Andhra Pradesh High Court - Amravati
Gattu Chinnaswamy Amarnath vs The State Bank Of India on 30 June, 2025
APHC010261232025
IN THE HIGH COURT OF ANDHRA PRADESH
AT AMARAVATI [3331]
(Special Original Jurisdiction)
MONDAY,THE THIRTIETH DAY OF JUNE
TWO THOUSAND AND TWENTY FIVE
PRESENT
THE HONOURABLE SRI JUSTICE SUBBA REDDY SATTI
WRIT PETITION NO: 13327/2025
Between:
1. GATTU CHINNASWAMY AMARNATH, S/0 GATTU. MUNASWAMY.
CHINNA SWAMY, AGE- 60 YRS, D NO. 442/2, KAVARA STREET,
NALLAVANAMPET(VIIIAGE) PALLIPET (TALUK) THIRUVALLUR
(DIST) TN-631207
2. PEMMASANI.SRAVAN KUMAR, S/0 PEMMASANI.MUNISEKHAR
NAIDU, AGE-39 YRS, 1-3 SRI KALAHASTHI ROAD,
PICHATUR(V8IM) TIRUPATI (DIST) AP-517587
3. K.MUNIYANDI, S/0 A KANNUSWAMY, AGE-53YRS, D.NO 2/102 MGR
STREET, THANDAL KAZHANI BALAJI NAGAR AMBATHUR(TALUK)
CHENNAI TN-600066
4. MUNUSWAMY. BABU, S/0 CHENGAIAH.MUNUSWAMY, AGE-65YRS,
D.NC 5/1 KAVARAPALEM (VILLAGE),
DEVADHANAM(POST),PONNERI(THALUK),TN
5. PEMMASANI. PARVATHI, W/0 PEMMASANI .MUNISEKHAR
NAIDU,AGE-57YRS, L-3,SRI KALAHASTHI ROAD PICHATUR(V AND
M) TIRUPATI (DIST) AP- 517587
6. PACHIAPPAN. RAMAKRISHNAN,, S/0 PACHIAPPAN, AGE-52YRS,
D.NO 2-275, 9TH STREET,PUDU NAGAR, PUKKI LINE,
REDHILLS,CHENNAI-TN-600052
7. ETTIYAN.VENKATESAN, S/0 EL IIYAN, AGE-53YRS, OLD
COLONY,SOUTH BAZAR VILLAGE, DINDIVANAM
(THALUK)VILLUPURAM (DIST)TN-
2
8. GUNASEKHAR.MUTHUSWAMY,,
S/OGANESAN.GUNASEKHAR,AGE-39YRS, D.NO 993/(NEW) AND
27(OLCL)VARADHARAPURI AMMAANKOIL STREET, KHIZHA
KOTTAIYUR, MELAKOTTAIYUR(POST)VANDALUR,CHENNAI-TN-
600048
9. YERRA.LAHARIKA, D/0 YERRA. VENKATESWARLU, AGE-36YRS,
SY NO 95/L,PLOT NO 47 PUTHUR VILLAGE,
AMABATHUR(TALUK)THIRUVALLURU (DIST)CHENNAI-TN-6000
...PETITIONER(S)
AND
1. THE STATE BANK OF INDIA, Rep.by its Chief Manager, ACB Puttur
Branch 580, Kapu street, Tirupathi District Andhra Pradesh
...RESPONDENT
Petition under Article 226 of the Constitution of India praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased to pleased to issue appropriate writ, order or direction more particularly one in the nature of writ of Mandamus directing the Respondent to release the mortgaged properties of the Petitioners which obtained as collateral security for the dairy plus loans availed by the 495 farmers, and to pass orders and pass Counsel for the Petitioner(S):
1. SRIDEVI GANTA Counsel for the Respondent:
1. VENKATA RAMA RAO KOTA The Court made the following ORDER:
Heard Mrs.Sridevi Ganta, learned counsel for the petitioner and Sri K.V.Ramarao, learned standing counsel appearing for the respondent.
2. The petitioners, 9 in number, filed the above writ petition complaining of the inaction of the respondent in returning/releasing the documents offered by the petitioners as collateral security for "Dairy plus Loans" availed by 495 farmers in 49 loan accounts, as illegal and arbitrary.
33. Learned counsel for the petitioner submits that 495 farmers obtained loans under 49 accounts from the respondent bank under the 'Dairy Plus Loans' scheme. The petitioners stood as guarantors for these loans. Since the farmers failed to repay the amounts, the 49 loan accounts were declared as Non-Performing Assets (NPA).
4. Later, the issue was settled before the National Lok Adalat vide L.A.No.73 of 2024 in Pre-Litigation Case No.205/2024. A copy of the same is filed as Ex.P.2.
5. The petitioners, following the Award, paid the entire sum of Rs. 36,75,000/- as full and final settlement. However, despite the said payment, the respondent bank has not released the relevant documents.
6. A counter-affidavit was filed on behalf of the respondent, wherein it was contended that loans under the 'Dairy Plus' scheme were sanctioned. The petitioners stood as guarantors, and a settlement was eventually reached before the National Lok Adalat, according to which the agreed amount was discharged. It was further pleaded that the Central Bureau of Investigation (CBI) registered a case vide RC 01(A)/2002 against M/s. S.V. Milk and Milk Products Pvt. Ltd., in which petitioners 2 and 5 herein have been arrayed as accused Nos. 3 and 4. The case is numbered as C.C. No. 704 of 2024 and is pending before the Court of the V Additional Metropolitan Magistrate, Vijayawada. Since petitioners 2 and 5 are accused in the said case, the respondent has withheld the release of the documents.
Consideration:
7. Thus, as seen from the pleadings, there is no dispute that the petitioners acted as guarantors in respect of the 49 loan transactions covered under Ex.P.2 - the Lok Adalat Award. There is also no dispute regarding the petitioners having paid the sum of Rs. 36,75,000/- as agreed. Since the petitioners have discharged the loan liability in their capacity as guarantors, 4 the respondent is under an obligation to return and release the documents mortgaged as collateral security.
8. Reserve Bank of India issued Circular No.RBI/2023-24/60, DoR.MCS.REC.38/01.01.001/2023-24, dated 13.09.2023, setting out directions regarding the release of movable/immovable property documents.
9. The criminal case registered against the petitioners 2 and 5 herein has nothing to do with the loan transaction referred to supra. The bank cannot retain the documents despite the payment of the loan amount. The stand taken by the bank is not only illegal but also arbitrary.
10. Given the facts and circumstances of the case, the Writ Petition is disposed of with a direction to the respondent to release and return the documents mortgaged by the petitioners in connection with the 'Dairy Plus Loans', as referred to in L.A. No. 73 of 2024 in P.L.C. No. 205 of 2024, before the Lok Adalat Bench, Mandal Legal Services Committee, Puttur, keeping in view the directions given by Reserve Bank of India and the loan was discharged, within two (2) weeks from the date of receipt of a copy of this order. There shall be no order as to costs.
As a sequel, pending miscellaneous petitions, if any, shall stand closed.
___________________________ JUSTICE SUBBA REDDY SATTI Dated 30.06.2025 KA 5 204 THE HONOURABLE SRI JUSTICE SUBBA REDDY SATTI WRIT PETITION NO: 13327/2025 Dated 30.06.2025 KA