Tirumalasetti Venkata Rao,W.G.Dist.,And 3 Otrs. v. The State Of A.P.,Co-Op.,Amaravati,And 8 Otrs.
THE HON'BLE SRI JUSTICE CHALLA KODANDA RAM WRIT PETITION No.36891 of 2017 ORDER:
This Writ Petition is filed seeking the following relief: "....to issue a writ, order or direction more particularly one in the nature of Writ of Mandamus declaring action of Respondents 2 and 3 in conducting auction of the properties over an extent of Ac.1-50 cents in R.S.No.31/6 and house site in an extent of Ac.0-20 cents in R.S.No.105 of Venkatapuram village and Panchayat, Kalidindi Mandal, Krishna District in favour of the respondents 8 and 9 without deciding petitioner's claim petitions dt.20.10.2017 as illegal, irregular, arbitrary and violative of the principles of natural justice and the provisions of the Andhra Pradesh Co-operative Societies Act, 1964 and rules framed there under and also offends Articles, 14, 21 and 300-A of the Constitution of India and consequently set aside the auction proceedings dt.23.10.
2017 in favour fo respondents 8 and 9 and pass such other order or orders may deem fit and proper in the circumstances of the case." 2) The averments in the Writ Petition, in brief, are that one Kola Venkateswara Rao, who is the father of the respondents 5 and 6, and who worked as the Secretary of the 3rd respondent society, was served with the surcharge proceedings as he was found to have misappropriated a sum of Rs. 3,06,25,988/-. In that process, eight Execution Proceedings were filed seeking recovery of the said amount. During the said recovery proceedings, the land in an extent of Ac.1-50 cents out of Ac.2-00 cents in Sy.No.31/6 situated at Venkatapuram Village, Kalidindi Mandal, Krishna District and also a house bearing No.2/11 over an extent of Ac. 0-19 cents of the same village, were attached and sought to put to sale.
operative Societies Rules, 1964 (in short "the Rules"). Along with the claim petition, a petition to stay all further proceedings was also filed, however, the same came to be rejected. E.A. was rejected with an endorsement of the 2nd respondent as follows: "1. No substantial evidence is produced to accept the stay petition.
2.
The property was conditionally attached by the then Deputy Registrar of Coop. Society, Gudivada, on 03.03.2003. Since then, no claim petitioners were received so far.
3.
50% of loan amount under rule 52 was not deposited." 3) It is the case of the petitioners that along with the claim petition, they filed two documents evidencing their claim viz., 1) Family arrangement document, dated 11.02.2012;
and 2) Possession certificate issued by the V.R.O., Venkatapuram village in their favour. Instead of considering the same, on merits, the 2nd respondent merely returned the same stating that the petitioners have failed to deposit 50% of the loan amount under Rule 52. 4) A counter affidavit is filed, wherein, in detail, the method and manner in which the said K.Venkateswara Rao became liable to pay and further stated that the 2nd respondent had considered the objections and rejected only the stay petition for not depositing the 50% of the loan amount. It is further stated that an appeal lies against the said order, dated 23.10.2017.
5) It is the contention of the learned counsel for the petitioners that the imposition of condition of depositing 50% of loan amount is not contemplated in the Rules. Apart from that, when the claim petition is filed, it is the duty of the 2nd respondent to adjudicate the same and pass a reasoned order, which has not been done in
the present case. He also further asserts that there is no provision for appeal.
6) On the other hand, learned Government Pleader for Cooperation (A.P.) opposed the Writ Petition and submits that the condition is imposed taking into consideration the amount, which has been misappropriated by K.Venkateswara Rao and that the said condition imposed is reasonable.
7) Having considered the respective submissions, Rule 52 is the relevant Rule, which gives a right to any third party to make a claim, which is required to be filed under Rule 52 (21) (a). Rule 52 (21)(a) reads as under:
"Rule 52 (21) (a): Where any claims is preferred or any objection is made to the attachment of any property under this rule on the ground that such property is not liable to such attachment, the officer shall investigate the claim or objection and dispose it of on the merits:
Provided that no such investigation shall be made when the sale officer considers that the claim or objection is frivolous."
8) A bare reading of the above Rule discloses that in a given case, there is a duty cast on the 2nd respondent to investigate the claim and pass a reasoned order. In the present case, admittedly the claim petition is required to be adjudicated. Pending disposal of the adjudication of the claim petition, if the property is put to sale, prejudice would be caused to the petitioners. There is no supporting provision, which mandates deposit of 50% of the loan amount. Though a reference is made to Rule 52, justification for directing to deposit 50% of the surcharge amount, as a condition for grant of stay, was not provided therein. However, it cannot be said, as a matter of rule, in the given case, that the authority is not authorized to impose a condition either for keeping the auction in
abeyance or for granting stay. In the present case, considering the nature of demand, which is made, and considering the right, which is required to be adjudicated, imposition of such onerous condition is not warranted. Inasmuch as, there is a duty cast on the 2nd respondent and the claim petition is pending for adjudication, interest of justice would be served if a direction is issued to the 2nd respondent to complete the adjudication of the claim petition in accordance with law, duly complying with the principles of natural justice in all respects and till such time, the respondent authorities shall refrain from taking any coercive steps against the petitioners' property.
9) Respondents 8 and 9 have no role to play in the present adjudication. The grievance of the learned counsel for respondents 8 and 9 that they have deposited the amount is concerned, they shall independently workout their remedies in accordance with law. In view of the uncertainty, if respondents 8 and 9 do not desire to continue to participate in the adjudication, they are at liberty to seek refund of the money deposited as security. As and when such request is made the same shall be considered and pass appropriate orders be passed.
10) With the above direction, the Writ Petition is disposed of. There shall be no order as to costs.
11) Consequently, Miscellaneous Petitions pending, if any, shall also stand dismissed.
_____________________________ CHALLA KODANDA RAM, J.
Date: 23.01.2018.
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