Final Order 2

Order Details: Other
Pdf Text: MHCC010019702020
IN THE COURT OF CITY CIVIL FOR GREATER BOMBAY
AT BOMBAY
TRANSFER APPLICATION NO.39 OF 2020
IN
SUIT NO.8414 OF 2000
Ahura Mazda Dairy Farm Pvt. Ltd. ... Applicant
(Org.Defendant)
Versus
M/s.Kwality Food & Masala Products ... Respondent
(Org.Plaintiff)
CORAM: CORAM: H.H.THE PRINCIPAL JUDGE
SMT.V.V.JOSHI (C.R.No.19)
DATED: 27th JULY, 2022
Adv.Swati Sagvekar for applicant.
Adv.Yaya Ghogari for respondent. .
ORAL ORDER
1. The applicant/original defendant has filed this application to
transfer the Suit No.8414 of 2000 to the designated Court under the
MPID Act.
2. My learned predecessor has decided this Transfer Application
No.39 of 2020 on 19th January 2021 by allowing it to transfer the Suit
No.8414 of 2020 to the designated MPID Court Room No.36. Against
the said order respondent/ Org.plaintiff has preferred revision before
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the Hon'ble High Court. The Hon'ble High Court has set aside the
impugned order and directed the trial judge to reconsider the said
application seeking transfer of the suit to the designated Court, after
hearing the parties and to decide the application within 30 days from
the appearance of the parties vide order dated 15th July, 2022 in Civil
Revision Application No.43 of 2021. Accordingly, this Court is deciding
the present Transfer Application No.39 of 2020 after hearing both the
parties.
3. The applicant has stated that the suit is filed by the
respondent/org.plaintiff seeking declaration in respect of termination of
agreement executed in respect of a property owned by plaintiff in
favour of defendant. The defendant claims to have paid Rs.42,50,000/
out of total amount consideration of Rs.70,00,000/ and Deed of
Conveyance was to be executed. During the pendency of said suit,
defendant i.e. applicant came to be prosecuted under MPID Act and the
property in this suit came to be attached. As the property in question
and the proceedings before the MPID Court is against the defendant and
the property is attached in said proceedings, therefore the applicant has
filed this application to transfer the civil suit before the MPID Court.
4. The learned counsel for respondent has objected the application
stating that the object of MPID Court is totally different. It is for the
protection of investors. Section6 of the MPID Act is not attracted and
will not be applicable to Civil Suits as it is criminal proceeding and the
object of the MPID Act is to protect the investors. The suit is challenged
for deciding the title. The MPID Court has no jurisdiction to try the civil
suit, hence prayed to reject the application.
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5. Heard both learned counsel.
6. Transfer Application is filed by the applicant invoking the
provisions of Section6 of the MPID Act. The said section read thus:
6. Designated Court.(1) For the purpose of this Act, the
Government may, with the concurrence of the Chief
Justice of the Bombay High Court by notification in the
Official Gazette, constitute on or more Designated Court
in the cadre of a District and Sessions Judge for such area
or areas or such case or class or group of cases, as may be
specified in the notification.
(2) No Court including the Court constituted under the
Presidency Towns Insolvency Act, 1909(3 of 1909) and
Provincial Insolvency Act, 1920(5 of 1920), other than
the Designated Court shall have jurisdiction in respect of
any matter which the provisions of this Act apply.
(3) Any pending case in any other Court to which the
provisions of this Act apply shall, on the date of coming
into force of this Act, stand transferred to the Designated
Court.”
As per sub section(1) of Section6 of MPID Act, the Designated
Court can try the cases specified in the notification. Civil suit does not
come under the class or group of cases specified in the notification,
(2) Requirement of this sub clause is application of provisions of MPID
Act, for suit of discharging contractual obligation and deciding the title
does not come under the purview of MPID Act.
As per sub section (3) condition to transfer the matter to MPID Court is
application of provisions of Act which is not possible in case of Civil
Suit. Therefore, Section6 of MPID Act is not applicable for transfer of
civil suit to Designated Court of MPID.
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7. The suit property is attached along with other properties in
MPID proceedings therefore the applicant has relied on Section 7(5) of
MPID Act which provides that
“(1) Upon receipt of an application under Section 5, the
Designated Court shall issue to the Financial
Establishment or to any other person whose property is
attached and vested in the competent Authority by the
Government under section 4, a notice accompanied by the
application and affidavits evidence, if any, calling upon
the said establishment or the said person to show cause on
the date to be specified in the notice, why the order of
attachment should not be made absolute.
(2) The Designated Court shall also issue such notice, to
all other persons represented to it as having or being likely
to claim, any interest or title in the property of the
Financial Establishment or the person to whom the notice
is issued under Subsection(1), calling upon all such
persons to appear on the same date as that specified in the
notice and make objection if they so desire to the
attachment of the property or any portion thereof, on the
ground that they have interest in such property or portion
thereof.
(3) Any person claiming an interest in the property
attached or any portion thereof may, notwithstanding
that no notice has been served upon him under this
section, make an objection as aforesaid to the Designated
Court at any time before an order is passed under Sub
section(4) or (6).
(4) The Designated Court shall, if no cause is shown and
no objections are made under Subsection(3), on or before
the specified date forthwith pass an order making the
order of attachment absolute and issue such direction as
may be necessary for realisation of the assets attached and
for the equitable distribution among the depositors of the
money realised from out of the property attached.
(5) “If cause is shown or any objection is made as
aforesaid, the Designated Court shall proceed to
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investigate the same and in so doing, as regards the
examination of the parties and in all other respects, the
Designated Court shall, subject to the provisions of this
Act, follow summary procedure as contemplated under
Order 37 of the Civil Procedure Code, 1908(5 of 1908)
and exercise all the powers of a Court in hearing a suit
under the said Code and any person making an objection
shall be required to adduce evidence to show that on the
date of attachment he had some interest in the property
attached.
(6) After investigation under subsection(5), the
Designated Court shall pass an order either making the
order of attachment passed under subsection(1) of
Section 4 absolute or varying it by realising portion of the
property from attachment or cancelling the order of
attachment.
Provided that the Designated Court shall not
release from attachment any interest, which it is satisfied
that the Financial Establishment or the person referred to
in subsection(1) has in the property, unless it is also
satisfied that there will remain under attachment an
amount of property of value not less than the value that is
required for repayment to the depositors of such Financial
Establishment.”.
This section allows the MPID Court to exercise the powers of a
Court in hearing a suit under Civil Procedure Code. On plain reading of
this subclause(5) it shows that it provides the summary proceedure as
contemplated under Order 37 of CPC which is not applicable to suits.
Therefore the MPID Court cannot try the civil suit.
8. Section 13 of MPID Act clearly provides to follow the Criminal
Procedure Code for trial of warrant cases. Considering the provisions of
MPID Act, the designated Court cannot try the Civil Suit. The MPID
Court cannot decide the title of the suit property which is subject matter
of the suit. An oject of the MPID Act is to protect the interest of
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(investors) depositers of financial establishment and civil suit is totally
different. As the designated Court cannot try the civil suit, hence
transfer application deserves to be rejected. In the result, I proceed to
pass the following order.
O R D E R
Transfer Application No.39 of 2020 is hereby rejected.
27/07/2022 (V.V.JOSHI)
PRINCIPAL JUDGE,
CITY CIVIL COURT, MUMBAI.
Dictated on : 27/07/2022
Transcribed on : 27/07/2022
Signed by HHJ on : 28/07/2022
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“CERTIFIED TO BE TRUE AND CORRECT COPY OF THE ORIGINAL
SIGNED JUDGEMENT/ORDER”
UPLOAD DATE TIME NAME OF STENOGRAPHER
28/07/2022 4.30p.m. B.R.HATEKAR (S.G.)
Name of the Judge HH THE SESSIONS JUDGE
SMT.V.V.JOSHI (CR No.19)
Date of Pronouncement of Judgment/Order. 27.07.2022
Judgment/order signed by P.O on 28.07.2022
Judgment/order uploaded on 28.07.2022
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