OM AGGARWAL versus HARYANA FINANCIAL CORPORATION AND OTHERS

Citation: [2015] 2 S.C.R. 505 · Decided: 23-02-2015 · Supreme Court of India · Bench: RANJAN GOGOI · Disposal: Dismissed
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Judgment (excerpt)

[2015] 2 S.C.R. 505 
OM AGGARWAL 
v. 
HARYANA FINANCIAL CORPORATION AND 
OTHERS 
(Civil Appeal No. 4942 of 2007) 
FEBRUARY 23, 2015 
[RANJAN GOGOi AND 
ABHAY MANOHAR SAPRE, JJ.] 
A 
B 
c 
Code of Civil Procedure, 1908 - 0. VII r. 11 (d) -
Rejection of plaint - Jurisdiction of civil court - Suit 
for declaration by appellant-one of the promoter of 
the limited company that the Buy Back Agreement D 
executed by the appellant with respondent no. 1-State 
Financial Corporation; and the recovery notice issued 
by the Corporation be declared null and void -
Application u/0. VII r.11 rw s.21 by respondent no. 1 
that the suit claiming the said relief was not E 
maintainable - Dismissal of suit as not maintainable 
by the courts below, by taking recourse to 0. VII r. 11 (d 
) - Interference with - Held: Not called for - On facts, 
appellant was a 'defaulter' as defined uls.2(c); the 
investment made by the Corporation pursuant to an F 
agreement was in the nature of the 'financial 
assistance' as defined uls.2(d); demand raised by 
Corporation was in relation to the amount given by 
way of financial assistance u/s. 3 and the subject G 
matter of the suit fell uls. 3(4)(a), (b), thus, the bar 
contained in s. 3(4) in filing the civil suit by the 
defaulter attracted -
Haryana Public Moneys 
505 
H 
506 
SUPREME COURT REPORTS 
[2015] 2 S.C.R. 
A 
(Recovery of Dues) Act, 1979 - ss. 2(b), (c), (d), 3(4). 
Dismissing the appeal, the Court 
HELD: 1.1 Section 3 of the Haryana Public 
8 Moneys (Recovery of Dues) Act, 1979 empowers 
the Corporation to make recovery of its 
outstanding dues from the defaulter as arrears 
of land revenue by getting the certificate of 
recovery of the amount issued from the 
C competent authority whereas sub-section (4) of 
Section 3 in clear terms takes away the 
jurisdiction of the civil court to entertain or/and 
adjudicate "any case" relating to the recovery 
of any sum due from the defaulter. It also takes 
0 away the jurisdiction of civil court to proceed 
with any pending case involving such issue. If 
any such case is pending on the date of 
commencement of the Act, such case shall 
stand abate. [Para 23) [518-E-G] 
E 
1.2 Applying the principle of law laid down in 
S.K. Bhargava case, it is clear by mere reading of 
the plaint that firstly, the plaintiff was a 'defaulter' 
as defined under section 2(c) of the Act; secondly, 
the investment made by defendant No.1-
F Corporation pursuant to an agreement was in the 
nature of the 'financial assistance' as defined 
under Section 2 (d) of the Act; thirdly, the demand 
raised by the respondent was in relation to the 
amount given by way of financial assistance 
G under Section 3 of the Act and lastly, the subject 
matter of the suit viz., challenge to the legality of 
the agreement and the demand fell under Section 
3(4)(a) and (b) of the Act. In the light of the facts, 
which are clearly discernable from the averments 
H 
OM AGGARWAL v. HARYANA FINANCIAL 
507 
CORPORATION 
made in the plaint, the provisions of the Act get A 
attracted to the case in hand which, in turn, attract 
the bar contained in sub-section (4) of Section 3 in 
filing the civil suit by the defaulter. The suit is, 
therefore, apparently barred by virtue of bar contained 
in Section 3(4) of the Act. It was thus, rightly dismissed B 
by the courts below by taking recourse to Order VII 
Rule 11 (d) of the Code. [Paras 25 and 26] [520-A-E] 
S.K. Bhargava v. Collector, Chandigarh and others 
(1998) 5 SCC 170: 1998 (2) SCR 1158 - relied on. 
C 
' 
Unique Butyle Tube Industries (P) Ltd. v. U.P. 
Financial Corporation and Others (2003) 2 SCC 455: 
2002 (5) Suppl. SCR 666 - held Inapplicable. 
Case Law Reference 
1998 (2) SCR 1158 
referred to 
Para 25 
2002 (5) Suppl. SCR 666 held inapplicable 
Para 32 
CIVILAPPELLATE JURISDICTION: Civil Appeal No. 
4942 of 2007 
D 
E 
From the Judgment and Order dated 03.03.2005 of 
the High Court of Punjab & Haryana at Chandigarh in 
F 
Civil Revision No. 3127 of 2004. 
Suresh Singh, Rohit Tandon, Ruchi Kohli for the 
Appellant. 
Birendra Kumar Choudhary, AAG, Sanjay Kumar 
Visen, Amarjit Singh Bedi, Amit Dayal for the Respondents. 
The Judgment of the Court was delivered by 
G 
H 
508 
SUPREME COURT REPORTS 
[2015] 2 S.C.R. 
A 
ABHAY MANOHAR SAPRE, J. 1. This civil appeal 
is filed by the appellant/plaintiff (hereinafter referred 
to as "the plaintiff) against the judgment/order dated 
03.03.2005 passed by the High Court of Punjab & 
Haryana at Chandi
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