Thursday, 22 June 2017

When it is not permissible for bank to forfeit amount deposited by successful bidder in Auction sale?

 Another issue which was debated during the course of
hearing of the instant Letters Patent Appeal, is whether forfeiture of the
amount deposited by the appellant would amount to unjust enrichment
of the respondent-Bank. The learned Senior counsel for the appellant
contended that in the subsequent auction vide E-auction notice
published in the Newspaper on 07.05.2016 the borrower himself has
paid all dues to the Bank, which issued “No Dues Certificate” to the
borrower vide letter dated 23.06.2016 and therefore, appropriation of
Rs.31,25,000/- deposited by the appellant would be unjust retention of
the said amount by the Bank amounting to unjust enrichment.
Mr. P.A.S. Pati, the learned counsel for the respondent-Bank, however,
contended that on account of failure of the appellant to deposit the
balance bid amount, the auction failed and the Bank was constrained
to re-auction the property. The amount deposited by the appellant has
to be forfeited in terms of the conditions attached to E-auction notice
dated 01.03.2016, and if, the Courts interfere with the matters like the
present one, no auction would ever be concluded.
18. The Contract Act, 1872 recognizes the principle of
unjust enrichment in Section 72. This principle is infact foundation
for the law governing restitution. The retention of money or property of
another against the principle of justice, equity and good conscience
has been held by the Courts “unjust enrichment”. On admitted facts,
forfeiture of the amount deposited by the successful bidder, for sale of
a property which the respondent-Bank could not have sold in auction
sale without prior approval of the Housing Board and after realizing its
dues from the borrower, would certainly amount to unjust enrichment.
The respondent-Bank cannot legally retain EMD and 25% of the bid
amount deposited by the appellant.

 IN THE HIGH COURT OF JHARKHAND AT RANCHI
 L.P.A. No. 220 of 2016

Kumar Rohit, 
 V
Allahabad Bank, 
CORAM:  MR. JUSTICE VIRENDER SINGH, CHIEF JUSTICE
  MR. JUSTICE SHREE CHANDRASHEKHAR

 Dated:26th July, 2016.
Citation: AIR 2017 Jharkh 65
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When decree for divorce by mutual consent is liable to be set aside?

 We have also gone through the Lower Court Record. The record shows
that the petition under Section 13-B of the Act was filed by the parties on
10.11.2006. There was some amendment in the date of marriage and the suit
was admitted on 30.11.2006 and it was fixed to be listed after six months on
14.7.2007. There is no order preponing the date, but the suit has been allowed by
dissolving the marriage between the parties on 16.5.2007, which is before the
expiry of the period of six months from the date of the amendment made in the5
petition, on which date, the case was admitted. The Lower Court Record also
shows that on 10.11.2006, both the applicants had filed affidavits in support of
the petition and on the back of the same affidavit on 15.5.2007, their statements
were recorded by the Court below stating that they had filed the petition out of
their freewill and they want their marriage to be dissolved by divorce and on that
basis only, the petition under Section 13-B of the Hindu Marriage Act has been
allowed by the Court below. In other words, the record clearly shows that the
Court below had not taken any step to satisfy itself after hearing the parties and
after making any enquiry, about the solemnization of marriage between the
parties and the truthfulness of the averments in the petition, nor the Court below
had taken any effort to satisfy itself that the consent of the parties had not been
obtained by force, fraud, or undue influence, as required under Section
23(1)(bb) of the Hindu Marriage Act. The Court below had not taken any efforts
for assisting or pursuing the parties in arriving at a settlement in respect of their
dispute, which is the mandatory requirement, both under Section 9 of the Family
Courts Act, as also under Order XXXII-A Rule 3 of the Code of Civil Procedure.
15. In the present case, we find that the Court below has ignored all these
mandatory provisions of law while passing the decree of divorce by mutual
consent. In our considered view, the impugned order passed by the learned
Principal Judge, Family Court, Ranchi, suffers from inherent illegality and the
same cannot be sustained in the eyes of the law.
IN THE HIGH COURT OF JHARKHAND AT RANCHI
 First Appeal No. 198 of 2008

Seema Pathak .
 V
Chotelal Pandey .
PRESENT :  MR. JUSTICE H. C. MISHRA
 MR. JUSTICE Dr. S.N. PATHAK
Citation: AIR 2017 Jharkhand 59
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Whether arbitrator can act contrary to terms of contract under which he is appointed?

Moreover, it is well-settled that the arbitrator derives authority from the contract and if he acts in manifest disregard of the contract, the award given by him would be an arbitrary one as it would be deliberate departure from the contract.
25. The arbitrator may have jurisdiction to entertain claim and yet he may not have jurisdiction to pass award for particular items in view of the prohibition contained in the contract and, in such cases, it would be a jurisdictional error. The role of the arbitrator is to arbitrate within the terms of the contract. He has no power apart from what the parties have given him under the contract. If he has travelled beyond the contract, he would be acting without jurisdiction, whereas if he has remained inside the parameters of the contract, his award cannot be questioned on the ground that it contains an error apparent on the face of the record.
26. An Arbitral Tribunal is not a court of law. Its orders are not judicial orders. Its functions are not judicial functions. It cannot exercise its power ex-debito justitiae. The jurisdiction of the arbitrator being confined to the four corners of the agreement, he can only pass such an order which may be the subject-matter of reference. 
IN THE HIGH COURT OF CALCUTTA
AP No. 274 of 2005
Decided On: 28.02.2017
Union of India and Ors.

Vs.
 Venus Engineering Concern Pvt. Ltd.

Hon'ble Judges/Coram:

Soumen Sen, J.
AIR 2017 Cal 78
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Whether decree can be set aside on account of misjoinder or non-joinder of parties?

 Learned senior counsel, inviting our attention to
Section 99 of the Code of Civil Procedure, contends
that no decree shall be reversed or varied
substantially on account of non-joinder or misjoinder
of parties. Section 99 of the Code of Civil
Procedure reads as follows:-
“99. No decree to be reversed or modified
for error or irregularity not affecting
merits or jurisdiction.- No decree shall
be reversed or substantially varied, nor
shall any case be remanded, in appeal on
account of any misjoinder or non-joinder
of parties or causes of action or any
error, defect or irregularity in any

proceedings in the suit, not affecting
the merits of the case or the
jurisdiction of the court:
Provided that nothing in this section
shall apply to non-joinder of a necessary
party.”
5. The provision, in our view, is crystal clear. No
decree can be reversed or substantially varied in
appeal on account of misjoinder or non-joinder of
parties. Under Section 141 of the Code of Civil
Procedure, procedure under the Code in regard to suit
shall be followed as far as it can be made applicable
to proceedings in any Court of Civil jurisdiction.
Therefore, what is provided under Section 99 of the
Code of Civil Procedure in respect of appeal would
apply to revision as well.

REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO(S). 2014/2009
MANTI DEVI & ANR.
 V
KISHUN SAH @ KISHUN DEO SAO & ORS. 
Dated:MARCH 23, 2017.
Citation: AIR 2017 SC 2002
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