Full Judgment Text
* IN THE HIGH COURT OF DELHI AT NEW DELHI
nd
Date of decision: 22 May, 2013.
+ CS(OS) 1659/2010
ANOOP MADAN ..... Plaintiff
Through: Mr. Sakal Bhushan, Advocate.
Versus
DENA BANK ..... Defendant
Through: Mr. Sanjeev Gupta, Advocate.
CORAM:
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW
J U D G M E N T
%
1. The plaintiff has instituted this suit for recovery of Rs.22,50,000/-
with past, pendente lite and future interest @ 12% per annum till the date of
actual realization.
2. It is the case of the plaintiff in the plaint:
(i) that the defendant Dena Bank had got published the Sale
th
Notice dated 19 January, 2010 with respect to the secured asset
namely B-814 A, RIICO Industrial Area, Phase-II, Bhiwadi,
Rajasthan;
(ii) that one of the terms of the said Sale Notice inter alia was that
statutory and other dues payable and due on the secured asset shall be
CS(OS) 1659/2010 Page 1 of 17
borne by the buyer;
th
(iii) that the plaintiff submitted his bid dated 20 January, 2010 for
Rs.90 lakhs along with an Earnest Money Deposit (EMD) of Rs.9
lakhs but the said bid was conditional since the plaintiff had
introduced a condition therein that his liability will be limited to
payment of the bid amount and any amount owed to other authorities
i.e. Central Excise Department or the Department of Sales Tax or any
other agency prior to the date of sale, shall not be covered by the
plaintiff;
(iv) that the said conditional bid of the plaintiff was accepted by the
th
defendant Bank on 27 January, 2010; accordingly, the plaintiff
deposited a further sum of Rs.13,50,000/- with the defendant Bank to
make up a total deposit of 25% of the bid amount;
th
(v) thereafter the plaintiff received letter dated 27 January, 2010
from the defendant Bank again stating that the statutory and other
dues payable and due on the secured asset shall be borne by the
plaintiff;
(vi) that the aforesaid was in contradiction to the conditional bid
submitted by the plaintiff and accepted by the defendant Bank and in
CS(OS) 1659/2010 Page 2 of 17
pursuance whereto the plaintiff had deposited a further sum of
Rs.13,50,000/-;
(vii) that the plaintiff visited the defendant Bank on several
occasions for withdrawal of the aforesaid condition, but to no avail
th
and ultimately the plaintiff vide letter dated 19 February, 2010 called
upon the defendant Bank to refund the money but the defendant Bank
th
in its reply dated 6 March, 2010 avoided the issue;
th
(viii) that the plaintiff got legal notice dated 18 March, 2010
issued calling upon the defendant Bank to refund the amount of
nd
Rs.22,50,000/- deposited by him and to which a reply dated 22
March, 2010 was given by the defendant Bank, leading the plaintiff to
institute this suit for recovery.
3. The defendant Bank has contested the suit by filing a written
statement pleading:
(a) that at the time of accepting the bid of the plaintiff, the
th
defendant Bank had issued a letter dated 27 January, 2010 whereby
confirming the sale in favour of the plaintiff and the plaintiff had
accepted all the terms and conditions of the sale;
(b) that the defendant Bank had never given any assurance to the
CS(OS) 1659/2010 Page 3 of 17
plaintiff, neither at the time of accepting his bid nor subsequently, that
the liability of the plaintiff shall be limited to the bid amount only;
(c) that it was a clear condition of advertisement of sale that the
statutory and other dues shall be borne by the buyer;
(d) that the defendant Bank had never accepted the conditional bid
th
of the plaintiff and the letter dated 27 January, 2010 was issued to
the plaintiff at the same time when the plaintiff deposited
Rs.13,50,000/-;
(e) that the sum of Rs.13,50,000/- was accepted by the defendant
Bank in terms of the advertisement of sale and there was no question
of the defendant Bank agreeing to any other condition.
4. No replication has been filed by the plaintiff.
5. On the pleadings of the parties, the following issues were framed on
rd
3 February, 2012:
“1. Whether the plaintiff is entitled to recover an amount of
Rs.22,50,000/- from the defendant? OPP
2. Whether the plaintiff is entitled to any interest, if so at
what rate and for what period and on what amount? OPP
3. Relief.”
6. The plaintiff has thereafter filed I.A. No.19248/2012 under Order XII
CS(OS) 1659/2010 Page 4 of 17
Rule 6 of Civil Procedure Code (CPC), 1908 and to which a reply has been
filed by the defendant Bank.
st
7. During the hearing of the aforesaid application on 21 March, 2013, it
was the contention of the counsel for the plaintiff that the plaintiff is entitled
to a decree under Order XV of CPC also inasmuch as no oral evidence is
required and the suit can be decided on the basis of the admitted documents.
The counsel for the defendant Bank also agreed to the said course of action.
The counsels were thus heard finally on the suit including on the issue
framed as to interest, and judgment reserved.
8. Since the parties have done away with oral evidence and agreed to
decision on the basis of the admitted documents, it is relevant to set out the
relevant portions of the documents.
th
9. The defendant Bank had vide Sale Notice dated 19 January, 2010
scheduled the auction of property No.B-814 A, RIICO Industrial Area,
th
Phase-II, Bhiwadi, Rajasthan on 27 January, 2010 at its office at Rajendra
Place, New Delhi at 3.00 PM and had invited in sealed cover offers for
purchase of the said property fixing the Reserve Price at Rs.85 lakhs. The
relevant conditions mentioned in the Sale Notice were as under:
“1.....
CS(OS) 1659/2010 Page 5 of 17
2. The intending bidders should send their sealed cover
along with an EMD of Rs.8.50 Lakh (Refundable without any
interest to unsuccessful Bidders) by way of demand draft drawn
in favour of Dena Bank, payable at New Delhi. The amount of
EMD paid by successful bidders shall be adjusted towards the
sale price.
3....
4. The sealed offers will be opened by the undersigned at
Rajendra Place, Branch on 27/01/10 at 3.00 PM.
5. After opening the tenders, the intending bidders may be
given an opportunity at the discretion of the authorized officer
to have inter se bidding amongst them to enhance the offer
price.
6. The highest bid will be subject to approval of the secured
creditor/Authorized officer.
7. On completion of the auction, the successful purchasers
shall deposit 25% (less the EMD amount paid) of the sale
price immediately and balance 75% within 15 days failing
which the Bank shall forfeit all the amount already
paid/deposited by the purchaser in default payment, the
property shall at the discretion of Authorized
Officer/secured Creditor be sold to second highest bidders or
resold and the defaulting purchaser shall not have any claim.
8......
9. Any statutory and other dues payable and due on the
secured Asset shall be borne by the buyer.
10....
The offers not confirming to the terms of sale shall be rejected.”
th
10. The offer dated 20 January, 2010 of the plaintiff for Rs.90 lakhs
(Ex.P-1) comprises of a single sheet letter and besides enclosing a demand
draft of Rs.9 lakhs stipulated as under:
CS(OS) 1659/2010 Page 6 of 17
“1.....
2. And a part payment of Rs.13.50 lacs will be paid to you
th
on 27 January provided you accept our deviation that we will
make balance payment on or before 25.03.2010. Otherwise you
will return our 9.00 lac on same day.
Also with an assurance that our liability will be limited to the
payment of the above said amount & the dues to RIICO &
registry, any amount owed to any other authority i.e. Central
Excise Department or the Department of Sales Tax or any other
agency prior to the date of sale shall not be covered under our
liability of payment for the complete ownership of the said
property.”
th
11. The defendant Bank has filed Minutes of Auction dated 27 January,
2010 and which were admitted by the plaintiff during admission/denial of
documents and proved as Ex. D-1. The said minutes record as under:
“It is pertinent to note here that twice the sale of the secured
assets of M/s Hathway Systems (India) Pvt. Ltd. were
conducted as per laid down procedure of SARFAESI Act, 2002,
on 20.03.2009 in pursuance of Sale Notice dated 12.02.2009
published in The Statesman & Rajasthan Patrika and again sale
was conducted on 25.08.2009 in pursuance of Sale Notice dt.
18.07.2009 published in The Statesman and Haribhumi.
However, the secured assets was not sold on both the times as
no bidders came on the date of sale.
There was only one bid namely Mr. Anoop Madan, Proprietor,
M/s Rollcon Industries who participated in the auction dt.
27.01.2010. Mr. Anoop Madan, Proprietor, M/s. Rollcon
Industries in this regard signed the attendance sheet. The
Reserve Price is Rs.85,00,000/- (Rupees Eighty Five Lacs
Only). Mr. Anoop Madan, Proprietor, M/s Rollcon Industries
had submitted his bid vide letter dated 20.01.2010 along with
EMD amount of Rs.9.00 lacs (Lacs) vide Demand Draft bearing
CS(OS) 1659/2010 Page 7 of 17
No.675302 dated 19.01.2010 as he had quoted his bid for
Rs.90.00 lacs (Rupees Ninety Lacs Only). Mr. Anoop Madan,
Proprietor, M/s Rollcon Industries further submitted in his letter
dt. 20.01.2010 that he shall be able to deposit remaining 75% of
the sale price i.e. Rs.67.50 lacs (Rupees Sixty Seven Lacs Fifty
Thousand Only) on or before 25.03.2010 in lieu of fifteen days
from the date of sale.
As there is only bidder so we have acceded to his request for
deposit of remaining 75% of the sale price i.e. Rs.67.50 lacs
(Rupees Sixty Seven Lacs Fifty Thousand Only) on or before
25.03.2010 in lieu of fifteen days from the date of sale, after
accepting following Demand Draft/pay Order:-
Thus Mr. Anoop Madan, Proprietor, M/s Rollcon Industries had
deposited 25% of the sale price i.e. Rs.22.50 lacs (Rupees
Twenty Two Lacs Fifty Thousand Only) and the sale was
confirmed in his favour subject to the deposit of remaining 75%
of the sale price i.e. Rs.67.50 lacs (Rupees Sixty Seven Lacs
Fifty Thousand Only) on or before 25.03.2010.”
th
12. The defendant Bank also issued a letter dated 27 January, 2010 to
the plaintiff proved as Ex.D-2 inter alia stating as under:
“This has reference to your bid vide letter dt. 20.01.2010 for the
subject property, in pursuance of Sale Notice dt. 19.01.2010
published in two newspapers namely The Statesman and
Rajasthan Patrika.
.......
The undersigned confirmed the subject sale in your favour and
also acceded to your request for making payment of the Balance
75% i.e. Rs.67.50 Lacs (Rupees Sixty Seven Lacs Fifty
Thousand Only) of the sale price on or before 25.03.2010 in
lieu of fifteen days from the date of sale, subject to the
following stipulations:-
1) The Sale Certificate of the subject property which are
CS(OS) 1659/2010 Page 8 of 17
under the physical possession of the Authorised Officer of the
Bank under the SARFAESI, 2002 Act is to be issued strictly on
“As is where is Basis”.
2) You are supposed to deposit remaining 75% i.e. 67.50
Lacs (Rupees Sixty Seven Lacs Fifty Thousand Only) of the
sale price on or before 25.03.2010, failing which the Bank shall
forfeit all the amount already paid/deposited by you. In default
of payment, the property shall at the discretion of Authorized
officer/secured creditor to be re-sold and you shall not have any
claim.
3) You shall bear the expenses on Stamp duty and
Registration charges, if any.
4) Any statutory and other dues payable and due on the
secured Asset shall be borne by you.”
th
13. The plaintiff has filed photocopy of the letter dated 19 February,
th
2010 and the reply thereto of the defendant Bank dated 6 March, 2010
referred to in the pleadings and though no admission/denial of the said
documents have been done, probably owing to the same being photocopies,
but the defendant Bank in its written statement has not denied the said pleas
and thus in my opinion the said document can also be read in evidence. The
th
plaintiff vide the letter dated 19 February, 2010 stated that he had upon
acceptance of his conditional bid deposited Rs.13,50,000/- and “thereafter”
th
had received the letter dated 27 January, 2010, in which Clause 4 as under
was reiterated:
CS(OS) 1659/2010 Page 9 of 17
“ Any statutory and other dues payable and due on the secured
asset shall be borne by you”.
This letter/clause was stated to be in contradiction to the conditional
th
offer dated 20 January, 2010, and the defendant Bank was called upon to
refund the money within seven days of receipt of this letter. The defendant
th
Bank vide its reply dated 6 March, 2010 informed the plaintiff that it was
unable to accede to the request of the plaintiff for refund and called upon the
plaintiff to deposit the balance sale consideration of Rs.67.50 lakhs on or
th
before 25 March, 2010.
th
14. Need is not felt to reiterate the contents of the legal notice dated 18
nd
March, 2010 and reply dated 22 March, 2010 thereto.
15. The contention of the counsel for the plaintiff is that the Sale Notice
th th
dated 19 January, 2010 was an invitation to offer; that the bid dated 20
January, 2010 was an offer of the plaintiff; the same was accepted on the
fall of hammer and upon which acceptance, the plaintiff deposited
Rs.13,50,000/-; on acceptance of the offer, the defendant Bank is deemed to
have accepted the conditional offer of the plaintiff and could not have
thereafter reneged from the same. It is contended that the defendant Bank
having reneged from the contract, the plaintiff is entitled to refund of the
monies paid and the defendant Bank is not entitled to forfeit the same in
CS(OS) 1659/2010 Page 10 of 17
terms of the conditions of the Sale Notice.
16. On the contrary, the contention of the counsel for the defendant Bank
is that though the plaintiff had given a conditional offer but as is evident
from the minutes of the auction (Ex.D-1), the plaintiff did not insist on the
condition and sought variation only to the extent of extension of the time for
making the balance payment and which was accepted; that the letter dated
th
27 January, 2010 is not issued “thereafter” as the plaintiff has sought to
portray but is of the same date as of the opening of the bid. He has thus
contended that a case for forfeiture in accordance with the terms of the Sale
Notice is made out.
17. I have considered the rival submissions and at the outset clarify that
the parties, after the framing of issues and being put to trial having agreed to
decision on the basis of the documents and agreement qua which procedure
is permissible in law (Reference in this regard can be made to Saheb Ram
Vs. Ram Newaz AIR 1952 All. 882 and Florabel Skinner Vs. Jai Bajrang
Kala Mandir Ram Lila Mandal MANU/PH/0326/1979 (FB) where relying
on Section 20 of the Evidence Act, the procedure adopted by the parties of
decision on the basis of admission by the other party was held to be lawful)
the suit has to be decided within the parameters of the agreed procedure
CS(OS) 1659/2010 Page 11 of 17
only i.e. on an interpretation of the documents.
18. The adage, parties may lie but the documents do not lie, is of the
nature of a classicum . The position as emerging from the documents in this
case, in my opinion does not admit of any doubt whatsoever. The Sale
Notice, which the counsel for the plaintiff has correctly contended, is an
invitation to offer, clearly provided that offers not confirming to the terms
laid down therein shall be rejected. It was thus not open to anyone to make
an offer inconsistent with the terms and conditions laid down in the said
invitation to offer. The plaintiff still did so.
19. Upon the attention of the counsel for the plaintiff being invited to the
clause aforesaid in the Sale Notice, his contention was that the only
consequence of his offer inconsistent with the Sale Notice could be its
rejection; from the very fact that his offer was not rejected, rather accepted
as is evident from the acceptance by the defendant Bank of the further sum
of Rs.13,50,000/- from him, the defendant Bank is deemed to have agreed to
the conditional offer and the contract which came into existence between the
parties was the contract with the condition imposed by the plaintiff and the
defendant Bank being in breach thereof, is not entitled to forfeiture of the
amount paid.
CS(OS) 1659/2010 Page 12 of 17
20. The argument though attractive on the face, is factually not tenable.
The offers/bids were invited in sealed cover. It can thus safely be assumed
th
that the offer dated 20 January, 2010 of the plaintiff comprising aforesaid
of a single sheet was contained in a sealed envelope. The said sealed
th
envelopes were to be opened only on 27 January, 2010 at 3.00 PM. The
defendant Bank itself till the stage of opening of the sealed envelope
submitted by the plaintiff had no occasion to know that the offer of the
plaintiff was a conditional one and was well-neigh entitled to presume that
the offer contained in the sealed envelope was in accordance with the Sale
Notice. Had the plaintiff been desirous of making a conditional offer, the
plaintiff ought to have besides the sealed envelope containing its bid and
EMD, given an open letter to the defendant Bank setting out its condition
and only in which eventuality, the defendant Bank prior to the opening of
the sealed offers/bids could have had notice of the bid/offer of the plaintiff
being not confirming to the terms of the Sale Notice and would have had the
opportunity to reject the same.
21. As the Minutes of Auction show, only one bid was received i.e. of the
plaintiff. Thus, the plaintiff would have been the only person at the office
of the defendant Bank at the stipulated time when the bids were opened.
CS(OS) 1659/2010 Page 13 of 17
The defendant Bank is supposed to have at least then known that the bid of
th
the plaintiff was a conditional one. However, on 27 January, 2010 at/after
3.00 PM, the following events occurred:
(i) opening of the bid;
(ii) drawing of the minutes of the auction;
th
(iii) issuance and delivery of the letter dated 27 January, 2010 by
the defendant Bank to the plaintiff.
22. The fulcrum of the argument of the counsel for the plaintiff is the
acceptance of the conditional bid preceding the issuance of the letter dated
th
27 January, 2010. It is precisely for that reason that the plaintiff in his
pleadings uses the word “thereafter”. What falls for determination is,
whether the said contention of the plaintiff is believable/can be accepted.
23. At the outset, the contention of the plaintiff that the bid stood
accepted on the fall of hammer is again contrary to the sale condition supra,
of the highest bid being subject to approval of the Authorized Officer of the
defendant Bank. The bid was thus not to be accepted on the fall of hammer
but only on approval of the Authorized Officer of the defendant Bank.
24. It is for such approval that the Minutes of the Auction have been
drawn up. The said minutes though not signed by the plaintiff have been
CS(OS) 1659/2010 Page 14 of 17
admitted by the plaintiff. The said minutes, though record the request of the
plaintiff for extension of time for deposit of the balance sale consideration
th th
till 25 March, 2010 instead of within 15 days of 27 January, 2010 and
th
which was also a condition of the plaintiff in his offer dated 20 January,
2010, but do not record the other condition of the plaintiff in his offer, of
being not liable for statutory dues. Since the plaintiff as per the Sale Notice
was required to be present at the time of opening of the bids, for inter se
bidding if any required and has admitted such presence inasmuch as the
amount of Rs.13,50,000/- was paid on the same day, it follows that the
minutes aforesaid were drawn in the presence of the plaintiff. The
admission, during admission/denial of documents by the plaintiff, of the
said minutes is also indicative thereof. Thus, the argument of the plaintiff of
the defendant Bank having accepted his conditional offer cannot be
believed.
th
25. Not only so, the letter dated 27 January, 2010 also was not issued
“thereafter” but before the plaintiff left the office of the defendant Bank.
The said letter is in fact the approval of the bid of the plaintiff by the
Authorized Officer of the defendant Bank. The said acceptance again, save
for varying the date of payment of the balance sale consideration, reiterates
CS(OS) 1659/2010 Page 15 of 17
the other conditions of the Sale Notice. The plaintiff is shown to have
th
personally accepted the said letter on 27 January, 2010 itself.
th
26. The chronology of events in the office of the defendant Bank on 27
January, 2010 is revealed as, (i) opening of the bids; (ii) the plaintiff
agreeing to give up the condition in his bid of being not liable for statutory
dues and the defendant Bank agreeing to extend the time for payment of
balance sale consideration; (iii) the Minutes of Auction being drawn up;
th
and, (iv) the letter dated 27 January, 2010 being issued by the defendant
Bank to the plaintiff.
27. Had the plaintiff not given up the condition put in the bid, of not
being liable for statutory dues and/or agreed that the statutory dues shall be
th
borne by him, the plaintiff would have neither signed the letter dated 27
January, 2010 nor left the office of the defendant Bank without the demand
th
drafts for Rs.9 lakhs and Rs.13,50,000/-. It is rather the letter dated 27
January, 2010 signed both by the plaintiff as well as the defendant Bank
which constitutes the contract between the parties and as per which contract,
the statutory dues were payable by the plaintiff and the amount of
Rs.22,50,000/- deposited by the plaintiff to be forfeited upon the failure of
the plaintiff to deposit the balance sale consideration.
CS(OS) 1659/2010 Page 16 of 17
28. The plaintiff appears to have changed his mind subsequently. It is
th
significant that the first communication from the plaintiff after 27 January,
th
2010 is of 19 February, 2010. The plaintiff therein as well as in the plaint
th
has falsely represented that the letter dated 27 January, 2010 was received
by him “thereafter”. As aforesaid, the said letter was personally received by
th
the plaintiff on 27 January, 2010 itself and signed in acceptance of the
terms therein.
29. The right of the defendant Bank to forfeit is otherwise not under
challenge and neither any pleading has been made by the plaintiff in that
regard nor any issue claimed.
30. There is thus no merit in the suit; the same is dismissed; however in
the circumstances and considering that the suit has been disposed of
expeditiously, no costs.
Decree sheet be drawn up.
RAJIV SAHAI ENDLAW, J
MAY 22, 2013
bs.
CS(OS) 1659/2010 Page 17 of 17
nd
Date of decision: 22 May, 2013.
+ CS(OS) 1659/2010
ANOOP MADAN ..... Plaintiff
Through: Mr. Sakal Bhushan, Advocate.
Versus
DENA BANK ..... Defendant
Through: Mr. Sanjeev Gupta, Advocate.
CORAM:
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW
J U D G M E N T
%
1. The plaintiff has instituted this suit for recovery of Rs.22,50,000/-
with past, pendente lite and future interest @ 12% per annum till the date of
actual realization.
2. It is the case of the plaintiff in the plaint:
(i) that the defendant Dena Bank had got published the Sale
th
Notice dated 19 January, 2010 with respect to the secured asset
namely B-814 A, RIICO Industrial Area, Phase-II, Bhiwadi,
Rajasthan;
(ii) that one of the terms of the said Sale Notice inter alia was that
statutory and other dues payable and due on the secured asset shall be
CS(OS) 1659/2010 Page 1 of 17
borne by the buyer;
th
(iii) that the plaintiff submitted his bid dated 20 January, 2010 for
Rs.90 lakhs along with an Earnest Money Deposit (EMD) of Rs.9
lakhs but the said bid was conditional since the plaintiff had
introduced a condition therein that his liability will be limited to
payment of the bid amount and any amount owed to other authorities
i.e. Central Excise Department or the Department of Sales Tax or any
other agency prior to the date of sale, shall not be covered by the
plaintiff;
(iv) that the said conditional bid of the plaintiff was accepted by the
th
defendant Bank on 27 January, 2010; accordingly, the plaintiff
deposited a further sum of Rs.13,50,000/- with the defendant Bank to
make up a total deposit of 25% of the bid amount;
th
(v) thereafter the plaintiff received letter dated 27 January, 2010
from the defendant Bank again stating that the statutory and other
dues payable and due on the secured asset shall be borne by the
plaintiff;
(vi) that the aforesaid was in contradiction to the conditional bid
submitted by the plaintiff and accepted by the defendant Bank and in
CS(OS) 1659/2010 Page 2 of 17
pursuance whereto the plaintiff had deposited a further sum of
Rs.13,50,000/-;
(vii) that the plaintiff visited the defendant Bank on several
occasions for withdrawal of the aforesaid condition, but to no avail
th
and ultimately the plaintiff vide letter dated 19 February, 2010 called
upon the defendant Bank to refund the money but the defendant Bank
th
in its reply dated 6 March, 2010 avoided the issue;
th
(viii) that the plaintiff got legal notice dated 18 March, 2010
issued calling upon the defendant Bank to refund the amount of
nd
Rs.22,50,000/- deposited by him and to which a reply dated 22
March, 2010 was given by the defendant Bank, leading the plaintiff to
institute this suit for recovery.
3. The defendant Bank has contested the suit by filing a written
statement pleading:
(a) that at the time of accepting the bid of the plaintiff, the
th
defendant Bank had issued a letter dated 27 January, 2010 whereby
confirming the sale in favour of the plaintiff and the plaintiff had
accepted all the terms and conditions of the sale;
(b) that the defendant Bank had never given any assurance to the
CS(OS) 1659/2010 Page 3 of 17
plaintiff, neither at the time of accepting his bid nor subsequently, that
the liability of the plaintiff shall be limited to the bid amount only;
(c) that it was a clear condition of advertisement of sale that the
statutory and other dues shall be borne by the buyer;
(d) that the defendant Bank had never accepted the conditional bid
th
of the plaintiff and the letter dated 27 January, 2010 was issued to
the plaintiff at the same time when the plaintiff deposited
Rs.13,50,000/-;
(e) that the sum of Rs.13,50,000/- was accepted by the defendant
Bank in terms of the advertisement of sale and there was no question
of the defendant Bank agreeing to any other condition.
4. No replication has been filed by the plaintiff.
5. On the pleadings of the parties, the following issues were framed on
rd
3 February, 2012:
“1. Whether the plaintiff is entitled to recover an amount of
Rs.22,50,000/- from the defendant? OPP
2. Whether the plaintiff is entitled to any interest, if so at
what rate and for what period and on what amount? OPP
3. Relief.”
6. The plaintiff has thereafter filed I.A. No.19248/2012 under Order XII
CS(OS) 1659/2010 Page 4 of 17
Rule 6 of Civil Procedure Code (CPC), 1908 and to which a reply has been
filed by the defendant Bank.
st
7. During the hearing of the aforesaid application on 21 March, 2013, it
was the contention of the counsel for the plaintiff that the plaintiff is entitled
to a decree under Order XV of CPC also inasmuch as no oral evidence is
required and the suit can be decided on the basis of the admitted documents.
The counsel for the defendant Bank also agreed to the said course of action.
The counsels were thus heard finally on the suit including on the issue
framed as to interest, and judgment reserved.
8. Since the parties have done away with oral evidence and agreed to
decision on the basis of the admitted documents, it is relevant to set out the
relevant portions of the documents.
th
9. The defendant Bank had vide Sale Notice dated 19 January, 2010
scheduled the auction of property No.B-814 A, RIICO Industrial Area,
th
Phase-II, Bhiwadi, Rajasthan on 27 January, 2010 at its office at Rajendra
Place, New Delhi at 3.00 PM and had invited in sealed cover offers for
purchase of the said property fixing the Reserve Price at Rs.85 lakhs. The
relevant conditions mentioned in the Sale Notice were as under:
“1.....
CS(OS) 1659/2010 Page 5 of 17
2. The intending bidders should send their sealed cover
along with an EMD of Rs.8.50 Lakh (Refundable without any
interest to unsuccessful Bidders) by way of demand draft drawn
in favour of Dena Bank, payable at New Delhi. The amount of
EMD paid by successful bidders shall be adjusted towards the
sale price.
3....
4. The sealed offers will be opened by the undersigned at
Rajendra Place, Branch on 27/01/10 at 3.00 PM.
5. After opening the tenders, the intending bidders may be
given an opportunity at the discretion of the authorized officer
to have inter se bidding amongst them to enhance the offer
price.
6. The highest bid will be subject to approval of the secured
creditor/Authorized officer.
7. On completion of the auction, the successful purchasers
shall deposit 25% (less the EMD amount paid) of the sale
price immediately and balance 75% within 15 days failing
which the Bank shall forfeit all the amount already
paid/deposited by the purchaser in default payment, the
property shall at the discretion of Authorized
Officer/secured Creditor be sold to second highest bidders or
resold and the defaulting purchaser shall not have any claim.
8......
9. Any statutory and other dues payable and due on the
secured Asset shall be borne by the buyer.
10....
The offers not confirming to the terms of sale shall be rejected.”
th
10. The offer dated 20 January, 2010 of the plaintiff for Rs.90 lakhs
(Ex.P-1) comprises of a single sheet letter and besides enclosing a demand
draft of Rs.9 lakhs stipulated as under:
CS(OS) 1659/2010 Page 6 of 17
“1.....
2. And a part payment of Rs.13.50 lacs will be paid to you
th
on 27 January provided you accept our deviation that we will
make balance payment on or before 25.03.2010. Otherwise you
will return our 9.00 lac on same day.
Also with an assurance that our liability will be limited to the
payment of the above said amount & the dues to RIICO &
registry, any amount owed to any other authority i.e. Central
Excise Department or the Department of Sales Tax or any other
agency prior to the date of sale shall not be covered under our
liability of payment for the complete ownership of the said
property.”
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11. The defendant Bank has filed Minutes of Auction dated 27 January,
2010 and which were admitted by the plaintiff during admission/denial of
documents and proved as Ex. D-1. The said minutes record as under:
“It is pertinent to note here that twice the sale of the secured
assets of M/s Hathway Systems (India) Pvt. Ltd. were
conducted as per laid down procedure of SARFAESI Act, 2002,
on 20.03.2009 in pursuance of Sale Notice dated 12.02.2009
published in The Statesman & Rajasthan Patrika and again sale
was conducted on 25.08.2009 in pursuance of Sale Notice dt.
18.07.2009 published in The Statesman and Haribhumi.
However, the secured assets was not sold on both the times as
no bidders came on the date of sale.
There was only one bid namely Mr. Anoop Madan, Proprietor,
M/s Rollcon Industries who participated in the auction dt.
27.01.2010. Mr. Anoop Madan, Proprietor, M/s. Rollcon
Industries in this regard signed the attendance sheet. The
Reserve Price is Rs.85,00,000/- (Rupees Eighty Five Lacs
Only). Mr. Anoop Madan, Proprietor, M/s Rollcon Industries
had submitted his bid vide letter dated 20.01.2010 along with
EMD amount of Rs.9.00 lacs (Lacs) vide Demand Draft bearing
CS(OS) 1659/2010 Page 7 of 17
No.675302 dated 19.01.2010 as he had quoted his bid for
Rs.90.00 lacs (Rupees Ninety Lacs Only). Mr. Anoop Madan,
Proprietor, M/s Rollcon Industries further submitted in his letter
dt. 20.01.2010 that he shall be able to deposit remaining 75% of
the sale price i.e. Rs.67.50 lacs (Rupees Sixty Seven Lacs Fifty
Thousand Only) on or before 25.03.2010 in lieu of fifteen days
from the date of sale.
As there is only bidder so we have acceded to his request for
deposit of remaining 75% of the sale price i.e. Rs.67.50 lacs
(Rupees Sixty Seven Lacs Fifty Thousand Only) on or before
25.03.2010 in lieu of fifteen days from the date of sale, after
accepting following Demand Draft/pay Order:-
Thus Mr. Anoop Madan, Proprietor, M/s Rollcon Industries had
deposited 25% of the sale price i.e. Rs.22.50 lacs (Rupees
Twenty Two Lacs Fifty Thousand Only) and the sale was
confirmed in his favour subject to the deposit of remaining 75%
of the sale price i.e. Rs.67.50 lacs (Rupees Sixty Seven Lacs
Fifty Thousand Only) on or before 25.03.2010.”
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12. The defendant Bank also issued a letter dated 27 January, 2010 to
the plaintiff proved as Ex.D-2 inter alia stating as under:
“This has reference to your bid vide letter dt. 20.01.2010 for the
subject property, in pursuance of Sale Notice dt. 19.01.2010
published in two newspapers namely The Statesman and
Rajasthan Patrika.
.......
The undersigned confirmed the subject sale in your favour and
also acceded to your request for making payment of the Balance
75% i.e. Rs.67.50 Lacs (Rupees Sixty Seven Lacs Fifty
Thousand Only) of the sale price on or before 25.03.2010 in
lieu of fifteen days from the date of sale, subject to the
following stipulations:-
1) The Sale Certificate of the subject property which are
CS(OS) 1659/2010 Page 8 of 17
under the physical possession of the Authorised Officer of the
Bank under the SARFAESI, 2002 Act is to be issued strictly on
“As is where is Basis”.
2) You are supposed to deposit remaining 75% i.e. 67.50
Lacs (Rupees Sixty Seven Lacs Fifty Thousand Only) of the
sale price on or before 25.03.2010, failing which the Bank shall
forfeit all the amount already paid/deposited by you. In default
of payment, the property shall at the discretion of Authorized
officer/secured creditor to be re-sold and you shall not have any
claim.
3) You shall bear the expenses on Stamp duty and
Registration charges, if any.
4) Any statutory and other dues payable and due on the
secured Asset shall be borne by you.”
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13. The plaintiff has filed photocopy of the letter dated 19 February,
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2010 and the reply thereto of the defendant Bank dated 6 March, 2010
referred to in the pleadings and though no admission/denial of the said
documents have been done, probably owing to the same being photocopies,
but the defendant Bank in its written statement has not denied the said pleas
and thus in my opinion the said document can also be read in evidence. The
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plaintiff vide the letter dated 19 February, 2010 stated that he had upon
acceptance of his conditional bid deposited Rs.13,50,000/- and “thereafter”
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had received the letter dated 27 January, 2010, in which Clause 4 as under
was reiterated:
CS(OS) 1659/2010 Page 9 of 17
“ Any statutory and other dues payable and due on the secured
asset shall be borne by you”.
This letter/clause was stated to be in contradiction to the conditional
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offer dated 20 January, 2010, and the defendant Bank was called upon to
refund the money within seven days of receipt of this letter. The defendant
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Bank vide its reply dated 6 March, 2010 informed the plaintiff that it was
unable to accede to the request of the plaintiff for refund and called upon the
plaintiff to deposit the balance sale consideration of Rs.67.50 lakhs on or
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before 25 March, 2010.
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14. Need is not felt to reiterate the contents of the legal notice dated 18
nd
March, 2010 and reply dated 22 March, 2010 thereto.
15. The contention of the counsel for the plaintiff is that the Sale Notice
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dated 19 January, 2010 was an invitation to offer; that the bid dated 20
January, 2010 was an offer of the plaintiff; the same was accepted on the
fall of hammer and upon which acceptance, the plaintiff deposited
Rs.13,50,000/-; on acceptance of the offer, the defendant Bank is deemed to
have accepted the conditional offer of the plaintiff and could not have
thereafter reneged from the same. It is contended that the defendant Bank
having reneged from the contract, the plaintiff is entitled to refund of the
monies paid and the defendant Bank is not entitled to forfeit the same in
CS(OS) 1659/2010 Page 10 of 17
terms of the conditions of the Sale Notice.
16. On the contrary, the contention of the counsel for the defendant Bank
is that though the plaintiff had given a conditional offer but as is evident
from the minutes of the auction (Ex.D-1), the plaintiff did not insist on the
condition and sought variation only to the extent of extension of the time for
making the balance payment and which was accepted; that the letter dated
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27 January, 2010 is not issued “thereafter” as the plaintiff has sought to
portray but is of the same date as of the opening of the bid. He has thus
contended that a case for forfeiture in accordance with the terms of the Sale
Notice is made out.
17. I have considered the rival submissions and at the outset clarify that
the parties, after the framing of issues and being put to trial having agreed to
decision on the basis of the documents and agreement qua which procedure
is permissible in law (Reference in this regard can be made to Saheb Ram
Vs. Ram Newaz AIR 1952 All. 882 and Florabel Skinner Vs. Jai Bajrang
Kala Mandir Ram Lila Mandal MANU/PH/0326/1979 (FB) where relying
on Section 20 of the Evidence Act, the procedure adopted by the parties of
decision on the basis of admission by the other party was held to be lawful)
the suit has to be decided within the parameters of the agreed procedure
CS(OS) 1659/2010 Page 11 of 17
only i.e. on an interpretation of the documents.
18. The adage, parties may lie but the documents do not lie, is of the
nature of a classicum . The position as emerging from the documents in this
case, in my opinion does not admit of any doubt whatsoever. The Sale
Notice, which the counsel for the plaintiff has correctly contended, is an
invitation to offer, clearly provided that offers not confirming to the terms
laid down therein shall be rejected. It was thus not open to anyone to make
an offer inconsistent with the terms and conditions laid down in the said
invitation to offer. The plaintiff still did so.
19. Upon the attention of the counsel for the plaintiff being invited to the
clause aforesaid in the Sale Notice, his contention was that the only
consequence of his offer inconsistent with the Sale Notice could be its
rejection; from the very fact that his offer was not rejected, rather accepted
as is evident from the acceptance by the defendant Bank of the further sum
of Rs.13,50,000/- from him, the defendant Bank is deemed to have agreed to
the conditional offer and the contract which came into existence between the
parties was the contract with the condition imposed by the plaintiff and the
defendant Bank being in breach thereof, is not entitled to forfeiture of the
amount paid.
CS(OS) 1659/2010 Page 12 of 17
20. The argument though attractive on the face, is factually not tenable.
The offers/bids were invited in sealed cover. It can thus safely be assumed
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that the offer dated 20 January, 2010 of the plaintiff comprising aforesaid
of a single sheet was contained in a sealed envelope. The said sealed
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envelopes were to be opened only on 27 January, 2010 at 3.00 PM. The
defendant Bank itself till the stage of opening of the sealed envelope
submitted by the plaintiff had no occasion to know that the offer of the
plaintiff was a conditional one and was well-neigh entitled to presume that
the offer contained in the sealed envelope was in accordance with the Sale
Notice. Had the plaintiff been desirous of making a conditional offer, the
plaintiff ought to have besides the sealed envelope containing its bid and
EMD, given an open letter to the defendant Bank setting out its condition
and only in which eventuality, the defendant Bank prior to the opening of
the sealed offers/bids could have had notice of the bid/offer of the plaintiff
being not confirming to the terms of the Sale Notice and would have had the
opportunity to reject the same.
21. As the Minutes of Auction show, only one bid was received i.e. of the
plaintiff. Thus, the plaintiff would have been the only person at the office
of the defendant Bank at the stipulated time when the bids were opened.
CS(OS) 1659/2010 Page 13 of 17
The defendant Bank is supposed to have at least then known that the bid of
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the plaintiff was a conditional one. However, on 27 January, 2010 at/after
3.00 PM, the following events occurred:
(i) opening of the bid;
(ii) drawing of the minutes of the auction;
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(iii) issuance and delivery of the letter dated 27 January, 2010 by
the defendant Bank to the plaintiff.
22. The fulcrum of the argument of the counsel for the plaintiff is the
acceptance of the conditional bid preceding the issuance of the letter dated
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27 January, 2010. It is precisely for that reason that the plaintiff in his
pleadings uses the word “thereafter”. What falls for determination is,
whether the said contention of the plaintiff is believable/can be accepted.
23. At the outset, the contention of the plaintiff that the bid stood
accepted on the fall of hammer is again contrary to the sale condition supra,
of the highest bid being subject to approval of the Authorized Officer of the
defendant Bank. The bid was thus not to be accepted on the fall of hammer
but only on approval of the Authorized Officer of the defendant Bank.
24. It is for such approval that the Minutes of the Auction have been
drawn up. The said minutes though not signed by the plaintiff have been
CS(OS) 1659/2010 Page 14 of 17
admitted by the plaintiff. The said minutes, though record the request of the
plaintiff for extension of time for deposit of the balance sale consideration
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till 25 March, 2010 instead of within 15 days of 27 January, 2010 and
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which was also a condition of the plaintiff in his offer dated 20 January,
2010, but do not record the other condition of the plaintiff in his offer, of
being not liable for statutory dues. Since the plaintiff as per the Sale Notice
was required to be present at the time of opening of the bids, for inter se
bidding if any required and has admitted such presence inasmuch as the
amount of Rs.13,50,000/- was paid on the same day, it follows that the
minutes aforesaid were drawn in the presence of the plaintiff. The
admission, during admission/denial of documents by the plaintiff, of the
said minutes is also indicative thereof. Thus, the argument of the plaintiff of
the defendant Bank having accepted his conditional offer cannot be
believed.
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25. Not only so, the letter dated 27 January, 2010 also was not issued
“thereafter” but before the plaintiff left the office of the defendant Bank.
The said letter is in fact the approval of the bid of the plaintiff by the
Authorized Officer of the defendant Bank. The said acceptance again, save
for varying the date of payment of the balance sale consideration, reiterates
CS(OS) 1659/2010 Page 15 of 17
the other conditions of the Sale Notice. The plaintiff is shown to have
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personally accepted the said letter on 27 January, 2010 itself.
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26. The chronology of events in the office of the defendant Bank on 27
January, 2010 is revealed as, (i) opening of the bids; (ii) the plaintiff
agreeing to give up the condition in his bid of being not liable for statutory
dues and the defendant Bank agreeing to extend the time for payment of
balance sale consideration; (iii) the Minutes of Auction being drawn up;
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and, (iv) the letter dated 27 January, 2010 being issued by the defendant
Bank to the plaintiff.
27. Had the plaintiff not given up the condition put in the bid, of not
being liable for statutory dues and/or agreed that the statutory dues shall be
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borne by him, the plaintiff would have neither signed the letter dated 27
January, 2010 nor left the office of the defendant Bank without the demand
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drafts for Rs.9 lakhs and Rs.13,50,000/-. It is rather the letter dated 27
January, 2010 signed both by the plaintiff as well as the defendant Bank
which constitutes the contract between the parties and as per which contract,
the statutory dues were payable by the plaintiff and the amount of
Rs.22,50,000/- deposited by the plaintiff to be forfeited upon the failure of
the plaintiff to deposit the balance sale consideration.
CS(OS) 1659/2010 Page 16 of 17
28. The plaintiff appears to have changed his mind subsequently. It is
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significant that the first communication from the plaintiff after 27 January,
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2010 is of 19 February, 2010. The plaintiff therein as well as in the plaint
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has falsely represented that the letter dated 27 January, 2010 was received
by him “thereafter”. As aforesaid, the said letter was personally received by
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the plaintiff on 27 January, 2010 itself and signed in acceptance of the
terms therein.
29. The right of the defendant Bank to forfeit is otherwise not under
challenge and neither any pleading has been made by the plaintiff in that
regard nor any issue claimed.
30. There is thus no merit in the suit; the same is dismissed; however in
the circumstances and considering that the suit has been disposed of
expeditiously, no costs.
Decree sheet be drawn up.
RAJIV SAHAI ENDLAW, J
MAY 22, 2013
bs.
CS(OS) 1659/2010 Page 17 of 17