CRIMINAL APPEAL NO. 720/2018

6th March 2020

Petitioner Counsel: Shri S. P. Dharmadhikari Shri R. D. Dharmadhikari
Respondent Counsel: Shri T. A. Mirza Shri S. S. Das Shri S. B. Gandhe Shri A. S. Ambatkar Shri P. S. Wathore
Act Name: Indian Penal Code, 1860 Maharashtra Ownership of Flats (Regulation of the Promotion of Construction, Sale, Management & Transfer) Act, 1963 Maharashtra Protection of Interest of Depositors (In Financial Establishments) Act, 1999 Maharashtra Housing and Regulations Act, 2012

HeadLine : Protection of Interest of Depositors - Attachment of property - Objection as to - When not tenable

Section :
Section 34 Indian Penal Code, 1860 Section 403 Indian Penal Code, 1860 Section 406 Indian Penal Code, 1860 Section 420 Indian Penal Code, 1860 Section 465 Indian Penal Code, 1860 Section 467 Indian Penal Code, 1860 Section 468 Indian Penal Code, 1860 Section 2(c) Maharashtra Ownership of Flats (Regulation of the Promotion of Construction, Sale, Management & Transfer) Act, 1963 Section 3 Maharashtra Ownership of Flats (Regulation of the Promotion of Construction, Sale, Management & Transfer) Act, 1963 Section 4 Maharashtra Ownership of Flats (Regulation of the Promotion of Construction, Sale, Management & Transfer) Act, 1963 Section 8 Maharashtra Ownership of Flats (Regulation of the Promotion of Construction, Sale, Management & Transfer) Act, 1963 Section 2(c) Maharashtra Protection of Interest of Depositors (In Financial Establishments) Act, 1999 Section 4 Maharashtra Protection of Interest of Depositors (In Financial Establishments) Act, 1999 Section 4(1) Maharashtra Protection of Interest of Depositors (In Financial Establishments) Act, 1999 Section 5 Maharashtra Protection of Interest of Depositors (In Financial Establishments) Act, 1999 Section 7(3) Maharashtra Protection of Interest of Depositors (In Financial Establishments) Act, 1999 Section 7(4) Maharashtra Protection of Interest of Depositors (In Financial Establishments) Act, 1999 Section 11 Maharashtra Protection of Interest of Depositors (In Financial Establishments) Act, 1999 Section 4 Maharashtra Housing and Regulations Act, 2012 Section 6 Maharashtra Housing and Regulations Act, 2012 Section 16 Maharashtra Housing and Regulations Act, 2012 Section 19(2) Maharashtra Housing and Regulations Act, 2012

Cases Cited :
Para 12: C. Cheriathan Vs. P. Narayan Embranthiri reported in AIR 2009 SC 1502
Para 17: J.K. Trust Bombay. Vs. Commissioner of Income-Tax,Bombay reported in AIR 1957 SC 846

JUDGEMENT

Madhav J. Jamdar, J.

1. By this appeal filed under Section 11 of the Maharashtra Protection of Interest of Depositors (In Financial Establishments) Act, 1999 (hereinafter referred to as “MPID Act”), the order dated 21.09.2018 passed below Exh.56 in Spl. MPID C No.290/2016 by learned Additional Sessions Judge-4, Amravati is challenged. By said order dated 21.09.2018, objection by the appellants bearing Exh.56 preferred under Section 7(3) of the MPID Act taken in Spl.(MPID) Case No.290 of 2016 to the attachment of the field Survey No.78 admeasuring 5H 10R of Mouja Kathora Bk., Pragane Nandgaon Peth, Tq. and Dist. Amravati is rejected.

2. We have heard Shri S. P. Dharmadhikar, learned Senior Counsel for the appellants as well as Shri T. A. Mirza, learned APP for the respondent Nos.1 and 7, Shri S. S. Das, learned counsel for the respondent No.2, Shri S. B. Gandhe, learned counsel for the respondent No.3, Shri A. S. Ambatkar, learned counsel for the respondent No.5 and Shri P. S. Wathore, learned counsel for the respondent No.6 respectively.

3. It is the contention of the learned Senior Counsel Shri S. P. Dharmadhikari on behalf of the appellants that there is merely an agreement of sale dated 14.06.2012 executed between the appellants and the Rana Landmarks Pvt. Ltd., through Director Yogesh Narayanrao Rana (hereinafter referred to as “Developers/Builders”) with respect to the land in question and for that earnest amount was accepted and as the Developers/Builders i.e. Rana Landmark Pvt. Ltd., failed to make entire payment as per the agreement and therefore, notices dated 30.11.2015, 06.01.2016 and 29.04.2016 were sent and the said agreement for sale was terminated. He further submitted that by said agreement no right is created in favour of the purchaser. It is the further contention of the learned Senior counsel that for exercising power under Section 4 of the MPID Act providing attachment of the properties, what is important is that the property should have been acquired by financial establishment. He further submitted that agreement does not create any right and what is important for Section 4 is acquisition of the property i.e. transfer of the title and in the present case there is no transfer of title and as said agreement was also terminated in view of defaults committed by the Developer in making payment of balance consideration, action of attachment taken under Section 4 is totally illegal. He further submitted that the acceptance of “earnest money” by the appellants under the said agreement of sale dated 14.06.2012 cannot come within the four corners of the definition of “deposit” as contemplated under Section 2(c) of the MPID Act. He further submitted that therefore, detailed objection as per Section 7(3) of the MPID Act to the attachment of said property were submitted but, the same are decided without considering the detailed objection submitted and therefore appeal be allowed and the impugned order dated 21.09.2018 be quashed and set aside and said objection be allowed.

4. Shri T. A. Mirza, learned APP for the respondent Nos.1 and 7 submitted that on the basis of said agreement to sale dated 14.06.2012 the possession of the said property was handed over to the Developers/Builders, the Developers/Builders started selling the flats and also started construction and Developers/Builders have collected huge amount of money of more than 10 Crores from the flat purchasers. Thus it is clear that the Developers have acquired title to the said land. He further submitted that therefore, in the facts and circumstances of this case, there is no interference is required in the order dated 21.09.2018.

5. Shri S. S. Das, learned counsel for the respondent No.2 submitted that objection raised by the appellants to the attachment of the property be allowed, however his only request is that the interests on the amount of Rs.1,86,00,000/- received by the appellants is also directed to be deposited by them in addition to Rs.1,86,00,000/- deposited by them.

6. Learned counsel for respondent Nos.3, 5 and 6 supported the submissions made by the learned counsel for the respondent No.2.

7. We have gone through the agreement of sale dated 14.06.2012 titled as “LFkkoj ekyeRr sph (’ksrhph) blkjfpB~Bh” (Receipt of earnest amount of immovable property (agricultural)). The said agreement was executed between Rana Landmark Private Limited, through Director Yogesh Narayanrao Rana (hereinafter referred to as the “Builders/Developers” or “Financial Institution”) and Manohar Shriramji Mahalle and four others (hereinafter referred to as the “Owner”). Said Manohar Mahalle and four others are the appellants and said Yogesh Rana is the respondent no.1. A perusal of various terms and conditions of the said agreement of sale dated 14.06.2012 show that total agreed consideration was Rs.5,75,00,000/- and the earnest amount received was Rs.1,42,00,000/- and additional Rs.1,00,001/-. Thus total amount received by the appellant was Rs.1,43,00,001/- and the balance consideration was Rs.4,31,99,999/-. The clause No.4 of the agreement mentions that balance amount of consideration is to be paid at the time of registration of sale-deed and it is further mentioned that the sale-deed to be completed till 31.01.2013. Clause No.4 further mentions that if the “Builders/ Developers” fail to pay the balance amount of consideration and complete the sale within the time limit i.e. on or before 31.01.2013, then the earnest amount stands forfeited. The clause No.6 records that although Developers/Builders are entitled to develop layout and also make developments of roads, drainage, electric poles etc., the actual possession would be handed over at the time of completion of sale. The Clause No.8 of the said agreement of sale is very important and is reproduced herein below for ready reference :
“8- vkEgh dqBY;kgh ys&vkmV eatwj udk’kkrhy IykWVP;k [kjsnh@fodzh O;ogkjkoj lg;k dj.kkj ukgh- loZ IykWV fodzhp s O;ogkj gk O;ogkj iw.kZ >kY;koj r qEgh Lor a=i.ks r qeP;k lghus djko s- R;kiksVh rqEgkl feG.kk&;k jde spk vkeP;ki Sdh dq.kk’kh l aca/k jkg.kkj ukgh- ek= blkj fpB~BhP;k gDdko:u r qEgh IykWV fodzhpk O;ogkj d: 'kdky R;kl vkeph l aerh jkghy-” (Emphasis supplied)

8. Thus it is clear that a specific right was given to the “Builders/ Developers” to sale the plots on the basis of said agreement. It is clear that absolute right is given to the “Builder/Developers” to sale the plots i.e. right to deal with said property in any manner whatsoever which include even right to construct flats on the said plots and sale the same to the prospective purchasers. It is further clear that clause No.6 allows the “Builders/Developers” to get sanction the Layout Plan and also to develop various amenities in the said layout. The “Builders/Developers” on the basis of said Agreement of Sale started selling flats to prospective purchasers and accepted huge consideration from them. The F.I.R. lodged on 25.09.2014 by Sharad Kukade with City Kotwali Police Station under Sections 403, 406, 420, 465, 467, 468 read with Section 34 of the Indian Penal Code along with Section 3 of the M.P.I.D. Act, 1999 and under Sections 4, 6, 16, 19(2) Maharashtra Housing and Regulations Act, 2012 and Section 3 and 4 of the Money Lending Act vide Crime No.284/2014, records that respective flats were sold to 514 flat purchasers. Thus it is clear that the said Agreement of Sale created right in favour of the “Builders/Developers” in the said property and gives specific right to sale the plots to the “Developers/Builders” which obviously also include right to sale flats to be constructed on said plots. Thus normal rule that agreement of sale do not create any right in the property is not applicable to this case as specific right to sale plots is given by the said Agreement of Sale. Thus, the “Developers/Builders” have acquired right in the said property to sell plots out of said property which includes right to deal with the said property in any manner whatsoever including right to construct flats on said property and sale the same to prospective purchasers.

9. It is the contention of the appellants that they remained present on 31.01.2013 in the office of the Sub-Registrar, Amravati for completion of sale by executing sale-deed after receiving balance consideration, however, the “Builders/Developers” failed to remain present. It appears that thereafter, another agreement dated 07.03.2013 was executed by which the time limit mentioned in agreement dated 14.06.2012 was extended up to 30.04.2013. However, the said document dated 07.03.2013 is not produced before this Court and not annexed to the Appeal compilation. Therefore we are not aware about the terms and condition of the said agreement dated 07.03.20213. It is the contention of the appellants that, at the time of execution of agreement dated 07.03.2013 cheques of aggregated amount of Rs.50,00,000/- were handed over, however, out of same only cheques of aggregated amount of Rs.43,00,000/- were encashed and thus only amount of Rs.1,86,00,001/- was received out of total consideration of Rs.5,75,00,000/-. Therefore, by notice dated 30.11.2015 it was informed to the “Builders/Developers” that the said agreement dated 14.06.2012 stood automatically cancelled. The appellants have also reiterated the said contention by their further notice dated 06.01.2016 and also sent another notice dated 29.04.2016 and reiterated all these facts and mentioned that the said agreement dated 14.06.2012 stood cancelled and the earnest amount also stood forfeited as per the specific terms of the said agreement. It is already set out herein above that in the meanwhile, pursuant to the Clause No.8 of the agreement of sale dated 14.06.2012 giving specific right to sell plots, the “Developers/Builders”, have sold various flats to be constructed on said Survey No.78 to about 514 flat purchasers (hereinafter referred as to “flat purchasers”) and it appears that total amount of Rs.10 Crores was collected from the flat purchasers. In the meanwhile on the basis of report lodged by Shri Sharad Bhimraoji Kukde, one of the flat purchaser, offences punishable under Sections 403, 406, 420, 465, 467, 468 read with Section 34 of the Indian Penal Code vide Crime No.284/2014 were registered on 25.09.2014 against Yogesh Rana and Chandrashekhar Rana, who are the Directors of Rana Landmarks Pvt. Ltd. It further transpires that during the course of investigation the police authorities recorded the statements of various flat purchasers in the said scheme and therefore, provisions of MPID Act were also invoked and charge-sheet inter alia came to be filed before the learned Special Court under Section 3 of the MPID Act. The Deputy Commissioner of Police Zone – 1, Amravati City by letter dated 08.06.2015 addressed to the Collector, District Amravati requested that the competent authority be appointed and further action be taken in the interest of investors and depositors. The Collector, Amravati submitted his report dated 18.06.2015 to the Government of Maharashtra mentioning that the said property be attached. It is stated in the said report that about 495 purchasers have invested about 10 Crores. In view of this the Government of Maharashtra in exercise of the powers conferred by Section 4(1) and Section 5 of the MPID Act appointed Sub-Divisional Officer, Amravati as Competent Authority and vide notification dated 29.03.2016 attached various properties of the financial establishment i.e. “Builders/Developers” and it’s directors including the said property. On 01.01.2018, Sub-Divisional Magistrate, Amravati i.e. competent authority under MPID Act filed application – affidavit seeking that order of attachment be made absolute and further orders under Section 7(4) of the MPID Act be passed. It is stated that the said affidavit – application was filed in addition to affidavit filed on 10.05.2016 which appears to have been misplaced from the record. Thereafter, the present appellants submitted objection dated 02.05.2018 to the attachment of the said property under Section 7(3) of the MPID Act. The appellants inter alia contended in the said objection that, they never authorized the said Rana Landmark Pvt. Ltd. to accept the booking in respect of the flat and apartment of the proposed township and only consent for non agricultural conversion was given by the objectors. The paragraph No.7 of the said objection which is relevant is reproduced herein below for ready reference :
“Now it is pertinent to note that, said Rana Landmarks Pvt. Ltd., prepared a proposed scheme for the construction of residential township and even started obtaining booking for the apartments / flats in the proposed township on the basis of agreements executed with various persons. It is submitted that the present objectors have never authorized said Rana Landmarks Pvt. Ltd., to accept the bookings in respect of the flats / apartments of the proposed township and only consent for non agricultural conversion was given by the objectors, and objectors are agreed for help for the non agricultural conversion of the said land. It is also pertinent to note here that as per the condition no. 6 of the agreement it was incumbent and mandatory upon the said Rana landmarks to take the sale deed on or before the date fixed for the execution of sale deed and this condition was the essence of the contract. It is submitted that, as the said Rana Landmarks Pvt. Ltd., failed to comply with the terms and conditions of the agreement of sale dated 14.06.2012 as mentioned above the said agreement of sale stood cancelled in all respect and as a matter of fact the title and ownership of the said field survey No. 78 was never transferred or assigned in favour of the said Rana Landmarks Pvt. Lt., or Mr. yogesh Narayan Rana.”[emphasis supplied]

10. Therefore, it is contended in the objection that neither the property is owned by the said Rana Landmark Pvt. Ltd., or Yogesh Narayan Rana nor it is acquired from the deposits or funds collected by said Rana Landmark Pvt. Ltd., and therefore the same cannot be attached under Section 4 of the MPID Act. It is further contended in paragraph No.10 that although in view of cancellation of said agreement of sale dated 14.06.2012, by notices dated 30.11.2015, 06.01.2016 and 29.04.2016, the earnest money paid stood forfeited but, the appellants are ready to deposit the said entire amount of Rs.1,86,00,001/- received by them from said Rana Landmark Pvt. Ltd., without prejudice to their right to claim and recover the damages from said Rana Landmark Pvt. Ltd., for the breach of agreement of sale dated 14.06.2012. The said objection as set out herein above was rejected by order dated 21.09.2018 by learned Additional Sessions Judge-4, Amravati, and the said order is challenged by way of filing the present appeal.

11. In this appeal the contention that the appellants never authorized said Rana Landmark Pvt. Ltd., to accept the bookings in respect of flats-apartments of the proposed township and only consent for non agricultural conversion was given by the appellants was reiterated.

12. In the light of above position, very important question to be decided is what is the nature of said agreement for sale dated 14.06.2012 and whether the said agreement creates any right in the said property of the said financial establishment i.e. Rana Landmark Pvt. Ltd. (Developers/Builders). It is settled legal position that a document is required to be read in its entirety. Although the heading is not conclusive it plays very significant role in construing a document. Intention of the parties must be gathered from the document itself but circumstances attending there to would also be relevant as held in C. Cheriathan Vs. P. Narayan Embranthiri reported in AIR 2009 SC 1502. It is also very important to note the manner in which parties have construed the various terms and conditions of the agreement. We have already discussed certain aspects in this behalf earlier. Clause No.8 of the said agreement of sale although initially mentions that the “Builders/Developers” should carry on the transaction of sale of plots only after completion of the sale of the said land, however, further gives specific power to the “Builder/Developer” i.e said Financial Establishment to sell the plots on the basis of the said agreement of receipt of earnest amount and that the appellants are consenting for the same. The said “Financial Establishment” acted on the said right given to them to sell plots and accepted huge consideration from about 514 flat purchasers. Thus, it is clear that various flats purchasers have invested huge amount in the flats to be constructed or being constructed on the said plots. Therefore, the contention raised by the appellant in their objection dated 02.05.2018 as well as in this appeal that they have never authorized said Rana Landmark Pvt. Ltd., to accept the booking in respect of the flats-apartment of the proposed township and only consent for non agricultural conversion was given by the appellant is found to be totally incorrect.

13. It is further significant to note that as set out herein above, by agreement of sale dated 14.06.2012 power was given in Clause No.8 to transfer the plots and naturally the said power also includes power to sell flats to be constructed on such plots. The F.I.R. lodged on 25.09.2014 records that various flats were agreed to be sold to about 514 flats purchasers. Thus, before the alleged cancellation of Agreement of Sale by notices dated 30.11.2015, 06.01.2016 and 29.04.2016 already third party interests were validly created on the basis of power given under Agreement of Sale dated 14.06.2012. It is also significant to note that although the “Builders/Developers” were selling the flats in open market since 2012 the appellants never took any objection to the same and also did not issue any public notice taking objection to the activities of the “Builders/Developers”. There is nothing on record to show that the appellants have filed any Civil Suit seeking injunction preventing “Developers/Builders” from selling the flats or constructing flats on the said property. It is also not clear that as to why there was delay in sending notice when the default in making balance consideration took place on 31.01.2013, the first notice of termination of the Agreement dated 14.06.2012 was sent on 30.11.2015 i.e. after almost two years and 10 months. It is also significant to note that the said termination notice dated 30.11.2015 was sent after lapse of considerable period after lodging F.I.R. on 25.09.2014 which reveals that the “Developers/Builders” had sold the flats to about 514 flat purchasers. It is also very significant to note that when valuable rights are created in favour of “Builders/Developers” by said agreement dated 14.06.2012 and when “Builders/Developers” have acted on said rights by selling flats to about 514 flat purchasers, now in this proceeding “Builders/Developers” are shockingly supporting the stand of the appellants that by said agreement dated 14.06.2012 no rights are created in their favour.

14. It is settled legal position that a document must be read in its entirety. The intention of the parties can be gathered from the document itself. However, circumstances attending thereto would also be relevant. In this particular case, although the document is titled as “LFkkoj ekyeRr sph (’ksrhph) blkjfpB~Bh” i.e. receipt of earnest amount of immovable property (agricultural), however, gives specific power to sell the plots in Clause No.8 which is reproduced hereinabove. The said Clause (8) of the agreement is very wide as it gives power to sell the plots which includes selling of the flats to be constructed on the said plots. In this behalf it is to be noted that from 14.6.2012 i.e. the date of the agreement till lodging of FIR on 25.9.2014, flats were sold to about 514 flat purchasers and the appellants i.e. the owners have not taken any objection for sale of the said flats as well as for construction of the said flats. This conduct is very important as the default in payment of balance consideration was committed on 31.1.2013 and, thereafter, on 30.04.2013 as the said outer limit of 31.1.2013 for making payment of balance consideration was extended up to 30.4.2013 by document dated 07.03.2013. It is very significant to note that the first notice cancelling the agreement was sent by appellants on 30.11.2015 although default was committed on 31.01.2013 and thereafter on 30.04.2013 and in spite of said notice, further notices dated 06.1.2016 and 29.4.2016 were sent by the appellants and no action whatsoever was taken to protect said property from creation of third party interest.

15. As the record shows that flats to be constructed on said plots were sold to about 514 flat purchasers, it is important to note the provisions of the Maharashtra Ownership of Flats (Regulation of the Promotion of Construction, Sale, Management & Transfer) Act, 1963 (hereinafter referred to ‘MOFA’). It is significant to note the statements of objects and reasons behind enacting MOFA. The same is reproduced herein below for ready reference.
“The Maharashtra Ownership Flats (Regulation of e Promotion of Construction, Sale Management and Transfer)Act, 1963 (Mah.SLV if 1963) had been enacted with a view to regulate the promotion of construction, sale, management and transfer of flats taken on ownership basis, initially for a period of five years. The duration of the said Act had been extended from time to time and was last extended upto the 31st March, 2005. The existing shortage of housing in several areas of the State of Maharashtra, especially in the metropolitan cities like Mumbai, Pune, Nagpur, etc, is increasing day by day due to continuous flow of population from rural to urban areas for various reasons, especially for getting employment. In view of this, it was considered expedient to have a perpetual Act to prevent the mal-practices in the matter of construction, sale, management and transfer of flats taken on ownership basis and also to overcome the difficulties relating to the promotion of the construction of ownership flats. [emphasis supplied]”
Section 2(c) of MOFA defines promoter as follows :
2(c) ["promoter" means a person and includes a partnership firm or a body or association of persons, whether registered or not] who constructs or causes to be constructed a block or building of flats, [or apartments] for the purpose of selling some or all of them to other persons, or to a company, co-operative society or other association of persons, and includes his assignees; and where the person who builds and the person who sells are different persons, the term includes both;

16. Section 3 of the MOFA sets out, general liabilities of the promoter, providing various liabilities including disclosure of all encumbrances and specifying the date of giving possession. Section 4 of the MOFA provides that promoter before accepting advance payment or deposit is required to enter into agreement and such agreement has to be registered. In Section 4-A the effect of non registration is set out. It is significant to note that registration of the agreement executed with the flat purchaser is the responsibility of the promoters and Section 4-A regarding effect of non registration of agreement required to be registered under Section 4 provides that such unregistered agreement can be received as evidence of a contract in a suit for specific performance or as evidence of part performance of a contract or as evidence of any collateral transaction not required to be effected by registered instrument. It is further significant to note that Section 8 of the MOFA provides that if promoter fails to give possession within time limit or unable to give possession of the flats then in such a case the promoter shall be liable to refund the amounts already received by him in respect of the flat with prescribed interest and the amounts and the interest shall be a charge on the land.

17. The ‘property’ is a term of the widest import and is subject to any limitation or qualification which the context might require. It signifies every possible interest which a person can acquire, hold and enjoy [J.K.Trust Bombay. Vs. Commissioner of Income-Tax,Bombay reported in AIR 1957 SC 846]. As set out hereinabove, the definition of ‘Promoter’ under MOFA is very wide and it includes both appellants i.e. owners as well as the respondents i.e. “Builders/Developers”/ “Financial Establishment” and a duty has been cast on both of them to construct the flats and give possession of the same to the flat purchasers. As set out earlier, clause no.8 of the said Agreement gives specific absolute power to the “Financial Establishment” to sell the plots which includes right to sell flats to be constructed on such plots. Thus, it is very clear that the property which is subject matter of the present appeal is property as contemplated under Section 4 of the MPID Act.

18. It is argued on behalf of the appellants that Section 4 of the MPID Act is attracted when property is acquired by using depositors money and acquisition means the property should absolutely vest in the “Financial Establishment”. The factual position on record shows that substantial payments were made to the appellants after “Builders/ Developers” sold flats proposed to be constructed on said plot to flat purchasers and, therefore, it is clear that the depositors’ monies were used substantially in acquiring the said property. Learned Senior Counsel appearing for the appellants is conscious of this position and therefore has not argued much on this aspect. However, his emphasis is on the word “acquire” which according to him is absolute acquisition of rights regarding the property. As observed earlier, the ‘property’ is a term of the widest import and is subject to any limitation or qualification which the context might require. It signifies every possible interest which a person can acquire, hold and enjoy. If we examine the said rights acquired by “Builders Developers” i.e Financial Establishment within the frame work of MOFA, then it is clear that the property which is the subject matter of the present appeal need not be the absolute property of the appellants. This is so as on the basis of said agreement of sale dated 04.06.2012, flats were sold to about 514 flat purchasers. Thus, it is clear that the “Financial Establishment” has got rights in the said property. Apart from this aspect both appellants as well as the respondents i.e “Builders/Developers/Financial Establishments” are under obligation to perform their statutory duties under the MOFA. In fact Section 8 of the MOFA creates charge of flat purchasers on the said property. Thus, it is clear that not only the said property is the property of the “Financial Establishment” as set out herein above but there is also a charge of the flat purchasers on the said property. Therefore, looking from any angle it cannot be said that no right is created by the said agreement dated 14.06.2012 and in fact, as set out herein above as the “Financial Establishment” has rights in the said property, Section 4 of the MPID Act is applicable to the same. Thus, it is very clear that the property which is the subject matter of the present appeal comes under the purview of Section 4 of the MPID Act.

19. The MPID Act was enacted to protect the interest of depositors in the Financial Establishments and matters relating thereto. The term “Deposit” as defined in Section 2(c) of the MPID Act inter alia includes any receipt of money by any “Financial Establishment” to be returned after a specified period or otherwise either in cash or in kind or in the form of specified service with or without any benefit in the form of interest, bonus, profit or in any other form. Thus, what is contemplated is receipt of money by the “Financial Establishment” and return of the same in any other form. In the present case, about 514 flat purchasers have paid substantial amounts to the “Financial Establishment” as “Financial Establishment” agreed to hand over to them possession of the flats to be constructed on the same plots. Thus, it is clear that the purchase of flats by flat purchasers from the “Financial Establishment” and for that purpose payment of money to the “Financial Establishment” by flat purchasers is covered under the definition of the term “Deposit” under MPID Act. The exceptions mentioned in the definition of “Deposit” are not applicable to such purchase of flats by flat purchasers from “Financial Establishment”. It is also to be noted that neither the appellants nor any of the respondents contended that money advanced by the flat purchasers to said M/s. Rana Landmark Pvt. Ltd. is not deposit as per MPID Act and only argument was that the title of the property has not transferred to M/s Rana Landmark Pvt. Ltd. and that the same is not the absolute property of said M/s. Rana Landmark Pvt. Ltd. and therefore, Section 4 of the MPID Act is not applicable. We have already discussed in detail this aspect and held that the said property comes within the purview of Section 4 of the MPID Act.

20. Section 4 of the MPID Act contemplates that two types of properties can be attached :
(i) Property believed to have been acquired by the “Financial Establishment” either in its own name or in the name of any other person from out of the deposits, collected by the “Financial Establishment”.
(ii) If it is found that property as contemplated above is not available for attachment or not sufficient for repayment of the deposits, such other property of the said “Financial Establishment” or the promoter, director, partner or manager or member of the said “Financial Establishment”.
The Notification dated 29.03.2016 issued by the Home Department of the Government of Maharashtra by exercising power under Section 4(1) and Section 5 of MPID Act shows that only two properties at Sr.No.2 and 3 in the Schedule to the said Notification are in the name of M/s. Rana Landmark Pvt. Ltd. having approximate value of Rs.1,20,00,000/- and Rs.3,50,000/-. The property as Sr. No.1 of the said Schedule is the subject matter of the present appeal. The properties at Sr.No.10 and 11 are in the name of third persons and said M/s. Rana Landmark Pvt. Ltd. are shown to be the purchasers and that they have paid certain earnest amount. As far as the other properties are concerned, either they are in the name of third persons or in the name of Directors. Therefore, only properties at Sr.No.2 and 3 which are in the name of M/s. Rana Landmark Pvt. Ltd. i.e. “Financial Establishment” can be considered as properties of said “Financial Establishment” and aggregate value of both these properties is Rs.1,23,50,000/-. In this background of the matter, the affidavit in reply of Pravinkumar Bansilal Patil, PSI, Economic Offence Wing, Amravati City dated 14.12.2018 filed on behalf of the respondent No.1 – State of Maharashtra states that the total fraud committed by the accused persons is to the tune of Rs.13.88 Crores. Thus, it is clear that even if it is assumed that the said property is not the property acquired by the “Financial Establishment” out of the deposits collected by the “Financial Establishment”, the said property will fall in the category of “such other property” of the said “Financial Establishment” coming in the purview of Section 4 of the MPID Act as the properties in the name of the “Financial Establishment” acquired out of the deposits collected by the “Financial Establishment” or otherwise are not sufficient for repayment of the deposits to the depositors. If we consider all the properties mentioned in Notification dated 29.03.2016 irrespective whether they are in the name of the “Financial Establishment” or not then also the aggregate approximate price of the said properties is Rs.17,85,85,900/- and if the price of the present property of Rs.5,75,00,000/- is excluded from the same then it is clear that the same will not be sufficient for repayment of the deposits. Therefore, it is clear that the property which is subject matter of the present appeal is the property which is acquired by M/s. Rana Landmark Pvt. Ltd. i.e. “Financial Establishment” in its own name from out of the deposits collected by said “Financial Establishment” or other property belonging to the “Financial Establishment” and therefore, Section 4 of the MPID Act is squarely attracted to the same.

21. As we have held for the reasons set out herein that the said property is the property of financial establishment, the contention that the earnest money is excluded from the definition of “deposits” becomes irrelevant.

22. It is significant to note that land admeasuring only 05 Acres out of total land of 05H 10R. appears to be the subject matter of agreement dated 14.06.2012 and it further appears that entire land is attached under Notification dated 29.03.2016. However, no arguments in this behalf are made and even no prayers in that behalf are made. Therefore, the appellants are granted liberty to approach the trial Court if excess land which is not the subject matter of agreement dated 14.06.2012 is attached.

23. Thus, there is no merit in the present appeal and the same is dismissed with costs.

24. The appellants have deposited Rs.1,86,00,000/- in the Court of Learned Special Judge, Amaravati in Special MPID Case No. 290 of 2016, pursuant to order dated 19.12.2018 passed in this appeal. The said amount be returned back to the appellants.

Decision : Appeal Dismissed