P.K. Bhasin, Chairperson,
1. The appellants seek review of order dated 9th December, 2015 passed by my learned predecessor dismissing in limine three appeals filed by the three appellants against the common order passed by the learned DRT dated 16th September, 2015 whereby three appeals filed by three different parties, including the appellants herein, against the common order dated 8th December, 2014 passed by the learned Recovery Officer during the course of recovery proceedings (RC No. 171/2001) arising out of recovery certificate issued in O.A. No. 721/1996 by the DRT-II, Delhi on 13.11.2010, were dismissed.
2. The order dated 9.12.2015 passed by this Tribunal of which review is being sought and the relevant parts of the order dated 16.9.2015 passed by the DRT which give the relevant background facts of the litigation leading to the filing of these appeals, their being dismissed in limine and filing of these review applications are re-produced below. Order dated 9.12.2015 of this Tribunal reads as under:
“Though these two appellants in these appeals filed before this Tribunal had acted in an illegal manner by showing scant regard to the orders passed by even the High Court, yet they would dare to file the present appeals, making allegation of fraud on the part of the Bank. The O.A. filed by the Bank was allowed long ago in the year 2000 and the appellant came to the scene being highest bidder when the R.O. sold the properties of the borrower pursuant to the R.C issued in the O.A. The appellants would have no locus to question the order passed in the O.A. The appellants have even failed to realise that if the order passed in the O.A. would go then they would be nowhere to even stand. The Counsel has even failed to realise that the appellants being the highest bidders in respect of the properties which were put to auction by the Bank, which were subsequently set aside, would have no locus to challenge the order passed in the O.A. where they were not parties and with which they had no concern.
The appellants by now have succeeded in wasting enough judicial hours of various Fora by illegally occupying the properties as can be noticed from the facts in this case.
On 13.11.2000, the Tribunal had allowed O.A. No. 721/1996 for recovery of a sum of Rs. 81,47,124/- with interest @ 21% p.a. and cost of Rs. 84,000/- from the borrower company, namely, M/s. Lan Eseda Industries Limited. To recover this amount, two properties of the borrower company, i.e., C-4/1 and C-4/2, Gondia Industrial Area, Village Mundipur, Tehsil and Dist. Gondia, Maharashtra, measuring 98.90 acres were sold in public auction by the Recovery Officer (R.O.) on 27.6.2008. Appellant M/s. Shri Hari Rice & Agro Mills Pvt. Ltd. was the highest bidder in respect of the property C-4/1 whereas appellant M/s. D.J. Enterprises Ltd. was the highest bidder in respect of the property C-4/2.
The auction sale so held by the R.O. was set aside by the Tribunal below on 6.10.2008. The appellants, who were the highest bidders, challenged this order before this Tribunal by filing Appeal No. 195/2008. This appeal was dismissed on 9.6.2009. Aggrieved by this order, the appellants approached the Hon’ble High Court. Upon dismissal of their writ petition, the appellants filed an SLP before the Hon’ble Supreme Court, which was also dismissed.
Despite the above noted position, the appellants took possession of the properties illegally without any direction from the R.O. The appellants even came up with the plea that they had made constructions in the properties spending huge amount. This contention when raised was rejected by the High Court by observing that the appellants were the trespassers in the auctioned properties and so could not claim any equity in their favour. The possession of the appellants, therefore, was termed as illegal and they were termed as trespassers.
Not only that the appellants had illegally occupied the properties in question, but they created further complication by inducting M/s. Adani Powers as tenant in the properties concerned on 1.8.2010. This lease agreement was not properly stamped or registered. The R.O., vide his order dated 24.6.2009, had directed the appellants to hand over the possession of the properties in terms of the order passed by this Tribunal. The appellants still refused to surrender their possession. A Court Receiver was appointed by the R.O. for the purpose, who, on 21.10.2011, came back with the report that the properties in question were in possession of M/s Adani Power Ltd. The R.O. accordingly issued notice to M/s. Adani Power Ltd. They, M/s. Adani Power Ltd., were also put to notice that in case they failed to vacate the properties, they would be liable for substantial financial penalty for each day from 5.1.2012 onwards.
M/s. Adani Power Ltd. filed an application before the R.O. on 16.1.2012 seeking praying for extension of time to vacate the properties and for recalling the order dated 5.1.2012. The R.O. dismissed this application and directed them to deposit penalty of Rs. 1.50 lac for each day till delivery of possession. Aggrieved against this, M/s. Adani Power Ltd. filed an appeal before the Tribunal below. The Tribunal directed M/s Adani Power Ltd. to vacate the properties, but set aside that part of the order whereby penalty of Rs. 1.5 lac for each day was imposed while directing the R.O. to pass appropriate orders fixing compensation for illegal occupation of the premises after hearing the parties.
M/s. Adani Power Ltd. filed an appeal before this Tribunal against this order passed by the Tribunal below. Even the borrower company M/s. Lan Eseda Industries Ltd. had also filed an appeal before this Tribunal. Under the direction of this Tribunal, M/s. Adani Power Ltd. deposited a sum of Rs. 75 lacs before the R.O. towards the charges for use and occupation of the properties as an interim measure. The certificate-holder was allowed to adjust this amount towards the debt, without prejudice to the rights of the parties vide order passed by this Tribunal on 7.8.2013.
The borrower M/s. Lan Eseda Industries Ltd. moved an application demanding compensation of Rs. 6.45 crores from the successful bidders for unlawful use and occupation of the properties besides demanding damages from M/s. Adani Power Ltd. to the tune of Rs. 2,09,33,000/- for causing damage to the properties. The certificate-debtor also claimed the amount which the successful bidders who had trespassed into the property had received as rent from M/s. Adani Power Ltd. The R.O., after considering all the contentions, has held that M/s. Adani Power Ltd. is liable to pay a sum of Rs. 51,23,658/- as compensation for use and occupation of the properties from 19.1.2012 to 30.11.2012. The R.O., however, rejected the claim of damages by saying that he has no jurisdiction to entertain such a prayer.
The borrower company as well as the present appellants filed appeals against the order so passed by the R.O. While the borrower company challenged the order with the grievance that the compensation determined was inadequate, the present appellants challenged the order fixing compensation of Rs. 51,23,658/- and for setting aside and release of Rs. 62.50 lac deposited by them towards sale consideration and for awarding compensation of Rs. 25 lac for mental agony caused to them.
The Tribunal below has found that the compensation allowed to the borrower company was not adequate and accordingly has enhanced the same so far as the amount assessed against M/s Adani Power Ltd. is concerned. The Tribunal has also held that the certificate-holder would be entitled to adjust the amount of Rs. 62.50 lac received as rent towards the debt. The Tribunal has also not agreed with the finding returned by the R.O. that the borrower company was not entitled to maintain the claim for damages. As per the Tribunal, such claim could be maintained before the Tribunal. The Tribunal otherwise found that enough material was not available to decide the question of damages. However, liberty has been given to the borrower company to claim damages by approaching Civil Court as no proper material has been placed to assess the damages which could be so awarded. The claim of the appellants who were directed to pay compensation for the period from 19.1.2012 to 30.1.2012 towards the use and occupation of the properties, being trespassers, has been disallowed. The challenge raised in this regard has accordingly been rejected.
The appellants have filed the present appeals to impugn the said order. The learned Counsel for the appellants would refer to the O.A. filed in this case to urge that the Bank has fraudulently made this claim in the O.A. pleading that respondent was Fl. As already noticed, the appellants would have no locus to impugn the order passed in the O.A. They came to the scene subsequently, being the highest bidders in an auction conducted by the R.O. Otherwise, the facts noticed above would show that the appellants had acted in a most highhanded manner and has shown scant regard to even judicial orders passed. Despite dismissal of their writ petition by the High Court, they had the audacity to create a tenancy in favour of M/s. Adani Power Ltd. The act and conduct of the appellants was in blatant violation of law and has consumed umpteen work hours of various fora. Tribunal below and this Tribunal had to entertain various petitions, appeals etc. It is because of the act and conduct of the appellants that considerable Court hours were wasted to set right the illegalities on the part of the appellants. The Hon’ble High Court found no equity in favour of the appellants while dismissing their writ petition. The appellants being trespassers, that too, while showing scant regard to the order passed by the High Court, cannot be heard to waste of any further time of the fora. The Tribunal below has rightly allowed the compensation. The rent received by the appellants from M/s. Adani Power Ltd. cannot be allowed to be appropriated by them as they had no right to receive the same.
There is no cause made out to interfere in the impugned order passed by the Tribunal below. All the three appeals are without any substance. The appellants who have committed one illegal act after another cannot be allowed to take advantage of their illegal actions. These appeals are accordingly dismissed in limine with a cost of Rs. 50,000/- to be deposited with the Delhi State Legal Services Authority. Respondent IFCI would ensure that the cost imposed is realized.”
3. The relevant part of the order dated 16.9.2015 passed by the learned DRT, which was being impugned before this Tribunal and which challenged came to be repelled by this Tribunal buy order dated 9.12.2015, may now be noticed:-
“These three appeals arise out of the order dated 8.12.2014 passed by the Recovery Officer in RC No. 171/2001 in OA No. 721/1996. These appeals are disposed by common order.
1. This Tribunal issued Recovery Certificate vide judgment dated 13.11.2000 in OA No. 721/1996 for recovery of the sum of Rs. 18,47,124/- with interest @ 21% p.a and cost Rs. 84,00,000/ -from Lan Eseda Industries Ltd., The appellant in appellant, C-4/l and C-4/2, Gondia Industrial Area, Village Mundipur, Tehsil and Dist Gondia, Maharashtra admeasuring 98.90 acres/400337.50 sq mts. Were sold in public auction by the Recovery Officer on 27.6.2008. M/s Shree Han Rice & Agro Mills Pvt. Ltd. was the highest bidder in respect of the property C-4/1 and M/s DJ Enterprises Ltd. was the highest bidder in respect of the property C-4/2. They are the appellants in appeal-09/2015.
2. The sale conducted by the Recovery Officer was set aside by this Tribunal in appeal-07/2008 vide order dated 6.10.2008 and the recovery officer was directed to conduct fresh sale. The successful bidders challenged this order before DRAT, Delhi in appeal-195/2008. The appeal was dismissed vide order dated 9.6.2009. Aggrieved by the order, the successful bidders approached the Hon’ble High Court and thereafter by special leave before the Hon’ble Supreme Court but they were unsuccessful.
3. The successful bidders had token possession of the property without any direction from the recovery officer. They had raised a contention in the appeals that they had built constructions in the property spending huge amount The Hon'ble High Court while dealing with this contention observed that the appellants are trespassers on auctioned properties and they cannot claim any equity in their favour. They Hon'ble High Court observed that they were not in legal possession of the auctioned properties.
4. Hon’ble High Court of Delhi dismissed the writ petition filed by appellants in appeal-09/2015 on 4.5.2010 but on 1.8.2010 these appellants created a tenancy in favour of M/s. Adani Powers for storing their equipments/ goods in these properties by a lease agreement dated 1.8.2010 which was not properly stamped and registered.
5. The Recovery Officer vide order dated 24.06.2009 directed the appellants in appeal-09/ 2015 to hand over possession of the properties as directed by the Hon’ble DRAT in its order dated 9.6.009 in appeal-195/2008. They refused to surrender possession of the property. The Court receiver appointed by the recovery officer reported on 21.10.2011 that the properties were in possession of M/s. Adani Power Limited and M/s. Adani Power Limited was engaged in establishing thermal power project at Tirqda, Dist. Gondia and this property was used by them for storing equipments and heavy machinery and goods. Since the property was found in possession of M/s. Adani Power Limited the recovery officer issued notice to them and directed to vacate the properties. They were also given notice that in case of failure to vacate the property they shall be liable for substantial financial penalty for each day from 5.1.2012 onwards.
6. M/s. Adani Power Limited moved and application before recovery officer on 16.1.2012 seeking extension of time to vacate the property and to recall the order dated 5.1. 2012 The recovery officer dismissed that application vide order dated 19.1. 2012 and directed to deposit penalty of Rs. 1.50 lacs for each day till delivery of possession commencing from 5.1.2012.
7. Now it was for M/s. Adani Power Limited to appeal against this order before this Tribunal. Vide order dated 16.2.2012 in appeal-18/2012 this Tribunal directed M/s. Adani Power Limited to vacate the properties. But that part of the order imposing penalty of Rs. 1.5 lacs for each day was set aside by this Tribunal and directed the recovery officer to pass appropriate orders fixing compensation for illegal occupation of the premised after hearing the parties concerned. It was also directed that M/s. Adani Powers Limited shall be liable to pay such compensation as determined by the recovery officer w.e.f. 19.1.2012 until M/s. Adani Powers Limited vacates the premises.
8. Against the order of this Tribunal in appeal-18/2012 M/s. Adani Powers Limited filed appeal- 122/2012 before Hon’ble DRAT, Delhi. The certificate debtor M/s. industries Limited also filed appeal- 109/2012 before Hon’ble DRAT. In pursuance of the order dated 6.9.2012 of the Hon’ble DRAT M/s. Adani Power Limited deposited Rs. 75 lacs before the Recovery Officer towards the charges for use and occupation of the properties as an interim measure. The certificate holder was allowed to adjust this amount towards the debt without prejudice to the rights of the parties vide order dated 7.8.2012 passed by the DRAT.
9. The certificate debtor M/s. Lan Eseda Industries Limited filed application before the Recovery Officer demanding compensation of Rs. 6.45 crores from the successful bidder for unlawful use and occupation of the property and they also demanded damages from M/s. Adani Power Limited amounting to Rs. 2,09,33,000/- for causing damage to the property. The certificate debtor also claimed that the successful bidders who trespassed into the property is liable to refund all the benefits received by them as rent from M/s. Adani Powers Limited and for adjustment of the sum of Rs. 62.50 Iacs deposited by the successful bidders as sale consideration towards the debt.
10. The recovery Officer considered all these contentions and passed he impugned order dated 8.12.2012. The recovery officer held that M/s. Adani Powers Limited liable to pay Rs. 51.23.658/- As compensation for the use and occupation of the properties from 19.1.2012 to 30.11.2012. The Recovery Officer held that it has no jurisdiction to entertain the claim for damages and that application filed by certificate debtors was dismissed.
11. The recovery officer in the meanwhile had also sold the property C-5 Gondia Industrial Area. Village Mundipur. Tehsil and Dist. Gondia. Maharashtra holding that the property belonged to the certificate holder. The appellant in appeal-09/2015 was the successful bidder for the sum of Rs. 50.51 lacs. The sale was confirmed in its favour and sale certificate was issued and possession was ordered to be delivered vide order dated 9.11.2009. Ms. Lan Eseda Steels contended that this property belonged to them and they had filed objection before the Recovery Officer and on dismissal of the objection filed appeal before this Tribunal. Vide order dated 13.4.2012 this Tribunal set aside the sale of plot No. C-5 and cancelled the sale certificate issued. This order was challenged in appeal-286/2012 before the Hon'ble DRAT. The appeal was dismissed as withdrawn. This property was also leased out by auction purchaser to M/s. Adani Power Limited and subsequently possession has been re- delivered to m/s Lan Eseda Steels.
12. The appellant in appeal-06/2015 has challenged the order of compensation determined at Rs. 51,23,658/- as inadequate and they have demanded compensation @ Rs. 90 lacs p.m. for the period of occupation. The appellant has also challenged the order dismissing the prayer for damages.
13. The appellant in appeal-07/2015 has challenged the order of the recovery officer in dismissing the claim of compensation against successful bidders and demanded the sum or Rs. 62,30,300/- the admitted rent received by the successful bidders from M/s. Adani Powers Limited. The appellant has requested to adjust the sale consideration of Rs. 62.50 lacs deposited by the successful bidders towards this amount towards the debt due by the certificate debtor.
14. The appellant in appeal-09/2015 challenges the order affixing compensation of Rs. 51,23,658/- has prayed for setting aside lacs deposited by them as sale consideration and for awarding compensation of Rs. 25 lacs for the mental agony caused to them in setting aside the sales.
15. Now the points for determination in these appeals are:
(i). Whether the compensation for use and occupation determined by the Recovery Officer at Rs. 51,23,658/- is adequate and if not what shall be the proper compensation payable by M/s. Adani Power Limited to the appellant M/s. Lan Eseda Industries Limited?
(ii). Whether the successful bidders in respect of property C-4/1 and C-4/2 are liable for refund of the benefits enjoyed by them after trespass into the property?
(iii). Whether M/s. Adani Power Limited is liable for damages to M/s. Lon Eseda Industries Limited?
(iv). Whether the appellants in appeal-09/2015 are entitled to succeed in their claims?
16. Point No. (i)
(a). All the Courts in hierarchy upto Supreme Court have held that the successful bidder of C-4/1 and C-4/2 are trespassers. When the appeal filed by them was dismissed on 4.5.2010 immediately thereafter on 1.8.2010 they inducted M/s. Edani Power Limited as tenants in the property by way of an agreement which ought to have been properly stamped and registered. The liability of M/s. Adani Power Limited to pay compensation has also attained finality. The appellant has claimed the sum of Rs. 90 lacs p.m .The recovery officer granted the sum of Rs. 1,23,658/- The Recovery Officer has calculated the amount considering the rent fixed as per the rent agreement. The learned Counsel for the appellant Shri S.L. Gupta submitted since the rent agreement is not admissible in evidence in view of Section 17(I)(b) read with Section 49 of the' Registration Act ‘the rent’ fixed thereon cannot be a yard stick to determine the compensation. But it is a settled legal position that even if a document is not admissible in evidence because of Section 49 of the ‘Registration Act’ it can be used for collateral purposes as per the proviso to the section. Accordingly. The rent fixed in such an agreement can be taken into consideration, if other methods are not available.
(b). The learned Counsel Shri S.L. Gupta submitted that trespasser who blatantly violated orders of all the Courts up to High Court and retained the property and executed a rent agreement which itself is a sham document which does not disclose the actual rental of the property, that he being a trespasser was intending to grab anything at the earliest and the rent was for a song. It is true that under the circumstances as indicated above the rent stated in the agreement would not reflect the actual rent. This Tribunal has to consider other methods to ascertain the rent. One such method is depending upon the market value of the property. Of course, the Recovery Officer wanted to adopt this method and the parties submitted valuation reports.
(c). Shri Ramesh H. Bodani, on the request of the certificate holder inspected the property and filed his valuation report dated 13.11.2012 fixing the market value at Rs. 7,91,20,000/- the same person on the request of M/s. Adani Power Limited on 28.3.2012 gave the valuation at Rs. 2,17,S8,000/- See the drastic difference. I have to observe here that such persons are still in the panel as approved valuers. He has danced to the tune of the person who pays him and he had total disregard to his profession. I deter myself from making any further comments against this man as he is not before me to give and explanation on his side.
(d). Shri Avinash Pandey filed valuation report dated 23.2.2012 valuation at Rs. 28.70.00.000/- the same person by valuation report dated 3.6.2013 valued the property at Rs. 30.35.55.000/- We can see a difference of ocean in the valuation reports and none of the experts can b believed. The Recovery Officer was right in rejecting to rely upon the valuation reports to ascertain the actual rental.
17. The rent stated in the rent agreement is Rs. 33.000/- p.m. per acre. I have stated that this cannot be the actual rent. The Recovery Officer observed that since he is levying the compensation for use and occupation it shall not be the actual rent and he took double the amount Rs. 66.000/- per acre. Since I have found that it does not reflect the actual rent, the compensation for .use and occupation can be determined as three times of Rs. 33,000/- p.m. per acre. It comes to Rs. 99,000/- per acre per year. Therefore, for 98.90 acre it comes to Rs. 97,91,100/- For one month it would be Rs. 8,15,925/- to 30.11.2012 that means for 10 days and 10 months, for ten months the amount will come to Rs. 8,15,925/- x 10=Rs. 81,59,250. For ten days it will come to Rs. 27,197,50 x 10 =Rs. 2,71,975/- therefore , the total amount would be Rs. 81,59,250/- + Rs. 2,71,975/- = Rs. 84,31,225/-. This is the amount to which the appellant in appeal- 06/2015 is entitled to as compensation from M/s. Adani Power Limited. M/s. Adani power limited has deposited Rs. 75 lacs in pursuance of the order passed by the Hon'ble DRAT and this amount already is released to the certificate holder for adjustment towards the debt. Therefore, the balance amount payable by M/s. Adani Power Limited shall be Rs. 84,31,225/- Rs. 75,00,000= Rs. 9,31,225/- the appellant shall be entitled to further compensation from M/s. Adani Power Limited the sum of Rs. 9,31,225/- Ms. Adani Power Limited is directed to apt th sum of Rs. 9,31,225/- with simple interest @12% p.a from 30.11.2012 onwards until payment. The recovery officer shall receive the payment on behalf of M/s. Lan Eseda Industries Limited and remit the amount to certificate holder for adjustment towards the debt in RC No. 171/2001.
18. Point No. (ii)
(a). The Hon’ble High Court of Delhi has observed that the successful bidders are trespassers into the property. They could not have walked into the property. Even when their appeal was dismissed by the High Court on 4.5.2010 they created tenancy on 1.8.2010 which was unlawful. They had no right to create tenancy over the property. Vide order dated 6.10.2008 this Tribunal found that they are in unlawful possession of the property. The recovery officer had directed to deliver possession which was not complied. They fought upto Supreme Court to retain possession but they failed in their attempt. They had no right to let out the property. Therefore, they have no right to enjoy the benefits of the rent. M/s. Lan Eseda Industries Limited is the owner of the property and they alone are entitled to the benefits derived from the property. M/s. Adani Power Limited has stated that they have paid rent of Rs. 62,30,300/- as rental. They are not entitled to receive this amount. The recovery officer vide order dated 22.11.2012 directed them to deposit the sum of Rs. 62,30,300/- before the Recovery officer which they failed to comply. The principles of restitution is well established. It is explained by the Supreme Court in Kavita Trehan v. Balsara Hygiene Products Limited as follows:
“The jurisdiction to make restitution is inherent in every Court and will be exercised whenever the justice of the case demands. It will be exercised under inherent powers where the case did not strictly fall within the ambit of Section 144. Section 144 opens with the words “Where and in so for as a decree or an order is varied or reserved in any appeal, revision or other proceedings or is set aside or modified in any suit instituted for the purpose...” “the instant case may not strictly fall within the terms of Section 144, but the aggrieved party in such a case can appeal to the larger and general powers of restitution inherent in every Court.”
(b). In Special Officer (Revenue), Kerala State Electricity Board v. MRF Ltd., the principle was explained by the Supreme Court as under (IT, P. 379):
“24. There is no manner of doubt it is an imperative duty of the Court to ensure that the party to the Us does not suffer any unmerited hardship on account of an order passed by the Court. The principle of restitution as enunciated by the Privy Council in Alexander Rodger, Charles Carnie and Richard James Gilman v. The Comptoir ‘D’ Escompte De Parid (1871 LR (Privy Council Appeals) 465) has been followed by the Privy Council in later decisions and such principle being in conformity to justice and fair play be followed. It should, however, be noted that in an action by way of restitution, no inflexible rule can be laid down. It will be the endeavour of the Court to ensure that a party who had suffered in account of decision of the Court, since finally reversed, should be put back to the position, as far as practicable, in which he would have been if the decision of the Court adversely affecting him had not been passed. In giving full and complete relief in an action for restitution, the Court has not only power but also a duty to order for mesne profits, damages, costs, interest etc. As may deem expedient and fair conforming to justice to be done in the facts of the case.”
(c). The rent is a benefit to which the owner is entitled to. Therefore, the trespasser who has collected the rent has to refund the same to owner of the property M/s. Lan Eseda Industries Limited. M/s. Shree Hari Rice & Agro Pvt. Ltd. and M/s. DJ Enterprises Limited are liable to refund the sum of Rs. 62,30,300/- which they have collected as rent from M/s. Adani Power Limited. The order of the Recovery officer to remit this amount was not complied. Therefore, the appellant had asked the recovery officer to adjust this amount from the sale proceeds deposited amounting to Rs. 62.50 lacs. The Recovery Officer in his order dated 08.12.2014 has not considered the request of the appellant. Since the money was wrongfully retained by the successful bidders and they refused to remit the amount the proper order that can be passed is to adjust the sum of Rs. 62.50 lacs deposited by the them as sale consideration. The certificate holder had requested for allowing them to adjust this amount which also was not done by the recovery officer. There is no point in retaining this amount in a no Hen account as directed by the recovery officer. The certificate holder shall be entitled to adjust this amount of Rs. 62.50 lacs towards the debt w.e.f. the date of its deposit before the certificate holder and I direct the certificate holder to do accordingly. Since the amount due to successful bidders stands adjusted in place of the mount due from them there is nothing payable by the successful bidders and there is nothing payable to them also. The orders passed by the recovery officer to this effect are modified accordingly.
19. Point No. (iii)
(a). M/s. Adani Power Limited was inducted into the property wrongfully. They occupied the property on the basis of a lease obtained from a trespasser and the appellant has claimed that they damaged the property. The Recovery Officer in Paragraph-17.5 has held that recovery of damages is not within the scope and purview of the ‘RDDBFI Act’. He has relied upon the judgment of Hon'ble Supreme Court in Nahar Industrial Enterprises v. Hongkong & Shanghai Banking Corporation and observed that only civil Courts have jurisdiction and Tribunal has no jurisdiction to entertain claim for damages. The recovery officer failed to see that the claim for damages was not made on the original jurisdiction side. The Recovery officer had attached the property. Therefore, the property was in the custody of the Tribunal. During such custody of the Tribunal damage is alleged to be caused to the property by the successful bidder. The successful bidder came into picture by an act of the Court, by sale of the property. Therefore, the possession though taken illegally by the successful bidder was because of an act in respect of the property done by the Tribunal. If any, damage is caused to the property while it was in custody of the Court and if the property was to be returned to the real owner it is the duty of the Court to see that the property is returned in the same position. Every Court including the Tribunal has the inherent jurisdiction by applying the principles of restitution to do so and if the property cannot be restored to the previous position the only other alternative is to order damages payable by the person who caused the damage. I have stated the observations of the Supreme Court on this legal position above. This has been reiterated recently by the Hon’ble High Court of Delhi in the judgment dated 23.1.2012 in Pec Ltd. v. Thai Maparn Trading Co. Ltd. in OMP-149/2010. Therefore, the view expressed by the recovery officer that he has no jurisdiction to order damages is not correct.
(b). But in order to pay compensation for damages there should be sufficient materials placed before the Tribunal. The appellant has claimed the sum of Rs. 2,09,33,000/- and this amount is arrived at on the basis of a report procured by him. The appellant should have taken out a commission through the Tribunal to ascertain the damages. The opposite side would get on opportunity to rebut the findings arrived at by the commissioner. No sufficient materials are placed before this Tribunal to award damages. Therefore, while sitting in appeal this Tribunal cannot award any damages. But the appellant if serious can pursue his remedy before the civil Court for damages as per law. With this liberty granted to the appellant the request for damages is declined.
20. Point No. (iv)
(a). The appellants in appeal - 09/2015 has prayed for setting aside the order directing to pay compensation of Rs. 51,23,658/- for the period from 19.1.2012 to 30.1.2012 towards the use and occupation of the property No. C-4/1 and C-4/2. While deciding appeal - 06/2015 I have found that the certificate debtor is entitled to compensation for use and occupation and the compensation fixed by the Recovery officer has been enhanced. Therefore, this request cannot be allowed and hence declined.
(b). The applicants have prayed for setting aside attachment order of the property C-4/1 and C-4/2. The appellants are the successful bidders of the property and they cannot dispute the title of the property once the sale in favour of them stands cancelled. The recovery officer came to the conclusion that the certificate debtor is the owner of the property and order of attachment was passed. There is no illegality in this order and therefore this request is also rejected.
(c). The appellants have prayed for refund of Rs. 62.50 lacs the sale consideration deposited with interest @2l% p.a. In Paragraph-17(a) of this order I have already found that this amount has to be adjusted towards the rent received by these appellants from M/s. Adani Power Limited. The recovery officer directed these appellants to deposit the rent received by them from M/s. Adani Power Limited and they refused to deposit the rent. I have confirmed the order of the recovery officer which directed these appellants to deposit the rent enjoyed by them which was an unlawful enrichment by them as trespassers to the property. In view of the above findings the request for release of the sale consideration cannot be allowed and this request also stands rejected.
(d). These appellants have prayed for compensation of Rs. 25 lacs for causing mental harassment and losses. These appellants were the successful bidders. The sale conducted by the recovery officer was set aside by this Tribunal and that order attained finality. Any action of the recovery officer is subject to judicial scrutiny by the higher fora and the appellants cannot claim by setting aside the sale that they suffered mental harassment. I fail to understand how a company which is merely a juristic person because of the deeming provision of law can suffer mental harassment. This request is also turned down.
(e). These appellants are not entitled to any relief as prayed by them and their appeal is only to be rejected and I do accordingly.
21. In the result:
Appeals-06/2015 and 07/2015 stand allowed and appeal-09/2015 stands dismissed with the following directions:-
(i). M/s. Adani Power Limited is directed to further pay the sum of Rs. 9,31,225/- with simple interest @12% p.a. from 30.11.2012 onwards until payment. On failure to make the payment the recovery officer shall realize it from M/s Adani Power Limited remit the same to the Certificate Holder for adjustment towards the debt in RC No. 171/2001.
(ii). The Recovery Officer shall adjust the sale consideration Rs. 62,50,00/- (deposited by the appellants in appeal-09/2015) towards the rent received from M/s. Adani Power Limited and this amount shall be adjusted towards the debt in RC No. 171/2001. The certificate holder is directed to adjust this amount towards the debt in RC-171/2001 w.e.f. the date of its receipt.
(iii). The Recovery Officer is directed to release the sale consideration of Rs. 50,51,000/- in respect of Plot C-5, Gondia Industrial Area, Maharashtra to the auction purchaser with interest @12% p.a. from the date of deposit till payment.
(iv). The parties are directed to suffer their respective costs in appeals.”
4. These orders give the entire factual background and depict the tell tale circumstances justifying the conclusions drawn by different judicial fora that despite the fact that the present review petitioners had been successful in their effort to buy three properties in question in the public auction conducted by the Recovery Officer they had no business to on their own enter upon the properties auctioned in their favour without the involvement of the Recovery Officer. The auction in their favour had been set aside and challenge thereto right upto the Apex Court failed. Despite that the review petitioners had proceed to let out the properties in question and then they were required to pay damages for unauthorised use and occupation of the properties occupied by them without the involvement of the Recovery Officer and which occupation had been found to be unauthorised and illegal. They had challenged the orders of the Recovery Officer fixing financial liability on them for unauthorisedly encroaching upon the properties in question but failed before the DRT. They carried the matter then to this Tribunal but their appeals, as noticed earlier, were dismissed in limine by my learned predecessor. They are now seeking review and recall of order dated 9.12.2015 whereby their appeals were dismissed.
5. The relevant averments made in the review petitions may now be noticed. This is how the review petitioners have sought to justify their prayer for review of the order dated 9.12.2015 in their review petitions:-
“2. At the outset it most respectfully submitted that the appellants in the aforesaid appeals had raised the issue of Fraud, as allowed by the Hon’ble Supreme Court at any stage in (1994) 1 SCC I, but the Hon’ble did not appreciate the submission of the Counsel and, thus, an error apparent on the face of the record came to be committed in the matter at hand.
3. The first error apparent on the face of the record is on the very first page of the subject Order dated 184.108.40.206: “The appellant would have no locus to question the order passed in the OA”. With utmost respect it is stated that the appellants have the specify locus as they are the ones who are direct victims of the Fraud played by the respondents in obtaining the impugned order as a consequence of which they have been made to part with their hard earned money and later face wholly avoidable embarrassment when Auction Sale of the subject property was fraudulently set aside.
4. The second error apparent on the ace of the record is in the very next line of the said Order dated 9.12.2015: “The appellants have even failed to realize that if the order passed in the OA would go then they would be now here to even stand.” The appellants state that if the impugned order passed in the OA goes, then they will be legally entitled to just compensation if not the property they were made to buy in the Auction Sale because the said Order in the OA is the very foundation of the Fraud played by the respondents to unlawfully usurp public money as well as appellants' money for no fault on their part. The appellants were lured to bid and on bidding, were declared the highest bidder, and resultantly made to part with their hard earned money. So, it is very much a solid irrefutable case of reasonable expectation to receive and be the lawful owner of the subject property which was duly Auctioned in Public to them. Further, a lawful owner can never be declared as trespasser in his own property. Thus, undefeatable, valuable, legal rights have accrued in favour of the appellants on account of erroneous humiliation in public for no fault on their part but by acts and omissions on the part of the respondents called Fraud. If the bona fide Auction Purchasers are first sold properties by DRTs, and later the said Auction sales are set aside fraudulently, then that would be sending a message sales are set aside fraudulently, then that would be sending a message far and wide in public to prospective Auction Purchasers that you stand to lose your money and face humiliation at the hands of unscrupulous CDs in proceedings before DRTs and DRTs will not come to your aid. Can the country afford such a message in the face of unmanageable mounting NPAs running into more than 8 Lakhs Crores Rupees.
5. were sold in public auction.....” . It is most respectfully submitted that the said properties did not belong to the borrowers as claimed. The DRT had express knowledge of this fact, yet went ahead and sold a stranger’s properties in public auction. And that stranger is an instrumentality of the State - in other words - wealth and assets of the Public.
6. The next error apparent on the face of the record is further down in the next third para: “the appellants took possession of the properties illegally ....”. It is most respectfully submitted that it was natural for the appellants to have reasonable expectation that the Court would perform its part of the contractual obligation and hand over the possession of the properties in question once they have been duly and lawfully declared as the highest bidders in Public Auction and made to part with full money as agreed consideration.
A. Because the Hon’ble DRAT failed to apply its judicious mind to the fact of the case and thereby failed to appreciate the series of frauds played by the respondent No. 1 and 2 along with several others not only upon the Hon’ble DRT but also upon the petitioners. Therefore, impugned order is liable to be set aside;
B. The Hon’ble DRAT fell in grave error by dismissing the plea of the petitioners that plea of fraud can be raised at any time, even in collateral proceedings, and a Court before which fraud is pleaded has a duty to take judicial note of the said fraud and act accordingly without turning a blind eye to the fact of fraud, and, further, is duty bound to pass an appropriate order in appropriate cases directing the matter to be investigated by Serious Fraud Investigation Office (SFIO) if the fraud be of such a nature that it adversely affects the faith and trust of people in delivery of justice by Courts and Tribunals.
C. Because the Hon’ble DRAT failed to appreciate that petitioners lawfully entered the scene and have a locus because of the fraud deliberately played by the respondent No. 1 and 2 along with several others by first dishonestly inviting the bids to sell the subject properties, and thereafter, sold the subject properties to the Petitioners knowing fully well that the respondent No. 2 is not the owner of the subject properties and thus, the properties which belonged to someone else cannot be sold to recover the dues of the defaulter/borrower another, Respondent No 2 herein. Therefore, the impugned order is liable to be set aside.
D. Because the Hon'ble DRAT failed to appreciate that the respondent No. 2 has played a series of frauds from the very beginning wherein respondent No. 1 with the sole mala fide intention to achieve unlawfully and illegally which it is not allowed to achieve directly, filed the Original Application and supressed the fact that respondent No 1 is not the creditor and thus, could not have filed the Original Application before the Hon’ble Debt Recovery Tribunal to begin with. Thus, impugned order is liable to be set aside.
E. Because the Hon’ble DRAT foiled to appreciate that the money of the petitioners, who are bona fide auction purchasers, is being used to pay off the debt of the Defaulter/Borrower, respondent No. 2 herein, while the petitioners receive nothing in return.
F. Because the Hon'ble DRAT failed to appreciate that the petitioners cannot be legally or otherwise labelled as Trespassers post setting aside the Auction Sale because possession of the subject properties was taken based on legitimate expectation after the sale was duly confirmed way back in 2008/09 and after the petitioners had deposited the complete amount within 15 days. It is worth mentioning here none of the respondents ever raised any objection(s) when the petitioners took the possession of the subject properties.
G. Because the Hon’ble DRAT failed to appreciate the evident fraud as visible from a bare look at the Sole proclamation Which disclosed the name of the true owner: LAN ESADA Software Ltd., but the query of the learned Recovery officer was subdued by the respondent No. 1 by falsely stating that it is one and the same company as the Defaulter/Borrower, respondent No. 2 herein. Thus it emerges that the Respondent No 1 is willing to go to any extant for unlawfully usurping another’s money and has rather abused the forum of Hon’ble Tribunal by playing fraud in learned Tribunal for procuring favourable order by misrepresenting the material facts is visible to naked eye. This aspect is also not considered even by presiding Officer in impugned order dated 16.9.2015.
H. Because Hon’ble DRAT failed to appreciate that the Hon’ble DRT II passed a patently wrong order dated 16.9.2015 without appreciation the fact that the respondent No. 2 is not the owner of the Subject properties. The Hon’ble DRT-II categorically stated
Please Login To View The Full Judgment!
that...” Lan Eseda Limited is the owner of the property and they alone are entitled to the benefit derived from the property.” It is most respectfully submitted that the respondent No. 2 is not the owner of the subject properties. Thus respondent No. 2 is not entitled to any restitution from the appellant No. 1. One fails to understand since respondent No. 2 is not the owner, how can respondent No. 2 be allowed to claim any benefit arising out of subject properties? It is most respectfully submitted that the Hon'ble DRAT completely ignored this aspect and passed a wrong impugned order. Therefore, impugned order is liable to be set aside. I. Because the Hon’ble DRAT failed to appreciate that the respondent No. 1 and 2 have connived with each other and several others to unlawfully cause wrongful gain to themselves and wrong loss to petitioners of the huge sum of money deposited by appellants as sale consideration foe the subject properties. Therefore, now respondent No. 1 and 2 conveniently after usurping the huge money chose to close the matter as settled without giving due refunds to the suffering petitioners. Therefore, the impugned order which is completely silent on this aspect as well is liable to be set aside. J. Because the Hon’ble DRAT failed to appreciate that vide order dated 4.5.2010 Hon’ble High Court of Delhi at New Delhi in WP(C) in 10219/2009 did not give any such funding of fact that the petitioners were trespassers. The Hon’ble DRAT failed to appreciate that if only respondent No. 1 had approached the Hon’ble Courts with clean hands, then the petitioners would not have suffered at all. Therefore, impugned order is liable to be set aside. K. Because, the Hon’ble DRAT failed to appreciate that the respondent No. 1 and 2 connived with each other and with several others in a clandestine manner with common dishonest intention to hide illegalities of each other by suppressing material facts to get the outstanding debt paid off from the pocket of unsuspecting innocent Auction purchasers such as the petitioners herein, who are neither borrower nor debtors. P. Because, Hon’ble DRAT failed to appreciate the serious legal issues raised by the petitioners, and the petitioners are aggrieved parties being direct victims of the series of frauds as their legal right have been seriously infringed due to which they suffered a legal wrong. The interest of the petitioners recognized by law has been prejudicially affected by the act or omission of the Hon’ble Tribunal.” 6. From these paragraphs extracted from the review applications which were reiterated during the course of arguments also by the learned Counsel for the review petitioners it becomes evident that the review petitioners are in fact seeking aside of the order dated 9.12.2015 by this Tribunal as if this Tribunal is the appellate authority for its own orders. At the end of every paragraph it has been averred that the order dated 9.12.2015 is liable to be set aside. That however cannot be done by this Tribunal and only the higher Court, if approached, can come to a conclusion if that order is sustainable or not. There is no error apparent on the face of record. The maid grievance of the review petitioners has been that the properties in question which they had purchased in auction conducted by the Recovery Officer were not even the properties of the certificate debtors and so the certificate holder could not have asked for their auction and therefore by playing fraud the same were got auctioned in which the review petitioners participated in good faith and finally had been fastened with huge financial liability instead of being recognised as successful auction purchasers. This Tribunal in the order sought to be reviewed had observed that the review petitioners had no locus standi to challenge the verdict of the DRT in the O.A. If at all the review petitioners were aggrieved with that conclusion for the reason that allegations of fraud could be raised at any stage and before any forum including before this Tribunal their remedy was to challenge that finding before a higher Court and not to urge before this Tribunal itself that the conclusions arrived at in the order dated 9.12.2015 were contrary to well established legal position that whenever fraud upon Court or Tribunal is sought to be pleaded and demonstrated by anyone the forum before whom allegations of fraud are sought to be raised is bound to entertain the same. Its not even the case of the review petitioners that this Tribunal ignored any aspect highlighted by them. Their grievance is that wrong conclusions were reached while rejecting the appeals in limine. In my considered view this grievance cannot be raised in a review petition. 7. There are thus no good reasons and no case has been made out by the review petitioners to review the order dated 9.12.2015 passed by my learned predecessor. Consequently, these review petitions are dismissed. Review Petitions dismissed.