said publication as well as the terms and conditions setforth in the publication are not in dispute. It is also not indispute that the plaintiff was the successful bidder for an amount ofRs.7,25,000/=, out of which he deposited Rs.72,500/=, being the 10%amount to be paid on confirmation of the bid and the balance amountto be paid within 30 days therefrom.6. It is vehemently contended by the appellant that since thepublication misrepresented the facts as if the entire extent of 21088sq.ft., is to be sold, though the actual extent to be sold is only15788 sq.ft., and 5300 sq.ft. is ear-marked for public purpose, theplaintiff cannot be made to pay the sale consideration for the entireextent, rather the plaintiff should be allowed to pay only for theextent of 15788 sq.ft., which the trial court lost sight of and,therefore, the appeal has to be allowed. https://hcservices.ecourts.gov.in/hcservices/

7. On the other hand, learned senior counsel appearing for thedefendant/respondent contended that publication has been effected,wherein one of the terms mentioned is 'as is where is' condition.Knowing fully well about such terms, the plaintiff participated inthe auction where he was the successful bidder and he havingdeposited 10% of the amount, he should have deposited the balanceamount within the stipulated time of 30 days, which he failed to doand, therefore, now he cannot seek remedy that he be allowed to payonly for the extent of 15788 sq.ft.. Further, the auction being apublic auction, the prayer of the plaintiff cannot be acceded to andfor violation of the terms and conditions the respondent was right inforfeiting the amount and, therefore, he prayed that the appeal bedismissed and the judgment and decree of the trial court be confirmed.8. Heard the learned counsel appearing on either side and perusedthe materials available on record.9. As already noticed above, the terms and conditions as shown inthe publication are not disputed. It is also admitted by either sidethat the guarantor is not the owner of the entire extent of 21088sq.ft., while he is the owner only in respect of an extent of 15788sq.ft. along with a superstructure measuring 1140 sq.ft., the balanceof 5300 sq.ft., has been ear-marked for public purpose. Therefore,it is clear from the above that the extent mentioned in thepublication is not a correct one. It is also clear from thepleadings as well as the evidence that the guarantor is entitled onlyfor an extent of 15788 sq.ft. of land and not the whole 21088 sq.ft.As submitted by the learned counsel for the appellant, the respondentbeing a public undertaking is expected to publish correctfacts/details as to the extent of area of the property to beauctioned and cannot publish fanciful details to attract the biddersfor the purpose of obtaining higher bid. However, it is clear fromthe records that the respondent was also not aware of the actual factthat 5300 sq.ft. was ear-marked for public purpose, due to which ithas published the entire extent as the available area of theguarantor, though the guarantor is entitled for 15788 sq.ft. alone. 10. Be that as it may. The plaintiff, with open eyes, withoutascertaining the actual extent of the property for the seventh time,participated in the auction and was the successful bidder. Onlythereafter, based on Ex.P-7, encumbrance certificate, he came to knowabout the actual extent of the property and sought to make paymentonly for the reduced extent of 15788 sq.ft., which the respondentrefused, as the appellant purchased the property in public auctionand that the respondent has no authority to accept a lesser price forthe lesser extent of land. In the above background, neither therespondent nor the guarantor can be held responsible. It is for theauction purchaser to be aware of the encumbrance made and the 1st and2nd respondent cannot in any way certify as to the title of theguarantor's property. https://hcservices.ecourts.gov.in/hcservices/

11. Finding : Accordingly, the point is answered against theappellant/plaintiff, that he is not entitled for the relief ofspecific performance for lesser extent as indicted above.11. On a careful consideration of all the above aspects, findingno infirmity with the judgment and decree of the trial court, thisCourt holds that no interference is called for with the impugnedjudgment. However, as the respondent has given the wrong extent ofarea in the publication, which has led to this adjudication, they arenot entitled for any costs. Further a perusal of the records it isseen that the court fee paid by the plaintiff also is not inaccordance with Section 42 of the Tamil Nadu Court Fees Act.However, at this stage, this Court is not inclined to go into thesame. With the aforesaid observations, this appeal is dismissed.However, there will be no order as to costs. Sd/ Deputy Registrar/true copy/Sub Asst.Registrar GLNTo1. The Additional District Judge,(Fast Track Court) Namakkal1 cc To M/s.R.Subramanian, Advocate, SR.400941 cc To Mr.R.P.Kabilan, Advocate, SR.40115 A.S. NO. 469 OF 2008KSK (CO)RH (8.8.11)