Antony P.X v State of Kerala & Others

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT:** ## **THE HONOURABLE MR. JUSTICE SHAJI P.CHALY** **THURSDAY, THE 15TH DAY OF JUNE 2017/25TH JYAISHTA, 1939** ## **WP(C).No. 16508 of 2017 (K)** ## **-------------------------------------------** **PETITIONER(S) : -------------------------** **ANTONY P.X, AGED 57 YEARS, S/O. XAVIER, POOMKOTTIL HOUSE, VADATTUPARA, KOTHAMANGALAM, ERNAKULAM 686 694.** ## **BY ADV. SRI.P.B.AJOY** **RESPONDENT(S) :** - **----------------------------** **1. STATE OF KERALA, DEPARTMENT OF CO-OPERATION, OFFICE OF THE REGISTRAR OF CO-OPERATIVE SOCIETIES, JAWAHAR SAHAKARANA BHAVAN, DPI JUNCTION, THYCAUD P.O, THIRUVANANTHAPURAM 695 014.** **2. ASSISTANT REGISTRAR OF CO-OPERATIVE SOCIETIES(GENERAL) KOTHAMANGALAM, KOTHAMANGALAM P.O, ERNAKULAM 686 691** **3. SPECIAL SALE OFFICER, POTHANICADU FCB GROUP, OFFICE OF THE ASSISTANT REGISTRAR OF CO-OPERATIVE SOCIETIES (GENERAL, KOTHAMANGALAM, KOTHAMANGALAM P.O, ERNAKULAM 686 691.** **4. THE EDAMALAYAR SERVICE CO-OPERATIVE BANK LTD. NO. 1178, REPRESENTED BY SECRETARY, VADATTUPARA P.O, KOTHAMANGALAM, ERNAKULAM 686 694.** **R1 TO R3 BY GOVERNMENT PLEADER SMT. MABLE C.KURIAN R4 BY ADV. SRI.P.N.MOHANAN** **THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 15-06-2017, ALONG WITH W.P(C).NO. 16521 OF 2017, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** Msd. ## **WP(C).No. 16508 of 2017 (K)** ## **------------------------------------------** ## **APPENDIX** ## **PETITIONER(S)' EXHIBITS :** **EXHIBIT P1 TRUE COPY OF THE DEMAND NOTICE DATED 18/04/2016 IN EXECUTION PROCEEDING NO. 890/2015.** - **EXHIBIT P2 TRUE COPY OF THE DEMAND NOTICE DATED 18/04/2016 IN EXECUTION PROCEEDING NO. 891/2015.** - **EXHIBIT P3 TRUE COPY OF THE DEMAND NOTICE DATED 18/04/2016 IN EXECUTION PROCEEDING NO. 892/2015.** - **EXHIBIT P4 TRUE COPY OF THE SALE NOTICE DATED 08/05/2017 IN EXECUTION PROCEEDING NO. 890/2015.** - **EXHIBIT P5 TRUE COPY OF THE SALE NOTICE DATED 08/05/2017 IN EXECUTION PROCEEDING NO. 891/2015.** - **EXHIBIT P6 TRUE COPY OF THE SALE NOTICE DATED 08/05/2017 IN EXECUTION PROCEEDING NO. 892/2015.** - **EXHIBIT P7 TRUE COPY OF THE JUDGMENT DATED 16/12/2015 OF THE HONOURABLE COURT OF KERALA IN W.P(C).NO. NO 37564 OF 2015.** ## **RESPONDENT(S)' EXHIBITS :** **EXHIBIT R4(A): A TRUE COPY OF THE AWARD IN ARC. NOS. 201/2015. EXHIBIT R4(B): A TRUE COPY OF THE ORDER DATED 04.08.2015 OF THE JOINT REGISTRAR.** **EXHIBIT R4(C): A TRUE COPY OF THE LETTER DATED 17.11.2015 OF THE PETITIONER.** **//TRUE COPY//** **P.A.TO JUDGE.** Msd. ## **CR** ## **SHAJI P. CHALY, J.** ----------------------------------------------- **W.P.(C). Nos.16508 & 16521 of 2017 ----------------------------------------------Dated this the 15[th] day of June, 2017** ## **JUDGMENT** The subject writ petitions are materially connected with respect to the illegality alleged by the petitioners in conducting the sale proceedings in order to recover the amount due to the Edamalayar Service Co-operative Bank Ltd. No.1178. Admittedly, petitioners are either loanees or guarantors, and repayment of amounts were defaulted violating the terms and conditions of the agreement entered into by and between the parties. Consequent to which, bank proceeded after issuing demand notices, which finally culminated in sale notices. In W.P.(C) No.16508/2017, the sale notices are Exts.P1 to P6. In W.P.(C) No.16521/2017, the sale notices are Exts.P1 and P2. In both the writ petitions, petitioners are not disputing the amounts shown in the sale notices concerned. The legal contention raised in both the writ petitions is that, the stipulations contained under rule 81 W.P.(C). No.16508 & 16521 of 2017 2 (e) of the Co-operative Societies Rules, 1969 (hereinafter called “the Rules”) is not complied with. Rule 81 of the Rules deals with procedure in attachment and sale of immovable properties. Clause (e) of Rule 81 read thus: “ **81(e)** :-Proclamation of sale shall be published by affixing a notice in the offices of the Registrar, the Tahsildar and of the society concerned, at least thirty days before the date fixed for the sale and also by the beat of Tomtom in the village on 2 consecutive days previous to the date of sale and on the date of sale prior to the commencement of the sale [if found necessary under unavoidable circumstances]. Such proclamation shall, where attachment is required before sale, be made after the attachment has been effected. Notice shall also be given to the decree-holder and the defaulter. It shall specify the date, time and place of sale and specify as fairly and accurately as possible (i) the property to be sold (ii) any encumbrance to which the property is liable (iii) the amount for the recovery of which sale is ordered; and (iv) every other matter which the sale officer considers material for a purchaser to know in order to judge the nature and value of the property.” 2. Relying on the said provision, learned counsel for W.P.(C). No.16508 & 16521 of 2017 3 petitioners contended that as per the stipulation, 30 days notice is to be provided for conducting the sale. However, as per Ext.P1 notice dated 8.5.2017, 30 days is not provided and the sale is posted on 22.5.2017. It is also contended other mandatory requirements contained under clause (e) of rule 81, and rule 85 of the Rules 1969 are also violated. The question to be resolved is whether any such statutory requirements are violated. 3. A counter affidavit is filed by the respondent society refuting the allegations, claims and demands raised by the petitioners. According to the respondents, substantial amounts are due from the petitioners and petitioners were able to flout the proceedings initiated by the society to recover the amount till this extent of time. 4. Heard learned counsel for petitioners, learned Senior Government Pleader, learned Standing Counsel appearing for the respondent bank and perused the pleadings and documents on record. 5. In my considered opinion, on a proper analysis of W.P.(C). No.16508 & 16521 of 2017 4 clause (e), it is clearly discernible that, 30 days notice is stipulated for proclamation of sale by affixing a notice in the office of the Registrar, Tahsildar and of the society concerned at least 30 days before the date fixed for sale. Petitioners have produced before this court only the notices issued to the petitioners. Nowhere in the first limb of clause (e), it is provided that, a notice shall be provided to the petitioner with 30 clear days before conducting the sale. In my considered opinion, such a requirement is not contemplated under clause (e), because in the second limb, it is only stipulated that, notice shall also be given to the decree holder and the defaulter. Therefore, it is categoric and clear that notice of 30 days is mandated only for publication of the same by affixing in the offices of the Registrar, the Tahsildar and the society concerned. There is no case for the petitioners that, the publication was not done 30 days prior to the sale date. However, the contention put forth by the learned counsel for petitioners is that, normally the selfsame sale notices would have been published. But in the absence of a specific W.P.(C). No.16508 & 16521 of 2017 5 pleading with respect to the absence of 30 days notice by affixing the same in the offices referred to above, it cannot be presumed by this court that, there was no notice published as is contemplated under law. Moreover provisions of a statute must be read and construed in the context and purport in which they appear. 6. Yet another contention advanced is that, the sale shall be conducted by beating the Tom-tom in the village on 2 consecutive days previous to the date of sale and on the date of sale prior to the commencement of the sale, if found necessary under unavoidable circumstances. That apart it is contended, as per rule 85 of the Rules, the society can only sell the immovable property proportionate in extent to the amount due. Rule 85 reads thus: ## “85. **Sale of immovable property to be** ## **proportionate to the amount due** :- It shall be lawful for the sale officer to sell the whole or any portion of the immovable property of defaulter in discharge of money due. Provided that so far as may be practicable no larger section of immovable property shall be sold than may be sufficient to W.P.(C). No.16508 & 16521 of 2017 6 discharge the amount due with interest and expenses of attachment, if any and sale.” 7. Even though there is no imperative stipulation against sale of the entire property, reading of proviso to rule 85 clearly demonstrates that, so far may be practicable no larger section of immovable property shall be sold than may be sufficient to discharge the amount due with interest and expenses of attachment, if any and sale. Therefore, interest of justice requires adoption of a reasonable procedure by the society in order to recover the money due to it. Moreover, the larger interest of the society is only to secure the money due to it and if that can be achieved by selling a portion of the mortgaged property, there is no reason for the society to proceed against the whole mortgaged property. In this regard, I have no hesitation to hold that the principles of law contained under Order XXI Rule 64 CPC applies to the sale proceedings carried out by the Co-operative Societies. As held by the Apex Court in the Judgments in **Ambati Narasayya v. M. Subha Rao and another** [AIR 1990 SC 119 ] and **Balakrishnan v. Malaiyandi Konar** [ AIR 2006 SC W.P.(C). No.16508 & 16521 of 2017 7 1458], the power conferred to sell a portion of the property is not just a discretion but an obligation imposed on the court and the sale held without examining the said aspect, and not in conformity with the mandatory requirement, would be illegal and without jurisdiction. The provisions of rule 85 of the Kerala Co-operative Societies Rules, 1969 is some what similar and akin to the aforesaid provision of CPC. Therefore, there is a duty cast upon the respondent society to follow the said procedure. 8. Fact circumstances show, if at all there is any defect with respect to the stipulation contained in clause (e) of rule 81, the same shall only be with respect to the beat of Tomtom. It is also clear that, if large extent of properties are involved in the mortgage, there is a duty cast upon the society to sell only a portion of the property proportionate to the amount due. According to the petitioner, for that purpose a valuation should have been taken as is held by this court in **People's Urban Co-operative bank. Ltd. v. Mohanan** [1992(2) KLT 745]. So also learned counsel brought my W.P.(C). No.16508 & 16521 of 2017 8 attention to the judgment of a Division Bench of this court in **Thampi v. Kunnathunad Taluk Primary Co-operative Agrl. & R.D. Bank Ltd.** [2012(3) KLT 628] to canvass the aforesaid proposition. Learned counsel also pointed out that, petitioners are prepared to pay off the outstanding amount in 12 equated monthly installments. I also bear in mind that the sale did not take place consequent to the interim order passed at the time of admission. 9. Accordingly, there will be a direction to the petitioners to pay the outstanding amounts in 12 equated monthly installments starting from 5.7.2017 and on the corresponding date of the succeeding months. Needless to say, if the petitioners are not complying with the directives contained above, the bank will be at liberty to proceed in accordance with law. I also make it clear, if situation demands, the stipulations contained under rule 81(e) shall be scrupulously followed. That apart the valuation of the property mortgaged shall be taken in its entirety if larger section of immovable property is involved and the authority shall specify for sale W.P.(C). No.16508 & 16521 of 2017 9 only the proportionate extent of property required to recover the amount due from the petitioners. Writ petitions are disposed of with the above observations and directions. Sd/- **SHAJI P. CHALY JUDGE** smv 15.6.2017