2001 (10) TMI 1175 - HC - Indian Laws

Summary

Issues Involved:
1. Enforcement of court orders and decrees passed outside the State of Gujarat against properties within Gujarat.
2. Applicability of the Bombay Relief Undertakings (Special Provisions) Act, 1957 to proceedings outside Gujarat.
3. Validity of the Receiver's possession of properties after the issuance of the relief undertaking notification.
4. Revocation of leave granted under Clause XII of the Letters Patent.

Detailed Analysis:

1. Enforcement of Court Orders and Decrees Passed Outside Gujarat:
The primary issue is whether Section 4 of the Bombay Relief Undertakings (Special Provisions) Act, 1957, suspends the enforcement of court orders and decrees obtained outside Gujarat against properties within Gujarat. The court observed that the Gujarat Legislature cannot regulate, modify, or extinguish obligations and liabilities incurred outside the state. The Supreme Court in R. D. V. Finance Co. Pvt. Ltd. v. Shree Vallabh Glass Works Ltd. clarified that while proceedings outside Gujarat cannot be suspended, enforcement of decrees against properties within Gujarat can be interdicted by the notification under Section 4(1)(a)(iv). Therefore, while the suit or proceedings outside Gujarat remain unaffected, the execution of any decree against properties within Gujarat is suspended during the notification period.

2. Applicability of the Bombay Relief Undertakings (Special Provisions) Act, 1957:
The court referred to the Full Bench decision in Hatimbhai Hasanally v. Framroz Eduljee Dinshaw, which established that the relief undertaking notification under the Act does not affect proceedings in courts outside Gujarat. The Supreme Court's decision in R. D. V. Finance Co. Pvt. Ltd. further supported this view, stating that the Gujarat Legislature cannot extend immunity beyond its territorial bounds. Thus, the Act applies to properties within Gujarat but does not suspend proceedings outside the state.

3. Validity of the Receiver's Possession Post-Notification:
The Receiver was appointed by the Bombay High Court before the notification was issued. The Receiver attempted to take possession on 13th and 14th March 2001 but was obstructed. By the time the Receiver revisited on 17th March 2001, the notification had been issued, declaring the appellant a relief undertaking. The court held that under Section 4(1)(a)(iv), the Receiver could not enforce possession against the properties within Gujarat during the notification period. Therefore, the Receiver was not entitled to take possession of the Rayon Plant and Nylon Tyre Cord Plant.

4. Revocation of Leave Granted Under Clause XII of the Letters Patent:
The appellant's request for revocation of leave granted under Clause XII was dismissed by the learned single Judge, referencing the Full Bench decision in Hatimbhai Hasanally. The appellant did not press this issue further, conceding to the established legal precedent.

Conclusion:
The court concluded that the enforcement of orders and decrees obtained outside Gujarat against properties within Gujarat is suspended during the notification period under the Act. The Receiver's possession of the properties was invalid post-notification. The appeals related to Chamber Summons No. 361 of 2001 and Chamber Summons No. 365 of 2001 were allowed, directing the Receiver to hand over possession of the properties to the appellant. The appeal regarding revocation of leave under Clause XII was dismissed. The operation of the order was stayed for four weeks upon request.