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TMI Blog2009 (6) TMI 585X X X X Extracts X X X X X X X X Extracts X X X X ..... as mobilised funds by way of collection of deposits for the purpose of developing agro farms at various places. The company also acquired an open plot admeasuring 813 sq. yards through four different sale deeds bearing Nos. 7848 of 1996, 7967 of 1996, 7546 of 1996 and 7561 of 1996 for valuable consideration. On the said open plot of land, a multi-storied building has been constructed where the registered office of the company is located. It bears Municipal Door No. 12-25-12, Sivalyam Street, at Kothapet locality of Guntur City. 3. According to the applicants, since the company has become nearly insolvent and with a view to tide over its financial distress, through one of its directors, viz., Sri D.R.K. Singh, sold the property comprising of 813 sq. yards of site together with the building standing thereon for a total consideration of Rs. 50 lakhs. According to the applicants, they paid a sum of Rs. 49,75,000 towards advance and part payment of sale consideration and the balance amount of Rs. 25,000 was agreed to be received at the time of registration. It is their case that in spite of repeatedly informing the said director and the company about the readiness and willingness of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ets of the company under liquidation, the Official Liquidator took possession of the asset where the registered office of the company is located on 4-4-2007. It was also further pointed out that the criminal complaints lodged against the company are not being investigated properly and correctly and hence W.P. No. 3445 of 2004 has been instituted by some of the depositors in this court and the said writ petition came to be disposed of on 28-12-2004, directing the Crime Investigation Department of Police (CID police) to act upon the complaints lodged by the depositors of the company and take appropriate action in the matter. However, by the time the State police could finalise the entire action, the property in question has already been sold to the applicants herein. Hence, they moved the present application seeking the property to be released from the custody of the Official Liquidator, as the title over the property has been transferred by the company in favour of the applicants by way of sale deed executed on 14-7-2005. 5. It is not in dispute that the company M/s. Vijetha Agro Farms (India) Ltd., Guntur has collected huge sums of money by way of deposits from the general public ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s never been informed of the proposed sale of this particular asset of the company. Further, no company which has gone public and collected huge sums of money from the general public, would at the first instance, think of offering for sale its registered office premises, without selling any other asset. And still not expect a huge backlash of protests! No information was forthcoming as to how the applicants who are such young persons and are aged approximately around 25 years, 30 years and 35 years in the year 2005, came to know of the impending sale of the asset of this company. No circumstances have ever been explained as to how Sri D.R.K. Singh, said to be the director of the company, came to know about the financial wherewithal of such young persons situated in Nandyal to buy this property and offered them for sale of this asset. Nowhere it was explained as to how the applicants and their friends got the property valued before entering into a transaction. Why they refrained carefully from making any further inquiries about the property is truly intriguing. No information was forthcoming as to how they could pool up a huge sum of Rs. 49,75,000 in cash at one-go and then produce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... specified therein together with the building standing thereon. Whereas the open site purchased by the company in 1996 is 813 square yards. The defendant's address has been mentioned in the suit as under :- "M/s. Vijetha Agro Farms (India) Ltd., represented by its Chairman and Managing Director, Bondili Ramakrishna Singh, S/o. Vital Singh, aged : about 48 years, C/o. Vijetha Publications, Mangalagiri Road, Guntur, Guntur District." 7. Strangely, the defendant being a company instead of suing it at its registered office, as is required in terms of section 51 of the Companies Act, it has been preferred to be sued at a different address. A memo is said to have been filed before the District Court, Guntur, that both parties have proposed to settle the matter before the Lok Adalat and hence, prayed to refer the matter to the Lok Adalat. All the six plaintiffs have signed and on behalf of the defendant Mr. D.R.K. Singh, said to be the chairman and managing director of the company, signed and so did the two learned advocates on either side. Care has been taken to see to it that no date is mentioned there in the memo. However, a decree came to be passed by the Lok Adalat, Guntur, on 28-6- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... date on which the said amount is said to have been received and the mode of such receipt. According to the plaintiffs, it is the defendant and its chairman and managing director who has resisted to receive this balance sale consideration of Rs. 25,000. What brought about such a radical change of heart in him to suddenly agree to receive Rs. 25,000 is remaining elusive. It is therefore, crystal clear that the plaintiffs and the defendant acting through Sri D.R.K. Singh has played fraud on the court and they used this process for perfecting it. The entire act has been put together to possibly defeat the winding up process, for which an application has been moved in this court. The whole act from the start to finish has the tell tale signs and marks of fraud. Clan-destine acts always carry the foul smell of suspicion. 10. It becomes crystal clear that fraud has been played by merely looking at the sale deed said to have been executed on 14-7-2005, pursuant to the decree passed by the Lok Adalat on 28-6-2005. The sale deed has been executed in favour of Sri Nasayam Mohammed Feroz, S/o. Mohd. Farook, Sri Pasapoina Nageswara Rao, S/o. China Venkata Swamy and Sri Arimandla Veera Reddy, S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he company have been adversely reported in the Press ever since 2004 is a matter of common knowledge in Guntur city. Hundreds and thousands of complaints have been lodged with the police not only at Guntur, but at various other places in the State by the depositors alleging fraud and misrepresentation indulged in by the company. These depositors have been duped of their monies. Hence, this mode was devised by the applicants to knock off a valuable asset of the company. 12. This court has already intervened in the matter in the year 2004 itself by directing the CID of the Police to act promptly on the complaints lodged against the company and its directors. Therefore, to beat all these circumstances, the above transaction has been engineered and a sale deed has been got executed on 14-7-2005. There is no whisper of any authorisation issued by the company in favour of Sri D.R.K. Singh to enter into a compromise or enter into a transaction of sale at the first instance with the plaintiffs/applicants. No such agreement can be enforced, even if it is entered into with the sanction of the Judge at the trial of the proceedings to which it related (Keir v. Leeman 6 Q. B. 308; R. v. Blackm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gh Court, however, went haywire and made observations which are wholly perverse. We do not agree with the High Court that 'there is no legal duty cast upon the plaintiff to come to court with a true case and prove it by true evidence'. The principle of 'finality of litigation' cannot be pressed to the extent of such an absurdity that it becomes an engine of fraud in the hands of dishonest litigants. The courts of law are meant for imparting justice between the parties. One who comes to the court, must come with clean hands. We are constrained to say that more often than not, process of the court is being abused. Property-grabbers, tax-evaders, bank-loan-dodgers and other unscrupulous persons from all walks of life find the court process a convenient lever to retain the, illegal-gains indefinitely. We have no hesitation to say that a person whose case is based on falsehood, has no right to approach the court. He can be summarily thrown out at any stage of the litigation." 15. When an opportunity has been provided to the applicants to demonstrate their financial wherewithal to pool up such a huge sum of Rs. 49,75,000 in the additional material papers filed, material has been placed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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