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Anjeli Vaid v/s Sanjay Gupta & Others


Company & Directors' Information:- GUPTA CORPORATION PRIVATE LIMITED [Active] CIN = U40100MH2005PTC154038

Company & Directors' Information:- M R GUPTA AND COMPANY PRIVATE LIMITED [Active] CIN = U74899DL1992PTC051324

Company & Directors' Information:- SANJAY CORPORATION LIMITED [Active] CIN = U16009GJ1999PLC035814

Company & Directors' Information:- GUPTA INDIA PRIVATE LIMITED [Active] CIN = U51311DL1996PTC077255

Company & Directors' Information:- GUPTA AND COMPANY PRIVATE LIMITED [Active] CIN = U52110DL1974PTC007339

Company & Directors' Information:- GUPTA AND GUPTA PRIVATE LIMITED [Active] CIN = U55204DL1954PTC002390

Company & Directors' Information:- S K GUPTA PRIVATE LIMITED [Active] CIN = U26900MH1973PTC016294

Company & Directors' Information:- R. K. GUPTA AND COMPANY INDIA PRIVATE LIMITED [Active] CIN = U74899DL1993PTC052138

Company & Directors' Information:- B R GUPTA AND COMPANY PRIVATE LIMITED [Active] CIN = U63013DL2000PTC107343

Company & Directors' Information:- T N GUPTA PVT LTD [Active] CIN = U02005WB1951PTC020141

Company & Directors' Information:- A V GUPTA AND COMPANY PRIVATE LIMITED [Converted to LLP] CIN = U24239DL1999PTC102248

Company & Directors' Information:- Y P GUPTA AND COMPANY PVT LTD [Under Process of Striking Off] CIN = U74899DL1983PTC016661

Company & Directors' Information:- J S GUPTA AND CO PVT LTD [Strike Off] CIN = U20211UP1975PTC004078

Company & Directors' Information:- M K GUPTA AND CO PRIVATE LTD [Strike Off] CIN = U74999DL1979PTC009517

Company & Directors' Information:- A J GUPTA AND CO PRIVATE LIMITED [Strike Off] CIN = U74210UP1980PTC004986

Company & Directors' Information:- VAID & COMPANY PRIVATE LIMITED [Active] CIN = U24233DL2012PTC238807

Company & Directors' Information:- D. R. GUPTA & COMPANY PRIVATE LIMITED [Strike Off] CIN = U74899DL1944PTC000794

Company & Directors' Information:- S P GUPTA AND CO PVT LTD [Strike Off] CIN = U26932RJ1972PTC001459

    CS(OS). No. 231 of 2019, IAs. Nos. 6315, 6317, 8128 of 2019, 22 & 627 of 2020

    Decided On, 16 March 2020

    At, High Court of Delhi

    By, THE HONOURABLE MR. JUSTICE V. KAMESWAR RAO

    For the Plaintiff: Muneesh Malhotra, Manpreet Kaur, Advocates. For the Defendants: D1 & D2, Mohit Gupta, Ankit Jain, Alka Chojar, Meher Gupta, D3, Rajat Aneja, Sonali Chopra, Rajat Agnihotra, D4, Shiv Chopra, Advocates.



Judgment Text


(Oral)

I.A. 6317/2019

1. By this order I shall decide the instant application, which is filed by the plaintiff under Order 40 Rule 1 read with Section 151 CPC for appointment of a receiver.

2. It is the case of the plaintiff and so contended by Mr. Muneesh Malhotra, Advocate that the plaintiff has filed the aforesaid suit for partition, injunction and rendition of accounts being a legal heir of late Yatendra Nath Gupta (‘late Y.N. Gupta’, for short) who died on January 12, 2019. It is the case of the plaintiff that late Y.N. Gupta was a man of means and had various commercial properties in his name, which include 15-E, 16-E(i), 16-E(ii), 17-E, 18-E, 19-E, 20-E, 21-E, 40-E and 41-E in Block E, Connaught Place, New Delhi and residential house No. 139, Sunder Nagar, New Delhi and share in the estate of L. Gopinath HUF. Besides the aforesaid properties, late Y.N. Gupta had substantial bank balance as well as jewellery and funds running in crores of rupees at the time of his death.

3. He submitted that after the demise of Y.N. Gupta, plaintiff has sought her share in the property of the deceased, which was denied to her and she was offered a sum of Rs.2,00,000/- per month during her lifetime. He stated that by attitude and approach of defendant Nos.1 and 2, it became apparent that plaintiff shall not be given her share without due legal process. He also stated that in the written statement the defendant has admitted the fact that the two properties i.e 16-E(1), 17(E) were generating monthly rent of Rs.40,73,875/-. The other properties were also generating monthly rent of approximately Rs.2,00,000/- per month. Thus, in the given circumstances, the estate of late Y.N. Gupta is generating approximately Rs.42.50 lacs per month. He also stated that it is admitted in the written statement that defendant Nos.1 and 2, the plaintiff and defendant Nos.3 and 4 each are entitled to 20% of the income earned from the commercial properties.

4. It was his submission that during the course of arguments, the learned counsel for the defendants agreed that the plaintiff is also entitled to her share of 20% from the rent received. However, the issue boiled down to the expenses, which the defendant No.1 is claiming from the receipts. He stated that this Court had directed the defendants to file documents from the date of the death of the deceased till December 31, 2019. However, the defendants avoided such compliance despite orders of this Court. Finally, the defendants filed documents for the quarter October 01, 2019 till December 31, 2019. Even the filing of documents post the said period till January 31, 2020 shows that defendant Nos.1 and 2 have completely misused the funds.

5. It was his submission that from the books of accounts and other detailed calculations, it is admitted by the defendants that the plaintiff’s share of 20% would be Rs.7,56,695.27 per month. It was further his submission that by inflating the items of expenditure as well as including expenses which had no relation to the management of the estate of Late Y.N. Gupta, the defendants have completely usurped the share of the plaintiff and thus were manipulating the accounts, the appointment of Court receiver under such circumstances would be inevitable. Mr. Malhotra has relied upon the judgment of the Supreme Court in the case reported as (2001) 3 SCC 176 Kasturi Bai and Ors. v. Anguri Chaudhary to contend that collection of rent by the receiver when different tenants occupying different portion of the suit property, is justified. He also relied upon the judgment of the Supreme Court in the case reported as (2009) 11 SCC 127 Parmanand Patel (Dead) by LR’s and another vs. Sudha A. Chowgule and Ors to contend that where tenants have to be inducted, appointment of receiver is justified.

6. That apart, he also relied upon the judgment of the Bombay High Court in the case reported as AIR 2006 Bombay 92 Victor John Gomes (Decased) & Ors. v. Thomas John Gomes and Anr., to contend when there is mis-management of accounts, the appointment of a receiver is justified. That apart, it was his submission that the defendant Nos.1 and 2 are at the helm of affairs of the estate of late Y.N. Gupta to the exclusion of others. The said fact itself require, in order to mitigate the risk of the plaintiff not getting her share, receiver should be appointed. In this regard, he has relied upon the judgment of the Madras High Court reported as MANU/KA/0496/1997 Poovama and Ors. v. Chennamma.

7. On the other hand, Mr. Rajat Aneja, learned counsel appearing for defendant Nos.1 and 2 state that late Y.N. Gupta died on January 12, 2019 and had left a last and final Will dated January 28, 2016, which has been unequivocally accepted by the plaintiff, who has entered into and acted upon the Oral Family Settlement arrived at by the plaintiff and the defendants on February 19, 2019. In terms of the settlement, the plaintiff is only entitled to 20% of the net income received from the commercial properties owned by late Y.N. Gupta after deduction of expenses and taxes. The plaintiff has no other right/title/interest over the immovable properties and/or movable assets left behind by late Y.N. Gupta. Since the demise of late Y.N. Gupta, the defendants 1 and 2 have been collecting the rentals generated from the commercial properties that are now jointly owned by them and have been maintaining books of accounts in respect of the income earned and expense incurred. After the demise of late Y.N. Gupta, the income earned from the said commercial properties was utilized in paying of the outstanding debts and liabilities left behind by the deceased including but not limited to unpaid credit card bills, taxes etc. After meeting all the expenses such as Income Tax, day-to-day office running expenses inclusive of staff salaries, electricity and water charges, repairs and renovations, legal expenses etc., from the remaining amount i.e. the net income earned from the said commercial properties, a sum of Rs.10,00,000/- approximately has been paid to the plaintiff till the filing of the present suit. He denied the allegation of mis-management by the defendants 1 and 2.

8. That apart, it was his submission that it is a settled position of law that the receiver should not be appointed unless there is a substantial ground for interference, such as, a well founded apprehension that the suit properties will be dissipated or other irreparable mischief may be caused. According to him, the element of danger is an important consideration and it has been held time and again that a Court should not act on a possible danger only, but the danger should be imminent and grave, demanding immediate relief, which considerations are missing from this case.

9. Further, it was his submission that the plaintiff having approached this Court with unclean hands, is not entitled to any equitable relief. In this regard, he stated that the plaintiff has suppressed the last and final Will and Testament of late Y.N. Gupta and the Oral Family Settlement dated February 19, 2019 with the sole and mala fide motive of claiming rights in the immovable and movable properties which form part of the estate of late Y.N. Gupta in contravention and complete disregard to the last wishes of late Y.N. Gupta, as contained in the last and final Will / Testament dated January 28, 2016. In fact, it was his submission that the plaintiff in the present suit is trying to wriggle out of the Family Settlement entered into by her with the defendants herein on February 19, 2019.

10. That apart, it was his submission that an order appointing a receiver should not be made where it has the effect of depriving a Defendant of a ‘de-facto’ possession since the same shall cause irreparable wrong. He stated, the expenses which were being deducted from the receipts of the properties of late Y.N. Gupta, are those, which were the expenses made by late Y.N.Gupta during his lifetime. It was his submission that the expenses to the extent of Rs.5,000/- not being accounted for, would not make out a case of unauthorized expenses on the part of the defendants. In any case, the present application, filed by the plaintiff who has right only to the extent of 20% of revenues from the estate of late Y.N. Gupta as against 80% of the four defendants, would not make this Court appoint a receiver on behalf of such a shareholder. He stated that on January 31, 2020 the total income from the estate of late Y.N. Gupta was around Rs.38 lacs. The said amount has now reduced to Rs.24,50,000/-. In support of his submission, he has relied upon the following judgments:-

(i) T. Krishnaswamy Chetty vs. Thangawelu & ors. AIR 1955 Madras 430;

(ii) Jagat Singh vs. Sawai Bhawani Singh & Ors. (1991) ILR 2 Delhi 475;

(iii) Ravi Kumar vs. Misha Vadhera & Ors. ILR (1995) II Delhi;

(iv) B.D.A. Ltd., Bombay vs. Central Bank of India & Anr. AIR 1995 Bom 14;

(v) Dhruv Goyal & Ors. vs. Anand Prakash Goyal & ors. (1996) 62 DLT 403;

(vi) Kanwar Pratap Singh vs. Surat Singh & Ors. 67 (1997) DLT 367;

(vii) St. Sophia’s Christian Education Society vs. K. Samuel 1997 (42) DRJ 389;

(viii) Mohinder Nath & ors. vs. Harender nath & Ors. ILR (1998) I Delhi;

(ix) S.S. Brijbasi & Ors. vs. Chander Bhan Garg & Ors. (2002) I AD (Delhi) 678;

(x) Salma Majhi & Anr. vs. Bija Majhi & Ors. AIR 2004 Orissa 46;

(xi) Mrs. Razia Parvez & Ors. vs. Sikander Parvez & Anr. AIR 2011 Utt 20.

The judgments as referred by Mr. Aneja broadly outline the following:-

(i) The appointment of a receiver pending a suit is a matter resting in the discretion of the Court. The discretion should not be arbitrary or absolute. It should be sound and judicial discretion, taking into account all the circumstances of the case;

(ii) The Court should not appoint a receiver except upon proof by the plaintiff that prima facie he / she has very excellent chance of succeeding in the suit;

(iii) Not only must the plaintiff show a case of adverse and conflicting claims to property, but he / she must show some emergency or danger or loss demanding immediate action;

(iv) An order appointing a receiver will not be made where it has the effect of depriving a defendant of a ‘de facto’ possession since that might cause irreparable wrong. In other words, a receiver should not be appointed in supersession of a bona fide possessor of property in controversy and bona fides have to be presumed until the contrary is established or can be indubitably inferred;

(v) The Court, on the application of a receiver, looks at the conduct of the party who makes the application and will usually refuse to interfere unless his / her conduct has been free from blame.

(vi) The receiver ought not to be appointed except in case of imminent wrong. The appointment of receiver should be made only in circumstances where the interest of the creditors is exposed to manifest peril.

11. Having heard the learned counsel for the parties, there is no dispute that the suit has been filed by the plaintiff for partition, injunction and rendition of accounts.

12. At the outset, I may state that Mr. Malhotra, during the course of arguments has fairly stated that the appointment of receiver is primarily for ensuring the income generated from the estate of late Y.N.Gupta, is distributed in equal proportion, which include 20% in favour of the plaintiff, as admitted by the defendants in their written statement, by deducting proper / justifiable expenses. In other words, he states no receiver is required to be appointed for managing the bank accounts / residential property, which are also the subject matter of the suit.

13. Having said that, a written statement has been filed wherein the defendants have relied upon a Will of late Y.N. Gupta dated January 28, 2016 and a Settlement dated February 19, 2019. The stand of the defendant nos. 1 and 2, is primarily that no ownership rights over the properties situated in E Block, Cannaught Place, New Delhi have been bequeathed upon the plaintiff, defendant nos. 3 and 4, however, each one of them has been given a right to 20% of the income being earned from the properties after meeting taxes and expenses thereon for life. The income includes the income arising on transfer of any of the aforesaid properties after meeting the expenses and taxes thereon. So, the defendants have admitted the fact that the plaintiff is entitled to 20% of the net income received from the commercial properties owned by late Y.N. Gupta.

14. The issue, which arises for consideration is whether for determining the 20% share of the plaintiff from the revenue generated from the estate of late Y.N. Gupta, a receiver need to be appointed. In this regard, I may state that during earlier hearings, this Court had directed the defendants to file the details of the expenses, as being incurred by the defendants 1 and 2 for management of the estate of late Y.N. Gupta. The details have been filed by the defendants till January 31, 2020. I may also state here, during the course of hearings of this application, Mr. Malhotra had contested some of the expenses as incurred for managing the estate of late Y.N. Gupta.

15. On the other hand, Mr. Aneja has justified the expenses. In fact, to enable the parties work out the accepted expenses, the parties were relegated to the mediation process. It appears that no consensus could be arrived at by the parties before the learned Mediator.

16. The learned counsel for the parties, have relied upon various judgments, for the propositions, which have already been discussed above.

17. Noting the limited submission made by Mr. Malhotra, this court is of the view that the answer to the issue is not required to be seen in the said judgments, but outside the same either by directing the parties to arrive at a consensus on the expenses, themselves by sitting together or by appointing a Local Commissioner who would determine the justifiable expenses. As the parties could not arrive at a consensus before the Learned Mediator and there is an element of mistrust between the parties herein, appropriate shall be to appoint a Local Commissioner who shall determine the expenses. Accordingly, this court appoints Ms. Kanwal Inder, a retired District and Sessions Judge as the Local Commissioner for doing the following acts:

a. The learned local commissioner shall determine the permissible expenses towards the management of the estate of Late Y.N. Gupta in the preceding calendar month.

b. For this purpose, defendant nos. 1 and 2 shall on a given date and time to be informed by the learned Local Commissioner, when the plaintiff shall also be present produce before the learned Local Commissioner the books of accounts / statement of accounts / summary of receipts and expenses towards the estate of Late Y.N. Gupta in the preceding calendar month for consideration of the local commissioner to ena

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ble her to determine the expenses as noted at “a” above. c. The above process shall be completed by the Learned local commissioner on or before 15th day of the following calendar month, when the learned local commissioner shall determine the amount payable to the plaintiff, (which shall be equivalent to 20% of her share) the defendants by communicating to them a summary of statement. d. The above process shall be initiated for the month of February, 2020 to be completed on or before March 31, 2020. e. For the past period effective from October 1, 2019 till January, 2020, the same procedure shall be followed by the learned Local Commissioner, who shall complete the process also on or before March 31, 2020. f. It is made clear that the determination of the expenses by the learned Local Commissioner shall be final. g. The Local Commissioner shall be paid an amount of Rs.75,000/- in the month of March, 2020 and thereafter Rs.50,000/- per month for undertaking the commission. Any out of pocket expenses incurred by the learned local commissioner shall be paid as per actuals. This amount shall be deducted from the share of each of the parties to be paid to them from the estate of Late Y.N. Gupta. The above process shall continue till further orders by this court. 18. The application is disposed of. 19. The parties shall be at liberty to appear before the learned Local Commissioner for a preliminary hearing by taking an appointment on the mobile number being 9810125754. 20. A copy of this order be sent to Ms. Kanwal Inder at her address being C-230, Triveni Apartments, Sheikh Sarai, Phase-I, New Delhi-110017.
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