W B Industrial Corporation Ltd. Vs. Deen Mohammad Rana and another

W B  Industrial Corporation Ltd. and others  (Petitioners)


Deen Mohammad Rana and another (Respondents)

Supreme Court

Appellate Division



Shahabuddin Ahmed CJ

MH Rahman J

ATM Afzal J

Mustafa Kamal J

Latifur Rahman J


June 2nd, 1994.

Case Referred to-

Nur Mohammad and others vs. Moulvi Mainuddin Ahmed & others 39 DLR (AD) 1.

Lawyers Involved:

Asrarul Hossain, Senior Advocate, instructed by Mvi. Wahidullah, Advocate -on-Record — For the Petitioners.

Not Represented— Respondents.

Civil Petition for leave to Appeal No. 233 of 1994.

(From the judgment and order dated 10 March 1994 passed by the High Court Division. Dhaka in Civil Revision No. 3274 of 1993).


      MH Rahman J: On 28 June 1992 the petitioners instituted Title Suit No. 30 of 1992 in the Court of Subordinate Judge and Artho Rin Adalat No. 2. Dhaka for a declaration that the sale of the Leather Board Manufacturing industry of plaintiff No. 1 WB Industrial Corporation Ltd. at Kalurghat, Chittagong by the Bangladesh Shilpa Bank respondent No. 2 to Mr. Deen Mohammad Rana Respondent No. 1 is illegal, malafide and without jurisdiction and void.

2. The plaint case is, that plaintiff No. 1 took loan from the Bangladesh Shilpa Bank for a sum of Taka 1,22,58,702 during the period from December 1979 to June 1981 and repaid altogether a sum of Taka 45,2 1 lakh. The Bank recalled the entire loan with interest under Article 32 of the Bang Shilpa Bank Order. By a notice, dated 17 May 1990 tenders were invited for sale of the Leather Board of Industry. The tenders were not opened on that d fixed, 13 June 1990. The plaintiffs did not know when they were opened and in whose presence. Thereafter the Bank carried on negotiation with various parties including the plaintiffs. As a result of discussion between the plaintiffs and the Bank it was agreed between the parties that the industry would be restored to the plaintiffs on payment of Taka 1,54,12,000.00 in full and final settlement of all claims of the Bank. Accordingly, the plaintiffs submitted two cheques namely, (1) No. 4521827 dated 30 June 1990 for Tab 1,25,00,000.00 and (2) No. 4521826 dated 30 June 1990 for an amount of Tab 29,12,000.00 both drawn on Arab-Bangladesh Bank on 30 September 1990. Subsequently, by letter dated 26 July 1990 the Bank demanded cash or pay order. In response plaintiff No. 1 by letter dated 4 August 1990 agreed to give pay order on n the approval from the Board of Directors of the Bank in respect of the settlement reached. By a letter dated 22 February 1990, the Bank informed the plain that the industry had already been sold to respond No. 1 for a sum of Taka 60,00,000.00 only. The sale was fraudulent and collusive. The Bank had so power under the law to take resort to the provision of Article 34 of the Bangladesh Shilpa Bank Order 1972. Respondent No. 1 was neither a tenderer nor a bidder. There is no provision under Article 34 for the sale of the property by private negotiation in an arbitrary and malafide manner. The Bank filed Miscellaneous Case No. 91 of 1991 for recovery of their alleged balance dues from the personal properties of the Directors of petitioner No. 1. If the industry of plaintiff No. 1 had been sold properly and honestly then more than the entire claim of the Bank could have been recovered. The plaintiffs by a letter dated 30 September 1990 protested against the illegal and fraudulent action of the respondents and requested the Bank to cancel the so-called sale but the plaintiffs received no reply and in the said circumstances the plaintiffs were constrained to file this suit and prayed, pending hearing of the suit, for stay of further proceeding of the aforesaid Miscellaneous Case No. 91 of 1991 or, in the alternative, for analogous hearing of the suit with the Miscellaneous Case.

3. On 8 March 1993 Respondent No. 1 defendant No. 2 in the suit, filed an application for the rejection of the plaint on the ground that the suit is barred under Article 34(5) of the Bangladesh Shilpa Bank Order. 1972 (President’s Order 129 of 1972).

4. On 19 September 1993 the trial Court rejected that application. At the instance of respondent No. 1 the High Court Division set aside the order of the trial Court by the impugned judgment and allowed his prayer for the rejection of the plaint.

5. The petitioners now contend that when in the plaint it was alleged that the Bank collusively and malafide sold the property worth taka ten crore to respondent No. 1 at a shockingly low price of Taka 60 lakh only the High Court Division erred in law in rejecting the plaint.

6. It is further contended that the High Court Division erred in holding that there is no malafide where the Bank did not appear in the trial Court or in the High Court Division to support respondent No. l’s application for rejection of the plaint.

7. It is submitted that the impugned judgment is contrary to the decision of the Appellate Division in Nur Mohammad and others vs. Moulvi Mainuddin Ahmed & others 39 DLR (AD) 1 wherein it is held that malafide is a question of fact and where malafide is alleged in the plaint a petition for rejection of the plaint under Order VII rule 11 CPC is not maintainable.

8. Respondent No.1, the purchaser, got physical possession of the property and the sale certificate from the Bank after making full payment. For protecting his interest he can alone pray for rejection of the plaint. If the Bank does not join him in his prayer for rejection of the plaint then the sale cannot be held to have been malafide.

9. After noting the case reported in 39 DLR (AD)1, the High Court Division held that ‘it appears from the plaint itself that the plaintiffs themselves accepted the position that they failed to pay the instalment of the loan and several notices were also issued for selling the suit property by tender and it was also disclosed in the plaint that there was negotiation with plaintiff No. 1 with the Bank on several occasions and defendant No. 1 Bank had given the plaintiff No. 1 sufficient time to settle the matter amicably.”

“In the plaint it is merely alleged that since the project was sold at a shockingly low price of Taka 60 lakh and since it is done with malafide intention in collusion with the officers of defendant No. 1 Bank and defendant No. 2, the entire sale is void being malafide. Mere allegation of malafide is not enough. Prima facie from the plaint it must be shown to the satisfaction of the Court that the transaction was malafide. If such malafide is prima facie proved then the question of taking evidence in the matter will be required. We have considered the plaint of the suit ………….We have considered the materials on record and found that prima facie the plaint does not disclose any element of malafide. Rather the facts of the case show that the Bank defendant No.1 acted bonafide and on several occasions the Bank negotiated with the plaintiffs and tried to settle the matter amicably.”

The petitioners did not annex the plaint with the paper book nor did they place it before us. They have failed to assail the above findings of the High Court Division. The petition is dismissed.


Source: 48 DLR (AD) (1996) 50