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CA 5696/12,etc.                                                                                                                       1

   REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

 CIVIL     APPEAL     NO(s).5696       OF     2012    [@Petition(s) for Special Leave to Appeal (Civil)23150/2012                                                  CC 12128/2012]

  M/S. OPTIEMUS INFRACOM LTD.                       Appellant(s)

                VERSUS

  M/S. ISHAN SYSTEMS PVT.LTD. & ANR.                Respondent(s)

WITH   

 CIVIL     APPEAL     NO(s).5697       OF     2012    [@Petition(s) for Special Leave to Appeal (Civil)23151/2012

                                               CC 12468/2012]

M/S.PHOENIX ARC PVT. LTD.     Appellant(s)

VERSUS

M/S. ISHAN SYSTEMS PVT. LTD.  Respondent(s)

O     R     D     E     R   

1. Two Special Leave Petitions have been filed against the  

judgment and order dated 14th February, 2012, passed by the  

Allahabad High Court, in  Civil Miscellaneous Writ Petition  

No.8409/2012.

2. The first Special Leave Petition has been filed by M/S.  

OPTIEMUS INFRACOM LTD., being SLP(C)......CC 12128/12.   the  

second Special Leave Petition has been filed by M/S. PHOENIX  

ARC PVT.LTD., being SLP(C)......CC 12468/12.

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CA 5696/12,etc.                                                                                                                       2

3. Delay condoned.    

4. Leave granted in both the Special Leave Petitions.

5. Writ Petition No.8409 of 2012, was filed by the  

respondent, M/S. ISHAN SYSTEMS PVT.LTD.& ANR., against the  

judgment and order dated 11th April, 2011, whereunder the  

property of the respondent/judgment-debtor Co. was put to  

auction.   An application had been filed by the respondent-

company before the Debts Recovery Tribunal complaining of  

violation of the statutory rules which regulate the auction of  

property.   Other grounds were also taken, but the same were  

rejected by the High Court.   In fact, the High Court, after  

examining the records of the writ petition, had found no good  

ground to interfere with the order of the Appellate Authority.  

Instead of stopping there, the High Court went on further to  

give various directions to the Debts Recovery Tribunal, to  

proceed and decide the application, which had been filed by  

the respondent No.1/petitioner, being S.A.No.714/2011.   By  

another direction the auction purchaser was restrained from  

making any further transfer of the property in question and  

any construction raised would abide by the orders to be passed  

in the pending application before the Debts Recovery Tribunal.  

With the aforesaid directions, the High Court disposed of the  

writ petition finally.

6. The said judgment and order of the High Court had been  

questioned on the ground that having found no ground to

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CA 5696/12,etc.                                                                                                                       3

interfere with the order of the Appellate Authority, the  

learned Judge of the High Court should not have  passed other  

orders, and, in particular, an order of injunction, which was  

to the prejudice of the appellant before us, without issuing  

notice or giving the appellant  an opportunity of hearing.

7. Since the  writ petition was disposed of on the very first  

date, without notice to the respondents, there was no occasion  

to consider the competence of the Allahabad High Court to  

entertain the writ petition.    Subsequently, another writ  

petition was filed by the respondents herein, being No.35215  

of 2012, before the Allahabad High Court, for quashing the  

order dated 10th July, 2012, which had been passed by the  

D.R.T.-III, Delhi, by which the application filed by the  

respondents herein under Section 17(1) of the   Securitisation  

and Reconstruction of Financial Assets and Enforcement of  

Security Interest Act, 2002 (the SARFAESI Act), was rejected.  

In the said petition, the question of jurisdiction was raised  

and was heard and decided against  the respondents herein.  

In fact, reference was made in the judgment delivered on 30th  

July, 2012, to the earlier writ petition and it had been  

observed that although, the earlier writ petition had been  

entertained by the Allahabad High Court, the issue relating to  

jurisdiction had not been gone into, since the writ petition  

had been disposed of on the first date, without hearing the  

respondents.

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CA 5696/12,etc.                                                                                                                       4

8. Ultimately, the learned Judge accepted the preliminary  

objections raised on behalf of the appellants herein  and held  

that the Allahabad High Court had no jurisdiction to entertain  

the writ petition and dismissed the same accordingly.

9. Both, S/Shri Venugopal and Ranjit Kumar, learned senior  

advocates appearing for the appellants in these two appeals,  

submitted that, although, the order of the High Court has to  

some extent been worked out and the sale which had been  

effected has been confirmed, the only question which remained  

to be considered was the competence of the  Allahabad High  

Court to entertain a writ petition from an order  passed by  

the Debts Recovery Tribunal, Delhi, and the fact that the same  

was disposed of on the very first day, without notice, by  

issuing orders and directions which prejudiced  the  

appellants.

10. Mr. Chetan Sharma, learned senior advocate appearing for  

the respondents, has tried to impress upon us that the order  

of injunction which was passed by the Allahabad High Court  

was innocuous and that it  did not prejudice or adversely  

affect the appellants in any way and since the sale has been  

confirmed, nothing further remained to be decided, as far as  

the said question is concerned.

11. It is true that the impugned order has more or less  

worked itself out, but it needs to be indicated that the  

practice which was adopted by the Allahabad High Court, is not

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CA 5696/12,etc.                                                                                                                       5

only arbitrary, but also contrary to the concept of  the  

principles of natural justice.   Since the writ petition was  

to be dismissed without issuing notice, it should have been  

dismissed  without giving any further directions in the  

matter.  Instead, certain positive instructions were given to  

the respondents and   one of the respondents was restrained  

from dealing with the property, without any notice to  

him/them.   If there was any intention on the part of the  

learned Judge to protect the properties in question during the  

pendency of the matter before the Debts Recovery Tribunal, the  

proper course of action would have been to issue notice, and,  

if necessary, pass interim orders and, thereafter, after  

hearing the parties to pass final orders in the matter.  

12. We hope that in future, this kind of order will be avoided  

in the interest of justice and also having regard to the  

principles of natural justice.

13. The appeals are allowed.  The impugned judgment to the  

extent that it restrains the appellants from alienating or  

encumbering the property, is hereby set aside.

14. The appeals are  disposed of, accordingly.         

                      ...................J.

     (ALTAMAS KABIR)   

        ...................J.

            (J.CHELAMESWAR)     NEW DELHI;     August 01, 2012.    

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CA 5696/12,etc.                                                                                                                       6

  Pl. read SLP(C)No.23151 instead of SLP(C)No.23161 in cause title.