- (1.) In these appeals the question involved is that whether the lessor namely M/s. Mukundgarh Resorts having leased out the property to the lessee M/s. Cross Country Hotels Pvt. Ltd. with the specific stipulation in clause-5 of the lease agreement that the lessee shall have a right to create encumbrances on the lease hold rights possessed by them in favour of any financial institution for loan/finances raised for the development of fort, can claim the possession from the lessee without accounting for the encumbrances created by lessee on having obtained loan of Rs. 10.23 crores inter alia with respect to property in question and the property having been sold under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as 'SARFAESI Act') to BD & P Hotels (India) Pvt. Ltd. on 4.8.2009 by Tourism Finance Corporation of India Ltd. (hereinafter referred to as 'TFCI'), who had taken possession from lessee-M/s. Cross Country Hotels Pvt. Ltd. on 22.8.2008, Whether possession could have been taken by lessor-M/s. Mukundgarh Resorts in execution of the arbitration proceedings as against the lessee M/s. Cross Country Hotels Pvt. Ltd. on 9.3.2010 pursuant to the arbitration award dated 15.2.2010 in which TFCI or the transferee namely BD & P Hotels (India) Pvt. Ltd. were not the parties. Facts in short giving rise to the appeals are that HUF consisting of Shri Ajit Singh and Smt. Ratan Kanwar transferred property to M/s. Mukundgarh Resorts by way of lease executed on 25.9.1992. M/s. Mukundgarh Resorts, consisting of same persons as partners Shri Ajit Singh and Smt. Ratan Kanwar. M/s. Mukundgarh Resorts executed lease in favour of M/s. Cross Country Hotels Pvt. Ltd. on 13.10.1992. In the lease deed executed between M/s. Mukundgarh Resorts and M/s. Cross Country Hotels Pvt. Ltd., there was specific stipulation by which the M/s. Cross Country Hotels Pvt. was authorised to create encumbrances on the lease hold rights possessed by them in favour of any financial institution for loan/finances raised for the development of fort. Acting upon the aforesaid stipulation in the lease deed the lease hold rights were mortgaged by deposition of title deed in favour of TFCI, an undertaking of Government of India by lessee-M/s. Country Hotels Pvt. Ltd. The TFCI advanced 10.23 crores rupees to M/s. Cross Country Hotels Pvt. Ltd. There was default by M/s. Cross Country Hotels Pvt. Ltd. in making payment of loan to TFCI, who was a secured creditor. Consequently, in the year 2000, original application was filed by TFCI before the Debt Recovery Tribunal (hereinafter referred to as 'DRT') as against M/s. Cross Country Hotels Pvt. Ltd. However, on coming into force the SARFAESI Act, on 8.1.2003 notice was issued by TFCI to M/s. Cross Country Hotels Pvt. Ltd. for taking action under section 13(2) of the SARFAESI ordinance at the relevant time. These proceedings were assailed by lessee-M/s. Cross Country Hotels Pvt. Ltd. in the High Court of Delhi by filing CWP No. 6707/08 and a writ petition no. 9609/08 was also filed in this Court after the property was sold in the proceedings under SARFAESI Act. The writ petition no. 9609/08 filed by lessee-M/s. Cross Country Hotels Pvt. Ltd. was dismissed by single bench of this Court on 17.4.09 in which it assailed the taking over of the possession by authorised officer of TFCI of the secured assets on 22.8.08 pursuant to the demand notice dated 8.1.03 u/S. 13(4) of the SARFAESI Act. An appeal/application was also filed u/s. 17 of the SARFAESI Act before the Debt Recovery Tribunal, New Delhi by the lessee M/s. Cross Country Hotels Pvt. Ltd.
(2.) The possession was taken by TFCI from M/s. Cross Country Hotels Pvt. Ltd. on 22.8.08 is not in dispute. The possession was taken over from M/s. Cross Country Hotels Pvt. Ltd., by the mortgagee-TFCI on 22.8.08, notices were also published in the daily newspaper of national fame i.e. Times of India and Rajasthan Patriki (hindi edition) on 26th and 27th August, 08 respectively. Thereafter, M/s. Cross Country Hotels Pvt. Ltd. was not in possession of the property with effect from 22.8.08. The fact is also not in dispute that notice was published for sale of the property in Economic Times newspaper on 16.6.09, thereafter the property was sold by TFCI for realisation of the secured debt to BD & P Hotels (India) Pvt. Ltd. on 4.8.09 and assignee BD & P Hotels (India) Pvt. Ltd. was placed in possession of the property on the date of purchase i.e. 4.8.09.
(3.) Though M/s. Cross Country Hotels Pvt. Ltd. was not in possession, however, in the proceedings of arbitration, which was initiated on 15.9.06 between lessor-M/s. Mukundgarh Resorts and lessee-M/s. Cross Country Hotels Pvt. Ltd., an award was passed on 15.2.09. It is not in dispute that TFCI and BD & P Hotels (India) Pvt. Ltd. were not party to the arbitration proceedings. No notice was issued to them of the proceedings by the Arbitrator. The possession had been taken by TFCI from M/s. Cross Country Hotels Pvt. Ltd. on 22.8.08 before the award was passed. Later on execution was filed by M/s. Mukundgarh Resorts as the Arbitrator has passed the award in favour of M/s. Mukundgarh Resorts terminating the lease hold rights of M/s. Cross Country Hotels Pvt. Ltd. as there was failure on the part of M/s. Cross Country Hotels Pvt. Ltd. to make the payment of the lease amount ensured in the lease deed of 25.9.92 which was executed by M/s. Mukundgarh Resorts in their favour. The execution proceedings were filed before the District Court, Jhunjhunu. In these proceedings, possession was sought on the strength of arbitration award, which was passed in favour of lessor-M/s. Mukundgarh Resorts. In these proceedings, it is not in dispute that the possession was sought from M/s. Cross Country Hotels Pvt. Ltd. only. The possession was not sought from TFCI or its transferee BD & P Hotels (India) Pvt. Ltd. whereas TFCI was put in possession on 22.8.08 and BD & P Hotels (India) Pvt. Ltd. on 4.8.09. Thereafter, warrant no. 43 dated 5.3.2010 was issued for taking possession from M/s. Cross Country Hotels Pvt. Ltd. Warrant of possession was not issued against assignee BD & P Hotels (India) Pvt. Ltd. No warrant of possession was even issued against mortgagee-TFCI. This fact was not disclosed before the executing court that an order has been passed under SARFAESI Act in which possession had been taken from lessee-mortgagor-M/s. Cross Country Hotels Pvt. Ltd. by mortgagee-TFCI on 22.2.08. It was not disclosed that there was subsequent sale made by TFCI in favour of assignee-BD & P Hotels (India) Pvt. Ltd. for realising the secured debt in the sum of Rs. 2,20,00,000/- (Two crores and twenty lacs) and under warrant of possession issued by executing court, the BD & P Hotels (India) Pvt. Ltd. was dispossessed on 9.3.2010. After taking possession on 9.3.2010, the property was leased out on 10.3.2010 to Silver City Landmark Pvt. Ltd. and Silver City Landmark Pvt. Ltd. was placed in possession of the property for 18 years and during pendency of these intra court appeals, a sale deed has been executed by Ajit Singh and Ratan Kanwar selling the Mukundgarh property in question to M/s. Sampada Land Developers Pvt. Ltd. The authorised signatory of M/s. Sampada Land Developers Pvt. Ltd. is one of the Director in Silver City Land Marks Pvt. Ltd.;