Vikram Jairath vs Prabha Surana & Ors

Ashis Kumar Chakraborty, J

The Court : The petitioner, as the plaintiff in a suit for recovery of money and cancellation of a deed of gift has filed this application under Order XXXVIII Rule 5 of the Code of Civil Procedure, 1908 (hereinafter referred to as "the Code") for attachment of certain immovable properties of the respondent nos.1 and 2,as well as the ornaments of the respondent no.1.The suit has been filed in the Commercial Division of this Court.

It is the plaint case that from time to time, the respondent nos.1 and 2 obtained diverse loans and advances from the plaintiff petitioner. By issuing two separate confirmation of accounts both dated April 1, 2018 for the period April 1, 2017 to March 31, 2018 the respondent nos.1 and 2 acknowledged that Rs.5.14 Crores and a Rs.9.27 Crores remained due and owing by them respectively to the petitioner. In the petition the petitioner has disclosed a copy of the said confirmation of accounts both dated April 1, 2018 issued by the respondent nos.1 and 2, respectively. From time to time, the respondent no. 1 had also obtained diverse loans and advances from the wife of the petitioner, Harleen Jairath and by issuing a confirmation of accounts dated April 01, 2018 the respondent no. 1 acknowledged that as on March 31, 2018 a sum of Rs. 14,86,60,000/- remained due and owing by her to the said Harleen Jairath. The petitioner claims that despite being called upon to repay the said loans and advances, the respondent nos.1 and 2 had failed and neglected to repay the same to the petitioner and his wife and, as such they contemplated institution of a legal proceeding against the respondents for recovery of their dues. With the object of dissuading the petitioner and his wife from doing so, towards the end of June, 2018 the respondent nos.1 and 2 approached the petitioner and his wife with a promise to make payment of part of their dues within the next six months and offered to secure such amount by depositing with the petitioner the entire share holding of a company, called Middleton Hotels Private Limited which was owned by the respondent nos.1 and 2 together with one Pawan Surana, the brother of the respondent no.2 and a company, Moksh Investors Private Limited, which is fully owned and controlled by the respondent nos.1 and 2. On the basis of such offer the respondent nos.1 and 2 as well as the said Pawan Surana and Moksh Private Limited transferred to the petitioner and his wife 12,00,806 equity shares, being the entire share holding of the Middleton Hotels Private Limited at the face value of Rs.10/- per share. Accordingly, the total debt owed by the respondent nos.1 and 2 to the petitioner and his wife stood reduced by Rs. 70,08,060/- and Rs. 50,00,000/-, respectively.

In spite of having executed the share transfer forms in respect of the said 12,00,806 equity shares of Middleton Hotels Private Limited by the respondent nos.1 and 2 subsequently, the said company refused to record the transfer of the said shares in his names of the petitioner and his said wife. In view of certain further illegalities being committed by the respondent nos.1 and 2 in respect of the said Middleton Hotels Private Limited, the petitioner and his wife have filed a proceeding before the National Company Law Tribunal, Kolkata and the same is pending disposal. According to the petitioner, in response to letter dated January 10, 2019 issued by himself and his said wife the respondent nos.1 and 2 by their letter dated January 16, 2019 -acknowledged their liability to pay the outstanding dues of the petitioner and his wife, together with interest at the rate of 12% per annum from April 1,2018 and in spite thereof, the respondent nos. 1 and 2 have failed and neglected to repay their respective dues to the petitioner for Rs.5,66,46,860/- and Rs.10,38,11,855/-. The petitioner claims that his claim against the respondent nos.1 and 2 for Rs.5,66,46,860/- and Rs.10,38,11,855/-, respectively are unimpeachable. However, the petitioner has recently come to learn by a deed of gift dated August 6, 2018 that the respondent no.1 has transferred her two flats bearing nos.8A and 9A at 6, Queens Park, Kolkata-700019 in favour of her daughter, the respondent no.3. According to the petitioner, transfer of the said flat nos. 8A and 9A at 6, Queens Park, Kolkata-700019 by respondent no.1 in favour of the respondent no.3 for the purported consideration of natural love and affection is intended to delay and defeat payment of his dues. Therefore, in the present suit the petitioner has not only claimed money decrees against the respondent nos.1 and 2 for recovery his dues from the said respondents, but has also claimed for a decree for delivery up and cancellation of the said deed of gift dated August 06, 2018.

In the plaint as well as in the paragraphs 11 of the application the petitioner has expressed an apprehension, which is claimed to be bona fide that unless restrained the respondents will proceed to deal with and/or dispose of their other properties and assets as well as the flat nos. 8B and 9B at 6, Queens Park, Kolkata-700019 owned by the respondent no.2 and the flat nos. 5A and 6A of 'Metro Plaza Apartment' at 1, Ho-Chi Minh Sarani, Kolkata-700071 jointly owned by respondent nos.1 and 2 and the jewellery belonging to the respondent no.2. On the basis of such apprehension the petitioner has prayed for attachment of all the said flat nos.8B and 9B at 6, Queens Park, Kolkata-700019 and the flat nos. 5A and 6A of 'Metro Plaza Apartment' at 1, Ho-chi Minh Sarani, Kolkata-700071 as well as the jewellery of the respondent no.2 of the value of Rs.11,20,25,409/-.

The petitioner submits that in the facts of the present case, in aid of the relief for attachment before judgment of this Court would also pass ad interim order of injunction restraining the respondent nos.1, 2 and 3 in any manner dealing with, disposing of, alienating or parting with possession of the flat nos.8A and 9A at 6, Queens Park, Kolkata. The petitioner has also prayed for ad interim order of injunction restraining the respondent nos.1 and 2 from transferring or alienating or parting with possession of the flat nos.8B and 9B at 6, Queens Park, Kolkata-700019 and the flat nos. 5A and 6A of Metro Plaza Apartment, as well as the ornaments of the respondent no.2.

A copy of the application has been served upon the respondent nos. 1,2 and 3 and they are represented, by their counsel, before this Court. It is contended by the respondents that at the highest the petitioner is a unsecured creditor of the respondent nos.1 and 2 and the petitioner is not entitled to obtain any order in this application to have his unsecured claim being secured by any order of injunction in respect of any of the properties mentioned in the petition. It is submitted that in the plaint the petitioner's claim for the money decree is founded on the purported acknowledgments both dated April 1, 2018 appearing at pages 39A(typed copy at page 40 allegedly issued by the respondent no.2) and page 40(type copy at page 40A)of the petitioner. However, the alleged acknowledgment appearing at pages 39 and 39A do not bear any signature of the respondent no.2, Shanti Surana. Further, the alleged signatures of Prabha Surana, the respondent no.1 appearing in the purported confirmation of accounts issued in favour of the wife of the petitioner and the one appearing at page 41 being the purported confirmation of accounts issued in favour of the wife of the petitioner are ex facie different. The respondents point out that the petitioner has not disclosed any letter of demand issued to any of the respondent nos.1 and 2 calling upon them to repay their alleged dues. When the plaint and the present petition do not disclose the particulars of the amount of the alleged loan granted by the petitioner to the respondent nos.1 and 2, that is, the dates when such alleged loans were granted by the petitioner. Accordingly, none the alleged account confirmations dated April 1, 2018 can be construed as valid acknowledgment of any liability made by any of the respondent nos. 1 and 2, within the period of limitation, under Section 19 of the Limitation Act, 1963.

According to the respondents, the provisions of Order XXXVIII Rule 5 of the Code is applicable only when the plaintiff substantiates that after filing of the suit, the defendant is intending to transfer any immovable property, to obstruct or delay the execution of any decree that may be passed against him. It is urged that in the present case, admittedly the respondent no.1 transferred the flat nos. 8A and 9A at 6, Queens Park, Kolkata in favour of the respondent no.3 before filing of the present suit in the month of August, 2019. Thus, on the basis of the said deed of gift dated August 6, 2018 executed by the respondent no.1 in favour of the respondent no.3, the petitioner cannot obtain any order for attachment before judgment.

It is further argued for the respondents that it is settled law that the power under Order XXXVIII Rule 5 of the Code, which is a drastic and extra-ordinary power should not be exercised mechanically or merely for the asking in order to convert a unsecured debt into a secured debt. A defendant is not debarred from dealing with his property merely because a suit is filed or about to be filed against him. In order to obtain an order for attachment before judgment under Order XXXVIII Rule 5 of the Code, the plaintiff should show, prima facie, that his claim is bona fide and valid and also satisfy the Court that the defendant is about to remove or dispose of the whole or part of his property, with the intention of obstructing or delaying the execution of any decree that may be passed against him. It is further submitted that in the single Bench decision of this Court in the case of Premraj Mundra -versus- Md. Manech Gazi, reported in AIR 1951 Cal 156 it has been held that the Court would not be justified in issuing an order of attachment before judgment or for security, merely because it thinks that no harm would be done thereby or that the defendants would not be prejudiced. In the said decision, it was further held that the affidavits in support of the contentions of the applicant under Order XXXVIII Rule 5 of the Code must not be vague, where it is affirmed true to knowledge or information or belief, it must be stated as to which portion is true to knowledge, the source of information should be disclosed, and the grounds for belief should also be stated. It is pointed out that the ratio of the said decision of the learned Single Judge of this Court in the case of Premraj Mundra (supra) have been approved by the Hon'ble Supreme Court in the case of Raman Tech. & Process Engineering Co. & Anr. -versus- Solanki Traders reported in (2008) 2 SCC 302, as well as the Division Bench decision of this Court in the case of Sunil Kakrania & Ors. - versus- M/s. Saltee Infrastructure Ltd. & Anr. reported in AIR 2009 Cal 260. In support of their contention the respondents also rely on the said Supreme Court decision, as well as the Division Bench decision of this Court. It is pointed out that in the present case the petitioner has verified the statements contained in paragraphs 9 to 17 of the petition as his respectful submission before this Hon'ble Court. Thus, according to the respondents, when the petitioner has failed to fulfil the mandatory conditions of affirmation of an application under Order XXXVIII Rule 5 of the Code, the present application is not maintainable.

It is stressed by the respondents that in any event the petitioner has failed to make out a prima facie case for obtaining any ad interim order in this application and they should be given an opportunity to file an affidavit-in-opposition to this application.

In reply, the petitioner submits that although the confirmation of accounts dated April 1, 2018 issued by the respondent no.1 in favour of the petitioner does not bear any signature of the respondent no.1 but in her letter dated January 16, 2019 the respondent no.1 has not denied to have issued the said confirmation of accounts. In fact, in the said letter dated January 16, 2019 the respondents have admitted their outstanding dues to the petitioner and agreed to pay interest at the rate of 12%, per annum.

I have considered the materials on record, as well as the arguments advanced by the petitioner and the respondents, respectively. The present application filed by the petitioner under Order XXXVIII Rule 5 of the Code is founded on the confirmation of accounts both dated April 1, 2018, for the period April 1, 2017 to March 31, 2018 issued by the respondent nos.1 and 2 respectively. Admittedly, the confirmation of accounts issued in the name of the respondent no.1 does not bear her signature. Further, neither in the plaint nor in the petition the petitioners have disclosed the particulars of the loan transactions to substantiate that the said confirmation of the accounts issued by the respondent nos.1 and 2 constitute an acknowledgement under Section 19 of the Limitation Act. The respondent no.1 executed deed of gift dated August 6, 2018 in favour of the respondent no.3 for transfer of the said Flat Nos.8A and 9A of Premises No.6, Queens Park, Kolkata - 700 019 long before the filing of the suit and the present application in August, 2019. Further, when the petitioner has affirmed the averments made in paragraphs 9 to 17 of the petition as his respectful submissions before this Court, I find some substance in the contention of the respondents that the petitioner has not fulfilled the conditions with regard to his knowledge or source of information that after filing of the present suit, the respondent nos.1 and 2 are intending to transfer any of their immovable properties or the ornaments of the respondent as laid down in the case of Premraj Mundra (supra) which have been approved by the Hon'ble Supreme Court in the case Raman Tech. & Process Engineering Co. & Anr.(supra), as well as the Division Bench decision of this Court in the case of Sunil Kakrania & Ors.(supra).

For all the reasons mentioned above, I am unable to convince myself to hold that the petitioner has made out any prima facie case for obtaining any ad interim order in this application.

The respondents shall file their affidavit in opposition to this application within two weeks from date; reply thereto, if any, be filed within a week thereafter. The application will appear, under the heading 'Adjourned Motion', three weeks hence.

It is, however, made clear that the view expressed above by this court are only prima facie view.