CENTRAL BANK OF INDIA Vs. STATE OF GOA

JUDGEMENT

(1.) THIS appeal is directed against the judgment of the learned Addl. District Judge, South Goa, Margao, dated 22nd June, 1989 in Civil Suit No. 15 of 1982, filed by the appellant against the respondents and Union of India who was defendant No. 1 in the said suit, whereby the learned Judge has dismissed the suit with costs. The appellant had filed the suit for permanent injunction against respondents No. 1, 2 and 3 as well as the Union of India, seeking to restrain them from selling the movables belonging to respondent No. 3 which had been attached by the remaining respondents. It was the appellants case that the respondent No. 3 had obtained a loan from them to the tune of Rs. 1. 71 crores as on 31-3-1982 by giving security of its entire assets by way of mortgage of immovable properties and hypothecation of these properties. The respondent No. 3 had also hypothecated goods manufactured or in transit in its units. However, the respondent No. 2 has attached some of these goods for recovery of Sales Tax dues by the respondent No. 3 as mentioned in the plaint under the Sales Tax Act and the sale by auction of these goods was fixed on 6-7-1982. It was further stated that the appellant had filed objections before the said respondent No. 2 and the hearing was fixed on 5-7-1982. According to the appellant the movables which had been attached were covered by advance of Rs. 6 lakhs and necessary charge has been registered in respect of the same under the Companies Act, 1956. The movables attached were also covered by hypothecation agreement between the appellant and respondent No. 3. It was further contended that their claim being a secured claim, the Governments claim towards Sales Tax arrears does not get precedence over the claim of the appellant and as such the attachment was bad in law and not binding on the appellant. Hence they prayed for injunction to the restrain the respondent No. 1 and 2 from selling the attached movables in auction.

(2.) THE respondents resisted the suit by claiming that the attached goods were not covered under the agreement of hypothecation dated 30-7-1975 and that it was for the appellant to prove that their claim was secured. It was also contended that the same could be determined by the Mamlatdar as required under section 159 of the Land Revenue Code (hereinafter called the Code) in respect of the objections filed by the appellant. Therefore, according to the respondent the suit was premature since it could not be instituted without awaiting the order of the said inquiry under section 159 of the Code which was going on consequent upon the objections raised by the appellant. It was thus contended that the Court could not therefore restrain the proceedings or the inquiry being conducted by the respondent No. 2.

(3.) THE learned Judge after framing the issues, recorded evidence and on the basis of the evidence recorded of the appellant only dismissed the same by judgment which is under challenge.