NATRAJAN CHANDAN Vs. APNASAHAKARI BANK LTD

JUDGEMENT

(1.) The petitioner is a member of the Royal industrial Co-operative Society Limited (for short 'the Society') and has been allotted Gala number C-16 in the said Society. The society has also issued a share certificate in the name of the petitioner by virtue of which the petitioner is entitled to possess the said gala. In common parlance, the petitioner is the owner of Gala number C-16.

(2.) It appears that the petitioner intended to sell the said Gala number C-16 and the respondent No. 2 firm of which the respondent Nos. 3 and 4 at the relevant time were the partners desired to purchase the same. A memorandum of understanding was executed between the petitioner and respondent No. 2 in August, 1989. The memorandum states that the petitioner would sell the Gala number C-16 to respondent No. 2 for a consideration of Rs. 9 lakhs which was to be paid in three instalments. Clause (9) of the memorandum specifically states that the parties were to execute a formal agreement of sale within a period of one month. It appears that no formal agreement of sale was ever entered into between the petitioner and respondent no. 2 and the transaction of sale was never completed.

(3.) The respondent No. 2 approached the respondent No. 1 Bank for a loan to raise money for purchase of the gala. It appears that part of the loan was advanced and part of the amount of the consideration was also paid to the petitioner. There is some controversy between the parties as to whether the possession of Gala number C-16 was delivered by the petitioner to the respondent No. 2. It is however undisputed that on 20th June, 1997, the petitioner was in possession of the Gala and was dispossessed by the respondent No. 1 bank with the help of Special Recovery Officer in execution of an award obtained by it against the respondent No. 2 and its partners for recovery of the amount of the loan and interest. It appears that after the execution of a memorandum in August, 1989, the respondent No. 2 firm came in possession of the share certificate issued by the society in the name of the petitioner. According to the respondent No. 2 the petitioner handed over it while according to the petitioner the respondent No. 2 took it from the middleman for inspection but never returned it. It appears that the respondent No. 2 who was in possession of the share certificate issued by the society offered to create a security over the said Gala No. C-16 in favour of the respondent No. 1 by depositing the share certificate with the bank as the document of title. As the respondent No. 2 did not repay the loan borrowed by it, the respondent No. 1 filed a dispute before the Co-operative Court and obtained an award against the respondent No. 2 under the provisions of the Maharashtra co-operative Societies Act, 1960 on 9th October, 1996 for recovery of Rs. 14,25,159/ -. Respondent No. 1 Bank put the said award in execution and on 20th june, 1997, the Special Recovery Officer dispossessed the petitioner and took possession of the gala from him.