-HITLIST-Allahabad Bank v. Canara Bank (SC) -RECORD-BS250918 -CITATION-2003(11) SCC 796 SETTING DONE BY RAJESH\HN MADE BY BELA/PRIYANKA\HN TYPE BY RAJESH\P..R DONE BY SANTOSH\ zzzz3 -COURT-<ß>SUPREME COURT OF INDIA<þ> -JUDGE-Before:- M. Jagannadha Rao and Doraiswamy Raju, JJ.<þ> -NO- IA No. 9 in CA No. 2536 of 2000. D/d. -DECISIONDATE-8.9.2000.<þ> -EXTRATEXT- -PETITIONER- Allahabad Bank - Appellant<þ> Versus<þ> -RESPONDENT- Canara Bank and another - Respondents<þ> -HEADNOTE-<ß>Civil Procedure Code, 1908, Order BTZKACA379oETZK21, Rules BTZKACA379o21RETZK97 and BTZKACA379o21RETZK98 - Vacant possession - Auction purchaser (A-P) obstructed by Hypothecated machinery of J-D - Auction purchaser requiring bank to remove machinery - Bank finding it difficult to do so on apprehension that removal might cause damage to machinery - Held, not open to J-D to preclude A-P from taking vacant possession - Bank under obligation to remove machinery.<þ> [Paras 3 to 9]<þ> -ORDER- ORDER<þ> <ß>M. Jagannadha Rao, J. - Allahabad Bank, in execution of a decree passed against M.S. Shoes brought a shed, consisting of certain land and a building and a superstructure thereon, to sale. The property was purchased by the auction-purchaser, now represented before us by Shri R.K. Jain, learned Senior Counsel. The question relating to delivery of possession of the land and building and superstructure, is now before us, inasmuch as certain objections have arisen in respect of removal of some goods and machinery belonging to M.S. Shoes, which are located in the premises sold.<þ> 2. So far as these goods and machinery are concerned, these belong to M.S. Shoes, but the same are hypothecated to Canara Bank. The auction-purchaser of the land and structure is, therefore, requiring Canara Bank to remove these machinery and goods, so that he can have vacant possession of the property.<þ> 3. It appears that the property sold to the auction-purchaser consists of a building and a superstructure on the land, and according to M.S. Shoes, a part of the above construction is on its land while a part was constructed on the encroached property. At the same time, there have been huge municipal taxes remaining unpaid by M.S. Shoes to the Municipal Corporation with regard to the land and the superstructure. M.S. Shoes first wanted to get rid of its liability towards the Municipal Corporation in respect of the taxes and brought to the Corporation's notice that their entire taxes in relation to the land and superstructure should be adjusted or recovered from the auction-purchaser. The auction-purchaser has cleared these dues paying lakhs of rupees to the Municipal Corporation. After the said letter of M.S. Shoes, in our view, it was not at all open to the said Company, M.S. Shoes to preclude the auction-purchaser from taking possession of the property sold with superstructure in respect of which the auction-purchaser was thus compelled to pay municipal taxes. M.S. Shoes cannot get the benefit of the municipal taxes paid by the auction-purchaser in respect of the property sold and at the same time come in the way of the auction-purchaser taking delivery of any part of the land or the superstructure in respect of which they had to pay these taxes.<þ> 4. So far as Canara Bank is concerned, it has an obligation now to remove the goods and machinery belonging to M.S. Shoes which are located in the property purchased and for which the auction-purchaser has paid municipal taxes. But Canara Bank is apprehensive that in the event of its removing the machinery and goods and putting them to sale, in exercise of its power under the deed of hypothecation, M.S. Shoes might raise some objection alleging damage to the said property before the same is put to sale. When the property has been under hypothecation to Canara Bank and the debtor M.S. Shoes had not come forward to pay monies for redeeming the goods and machinery, Canara Bank will be entitled to sell these goods and machinery, by auction, at the cost and risk of the debtors, M.S. Shoes. We are of the view that the apprehension of Canara Bank as stated above, cannot be said to be unfounded.<þ> 5. In order that the auction-purchaser can have vacant possession of the property, we direct Canara Bank to remove these goods and machinery, within one month from today from the property sold to Mr R.K. Jain's client and in respect of which they paid municipal taxes to the Corporation. In the event of the goods and machinery not being sold by Canara Bank within one month as aforesaid, Canara Bank will have to remove the goods and machinery to some other place, so that thereafter they (Canara Bank) can sell the goods and machinery.<þ> 6. If Canara Bank is removing the goods and machinery within one month as aforesaid, for purposes of location elsewhere and selling them thereafter, it will be done in the presence of a representative of M.S. Shoes and Co. In that event, when the machinery and goods are removed by Canara Bank, the same shall be at the cost and risk of M.S. Shoes.<þ> 7. However, in case Canara Bank is not able to sell the goods and machinery within one month when they are still located in the shed sold to Mr R.K. Jain's client, the presence of the representative of M.S. Shoes at the time when any other person purchases the goods and machinery and wants to remove them, is not necessary. This is because in such an alternative, Canara Bank would not be removing the goods but the removal would be by the purchaser of the goods and machinery.<þ> 8. The sum and substance of what we have stated above is that within one month from today, Canara Bank itself or its auction-purchaser of the goods and machinery shall remove the goods and other machinery from the shed sold in favour of Mr R.K. Jain's client, subject to the above condition.<þ> 9. The Presiding Officer of the Debts Recovery Tribunal will ensure that these directions are complied with within one month from today. The IA is disposed of with the above directions. <þ> -RESULT- .<þ>

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