Razeena Beevi v. State of Kerala and Others

# **`IN THE HIGH COURT OF KERALA AT ERNAKULAM`** # **`PRESENT`** ``` THE HONOURABLE MR. JUSTICE GOPINATH P. ``` ``` FRIDAY, THE 4[TH] DAY OF AUGUST 2023 / 13TH SRAVANA, 1945 ``` ``` WP(C) NO. 16919 OF 2022 ``` ## **`PETITIONER/S:`** ``` RAZEENA BEEVI AGED 50 YEARS W/O.KABEER, KARIMPILACKAL VEEDU, VATTAKKAVU, KONNI P.O., PATHANAMTHITTA DISTRICT, PIN - 689 691. BY ADVS. JACOB P.ALEX JOSEPH P.ALEX MANU SANKAR P. AMAL AMIR ALI ``` ## **`RESPONDENT/S:`** - `1 STATE OF KERALA REPRESENTED BY ITS SECRETARY, DEPARTMENT OF COOPERATION, MAIN BLOCK, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM, PIN - 695 001.` - `2 REGISTRAR OF CO-OPERATIVE SOCIETIES OFFICE OF THE REGISTRAR OF CO-OPERATIVE SOCIETIES JAWAHAR SAHAKARANA BHAVAN, DPI JUNCTION, THYCAUD P.O., THIRUVANANTHAPURAM, PIN- 695 014.` - `3 JOINT REGISTRAR OF CO-OPERATIVE SOCIETIES (GENERAL) 4TH FLOOR, MINI CIVIL STATION, PATHANAMTHITTA, PIN - 689 645.` - `4 ASSISTANT REGISTRAR OF CO-OPERATIVE SOCIETIES (GENERAL) ELIYARACKAL, KONNI, PIN - 689 691.` - `5 KERALA STATE CO-OPERATIVE HOUSING FEDERATION LTD. REPRESENTED BY ITS MANAGING DIRECTOR, JUDGES AVENUE ROAD, KALOOR, ERNAKULAM, PIN - 682 017.` - `6 KONNI BLOCK HOUSING CO-OPERATIVE SOCIETY LTD.(Q 838) REPRESENTED BY ITS SECRETARY, KONNI P.O., PATHANAMTHITTA, PIN - 689 691.` - `7 * ADDL.R7 ‘PART TIME ADMINISTRATOR’ OF THE KONNI BLOCK HOUSING CO-OPERATIVE SOCIETY (Q838), (KONNI UNIT INSPECTOR) OFFICE OF THE KONNI ASSISTANT REGISTRAR(GENERAL) ELIYARACKAL, KONNI-689691.` ``` ADDL.R7 IS IMPLEADED AS PER ORDER DATED 22.08.2022 IN ``` WPC No.16919 of 2022 2 ``` IA NO.1/2022 IN WP(C)NO.16919/2022 BY ADVS. ADVOCATE GENERAL OFFICE KERALA BIJITH S.KHAN ``` ``` SMT. C S SHEEJA (SR GP) ``` ``` THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 04.08.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ``` WPC No.16919 of 2022 3 ## **J U D G M E N T** The petitioner availed a loan from the sixth respondent society. The sixth respondent society is a member of the fifth respondent Apex society. The petitioner has cleared the entire liability towards the sixth respondent. She has approached this Court being aggrieved by the fact that the documents of title deposited by her for the purposes of creating a mortgage to secure the repayment of amounts to the sixth respondent have not been returned, despite the fact that the petitioner has cleared the entire liability. 2. The learned counsel appearing for the petitioner would submit that the reason for not returning the title documents is that the sixth respondent has some liabilities with the fifth respondent and the documents of the petitioner are in the custody of the fifth respondent and the fifth respondent is refusing to release the documents on account of the fact that the sixth respondent has not paid off the loans taken from the fifth respondent. 3. The learned counsel appearing for the fifth respondent would submit that the amount of loan sanctioned to WPC No.16919 of 2022 4 the petitioner was financed by the fifth respondent and even the amount paid by the petitioner for settling his liability with the sixth respondent has not been paid to the fifth respondent. It is submitted that, as per the terms of the agreement executed by the petitioner with the sixth respondent, the petitioner has agreed that documents of title deposited by her can be retained by the fifth respondent until the liability of the sixth respondent is settled. 4. The learned counsel appearing for the petitioner would submit that the issue stands covered in favour of the petitioner by a Division Bench judgment of this Court in _**Kerala**_ ## _**State Co-operative Housing Federation v. Leela Issac, 2017**_ _**(2) KLT 942**_ wherein paragraph Nos.5, 15, 16 and 19. It is held as follows; “5. xxx Satisfaction of the liability to the Primary Society was sought to be substantiated by the writ petitioners, by producing relevant documents. But it was contended by the 6[th] respondent/Federation, that the loan amount was actually made available by the Federation effecting disbursement through the Primary Society; by virtue of which the Federation was having a lien/charge over the Building and the property where the Building was constructed; making use of the loan amount. It was also pointed out that, as per the accounts maintained WPC No.16919 of 2022 5 by the Federation, the amount was still due, to be cleared by the Members under the loan accounts and that, if the amount deposited by the members in the Primary Society was not properly paid by the Society to the account of the Federation, it was for the members/petitioners to have approached the statutory authorities or such other appropriate Forum or Magistrate’s Court, in respect of the deeds and misdeeds of the Primary Society/its office bearers. Unless and until the liability towards the Federation was cleared, the Title Deeds were not liable to be returned. 15. It is quite evident from the above Clauses, that the assets of the Mortgagor/Primary Society shall be considered as the Basic Security for the loan advanced by the Mortgagee/Federation and the Security offered by the Members of the Primary Society to whom the loan amount is distributed/disbursed can only be the collateral security. In so far as the borrower is concerned, the necessity to satisfy ‘security’ is only to the extent of loan amount obtained from the Primary Society(including interest/penal interest). There is no obligation, much less any pious obligation for the borrower/member of the Primary Society to offer their Title Deeds for any other loan availed by the Primary Society from the Federation; or in other words to any extent if it is beyond the dues covered under the particular loan transaction availed by the borrower. There cannot be any arbitrary exercise of power, either by the Federation or by the Primary Society to have the Title Deeds of the particular borrower WPC No.16919 of 2022 6 retained, notwithstanding the satisfaction of the due amount under the loan transaction. 16. Another important aspect to be noted is that, as borne by the relevant clauses in the documents produced and discussed above, the loan amount given by the Federation is to the Primary Society, to be distributed/disbursed to the beneficiary/member of the Primary Society. The said amount has to be repaid by the Primary Society by way of yearly/half yearly/quarterly installments and no provision is stipulated enabling the borrower/member of the Primary Society to have it remitted directly to the Federation. In so far as the repayment was routed only through the Primary Society, the role of the appellant Federation could be equated to that of a Principal and the Primary Society, as that of its agent. If the amount paid by the member/borrower to the Primary Society in respect of the loan is not remitted by the Primary Society to the Federation, it is the lookout of the Federation and no fault or lapse can be attributed or mulcted on the shoulders of the borrower/member of the Primary Society. That apart, there is no provision either in the Co-operative Societies Act, Rules, Regulations, ‘Loan sanction order’ or the Mortgage Deed to group all the loans given by the Federation to the Primary Society (for being disbursed to different borrowers/Members of the Primary Society) together as a single transaction. The amount deposited by a prompt borrower to the Primary Society and such amount to be remitted by the Primary Society in that account with the Federation ought to have been given due credit to, in WPC No.16919 of 2022 7 respect of the actual depositor. Such amount could not be credited as part of any amount remitted by the Primary Society against all borrowers taken together, including the defaulters, which otherwise will only give premium to the defaulters/wrong-doers. If that was the practice followed by the Federation so far, it can only be a defective practice, which cannot have the sanctity of law. 19. In so far as the appellant Federation has failed to substantiate that there is a valid contract between the Federation and writ petitioner/member of a Primary Society, authorising the Federation to keep the Title Deeds of the petitioners even after satisfaction of the loan liability to the Primary Society, retention of the Title Deeds cannot but be said as ‘arbitrary’. One it is declared as ‘arbitrary’, there is clear violation of Art.14 of the Constitution of India, which is enough to have made interference by this Court, invoking the power under Art.226 of the Constitution of India. No statue can overreach the constitutional power of this Court and it is settled law, that existence of alternate remedy is not a bar for invoking the power under Art.226.” Having heard the learned counsel for the petitioner and the learned counsel appearing for the fifth respondent and having regard to the findings of this Court in **Kerala State Cooperative Housing Federation** ’s case(supra), I am of the view that the petitioner is entitled to succeed. Therefore, this writ WPC No.16919 of 2022 8 petition is allowed. Respondents 5, 6 and 7 (Administrator of the sixth respondent) are directed to ensure that the documents of title deposited by the petitioner for securing the repayment of amounts due on account of a loan availed by the petitioner from the sixth respondent are released to the petitioner, if the petitioner has settled the entire liability with the sixth respondent. The fact that the sixth respondent owes amounts to the fifth respondent shall not be a ground to deny the request of the petitioner for release of the documents. Any Gehan executed by the petitioner shall also be duly cancelled. Needful shall be done within a period of one month from the date of receipt of a certified copy of this judgment. Sd/- **GOPINATH P., JUDGE** rkj WPC No.16919 of 2022 9 ## **`APPENDIX OF WP(C) 16919/2022`** |`PETITIONER EXHIBITS`|| |---|---| |`Exhibit P1`|`TRUE COPY OF THE LOAN SANCTIONING ORDER`| ||`DATED 31/01/2007 ISSUED BY THE 6TH`| ||`RESPONDENT.`| |`Exhibit P2`|`TRUE COPY OF THE RELEVANT PAGES OF THE`| ||`PASS BOOK (L.F.NO.7/76/72) ISSUED BY THE`| ||`6TH RESPONDENT FOR THE LOAN ACCOUNT OF`| ||`THE PETITIONER.`| |`Exhibit P3`|`TRUE COPY OF THE PAYMENT RECEIPT DATED`| ||`04/07/2014 WITH ENDORSEMENT 'CLOSED' FOR`| ||`THE INSTALMENT, AN AMOUNT OF RS.11,255/-.`| |`Exhibit P4`|`TRUE COPY OF COMPLAINT DATED 10/2020`| ||`SUBMITTED BEFORE THE DISTRICT LEGAL`| ||`SERVICES AUTHORITY, PATHANAMTHITTA.`| |`Exhibit P5`|`TRUE COPY OF THE STATEMENT FILED BY THE`| ||`6TH RESPONDENT BEFORE THE DISTRICT LEGAL`| ||`SERVICES AUTHORITY, PATHANAMTHITTA IN PLP`| ||`NO.1337/2020.`| |`Exhibit P6`|`TRUE COPY OF THE STATEMENT FILED BY THE`| ||`5TH RESPONDENT IN PLP NO.1337/2020 BEFORE`| ||`THE DISTRICT LEGAL SERVICES AUTHORITY.`| |`Exhibit P7`|`TRUE COPY OF THE PROCEEDINGS DATED`| ||`10/05/2022 OF THE TALUK LEGAL SERVICES`| ||`COMMITTEE, KOZHENCHERRY IN PLP`| ||`NO.1337/2020.`| |`Exhibit P8`|`TRUE COPY OF THE RELEVANT PAGES OF THE`| ||`LOAN LEDGER OF THE 6TH RESPONDENT WITH`| ||`RESPECT TO THE LOAN AVAILED BY THE`| ||`PETITIONER.`| |`Exhibit P9`|`TRUE COPY OF THE GEHAN DATED 04.10.2007`| ||`REGISTERED AS DOCUMENT NO.1137/2007.`|