HON’BLE SRI JUSTICE C.V. RAMULU W.P.No. 5105 of 2005 Date: 30-09-2010 Between: Andhra Bank ……….. petitioner and The Registrar of Co-op. Societies and others. ………. Respondents HON’BLE SRI JUSTICE C.V. RAMULU W.P.No. 5105 of 2005 ORDER: This writ petition is filed seeking a Mandamus declaring the action of second respondent in dismissing claim petitions filed by the petitioner in E.P.No.32/2003A, E.P.No.40/2003A and E.P.No.49/2003A even before filing the counter objections by respondent No.3 and without conducting due enquiry as contemplated under the A.P. Co-operative Societies Act and Rules, 1964, as arbitrary and illegal. 2. It appears, one M/s. Tanvi Exclusive Sarees, a proprietary concern represented by it’s proprietor Pramod Agarwal, borrowed a sum of Rs.15,00,000/- under Open Cash Credit Limit, from the petitioner bank, after executing necessary loan and security documents on 04-10-2000. One Radhika Agarwal W/o. Sanjay Agarwal, who is a close relative of Pramod Agarwal, offered her property bearing M.C.H.No.7-1-57, Flat No.103, Anand Medows Apartments situated at Anand Bagh, Ameerpet, Hyderabad as security for repayment of the liability in the above said O.C.C. limit. However, when the amounts were not paid, petitioner bank filed O.A.No.182 of 2003 before the Debt Recovery Tribunal, Hyderabad for recovery of an amount of Rs.26,51,315/- together with interest thereon from 25-09- 2003 till the date of realization. The said O.A. was allowed on 23-08- 2004 as prayed for. Therefore, the Recovery Officer issued demand notice to the certified debtors and also to the Pramod Agarwal and he was served. When the petitioner bank sought to serve the notice on the respondent No.6 and visited the mortgaged premises, it noticed the public auction/sale notice affixed by the respondent No.3 on the premises, proposing to conduct the sale/auction on 26-10-2004 by respondent No.2 in E.P.No.32/2003A, E.P.No.40/2003A and E.P.No.49/2003A. On coming to know about this, petitioner bank immediately contacted Respondent No.3 and came to know that one M/s Divia International Pvt Ltd and M/s. Car Care Center borrowed money in 2001 from the third respondent bank and it appears that respondent No.6 mortgaged her property with them. The petitioner bank, as required under law, filed the said claim petitions on 23-10- 2004 before the second respondent contending that the petitioner bank is having first charge over the mortgaged property and prayed to exclude the same from auction. After issuing summons, respondent No.2 fixed the date of hearing on 17-11-2004. The petitioner and respondent No.3 appeared before the second respondent on 17-11- 2004. The respondent No.3 has not filed any counter or documents on 17-11-2004. The petitioner bank also could not file the original title deeds pertaining to the mortgaged property as the same were filed before the Debt Recovery Tribunal and was the subject matter of the sale by the Recovery Officer. However, the said claim petitions filed by the petitioner bank were dismissed which reads as under: “The petitioner has filed claim petition before the under signed through their council Sri K. Vijaya Kumar Reddy, Advocate stating that the Petitoiner Bank sanctioned Rs.15.00 lakhs to the M/s. Tanvi Exclusive Sarees on the security of property bearing No.103, MCH No.7-1-57, Anand Medows Apts., Anand Bagh, Ameerpet, Hyderabad, after depositing a Registered Gift Settlement Deed bearing D.No.1343/2000 by 4th Respondent confirmed the deposit of gift settlement deed by her letter dated 04.10.2000. The Petitioner requested that they will be having 1st right over the property and they got orders from the Debt Recovery Tribunal, Hyderabad and also filed Execution Petition for Execution of the same, when they visited the premises they found auction notice of the 1st Respondent and immediately filed this claim petition. They requested that they will be having first charge over the suit property and to exclude the same from auction. On filing of the petition, the undersigned issued summons dated 03.11.2004 asking the parties to present before him with relevant original documents on 17.11.2004 at 11.30 a.m. at the address given. On 17.11.2004 both the parties i.e., Petitioner and Respondent No.1 present. The petitioner stated that the original document of Registered Gift Settlement Deed is with Debt Recovery Tribunal, Hyderabad and submitted the Xerox copy. On verification of the gift settlement deed it is found that it was executed on 1st day of July 2000 at Hyderabad. But the petitioner stated that the 4th Respondent deposited the documents on 03.04.2000. Further the petitioner also stated that the original of the Gift Settlement Deed is with Debt Recovery Tribunal, Hyderabad. If the original is with the petitioner he would have submitted at least a certified copy of the gift deed. Further the averment of the petitioner is also contrary to the facts. The gift settlement deed was registered on 1st July 2000 and there is no any chance to deposit the original gift settlement deed by 4th Respondent on 03.04.2000. Further the 1st Respondent produced the original document and it is also verified with the copy of the document filed by the petitioner and the under signed satisfied that the original document produced by 1st respondent and the Xerox copy of the documents filed by the petitioner are the same. Further the petitioner also did not file the any document in support of mortgage of the property for the loan sanctioned by them. Hence, the claim petition is dismissed. No cost.” Aggrieved by the said order, the present writ petition is filed. 3. The learned counsel appearing for the petitioner bank stated that under Rule 52(21)(a) of the A.P. Co-operative Societies Rules, 1964, a claim petition filed by any party must be heard on it’s own merits after receiving evidence, both oral and documentary, if any, and then decide the matter finally. 4. Rule 52(21) (a) of the A.P. Co-operative Societies Rules, 1964, reads as follows: “(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. (b) Where the property to which the claim or objection relates has been advertised for sale, the sale officer may postpone the sale pending the investigation or the claim or objection. (c) Where a claim or an objection is preferred that party against whom an order is made may institute a suit within six months from the date of the order to establish the right which he claims to the property in dispute, but subject to the result of such suit, if any, the order shall be conclusive.” A bare reading of the impugned order would indicate that the procedure laid down under the above provision was not followed by the respondents before passing the impugned order. No details were given and the matter was not examined in detail except saying that the date of deposit of the document was wrong. 5. Therefore, I am of the opinion that under Rule 52(21)(a) of the A.P. Co-operative Societies Rules, 1964, a detailed enquiry must be conducted by the Sale Officer. For this reason alone, the impugned order is liable to be set aside and accordingly, set aside. The matter is remitted to the second respondent for fresh consideration after issuing notice to all the parties concerned. 6. Accordingly, the writ petition is allowed. No order as to costs. _____________ C.V. RAMULU, J Date: 30-09-2010 YCR