Karnataka High Court
Smt K Padmavathi vs The State Of Karnataka on 18 April, 2023
Author: Suraj Govindaraj
Bench: Suraj Govindaraj
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WP No. 33175 of 2015
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 18TH DAY OF APRIL, 2023
BEFORE
THE HON'BLE MR JUSTICE SURAJ GOVINDARAJ
WRIT PETITION NO. 33175 OF 2015 (CS-RES)
BETWEEN:
SMT K PADMAVATHI
W/O H.B. BOREGOWDA
AGED ABOUT 47 YEARS
R/O NO.63, 16TH CROSS,
WEST PARK ROAD,
MALLESHWARAM
BANGALORE-55
REP BY GPA HOLDER
H.B. BOREGOWDA
AGED ABOUT 47 YEARS
... PETITIONER
(BY SRI. R.P. SOMASHEKARAIAH, ADVOCATE)
AND:
1. THE STATE OF KARNATAKA
REP BY ITS SECRETARY
Digitally signed
by DEPARTMENT OF CO-OPERATION
NARAYANAPPA M.S. BUILDING, BENGALURU-01
LAKSHMAMMA
Location: HIGH 2. THE DEPUTY REGISTRAR
COURT OF OF COOPERATIVE SOCIETIES (1ST CIRCLE)
KARNATAKA
PAMPAMAHAKAVI ROAD,
CHAMARAJAPET,
BANGALORE-18
3. THE SALE OFFICER
SRI.KENGAL CREDIT COOPERATIVE SOCIETY LTD.
OFFICE OF THE ASST. REGISTRAR OF
CO-OPERATIVE SOCIETY,
CIRCLE-1
BANGALORE-03
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WP No. 33175 of 2015
4. THE SECRETARY
SHREE KENGAL CREDIT COOPERATIVE
SOCIETY LTD.
NO.273, 2ND MAIN,
WEST OF CHORD ROAD,
2ND STAGE,
BANGALORE-86
5. SRI.B.S. RAVI
S/O SANNAIAH
AGED 40 YEARS
R/AT NO.101, 3RD A CROSS,
26TH MAIN ROAD, NANDHINI LAYOUT,
BENGALURU-26
... RESPONDENTS
(BY SMT. A.R. SHARADAMBA, AGA FOR R1 & R2;
SRI. JAYAKUMAR S. PATIL, SR. ADVOCATE FOR
SRI. MAHESH R. ADVOCATE FOR R3 & R4;
SRI. MADHUSUDHAN M.N., ADVOCATE FOR R5)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227
OF THE CONSTITUTION OF INDIA, PRAYING TO ISSUE A WRIT IN
THE NATURE OF CERTIORARI AND QUASH THE ORDER PASSED BY
THE RESPONDENT NO.1, DATED 5.6.2015 IN NO. CO/27/CAP/2012
AND CO/51/CAP/2012 UNDER ANNEXURE-E AND ETC.
THIS WRIT PETITION HAVING BEEN HEARD AND RESERVED
FOR ORDERS COMING ON FOR PRONOUNCEMENT OF ORDERS, THIS
DAY, THE COURT MADE THE FOLLOWING:
ORDER
1. The petitioner is before this Court seeking for the following reliefs:
a) Issue writ in the nature of certiorari and quash the order passed by the Respondent No.1, dated 5.6.2015 in No. CO/27/CAP/2012 and CO/51/CAP/2012 under Annexure-
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b) Issue a writ in the nature of mandamus directing the respondent no. 3 to 5 together to pay a sum of Rs.51,000/- together with interest and to pay the cost of the building a sum of Rs. 8 Lakhs together with interest
c) Issue direction to the respondent No.1 and 2 to take necessary steps to supersede the Respondent No.4 society for having violated acts and rules of the co- operative society.
d) Issue such other order or direction as may be deemed fit to grant in the circumstances of the case.
2. Learned counsel for the petitioner submits that the petitioner had borrowed Rs.2,10,000/- from the 4th respondent. When the petitioner failed to repay the necessary instalments, 4th respondent requested the competent authority to refer the matter to an arbitrator which was so referred. The Arbitrator passed an award directing the petitioner to make payment of a sum of Rs.1,92,415/- with interest at 22% p.a. till realization. The petitioner had challenged the said award before the Karnataka Appellate Tribunal [KAT] in Appeal No.658/2004 which came to be dismissed on 28.07.2006. -4- WP No. 33175 of 2015
3. It is in that background that the 4th respondent issued a public auction sale notice of the security provided by the petitioner fixing the date of auction as 15.10.2006. It is aggrieved by the same that the petitioner had filed W.P. No.14104/2006. This Court after considering the matter permitted the petitioner to submit a detailed reply to the statement of account produced by the 4th respondent within 10 days thereafter and the Bank was directed to afford an opportunity to the petitioner and pass orders thereon.
4. The said representation having been considered, 4th respondent confirmed the earlier order and had sought for permission from this Court by filing IA- 1/2007 in W.P. No.14104/2006 to confirm the auction sale. This Court observing that since the matter has already been disposed, IA-1/2007 was not maintainable and dismissed it as misconceived.
5. When the matter in W.P. No.14104/2006 was pending, auction sale notice had been stayed subject -5- WP No. 33175 of 2015 to the condition that the petitioner deposits Rs.1,40,000/- within four weeks. The auction sale notice was never set-aside but the auction was permitted to be continued.
6. The contention of the petitioner now is that the petitioner having deposited the said sum of Rs.1,40,000/-, the auction sale could not have continued and confirmed in favour of 5th respondent.
7. Shri R P Somashekariah learned counsel for the Petitioner submits that:
7.1. the petitioner had paid an excess amount of Rs.51,000/- and in the representation given to 4th respondent had claimed the said amount, the said claim not having been considered, 4th respondent has come to unilateral conclusion that there are amounts due and liable to be paid by the petitioner, when in fact they are not so due and payable.
7.2. If at all the 4th respondent was of the opinion that the certain amounts were due and liable to -6- WP No. 33175 of 2015 be paid, 4th respondent ought to have called upon the petitioner to make payment of said amount which the petitioner would have made payment of, not having done so the 4th respondent could not have approached the ARCS for confirmation of the auction. 7.3. This Court having refused to confirm the auction in W.P. No.14104/2006, the respondent could not have approached the ARCS for confirmation.
7.4. He further alleges that the 4th respondent-
Society has colluded with 5th respondent- auction purchaser and has got demolished the building which was standing on the property contrary to the status-quo order passed on 15.10.2009 in W.P. No.22750/2009 and it is in that background that the DRCS directed 4th respondent to make payment of Rs.8,00,000/- as cost/damages.
-7-WP No. 33175 of 2015 7.5. The 5th respondent auction purchaser did not have any money, there is collusion between the officers of the 4th respondent and the auction purchaser inasmuch as the sale deed was executed in favour of the said purchaser on 13.02.2008 and immediately on 14.02.2008 the Society had sanctioned loan of Rs.10,00,000/- on pledging the very same property. 7.6. It is in that background that the petitioner contends that the entire action taken by the respondents are in collusion with each other to frustrate the claims of the petitioner and to usurp the property of the petitioner. 7.7. The sale confirmation having been challenged by the petitioner before the 2nd respondent- DRCS, the 2nd respondent had allowed the appeal and set-aside the auction vide its order dated 16.04.2012. On a revision filed by 4th respondent before 1st respondent-State of Karnataka, the Revision Petition came to be -8- WP No. 33175 of 2015 allowed on the ground that the petitioner had not made payment of the amounts due and as such, confirmed the auction.
8. Sri.Jayakumar S.Patil, learned Senior counsel appearing for respondents No.3 and 4 would submit that, 8.1. The petitioner has involved in litigation after litigation, all of which have been dismissed. The petitioner has only filed proceedings without complying with his obligations in terms of the award passed, an amount of Rs.1,92,415/- with interest at the rate of 22 % p.a. from 23.10.2003 was required to be paid. 8.2. The One Time Settlement [OTS] proposal could not have been considered by 4th respondent, the same being a cooperative Bank, the OTS proposal introduced by Reserve Bank of India was not applicable to the Cooperative Bank. Taking into account only Rs.1,40,000/- had been paid leaving a balance of Rs.52,415/-, -9- WP No. 33175 of 2015 less interest from 2003, the representation directed to be considered by this Court vide order passed in W.P. No.14104/2006 was considered and rejected.
8.3. The said rejection order not having been challenged, the petitioner had approached this Court by filing an interlocutory application in W.P. No.14104/2006 seeking for confirmation of sale which process had been stayed at that point of time, this Court considering that the main petition had been dismissed the application was also dismissed. 4th respondent had thus approached the ARCS for confirmation which was so confirmed.
8.4. It is submitted that mere depositing of Rs.1,40,000/- does not confer any right on the petitioner for stopping the confirmation of auction. The confirmation could have been stopped if the entire amount was paid, the sum not having been paid, the property was
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WP No. 33175 of 2015auctioned and the amounts due to the Bank were appropriated and the balance amount was sent to the petitioner which was not received by the petitioner and as such, the same was invested in a fixed deposit.
8.5. The petitioner did not make payment of the due amounts but to the contrary claimed that an amount of Rs.51,000/- was due and payable by 4th respondent to the petitioner. The 4th respondent has also produced the proceedings of the auction sale, intimation letters, mahazar, etc. after serving a copy thereof to the petitioner.
8.6. It is on the basis of the above, he submits that the petitioner not having come to Court with clean hands, there being large amounts of monies payable to the cooperative Bank, even according to the petitioner only a sum of Rs.1,40,000/- having been deposited, the auction sale was confirmed which cannot be
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WP No. 33175 of 2015found fault with. There is no particular allegation which is made as regards the valuation of the property and therefore, the property having been auctioned, the successful auction purchaser having paid the due amounts, the same is required to be upheld by this Court and the petition dismissed.
9. Heard Sri.R.P.Somashekaraiah, learned counsel for the petitioner, Sri.Jayakumar.S.Patil, learned Senior counsel for Sri.Mahesh R.Uppin, learned counsel for respondents No.3 and 4 and Sri.Madhusudhan.M.N, learned counsel for respondent No.5. Perused papers.
10. The only contention of Sri.Somashekariah, learned counsel for the petitioner is that the entire amount due has been paid in terms of the direction of this Court, pursuant thereto the auction sale having been stayed, the rejection of the representation of the petitioner by 4th respondent is misplaced and there is no proper consideration. The present petition has
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WP No. 33175 of 2015admittedly been filed on 6.08.2015, the auction having taken place on 19.08.2007, the balance amount of Rs.7,75,065/- was forwarded by 4th respondent to the petitioner on 19.02.2008 which came to be returned by the petitioner under his legal notice dated 31.03.2008.
11. In the said legal notice, it is categorically stated that though the petitioner had received the cheque, same was returned on 21.02.2008 by the petitioner which was not accepted by the bank and hence, the counsel for the petitioner had once again returned the cheque along with the legal notice. This notice having been issued on 31.03.2008, the petitioner thereafter kept quiet and filed the above petition only on 6.08.2015 much after the auction purchaser had paid the due amounts, taken possession of the property, sale deed was executed in his favour and was exercising ownership rights in relation thereto. Thus, on the very basis of delay and laches the petition is not maintainable.
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WP No. 33175 of 2015
12. Be that as it may, since various arguments have been addressed, the same are also dealt with, lest it be contended that the merits have not been considered.
13. As observed above, the only contention is that the petitioner had made payment of a sum of Rs.1,40,000/- which included an excess amount of Rs.51,000/- and therefore, the auction could not be confirmed and OTS proposal ought to have been considered.
14. As rightly contended by Sri.Jayakumar S.Patil, learned Senior counsel that the OTS scheme propounded by the Reserve Bank of India is not applicable to the Cooperative Society since the bye- laws do not provide for the same. In that background, 4th respondent has rightly rejected the same.
15. Once, the OTS proposal is rejected what is required to be seen is the amounts due and payable by the petitioner to 4th respondent. A detailed statement of
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WP No. 33175 of 2015account having been produced, the said statement having been disputed only by claiming that an excess amount of Rs.51,000/- is paid cannot be countenanced either in law or facts. The said contention of the petitioner is not supported by any statement of accounts indicating any accumulated interest, the payment made by the petitioner and the balance due. Though this court is not conducting a trial or enquiry into the matter, the submission made by counsel for 4th respondent is more plausible inasmuch as on the date of the auction, there was a sum of Rs.1,92,415/- which was pending and liable to be paid by the petitioner. This dehors the OTS proposal.
16. Thus, on this ground also, it is clear that there being dues on part of the petitioner to 4th respondent, the 4th respondent has rightly brought the property for auction and the same has been confirmed.
17. Insofar as the contention of Sri.Somashekhakriah, learned counsel for the petitioner that the building
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WP No. 33175 of 2015has been unauthorizedly demolished, the petitioner has already approached the DRCS who has passed necessary orders, as such, this Court need not venture into that aspect.
18. For all the above reasons, no grounds having been made out, the petition stands dismissed.
Sd/-
JUDGE LN List No.: 1 Sl No.: 88