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CASE NO.: Appeal (civil)  .3328 of 1997

PETITIONER: Sangeeta Chowdhury                                       

RESPONDENT: Commissioner, Sanchaita Investments & Ors.               

DATE OF JUDGMENT: 06/01/2004

BENCH: BRIJESH KUMAR & ARUN KUMAR

JUDGMENT: JUDGMENT

ARUN KUMAR, J.

       The grievance of the appellant in the present appeal is that she  has been deprived of her valuable immovable property located at  Premises No.662/B, Tollygunge Circular Road, Block ’O’, New  Alipore, Calcutta - 700 053 without even being afforded an  opportunity of being heard.  The appellant had purchased the said  property vide a registered conveyance deed dated 28.11.1969  executed in her favour by one Pritam Singh.  According to the  appellant after its purchase she got building plans approved from the  Calcutta Municipal Corporation for construction of three-storeyed  building.  The appellant Sangeeta Chowdhury entered into an  agreement  to sell the said property with one Raja Mallo on  29.7.1980.  There is no dispute between the parties about an  agreement to sell having been executed by Sangeeta Chowdhury in  favour of Raja Mallo.  The dispute, however, is that according to the  appellant, the agreement was for a consideration of Rupees Five lacs  out of which Rupees one lac was received by her from Raja Mallo by  way of earnest money while according to the respondents, the  agreement was for a sum of Rs.one lac and the entire consideration  was paid by Raja Mallo to Sangeeta Chowdhury.  Neither party has  produced the original agreement on record.  According to Sangeeta  Chowdhury after paying Rs.one lac as earnest money in pursuance  of the said agreement Raja Mallo disappeared and did not perform  the rest of the agreement.  She forfeited the earnest money and she   continues to be the owner of the property.  According to the  respondent Raja Mallo paid the entire consideration of Rs.one lac in  pursuance of the agreement to Sangeeta Chowdhury and he further  entered into a construction agreement with one Biswajeet Ghosh on  27.2.1987. There was a firm Sanchaita Investments which had accepted  large number of deposits from small depositors and had purportedly  defrauded them.  Investigation into the affairs of the said firm had  been going on since long and by virtue of orders passed by this Court  a Court Commissioner had been appointed.  On 27.9.1983 this Court  had passed an order authorising the Commissioner of Sanchaita  Investments to attach such assets and properties which prima facie in  his opinion were owned by the firm Sanchaita Investments or any of  its partners.  The Commissioner was further authorised to put to sale  such assets and properties if no objections were received to  attachment thereof within one month of the date of attachment.  The  Commissioner Sanchaita Investments attached the property of the  appellant on 3rd January, 1989 and invited objections to the  attachment.  Two sets of objections were filed  (1) by  Biswajeet  Ghosh (filed in February, 1989) and  (2) by Tarun Kanti Chowdhury on behalf of Sangeeta Chowdhury  (filed in January, 1991).

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These objections were referred by the Commissioner to the High  Court for purposes of consideration and disposal.  The High court  vide its order dated 24.4.1991 disposed of the two sets of objections.   The objections filed on behalf of present appellant Sangeeta  Chowdhury were rejected on the ground that the Vakalatnama filed in  support of the objection was found to be defective, however, liberty  was given to the counsel to file a proper vakalatnama within ten days.   Strangely the order records in this behalf that "in the event such  vakalatnama is filed the objections will be governed by the order  which we would hereinafter pass.  In default the objection of Tarun  Kanti Chowdhury will be deemed to have been dismissed for absence  of proper authority of his learned Advocate-on-Record". The order  passed by the Court thereafter was that Biswajeet Ghosh, the other  objector offered to deposit a sum of Rs.4,50,000/-(Rupees Four Lacs  Fifty Thousand only) with the Commissioner, Sanchaita Investments  as a condition precedent for lifting the attachment.  Therefore, the  Court observed that if the said amount was deposited the attachment  would stand vacated.  The Cout specifically observed that it had not  gone into the question of title to the property in view of the offer of  Biswajeet Ghosh to deposit a sum o Rs.4,50,000/-(Rupees Four Lacs  Fifty Thousand only) and the question of title to property remained  open.  With these observations both sets of objections stood  disposed of.         From the above order it follows that the objections of appellant  Sangeeta Chowdhury to attachment of her property by the  Commissioner, Sanchaita Investments were never considered and  decided on merits.  If proper vakalatnama was not filed the objections  were to be treated as dismissed on the ground of being filed without   authority and if a proper vakalatnama was filed, her objections would  still stand disposed of on the basis of offer of deposit of Rs.4,50,000/- (Rupees Four Lacs Fifty Thousand only) by Biswajeet Ghosh.  The  question of title to property was left open.  Sanchaita Investments got  a sum of Rs.4,50,000/-(Rupees Four Lacs Fifty Thousand only), the  sum deposited by Biswajeet Ghosh as a condition for lifting of  attachment of the property.  It appears that thereafter Biswajeet  Ghosh moved an application asserting his title to the property before  the Bench of the Calcutta High Court dealing with matters relating to  Sanchaita Investments.  The said application was disposed of without  notice to the appellant by an order dated 26th July,1991 passed by  the Division Bench of the High Court.  The said order records that  since Tarun Kanti Chowdhury failed to prove how he was empowered  to file objection on behalf of Sangeeta Chowdhury, the objections  stood rejected.  This is factually incorrect as a fresh Vakalatnama  was filed within ten days as permitted by the Court.  It was also noted  that the property in question stood released from attachment.   Biswajeet Ghosh was free to assert his legal right and title to the   property.  The Bench made it specifically clear that it had not  adjudicated upon the question of title to the property and that matter  was left to be decided.         Biswajeet Ghosh thereafter filed a suit for specific performance  of the agreement which he had with Raja Mallo with respect to the  suit property.  In the said suit he impleaded Sangeeta Chowdhury  and Raja Mallo and did not implead Sanchaita Investment as a  defendant.  In his ex-parte evidence it appears that Ghosh took a  contradictory stand saying that Sangeeta Chowdhury was only a  benamidar with respect to the suit property for Sanchaita  Investments.  Further according to him the agreement between  Sangeeta chowdhury and Raja Mallo was not performed and that is  why he had impleaded both of them as parties to the suit requiring  them to execute a sale deed with respect to suit property in his  favour.  The said suit was dismissed on 8th June, 1992.  The Court  observed in the said order that when Sangeeta Chowdhury was said  to be a benamidar for Sanchaita Investments, Sanchaita Investments  should have been impleaded as a party and a declaration ought to  have been sought to the effect that Sangeeta Chowdhury was only a

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benamidar for Sanchaita Investments.  Further if the property  according to Ghosh really belonged to Sanchaita Investments, the  sale deed, if at all, had to be executed by Sanchaita Investments and  without making it as  a party to the suit such a relief could not have  been granted.  The Court also observed that payment of entire  consideration money to Sangeeta Chowdhury by Raja Mallo in  pursuance of the agreement of sale between the two was never  established by the plaintiff.  Further Raja Mallo being simply an  agreement-holder got no title to the property from Sangeeta  Chowdhury.  This order of dismissal of suit by Biswajeet Ghosh was  never challenged by way of appeal and, therefore, had become final.

       On 15th June, 1993 Biswajeet Ghosh moved an application  before the Sanchaita Bench of the Calcutta High Court making a  prayer that the Commissioner of Sanchaita investments be directed  to execute a deed of conveyance with respect to the suit property in  his favour.  On 7th July, 1993, the High Court without giving any  notice to the appellant Sangeeta Chowdhury passed an order  directing the Commissioner of Sanchaita Investments to execute a  Conveyance Deed with respect to the suit property in favour of  Biswajeet Ghosh.  In pursuance of the said order a Deed of  Conveyance was executed by the Commissioner in favour of          M/s. Veekayan Properties, a nominee of Biswajeet Ghosh on 22nd  July, 1993.  Sangeeta Chowdhury moved an application on 10th  December, 1993 for recall of the order dated 7th July, 1993.  The said  application of Sangeeta Chowdhury was dismissed by the Division  Bench of the Calcutta High Court on 20th September, 1996.  The  present appeal is directed against the said order of the High Court.

       We have heard learned counsel for the parties at length.  The  entire thrust of the arguments on behalf of  appellant is that she has  been condemned unheard.  Her objections to attachment of her  property were dismissed on technical grounds without going into  merits.  With the dismissal of the objections the property has been  assumed to be belonging to Sanchaita Investments.  Although the  matter has been before the High Court on several occasions, the  question of title to the property was never gone into inspite the High  Court observing on various occasions that the question of title of the  property will be considered independently.  The learned counsel  appearing for the respondents have tried to meet this argument by  stating that the objections filed on behalf of appellant  Sangeeta  Chowdhury stood decided on merits by virtue of the various orders  passed by the Special Bench of the Calcutta High Court.  In support  of this argument, we have been taken through various orders.   Unfortunately, we are unable to find from these orders that the  objections filed on behalf of Sangeeta Chowdhury were ever  considered on merits by the High Court at any stage.  The very first  order dated 24th April, 1991, by which appellant’s objections to  attachment of her property were rejected shows that the objections  were not considered on merits.  They were rejected on account of  non production of a proper Vakalatnama in support of the objections  by the Advocate-on-record.  Time to produce a proper Vakalatnama  was granted and another Vakalatnama was filed within the time  allowed.  Even then as per the said order the objections were to  stand rejected in view of acceptance by the Court the offer of  Biswajeet Ghosh to deposit Rs.4.50 lakhs against vacation of the  order of attachment with respect to the property in question.  Thus in  either case, the objections filed on behalf of Sangeeta Chowdhury  stood rejected without being considered on merits.  The subsequent  order of the High Court dated 26th July, 1991, again notes the fact of  rejection of objections filed on behalf of Sangeeta Chowdhury.  The  rejection of the objections is reaffirmed.  The same is the position  which emerges from the final order of the High Court dated 20th  September, 1996 which is subject-matter of the present appeal.   Therefore, the fact remains that the objection of the appellant against

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attachment of her valuable property were never considered on merits.

       From a careful consideration of impugned judgment in the light  of facts on record, the following points emerge: The fact that Sangeeta Chowdhury had a valid title to the  property in the first instance is not in dispute.  It is admitted that she  had purchased the property vide a Registered Deed of Conveyance  dated 28th November, 1969 from one Pritam Singh.  Again it is not in  dispute that she entered into an agreement to sell with respect to the  said property with one Raja Mallo.  According to appellant-Sangeeta  Chowdhury the consideration under the agreement to sell was  Rupees Five Lakhs out of which she was received Rupees one lac as   earnest money from Raja Mallo whereas according to respondents  the consideration under the agreement was Rupees one lac and the  entire amount was paid by Raja Mallo to Sangeeta Chowdhury and  she gave possession of the property to Raja Mallo.  Sangeeta  Chowdhury denies having handed over possession of the property to  Raja Mallo.  Neither party has produced the original agreement to sell  on record.  During  the course of hearing before this Court, both sides  asserted that they were in possession of their version of the original  agreement.  Which agreement is correct and genuine can be decided  only on the basis of evidence which may be produced by respective  parties.  We have no basis to uphold or reject either of the  agreements set up by the parties.  According to Sangeeta  Chowdhury, Raja Mallo failed to perform the agreement as he did not  pay the balance consideration and he is actually said to have  disappeard after the initial agreement.  However, according to  respondents, Raja Mallo  became owner of the property in question  on execution of the agreement of sale on payment of the  consideration of Rupees one lac under the agreement. The alleged  agreement of sell is said to be dated 29th July, 1980.  Raja Mallo is  said to have entered into a construction agreement with one  Biswajeet Ghosh on 27th February, 1981 under which Ghosh had to   construct a building on the plot in question.  On the basis of  the  construction agreement, Ghosh started asserting his title to the  property in which attempt he finally succeeded in getting a Deed of  Conveynace executed with respect to the property in favour of his  nominee in pursuance of order dated 7th July, 1993 passed by the  High Court.  The Deed of Conveyance was executed by the  Commissioner of Sanchaita Investments.  Thus without deciding as to  how and in what manner the title to the property in question travelled  to Sanchaita Investments,  the Deed of Conveynace was allowed to  be executed.   No attempt was ever made by the High Court to   ascertain as to whether Sanchaita Investments had any title to the  property before it could be called upon to execute a Conveyance  Deed with respect to the property in favour of Biswajeet Ghosh or his  nominee.

In our considered view the impugned judgment of the High  Court is liable to be set aside for the following additional reasons : (1)     The High Court has proceeded on the basis that the  agreement to sell between Sangeeta Choudhury and Raja  Mallo was for a consideration of Rs.1 lac only and the  amount stood paid to Sangeeta Choudhury.  The High Court  has failed to notice the case set up by Sangeeta Choudhury  in this behalf that the consideration under the agreement  was Rs. 5 lakhs out of which Rs.1 lac was paid as earnest  money.  Neither party had produced the original agreement  on record.  Therefore, the High Court had no basis to accept  that the agreement was for a total consideration of Rs.1 lac  only thereby ignoring the stand of Sangeeta Chowdhruy  altogether.  Whether the agreement to sell was for total  considertion of Rs.1 lac  or Rs. 5 lacs is a question which  goes to the root of the matter because admittedly Sangeeta  Chowdhury received Rs.1 lac in pursuance of the

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agreement.  If the total consideration under the agreement  was Rupees one lac, she received the entire consideration.   If it was Rupees five lakhs, she only received Rupees one  lac and balance amount was never paid to her.  Further the  case of Sangeeta Chowdhury is that the agreement was  abandoned and Rs.1 lac which was paid by way of earnest  money was forfeited.  In our view the High Court could not   ignore the stand of Sangeeta Chowdhury.  It had to consider  the stand of both parties and thereafter form a view about  the correctness of either party’s stand. (2)     Similarly, the High Court was wrong in accepting that  Sangeeta Chowdhury had delivered possession of the  property to Raja Mallo in pursuance of the agreement to sell.   The parties were at variance on the question of delivery of  possession of the property and the issue could be resolved  only after due consideration of the material on record in this  behalf, which was not done by the High Court. (3)     The Commissioner Sanchaita Investments attached the suit  property and issued an advertisement on 3rd January, 1989  inviting  objections to attachment.  The order of this court  dated 27th September, 1983 which authorized the  Commissioner to attach properties which in his prima facie  opinion were in the ownership of the firm Sanchaita  Investments, does not leave the matter to mere ipsi dixit of  the Commissioner.  The fact that the Commissioner had to  form a prima facie opinion before attaching the property  shows that the Commissioner had to have some basis  before he could attach a property.  In the present case, the  learned counsel appearing for the respondents have not  been able to point out to us anything to show that the  Commissioner formed a prima facie opinion in this behalf.   The High Court made no effort to find out whether there was  any prima facie satisfaction on the part of the Commissioner,  Sanchaita Investments before ordering attachment of the  property in question.  The question of attachment of the  property goes to the root of the matter.  If the attachment  was without any basis all subsequent acts qua the property  fall through.  The casual approach of the High Court in this  behalf is evidenced by the following observations contained  in the impugned judgment:  

" Now in this case, we have seen that the property was  attached by the Commissioner of Sanchaita  Investments, obviously prima facie holding that it  belonged to Sanchaita Investments."

Thus on the basis of "obviously", the real question has been  side tracked. 4.      The objections to attachment of the property filed by Tarun  Kanti Chowdhury  on behalf of Sangeeta Chowdhury were  rejected on two grounds: first, Tarun Kanti Chowdhury had   no authority to file the objections on behalf of  Sangeeta  Chowdhury; and secondly, there was no proper Power of  Attorney executed in favour of the Advocate who filed the  objections in court.  The High Court in its impugned  judgment has proceeded on the basis that both these  aspects remained unsatisfied and therefore the objections  filed on behalf of Sangeeta Chowdhury were rightly  rejected without being considered on merits.  However,  record shows that both the grounds for rejection of the  objections were met by Tarun Kanti Chowdhury and  therefore the grounds were not available.  Tarun Kanti  Chowdhury was given opportunity to show the authority in  his favour to file the objections which he did as recorded in  the order dated 28th August, 1996 of the High Court.  

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Likewise, a fresh Power to Attorney was filed on record  within the period of ten days allowed for that purpose  by  the  High Court.  Therefore, rejection of the objections of  Sangeeta Chowdhury to attachment of property on these  two grounds was uncalled for and contrary to record.  The  High Court in  its impugned order  has proceeded on a  totally incorrect basis that  Tarun Kanti Chowdhury failed  to meet these two grounds and therefore the objections  were rightly rejected. The High Court had been observing in its various  orders that the question of title to the property was to be  independently gone into but the same was side tracked in  the above manner. 5.      The impugned order shows that the Special Bench of the  High Court was looking after the affairs of Sanchaita  Investments and was really concerned with securing  money in order to meet the demands of the depositors.   Therefore, the Bench was impressed by the fact that  Biswajeet Ghosh had offered to deposit Rs.4.5 lacs with  the commission, Sanchaita Investments which really led  the Bench to give the property to Biswajeet Ghosh or his  nominee by way of a Conveynace Deed without  considering the basic question as to whether Sanchaita  Investments had title to the property before it could pass  the title to a third party.  If Sanchaita Investments had no  title to the property how could Biswajeet Ghosh or his  nominee could get a good title to the property? 6.      The High court failed to appreciate the weight of reasoning  contained in the order dated 8th June, 1992 passed by the  learned Assistant District Judge while dismissing the title  suit filed by Biswajeet Ghosh to claim title to the property.   Biswajeet Ghosh had filed a suit in January, 1992 seeking  specific performance of the agreement in his favour in  which he impleaded Sangeeta Chowdhury and Raja Mallo  as defendants.  The suit was dismissed and the order of  dismissal became final because it was not carried further  by way of appeal.  One of the reasons for dismissal of the  suit by the High Court is the contradictory stand of  Biswajeet Ghosh with respect to facts leading to his claim  to title to the property.  In his ex parte evidence in the said  suit he had stated that Sanchaita Investments was the real  owner of the property and Sangeeta Chowdhury was a  mere benamidar.  Another instance of contradictory stand  of Biswajeet Ghosh in this connection emerges from the  objections filed by him against attachment of property by  the Commissioner, Sanchaita Investments.  There he  stated that Sanchaita Investments had nothing to do with  the property and the property could not be attached by the  Commissioner.

       The above aspects show that the High Court in its impugned  judgment has proceeded on wrong assumptions and most  important question regarding title to the property was never gone  into.  Assuming Raja Mallo was an agent of Sanchaita Investments  had entered into the agreement to sell with Sangeeta Chowdhury  on behalf of the said firm, the title to property could not pass to  Sanchaita Investments merely on basis of an agreement to sell.   Title to immovable property of such value can pass only on the  basis of a registered Deed of Conveyance.  What right Sanchaita  Investments had to further sell the property?  These questions  needed to be considered before Deed of Conveyance could be  ordered to be executed.  The objections to attachment of property  filed on behalf of Sangeeta Chowdhury were rejected on technical  grounds and were never considered on merits.  Keeping all these  aspects in view, we are of the opinion that the impugned judgment

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of the High Court dated 20th September, 1996 cannot be  sustained.  We accordingly set aside the same and remand the  matter back to the High Court for consideration of the objections  filed on behalf of Sangeeta Chowdhury on merits.  Any  observation contained in this judgment shall not influence the High  Court in arriving at its own independent conclusion.  This appeal is allowed leaving the parties to bear their  respective costs.