STATE OF MADHYA PRADESH Vs. MEGMA LEASING LIMITED

JUDGEMENT

(1.) THIS appeal is directed on behalf of the Objector State of madhya Pradesh under Section 96 of CPC being aggrieved by the order dated 25. 11. 2005 passed in Execution Case No. 562/05 by 4th additional District Judge, Bhopal dismissing its application filed under O. 21 R. 58 and 59 r/w Sec. 151 of CPC.

(2.) THE facts giving rise to this appeal in short are that the respondent No. 1 being Non-Banking Finance Company had financed the acquisition of 99 buses to respondent No. 2 on higher purchase with lease agreement. According to terms the respondent No. 2 had to make the payment of such sum as per agreed schedule but inspite making various demands the same was not paid. On which as per terms respondent No. 1 referred the dispute to Arbitrator for its adjudication. After holding such proceedings the claim of the respondent No. 1 was awarded on 23. 5. 2003 for the sum of rs. 4,26,11,623/-up to the period of 30th June 2002 and also awarded the interest on such sum @ 9% p. a. from 1. 7. 2002, till it"s realization. Besides this the direction for handing over such buses was also given. Apart this the cost of arbitration proceeding Rs. 85,000/-was also awarded. Subsequent to such award when the payment was not made by the respondent No. 2 then respondent No. 1 initiated its Execution proceedings, in which some immovable properties of Bhopal were attached on 12. 1. 2005 and while the same was being placed for auction. On such occasion the official of the appellant, appeared on 14. 2. 2005 and took time to file its objections against attachment of such property and the same were filed on 13. 10. 2005 under O. 21 R. 58 and 59 r/w Section 151 of CPC contending that plots of such buildings are the properties of the appellant, and the same were never given to the respondent No. 2 either under ownership or on lease. The same was given to it only for opening its office to manage and operation of its commercial activities. The impugned award had passed without impleading the appellant as party in such arbitration proceedings. Thus the same is not binding against it. In such premises the aforesaid property of the appellant could neither be attached nor placed on auction under the execution of such award. Besides this such attachment is also objected on the ground of outstanding balance of road tax Rs. 29,79,73,853/-i. e. more than rs. 29 crores against the respondent No. 2 regarding operation of its buses in the State including the aforesaid 99 buses. Such recovery is to be made as arrears of land revenue from the properties of of the respondent No. 2 as first charge and in order to recover the same some properties of respondent No. 2 have already been attached under such proceedings. In addition to it, it is pleaded that proceeding for winding up the respondent No. 2 is also going on. Therefore, the respondent No. 1 had a right to recover the alleged sum along with the other creditors of respondent No. 2 only in the ratio which would be decided by the concerned official of winding up proceedings out of the available fund after satisfying the first chare over the property. With these averments the prayer for staying the auction proceedings of the aforesaid properties is made.

(3.) IN reply of respondent No. 1, the averments of the objections are denied. In addition to it, it is pleaded that as per notification published by the Central Government on re-organization of State of madhya Pradesh and Chhatisgarh the appellant owned the assets and liabilities of respondent No. 2 till some extent, therefore, firstly in such premises and secondly the respondent No. 2 being the constituted corporation and enterprises of the appellant, the appellant is bound to indemnify and satisfy the impugned award. It is also stated that the alleged land of the aforesaid building were transferred by the appellant to respondent No. 2 under the ownership in 1964, and subsequent to such transfer the respondent No. 2 enjoyed and dealt with as its own properties; the same was never objected by the appellant. Therefore, the appellant is precluded to claim such property as owner against the right of respondent No. 2. It is also stated that aforesaid property by staying the auction proceedings cannot be released from the attachment on the ground of alleged outstanding balance of the road tax. The papers relating to attachment of the property and road tax are prepared by the appellant, subsequent to execution proceedings with intention to defeat the claim and recovery of the respondent No. 1. With these averments the prayer for dismissal of the objection is made.