ETTUMANOOR SERVICE CO-OPERATIVE BANK LTD. v. State of Kerala and others

# **`IN THE HIGH COURT OF KERALA AT ERNAKULAM`** # **`PRESENT`** ## **`THE HONOURABLE MR.JUSTICE N.NAGARESH`** ``` MONDAY, THE 13[TH] DAY OF NOVEMBER 2023 / 22ND KARTHIKA, 1945 ``` ``` WP(C) NO. 35546 OF 2022 ``` ## **`PETITIONER:`** ``` THE ETTUMANOOR SERVICE CO-OPERATIVE BANK LTD. NO. 4069, REPRESENTED BY ITS SECRETARY-IN-CHARGE, OFFICE OF THE ETTUMANOOR SERVICE CO-OPERATIVE BANK, ETTUAMANOOR, KOTTAYAM-686 631. ``` ``` BY ADVS. LIJI.J.VADAKEDOM REXY ELIZABETH THOMAS TOM E. JACOB ``` ## **`RESPONDENTS:`** - **`1 STATE OF KERALA, REPRESENTED BY THE SECRETARY TO CO-OPERATIVE DEPARTMENT, SECRETARIAT, THIRUVANANTHAPURAM-695001.`** - **`2 THE REGISTRAR OF CO-OPERATIVE SOCIETIES, OFFICE OF THE REGISTRAR OF CO-OPERATIVE SOCIETIES, JAWAHAR SAHAKARANA BHAVAN, DPI JUNCTION, THYCAUD P.O., THIRUVANANTHAPURAM-695014.`** - **`3 THE JOINT REGISTRAR OF CO-OPERATIVE SOCIETIES (GENERAL)KOTTAYAM, OFFICE OF THE JOINT REGISTRAR OF CO-OPERATIVE SOCIETIES(GENERAL), COLLECTORATE, CIVIL STATION P.O., KOTTAYAM-686002.`** - **`4 THE ASSISTANT REGISTRAR OF CO-OPERATIVE SOCIETIES (GENERAL), OFFICE OF THE ASSISTANT REGISTRAR OF CO-OPERATIVE SOCIETIES (GENERAL), NAGAMPADAM, KOTTAYAM-686002.`** - **`5 JOBY CHERIAN, PLAKKITHOTTIYIL HOUSE, PUNNATHURA, KOTTAYAM DISTRICT, PIN-686 583.`** - **`6 MARIAMMA JOBY, PLAKKITHOTTIYIL HOUSE, PUNNATHURA, KOTTAYAM DISTRICT, PIN-686 583.`** W.P(C) No.35546 of 2022 2 |**`7`**|**`ANEESH SASIKUMAR,`**| |---|---| ||**`THANDUVALLIL HOUSE, PUNNATHURA,`**| ||**`KOTTAYAM-686583.`**| |**`8`**|**`PRAKASAN T.K.,`**| ||**`THEKKANAM KUNNEL HOUSE,`**| ||**`PUNNATHURA, KOTTAYAM-686583.`**| ||**`SRI.DHEERAJ A.S – GOVERNMENT PLEADER`**| ``` THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 13.11.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ``` W.P(C) No.35546 of 2022 3 ## **JUDGMENT** Dated this the 13[th ] day of November, 2023 The petitioner, which is a Primary Credit Co-operative Bank, has approached this Court seeking to quash Exts.P3 and P5 and to direct the 4[th] respondent to consider and dispose of Ext.P2 within a stipulated time. 2. The petitioner states that respondents 5 to 8, during the year 2018, availed four loans each for ₹10 lakhs respectively by mortgaging a total extent of 43 Ares and 72 Square Metres of property owned by the 5[th] respondent. The loan repayment was defaulted. The petitioner-Bank therefore took recovery steps and the property was put to sale. On the scheduled date of auction, namely 28.12.2017, there were no bidders for the property. The sale was therefore adjourned. The sale again took place on 13.06.2018. As there were no private bidders, the petitioner-Bank itself purchased the property, approximately for a price of 73 lakhs.₹ W.P(C) No.35546 of 2022 4 3. The petitioner states that after the sale confirmation in favor of the petitioner, the officials of the petitioner-Bank tried to find out purchasers for the property. But at that time, the petitioner came to know that no notice in person was issued to any of the defaulters regarding the adjourned sale conducted on 13.06.2018. Eventhough the 4[th] respondent decided to advertise the proclamation in Malayala Manorama daily dated 10.12.2017, no such paper publication was made with respect to the adjourned date of sale conducted on 13.06.2018. Apart from the above, it was found that the value of the property had been considerably reduced due to removal and selling of huge quantity of red earth from the property without the knowledge of the petitioner-Bank. 4. The petitioner therefore filed Ext.P2 petition dated 11.06.2021 to set aside the sale confirmed under Exts.P1 to P1(c) sale confirmation orders. The 4[th] respondent however returned Ext.P2 petition by order dated 30.09.2021, on the ground that as per Rule 83(3) of the Kerala Co-operative Societies Rules, such a petition ought to have been filed within a W.P(C) No.35546 of 2022 5 period of 30 days. It is aggrieved by Ext.P3 that the petitioner is before this Court. 5. The petitioner pointed out that though a petition in the nature of Ext.P2 to set aside a sale has to be preferred within 30 days, the 4[th] respondent has suo motu power to set aside the sale, if there are sufficient reasons even after the expiry of 30 days, in view of proviso to Rule 83(3) of the Kerala State Co-operative Societies Rules. In the facts and circumstances of the case, the 4[th] respondent is compellable to exercise his suo motu powers. 6. Counsel for the petitioner relied on the judgment of this Court in _**Nirmala P. v. State of Kerala and others** [2008 (2) KLT 346]_ to contend that aggrieved party filing application to exercise suo motu power, such application should not be treated as by way of revision, but one requesting invocation of the suo motu revision power of the authority. 7. If the authority is deciding not to exercise suo motu power, in such cases applicants should be given an opportunity to show why the suo motu power is not invoked. W.P(C) No.35546 of 2022 6 8. Heard. 9. It is discernible from the pleadings that in view of the default committed by respondents 5 to 8 in repaying the financial advance taken by them, the sale proceedings were initiated and a sale notice was published on 19.12.2017. It is not disputed that the sale did not take place on the scheduled date, namely 28.12.2017. Thereafter, the sale was conducted on 13.06.2018, on which date the petitioner purchased the mortgaged property. After the confirmation of sale, the petitioner found that there is irregularity in conducting the sale on 13.06.2018, inasmuch as the subsequent sale was without proper paper publication and in violation of Rule 81(F) of the Kerala State Co-operative Societies Rules. The petitioner-Bank was also aggrieved by the fact that the value of the property was diminished considerably perhaps due to the act of respondents 5 to 8 in removing the valuable red earth from the property. 10. Be that as it may, from the pleadings, I find that _prima facie_ there is violation of Rule 81(F) of the Kerala State Cooperative Societies Rules in effecting the subsequent sale on W.P(C) No.35546 of 2022 7 13.06.2018. In such circumstances, when the petitioner has submitted Ext.P2 application, eventhough Ext.P2 was submitted by the petitioner after the expiry of period of 30 days, the 4[th] respondent ought to have exercised his suo motu power and ascertain whether there was irregularity in the sale. In the facts of the case, the writ petition is disposed of setting aside Exts.P3 and P5. The 4[th] respondent is directed to reconsider Ext.P2 application submitted by the petitioner, invoking suo motu power, if found necessary. Before taking a final decision on Ext.P2, the petitioner-Bank shall be granted an opportunity of hearing. **Sd/-** **N.NAGARESH JUDGE** spk W.P(C) No.35546 of 2022 8 ## **`APPENDIX OF WP(C) 35546/2022`** ``` PETITIONER EXHIBITS Exhibit P1 ``` - **`Exhibit P1 THE COPY OF THE SALE CONFIRMATION ORDER DATED 22.3.2019 AGAINST RESPONDENT NO.5.`** - **`Exhibit P1 A THE COPY OF THE SALE CONFIRMATION ORDER DATED 22.3.2019 AGAINST RESPONDENT NO.6.`** - **`Exhibit P1 B THE COPY OF THE SALE CONFIRMATION ORDER DATED 22.3.2019 AGAINST RESPONDENT NO.7.`** - **`Exhibit P1 C THE COPY OF THE SALE CONFIRMATION ORDER DATED 22.3.2019 AGAINST RESPONDENT NO.8.`** - **`Exhibit P2 THE COPY OF THE PETITION DATED 11.6.2021 SUBMITTED BY THE PETITIONER ADDRESSED TO THE JOINT REGISTRAR WITH COPY TO THE 4TH RESPONDENT-ASSISTANT REGISTRAR.`** - **`Exhibit P3 A COPY OF THE ORDER DATED 30.9.2021 ISSUED BY THE 4TH RESPONDENT.`** - **`Exhibit P4`** ``` THE COPY OF THE PETITION DATED 17.11.2021 SUBMITTED BY THE PETITIONER BEFORE THE 2ND RESPONDENT. ``` - **`Exhibit P5 THE COPY OF THE COMMUNICATION DATED 1.3.2022 ISSUED FROM THE OFFICE OF THE 2ND RESPONDENT TO THE PETITIONER.`** - **`Exhibit P6 THE COPY OF THE APPEAL DATED 16.4.2022 FILED BY THE PETITIONER BEFORE THE 1ST RESPONDENT.`** - **`Exhibit P7 THE COPY OF THE COMPLAINT SUBMITTED BY THE PETITIONER SOCIETY BEFORE THE STATION HOUSE OFFICER, ETTUMANOOR.`**