Karnataka High Court
Sri. Chanabasayya Kottrayya vs The Joint Registrar Of Co-Operative ... on 23 November, 2012
Author: Ram Mohan Reddy
Bench: Ram Mohan Reddy
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IN THE HIGH COURT OF KARNATAKA
CIRCUIT BENCH AT DHARWAD
DATED THIS THE 23 R D DAY OF NOVEMBER, 2012
BEFORE
THE HON'BLE MR.JUSTICE RAM MOHAN REDDY
WRIT PETITION NO. 62482/2011 (CS-DAS)
BETWEEN:
Sri Chanabasayya Kottrayya
Durgadamath
Aged about 49 years, Occ: Business,
R/o.Umashankar Nagar, Ranebennur,
Tq: Ranebennur, Dist: Haveri.
... Petitioner
(By Sri R.M.Kulkarni, Advocate.)
AND
1. The Joint Registrar of
Co-operative Societies,
Shahapur, Belgaum,
Dist: Belgaum.
2. The Deputy Registrar of
Co-operative Societies,
D.C.Office Campus, Haveri,
Dist: Haveri.
3. The Assistant Registrar,
Co-operative Societies,
Haveri Sub-Division, Haveri
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and the Recovery Officer, Haveri.
4. The Sale Officer,
Shree Basaveshwara Urban
Co-operative Bank Ltd.,
Ranebennur, Cotton Market Road,
Ranebennur, Tq: Ranebennur,
Dist: Haveri.
5. Shree Basaveshwara Urban
Co-operative Bank Ltd.,
Ranebennur, Cotton Market Road,
Ranebennur, Tq: Ranebennur,
Dist: Haveri, by its Manager.
6. Sri Gururaj Seetaram Pallegadde
Age: Major, occ: Not known,
R/o.Siddeshwar Nagar,
P.B.Road, Ranebennur,
Tq: Ranebennur, Dist: Haveri.
... Respondents
(By Smt.K.Vidyavathi, Addl. Government Advocate,
for R.1 to R.3,
Sri R.K.Hatti, Advocate, for R.4 and R.5,
Sri Aravind D. Kulkarni, Advocate, for R.6.)
This writ petition is filed under articles 226
and 227 of the Constitution of India, praying to
issue of writ or certiorari or any writ quashing the
order dated 22.2.2011 passed by the respondent
No.2 Deputy Registrar of Co-operative Societies,
produced as per Annexure-A confirming the order
dated 9.11.2004, passed by the respondent No.3
Asst. Registrar of Co-operative Societies, Haveri,
Sub-division, Haveri, produced as per Annexure-B
confirming the auction in favour of the respondent
No.6, etc.,.
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This petition coming on for orders, this day
the court made the following:
ORDER
Petitioner claims to have raised a loan of `4,00,000/- in two instalments of `3,00,000/- and `1,00,000/- respectively, at the agreed rate of interest of 18% p.a. and in default 2% as penal interest against the amounts in default, as working capital for Shri Koteshwar Swamy HPC Dealer, Ranebennur, of which the petitioner was a proprietor. Petitioner created a charge over lands bearing R.S.No.243 and 794/A/5A+5B1 at Kajari and Ranebennur villages of Ranebennur Taluka, standing in the name of Kotrayya Chanabasayya Durgadamath the father of the petitioner. Due to accumulated losses, petitioner unable to repay the amount together with interest suffered an award dated 31.8.2002, Annexure-C, determining `6,73,382/-, as the amount due secured by the 4 mortgaged properties bearing Sy.No.243 and Sy.No.794/A/5A+5B1 measuring 4 guntas and 2 guntas, respectively. It is stated that the 5th respondent Cooperative Bank sought to execute the award by filing an execution petition in E.P.No.AR-16/ABN/461/CEP/2004-05 indicating that the mortgaged properties are those mentioned in the award. It is the allegation of the petitioner that land measuring 35 guntas in R.S.No.62 was put up for auction sale without verifying the properties subject matter of mortgage as security secured as for the loan. It is stated that the Sale Officer sold the said property in R.S.No.62 by accepting `1,28,000/- offered by the 6th respondent and the 3rd respondent Assistant Registrar of Co-operative Societies by order dated 9.11.2004 Annexure-B confirmed the sale. It is stated that on 22.2.2008 the 3rd respondent passed an order for re-registration of the said survey number, aggrieved by which petitioner filed 5 W.P.No.66647/2009 challenging the confirmation of the auction on the premise that it was without notice to the petitioner. This Court by order dated 10.3.2010 disposed off the petition liberty to the petitioner to file an appeal before the Deputy Registrar of Co-operative Societies the 2nd respondent. Petitioner thereafter filed an appeal under Section 106 of the Karnataka Co-operative Societies Act, 1959, challenging the confirmation of auction on 9.11.2004 and the order dated 22.2.2008. The 2 n d respondent having dismissed the appeal by order dated 22.2.2011, Annexure-A, has resulted in this petition.
2. Petition is opposed by filing statement of objections of respondents No.1 and 2 admitting the fact that the petitioner mortgaged the immovable properties bearing R.S.No.243 and 794/A/5A+5B1 situated at Kajari and Ranebennur which when insufficient to satisfy the award 6 passed by the arbitrator, even if sold, and the 5 t h respondent having reliably learnt that the petitioner was trying to alienate the immovable property in R.S.No.62 measuring 35 guntas, respondent No.3 confirmed the auction sale by the respondent No.4. It is denied that the value of the property sold in auction is more than `5,15,000/- on the date of auction. In paragraph 6 it is exerted that the auction sale conducted by the authorities is in accordance with law.
3. Petition is also opposed by filing statement of objections of the 6th respondent inter-alia contending that the petitioner is guilty of suppression of material facts and having not approached the Court with clean hands petition deserves to be rejected. According to the auction purchaser all formalities required under the relevant law were complied prior to the auction. Petitioner's bid when accepted, since all 7 formalities complied, the confirmation of sale by the authorities is in accordance with law and the amendment carried out in the confirmation of the auction by way of re-registration is also in accordance with law. In paragraph 4 of the statement of objections it is stated that the recovery officer issued a sale certificate under Rule 38(7) of the Karnataka Co-operative Societies Rules, 1960, stating that the auction purchaser purchased the property in question. The confirmation of sale during the year 2004 was not challenged for a very long time and that it was only in the year 2009 that the petitioner filed W.P.No.66647/2009, whence this Court while disposing of the petition observed that it is not in dispute that both the notices are issued in pursuance of the order that is passed against the petitioners. Petitioner claims that the heirs of the deceased judgment debtor had no notice; and if the petitioners are aggrieved by the same are at 8 liberty to challenge the same. At paragraph 8 it is stated that the panchanama was drawn in the presence of the Sales Officer and possession certificate issued to the respondent and the name of the respondent is recorded in the record of rights. Auction purchaser is said to have paid `1,28,000/- as the purchase price and also the registration charges of `11,648/-. Since the auction sale is conducted in a transparent manner without any mala fides, it is submitted that the petition is devoid of merit.
4. Learned Government Advocate having made available the original record relating to the recovery proceeding culminating in the auction notification as well as the acceptance of the bid of the 6 t h respondent, for inspection of the Court, submits that the notice under Sub-Rule (4) under Sub-Rule (3) of Rule 34 of the Karnataka Co-operative Societies Rules, 1960, with the 9 acknowledgment of the petitioner is not forthcoming except a photostat copy though the original notices are in the file.
5. Having heard the learned counsel for the parties who reiterate the submissions set out in their respective pleadings, examined the orders impugned and the original file relating to the auction of the immovable property belonging to the petitioner what is discernable is that there is non compliance with Rules 34 and 38 of the Karnataka Co-operative Societies Rules, 1960, for short Rules.
6. It is useful to extract Sub-Rules (2) and (3) of Rule 34 of the Karnataka Co-operative Societies Rules, 1960, which reads thus:
"34. Application for ex ecution to the Recovery Officer -
(1) xxxx 10 (2) Every such application shall be made in the form specified by the Registrar and shall be signed by the decree-holder. The decree-holder may indicate whether he wishes to proceed against the immovable property mortgaged to the decree-holder or other immovable property or to secure the attachment of moveable property. Where he wishes to proceed against immoveable property, he shall give in the applications such description of the property as is sufficient for its identification. In case such property can be identified by boundaries or numbers in a record of rights, settlement or survey, the specification of such boundaries or numbers and the specification of the judgment-debtor'' share or interest in such property to the best of the belief of the decree-holder and so far as he has been able to ascertain, shall be given in the application.
(3) On receipt of such application, the
Recovery Officer shall verify the
correctness and genuineness of the
particulars set forth in the application with the records, if any, in the office of the Registrar and prepare a demand notice, in writing, in duplicate in the form specified by the Registrar, settling forth the name of the judgment-debtor and the amount due and forward it to the Sales Officer. In case the execution is against immoveable property, the amount shall include the expenses, if any, and the batta to be paid to the person who shall serve the demand notice, the time allowed for payment; and in case of non-payment, the particulars of 11 the immoveable properties, if any, to be attached and sold or to be sold without attachment as the case may be:
Provided that where the Recovery Officer is satisfied that a judgment-debtor with intent to defeat or delay the execution proceedings against him is about to dispose of the whole or any portion of his property, the demand notice issued shall not allow any time to the judgment-debtor for payment of the amount due by him and the property of the defaulter shall be attached forthwith."
7. The requirement of filing an application by the Decree holder to execute the award to the recovery officer is set out in Rule 34. (1) In Sub Rule (2) it is stated that the application is to be made in a form specified by the Registrar and signed by the decree holder who has to indicate whether he has immovable property is mortgaged to the decree holder or other immovable property or to secure the attachment of moveable property and if he wishes to proceed against immovable property, he shall give in the applications such 12 description of the property as is sufficient for its identification by boundaries or numbers in the record of right, settlement or survey, the specification of such boundaries and the specification of the judgment debtor's share or interest in the property.
8. A bare perusal of the form No.1 dated 11.12.2002 being the application for execution to the recovery officer does not bear the signature of the decree holder, except affixing the seal of the manager of respondent No.5. This application does not disclose that the land against which the decree holder wishes to proceed is Sy.No.62 measuring 35 guntas, on the contrary what is disclosed is lands in R.S.No.243 and 794/A/5A+5B1. Therefore the decree holder did not wish to proceed against the immovable property bearing R.S.No.62 measuring 35 guntas standing in the name of Kotrayya Durgadamath, 13 the petitioner's father. As a consequent the application does not comply with the requirement of Sub-Rule (2) of Rule 34 of the Rules.
9. The noting sheet maintained by the Recovery Officer does not disclose that on receipt of the application by the Recovery Officer he had verified the correctness and genuineness of the particulars set forth in the application with the records, if any, in the office of the Registrar and thereafter prepared a demand notice, in writing, in duplicate in the form specified by the Registrar, setting forth the name of the judgment debtor and the amount due so as to forward it to the Sales Officer. In the absence of subjective satisfaction being recorded in the noting sheet it cannot but be said that there is non compliance with Sub- Rule (3) of Rule 34 of the Rules. The question of proceeding against the immovable property bearing R.S.No.62 measuring 35 guntas belonging 14 to the petitioner's father was never in the contemplation of the Decree holder or the recovery officer while exercising jurisdiction under Sub- Rules (2) and (3) of Rule 34 of the Rules.
10. There is yet another contravention of Rule 38(2)(a) which provides for attachment and sale of immovable property requiring the Sales Officer to serve or cause to be served a copy of the demand notice issued under sub-rule (3) of Rule 34 upon the judgment debtor or, if he is not available, upon some adult male member of his family or upon his authorised agent, or, if such service is not possible, shall affix a copy thereof on some conspicuous part of the immovable property about to be attached and sold or sold without attachment as the case may be.
11. The records though discloses an original and a carbon copy of the demand notice under sub-rule (3) of Rule 34 nevertheless there is 15 nothing to establish service of a copy of the same on the judgment debtor as required by sub-rule (2)(a) of Rule 38 of the Rules.
12. The decree holder, the Recovery Officer and the Sales Officers having thus violated the rule of law, the auction held on 21.9.2004 in which the respondent offered `1,28,000/- for purchase of land measuring 35 guntas in R.S.No.62 and its confirmation by order dated 9.11.2004 is illegal calling for interference. Sequentially the confirmation order dated 9.11.2002, Annexure-B, and the order dated 22.2.2011 in appeal Annexure-A are unsustainable.
13. Before parting it must be noticed that the petitioner made an offer to pay `3,00,000/- to the auction purchaser 6th respondent who declined the offer.
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14. The learned Government Advocate acknowledges return of the original record made available to the Court.
SD/-
JUDGE Mrk/-