SARALA SRINATH Vs. M MUTHUSAMY

JUDGEMENT

(1.) THESE two appeals are directed against the common order dated 17. 12. 2004 passed by the learned Company Judge in Company Appln. Nos. 1170 and 1172 of 2004 arising out of Company Petition Nos. 233 to 238 of 1999.

(2.) COMPANY Petition Nos. 233 to 238 of 1999 were filed on 26. 7. 1999 for winding up of R. P. S. Benefit Fund Limited, a company registered under the Companies Act. By order dated 28. 6. 2004 in C. A. No. 287 of 2004, arising out of C. P. Nos. 233 to 238 of 1999, the learned Company Judge granted permission to effect paper publication for sale of 221. 5. 9 acres of land in Kancheepuram district. The present dispute relates to 4. 50 acres of land in Sirukaveripakkam and 12. 72 acres of land in Keelambi. Pursuant to the said order, sale notice was published on 21. 7. 2004. On 31. 8. 2004, two applications were filed by the present appellants. The affidavits in support of the applications were sworn to by Mr. Bhaskaran, who is the power of attorney holder of the applicant in C. A. No. 1170 of 2004 and the applicant himself in C. A. No. 1172 of 2004. The averments in the two applications are as follows:- One M. N. Rajaraman, the father of the two applicants, had invested Rs. 18,50,000/- in Nimmathi deposit in R. P. S. Benefit Fund Ltd. , as per several fixed deposits. Such deposits after maturity became due for payment by May, 1999, but, R. P. S. Benefit Fund Ltd. expressed its difficulty in paying the maturity value working out to Rs. 55,50,000/ -. The Company agreed to convey 16. 32 acres of land towards investment of Rs. 16,50,000/- and accordingly the Company executed an irrevocable power of attorney dated 28. 7. 1999 in favour of M. N. Rajaraman, authorizing him to sell the disputed properties. Accordingly, M. N. Rajaraman, as the power of attorney holder on behalf of the Company, has executed sale deeds between 9. 8. 1999 and 12. 8. 1999 in favour of the two applicants and the applicants were in possession after the sale deeds were executed in their favour. The applicants were surprised to see the advertisement dated 18. 8. 2004 indicating about the auction of various properties including the disputed properties. In C. A. No. 287 of 2004, the applicants have not been made parties and the Administrator without bothering to find out about the sale in favour of the applicants, which was much before the date on which the Administrator has sought permission to sell the property, had obtained the order from the Court, and therefore, such order dated 28. 6. 2004 should be recalled.

(3.) IN the common affidavit filed on behalf of the Administrator, it was indicated as follows: -The petition for winding up was filed on 26. 7. 1999 and the irrevocable power of attorney was executed by the then Vice President of the R. P. S. Benefit Fund Ltd. in favour of the applicants on 28. 7. 1999 and the sale deeds were executed between 9. 8. 1999 and 12. 8. 1999, and therefore, the sale deeds having been effected after presentation of the winding up petition, were void. The deposits were made by M. N. Rajaraman in the name of his son and daughter (Applicants ). At the time of execution of the sale deeds in August, 1999, only some of the fixed deposits had become matured, but not all the fixed deposits as alleged. Possession of the land was with the custodian and not with the applicants. The father of the applicants was a necessary party, but he had not been impleaded. The power of attorney in favour of M. N. Rajaraman was executed by the then Vice President, who had no authority to execute such power of attorney on behalf of the company. The power of attorney was nothing but a fraudulent preference to defeat the other creditors and depositors of the company. Pursuant to the direction issued by the Court in C. A. No. 287 of 2004, first paper publication was made on 20. 3. 2004 and at that time an offer was made, but such offer had been rejected by the Court and thereafter, the subsequent paper publication was effected. Even though the value of the property was much higher, the applicants want to grab the property for a lesser amount. Paper publication was effected after obtaining a report from Mr. Y. Thyagrajan, who was appointed as Administrator for Kancheepuram farm lands and in the report dated 18. 8. 2000, he had indicated that there was no encumbrance over the properties. It was further indicated that -. . . negotiation process of selling of the property is yet another device adopted by the former Chairman, Mr. P. G. Saranyan to sell the company-s properties for a very low consideration on paper and to receive the secret balance of the market value by collecting the same in cash, thereby cheating the company and committing fraudulent preference to defeat the rights of other depositors and creditors of the company.-