IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE P.N.RAVINDRAN THURSDAY, THE 27TH OCTOBER 2011 / 5TH KARTHIKA 1933 WP(C).No. 24872 of 2010(H) -------------------------- PETITIONER(S): --------------- SREEJAYAN P.E., SREENIYALAM, KAKKAYANGAD P.O., PERAVOOR, KANNUR DISTRICT. BY ADV. SRI.P.C.SASIDHARAN RESPONDENT(S): --------------- 1. JOINT REGISTRAR OF CO-OPERATIVE SOCIETIES (GENRAL), OFFICE OF THE JOINT REGISTRAR OF CO-OPERATIVE SOCIETIES, KANNUR - 670 333. 2. THE SALE OFFICER/ASSISTANT REGISTRAR OF CO-OPRAIVE SOCIETIES, KANNUR DISTRICT CO-OPERATIVE BANK LTD, KANNUR - 1. 3. THE KANNUR DISTRICT CO-OPERATIVE BANK LTD., KANNUR - 1, REPRESENTED BY ITS GENERAL MANAGER. 4. T.OOMMEN PANICKER, TOPS MANOR, PANAVELI, KOTTARAKKARA, KOLLAM, PIN - 691 506. BY GOVT. PLEADER SRI.G.GOPAKUMAR SRI.P.NARAYANAN - SC ADV. SRI.P.P.JACOB FOR R4 THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 27/10/2011, ALONG WITH WP(C) NO. 14941 OF 2010 . THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).No. 24872 of 2010(H) APPENDIX PETITIONER'S EXHIBITS: EXT.P1 : COPY OF THE SALE NOTICE DTD.3.2.2010 EXT.P2 : COPY OF THE RECEIPT ISSUED BY THE BANK EVIDENCING THE DEPOSIT OF RS.50,000/- EXT.P3: COPY OF THE RECEIPT ISSUED BY THE BANK EVIDENCING THE DEPOSIT OF RS.6,03,000/- EXT.P4: COPY OF THE NOTICE DTD.16.2.2010 EXT.P5: COPY OF THE PETITON DTD.4.3.2010 EXT.P6: COPY OF THE PROCEEDINGS DTD.12.4.2010 RESPONDENT'S EXHIBITS: EXT.R4(A) : COPY OF THE INTERIM ORDER IN W.P(C) NO.30295/2009 DTD.25.1.2010 EXT.R4(B) : COPY OF THE JUDGMENT IN W.P(C) NO.6446/2010 DTD.7.6.2010 //TRUE COPY// P.A TO JUDGE ab P.N.RAVINDRAN, J ------------------------------------------------- W.P(C) Nos.14941/2010 & 24872/2010 -------------------------------------------------- Dated this the 27th day of October, 2011 J U D G M E N T A common question arises in these writ petitions. They were therefore heard together and are being disposed of by this common judgment. The brief facts of the case are as follows: 2. The petitioner in W.P(C) No.14941 of 2010 availed a loan of Rs.15 lakhs from the Kannur District Co-operative Bank Ltd, the first respondent in W.P(C) No.14941 of 2010 and the third respondent in the connected writ petition. He defaulted repayment of the loan. The bank thereupon filed A.R.C.No.160 of 2008 to recover the amount due from him. By Ext.P1 award passed on 18.9.2008 the Assistant Registrar of Co-operative Societies, the Arbitrator nominated by the Joint Registrar of Co- operative Societies permitted the Kannur District Co-operative Bank Ltd. to recover from the petitioner in W.P(C) No.14941 of 2010 the sum of Rs.21,10,178/- together with future interest at 15% per annum from 1.1.2008 on the principal sum of Rs.15,00,000/-. Ext.P1 award was not challenged and it has attained finality. Even thereafter, the petitioner in W.P(C) W.P(C) Nos.14941/2010 & 24872/2010 2 No.14941 of 2010 did not repay the loan. The bank thereupon took steps to bring the security offered by the petitioner for sale. At that stage he filed W.P(C) No.12509 of 2009 in this Court. By judgment delivered on 8.7.2009 a learned Single Judge of this Court disposed of the said writ petition with the following directions: “i I record submission of the counsel for the petitioner that he is giving up the challenge in A.R.C.No.160/08 against Ext.P2 award. ii) It is directed that the petitioner will be permitted to pay the amount due under Ext.P2 award in 5 equal monthly instalments, first of which shall be paid on or before the 30th July, 2009 and the subsequent instalments shall be paid on or before 30th of every succeeding month. Iii) Subject to payment as above, recovery proceedings pursuant to Ext.P4 shall be kept in abeyance and in case any default is committed in paying the instalments as above, Bank will be free to continue the recovery already initiated. iv) It is also made clear that this judgment will not stand in the way of the petitioner approaching the Bank for waiver of the penal interest levied on the him and it is entirely upto the Bank to consider the same.” 3. The petitioner did not comply with the directions issued by this Court and therefore the bank brought the security for sale. The petitioner thereupon moved the Lok Ayukta. By order passed on 12.10.2009, the Lok Ayuktha stayed the sale. The bank thereupon filed W.P(C) No.30295 of 2009 in this Court. W.P(C) Nos.14941/2010 & 24872/2010 3 In that writ petition a learned single Judge of this Court passed Ext.P3 interim order dated 25.1.2010 directing the petitioner to remit the sum of Rs.5,00,000/- on or before 15.2.2010. The petitioner accordingly remitted the sum of Rs.5,00,000/- by demand draft which was tendered along with Ext.P4 letter dated 9.2.2010. However, in view of the fact that the order of the Lok Ayukta was stayed by this Court in W.P(C) No.30295 of 2009, the bank brought the property for sale and it was sold in public auction on 16.2.2010. The petitioner in the connected case, W.P (C) No.24872 of 2010 was the successful bidder in the auction. He bid the property for Rs.14,20,000/-. The debtor thereafter filed W.P(C) No.6446 of 2010 and W.P(C) No.7392 of 2010 challenging the sale held on 16.2.2010 and seeking the benefit of Circular No.2 of 2010 dated 14.1.2010 issued by the Registrar of Co-operative Societies. By Ext.P14 order passed after hearing the learned counsel on both sides, a learned single Judge of this Court directed the Joint Registrar of Co-operative Societies, Kannur to hold a Special Adalath to determine the exact amount which the petitioner is liable to pay under the One Time Settlement Scheme contemplated in Circular No.2 of 2010 dated 14.10.2010. Pursuant thereto, the Joint Registrar of Co-operative W.P(C) Nos.14941/2010 & 24872/2010 4 Societies issued Ext.P7 order dated 12.3.2010 determining the amount payable by the petitioner for one time settlement as Rs.22,38,756/-. The petitioner remitted the said sum on 15.3.2010. He also filed I.A.No.3836 of 2010 in W.P(C) No.6446 of 2010 for permission to deposit the said amount under protest reserving liberty with him to get the excess amount paid by him refunded, in the event of the writ petition being allowed. When W.P(C) No.6446 of 2010 was disposed by judgment delivered on 7.6.2010, the relief sought by the petitioner in I.A.No.3836 of 2010 was not granted. It is in the background of these facts that WP(C) No.14941 of 2010 was filed challenging Ext.P7 order whereby the Joint Registrar of Co-operative Societies determined the liability of the petitioner and Ext.P9 order passed by the Assistant Registrar of Co-operative Societies setting aside the sale pursuant to the deposit of the sum of Rs.22,38,756/-, but directing the petitioner to pay 5% of the purchase value to the petitioner in the connected case W.P(C) No.24872 of 2010. The petitioner in W.P(C) No.24872 of 2010 has challenged the very same order contending that the sale ought not have been set aside but should have been confirmed. 4. I heard Sri.P.P.Jacob, learned counsel appearing for W.P(C) Nos.14941/2010 & 24872/2010 5 the petitioner in W.P(C) No.14941 of 2010, Sri.P.C.Sasidharan learned counsel appearing for the petitioner in W.P(C) No.24872 of 2010, Sri.P.Narayanan, learned standing counsel appearing for the Kannur District Co-operative Bank Ltd. and Sri.G.Gopakumar, learned Government Pleader appearing for the official respondents. I have also gone through the pleadings and the materials on record. During the course of arguments, the learned counsel appearing for the petitioner in W.P(C) No.24872 of 2010 and the learned standing counsel appearing for the bank submitted that the debtor and the auction purchaser have settled their differences out of court and that the purchaser has received whatever amount he is entitled to receive from the petitioner in W.P(C) No.14941 of 2010. The learned counsel appearing for the petitioner in W.P(C) No.14941 of 2010 submitted that as the dispute has been settled and the entire amount payable to the bank has been deposited and the loan account has been closed, the bank may be directed to return the documents of title deposited by the debtor. The learned counsel for the bank submitted that if the debtor and the auction purchaser will not make any further claim, the bank has no objection to return the title deeds to the petitioner in W.P(C) W.P(C) Nos.14941/2010 & 24872/2010 6 No.14941 of 2010. In my opinion, in view of the directions issued by this Court in W.P(C) No.6446 of 2010 evidenced by Ext.P14 and the fact that the permission sought by the debtor to deposit the amount determined in Ext.P7 under protest was declined, the petitioner in W.P(C) No.14941 of 2010 cannot successfully challenge Ext.P7. Under rule 83 in the event of sale being set aside on deposit, the judgment debtor is bound to pay 5% of the bid amount to the purchaser. The pleadings and materials on record disclose that the petitioner in W.P(C) No.14941 of 2010 has compensated the purchaser and the auction purchaser has in Ext.P15 memo stated in unequivocal terms that he has no subsisting claim against the petitioner in W.P(C) No.14941 of 2010. In such circumstances, as the petitioner in W.P(C) No.14941 of 2010 has settled the loan account and has also compensated the auction purchaser namely the petitioner in W.P(C) No.24872 of 2010, I am of the opinion that the petitioners in these two cases can have no claim against each other or the Kannur District Co-operative Bank Ltd. I accordingly, dispose of these writ petitions with a direction to the Kannur District Co-operative Bank Ltd. to return to the petitioner in W.P(C) No.14941 of 2010, the documents of W.P(C) Nos.14941/2010 & 24872/2010 7 title deposited by him for the purpose of the availing the loan which was the subject matter of Ext.P1 award, expeditiously and in any event within one week from the date on which he produces a copy of this judgment before the General Manager of the Kannur District Co-operative Bank. P.N.RAVINDRAN JUDGE ab