V RAMAN Vs. STATE BANK OF INDIA

JUDGEMENT

(1.) THE respondent Bank filed Original Application (OA) for recovery of the amount due to it. THE Bank also sought for the relief of appointment of Advocate Commissioner to take inventory of the A-Schedule property of the 1st defendant Company. THE PO. DRT, Hyderabad on 22.5.2000 appointed one Mr. S.M. Subhani, Advocate, as Commissioner to take inventory of the A-Schedule properly. THE Commissioner was also directed to execute the warrant after issuing notices to both the parties. Commissioner then filed his report on 4.7.2000 after taking inventory of the articles found in the premises. THE Commissioner has stated in his report that when he went to the factory premises and carried out the inventory, the officials of the applicant Bank and the 2nd defendant appellant were present. What all the Commissioner found in the premises during inventory, he has recorded it and he has stated it in his report dated 4.7.2000. From his report it is evident that at the time of taking inventory the Bank officials and the 2nd defendant the appellants were present.

(2.) After the report was filed by the Advocate Commissioner, the Bank filed petition IA-605/2000 before the PO, DRT, for sale of the goods and the PO, DRT, has ordered for sale of the goods through the Advocate Commissioner. With regard to all the details. The Advocate Commissioner was directed by the PO, DRT, to sell the Schedule property i.e. the inventory articles in public auction and deposit the same amount into the credit of the O.A. and the Commissioned was also directed to submit his report. As per the directions of the PO, DRT, the Commissioner fixed the auction on 29.11.2000 after giving notice to all the parties and he also has given Auction Notice in the news daily i.e. The Economic Times dated 24.11.2000. On 28.11.2000 at about 8.30 p.m., the Counsel for defendants 1 and 2 filed a Memo before the Commissioner requesting for postponement of the auction on the ground that there is some personal inconvenience and also the keys of the godown were lying with the appellant and the counts mentioned in the public notice also do not tally with the stock position. That request was rejected by the Commissioner. Then the Commissioner visited the factory on 29.11.2000 along with the Bank officials. He could not execute the warrant due to non-availability of the godown keys where the Schedule property was kept. Then, he filed a Memo before the DRT explaining the circumstance in the matter. Then, as per the direction of the PO, DRT, he fixed another date for conducting the auction and the DRT also permitted the Commissioner to break open the locks, if any of the parties failed to cooperate with him in executing the warrant and if necessary, police protection. The Commissioner has stated in his Report that before participating in the auction the intending purchasers wanted to set the schedule property to know about the quality and position of the commodities. So, the Commissioner decided to visit the factory premises on 16.12.2000 for verification of the material. Even though the Commissioner gave notice well in advance to all the parties the 2nd defendant was not ready with the godown keys. The Commissioner from the factory premises contacted the Counsel for the 2nd defendant and explained the situation and the Counsel for 2nd defendant promised to cooperate for verification of the material on 20.12.2000 and he requested the Commissioner to postpone the same to that date. At the request, the Commissioner visited the factory premises along with Bank officials on 20.12.2000 for verification of the material. On that day, some of the intending purchasers were also present in the factory for verification and the 3rd respondent was also present. The Commissioner has stated in his report that when he was about to visit the factory premises on 20.12.2000, at about 8.30 a.m. the Counsel for defendants 1 and 2 filed a Memo before the Commissioner stating that the goods have been used up in operations and business of the Company which became functional from 26.6.2000 and also contended that there is no need for the Commissioner to visit the factory or conduct any auction of the goods as per the notice. Anyhow, the Commissioner rejected the claim of the defendants and he visited the factory. When he visited the factory on 20.12.2000, the main entrance gate was closed and on his inquiries he came to know that the security were not permitting any one to enter the factory premises who came in response to the notice. Ultimately, at the intervention of the Commissioner, the 3rd respondent and other purchasers were permitted to enter the factory premises and he asked the General Manager of the factory to open the godown for verification of the goods and on opening it was found that the entire godown was empty. However, the Commissioner found only five small bags of yarn at the entrance of the godown. The Commissioner has further stated in his Report that the Suit schedule property was not there and except the five bags of yarn the godown was empty and the verification has been done for conducting the auction as per the direction of the Tribunal.

(3.) COUNSEL for the appellant submitted that when no objection in the petition in IASR-685/2000 was endorsed in September, 2000, the 3rd respondent was the Vice-Chairman and Managing Director and the 2nd defendant was not the Managing Director. But the Memo filed on behalf of D1 and D2 reveals clearly that the keys of the godown where the goods are lying were held by the Managing Director, the 2nd defendant-appellant herein. So, it is well evident that at the time when the Commissioner visited the factory only 2nd defendant-appellant was present while the Commissioner took inventory of the articles. This is revealed from the report of the Commissioner. Even the Memo filed on behalf of D1 and D2 clearly reveals that the keys of godown where the goods are kept were held by the Managing Director the 2nd defendant appellant herein. So, it is borne out by documents that only the 2nd defendant was in charge of the goods lying in the godown and he alone is responsible for all the goods taken on inventory and these goods were held only by the 2nd defendant. COUNSEL for the D1 and D2 also filed Memo before the Commissioner stating that the goods for which the inventory was taken were used by the Company. This also supports that only the 2nd defendant was having custody of the goods and the 2nd defendant only has stated that the goods have been used for the Company business.