IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 5TH DAY OF DECEMBER 2017 BEFORE THE HON’BLE MR.JUSTICE S.N.SATYANARAYANA WRIT PETITION NO.39838/2013 (CS-RES) BETWEEN SMT. SHWETHA KAMATH, W/O SRI GOPALA KRISHNA KAMATH, AGED ABOUT 31 YEARS, RESIDING AT 1-62/3(1), ’KAMAKSHI’, DEREBAIL, KONCHADY, MANGALORE -575 008.
REPRESENTED BY HER GPA HOLDER , SRI B. UMESH KAMATH, S/O B KRISHNARAYA KAMATH, AGED ABOUT 62 YEARS, RESIDING AT 1-62/3(1), ’KAMAKSHI’, DEREBAIL, KONCHADY, MANGALORE 575 008. ... PETITIONER (BY SRI GIRIDHAR .H, ADVOCATE) AND 1. THE ASSISTANT REGISTRAR AND RECOVERY OFFICER OF CO OPERATIVE SOCIETY, SUB-DIVISION, MANGALORE -575 001, DAKSHINA KANNADA.
2. MANGALA CREDIT CO-OPERATIVE SANGHA (N) , MANGALORE , REG NO.13441, HAVING ITS HEAD OFFICE AT DEVADIGA SAMAJ BHAVAN, GANDHINAGAR, MANNAGUDDE, MANGALORE - 575 002, REPRESENTED BY ITS MANAGER.
3. SMT MOHINI DEVADIGA, D/O KRISHNAPPA DEVADIGA, AGED ABOUT 66 YEARS , RESIDING AT ACHUT COMPOUND, DEREBAIL, KONCHADY, MANGALORE - 575 008. ... RESPONDENTS (BY SRI LAXMINARAYAN, AGA FOR R1, SRI C.R.PATIL, ADVOCATE FOR R2 SRI NATARAJ BALLAL, ADVOCATE FOR R3) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH ANNEXURE-D ORDER DATED 11.6.2013 BY THE FIRST RESPONDENT AND DIRECT THE FIRST RESPONDENT TO INVESTIGATE THE CLAIM IN RESPECT OF LEGAL RIGHT OF THE IMMOVABLE PROPERTY BY CONSIDERING THE ANNEXURE-B OBSTRUCTION PETITION ON THE BASIS OF MATERIAL MADE AVAILABLE ON RECORD ETC., THIS WRIT PETITION COMING ON FOR PRELIMINARY HEARING IN ‘B’ GROUP THIS DAY, THE COURT MADE THE FOLLOWING:
ORDER The Petitioner herein is impugning the order of 1st Respondent dated 11.6.2013 in CEP.No.295/2005-06 vide Annexure-D. Wherein the 1st respondent has declined to entertain objection raised regarding attachment of property, which is subjected to attachment and sale in a recovery proceeding.
Brief facts leading to this petition are that;
2. The Petitioner herein, is purchaser of 4 cents of land in Sy.No.104/5A1 situate at Derebail Village of Mangaluru Taluk within Mangaluru City Corporation. The said property consists of a building standing thereon bearing Door No.1- 62/3(1), which is schedule property to this writ petition. The Petitioner herein purchased aforesaid property from the 3rd Respondent Smt.Mohini Devadiga under registered sale deed Dated:7.8.2010 vide Annexure-B and has been in possession and enjoyment of the same.
3. It is stated that, the 3rd Respondent before conveying the schedule property in favour of the petitioner herein had mortgaged it in favour of South Canara District Central Co-operative Bank, Kavoor Branch. Subsequently, said loan was taken over by United Bank of India and the petitioner herein discharged said liability of 3rd respondent with United Bank of India and thereafter, secured registered sale deed of said property in her favour.
4. When matter stood thus, it is seen that a proceeding is initiated against 3rd respondent – Mohini Devadiga for recovery of loan said to have taken from 2nd respondent – Mangala Credit Co-operative Society. Wherein it is stated that 2nd respondent has created charge in its favour on property in question and for realization of the amount due from 3rd respondent, the property in question is subjected to attachment and sale. It is this attachment which is sought to be challenged by the petitioner by filing an application seeking an investigation in to the same under Rule 41 of the Karnataka Co-operative Societies Rules, 1960 (‘the Rules’ for short). The said proceeding which is in CEP.No.295/2005- 06 on the file of 1st respondent came to be dismissed holding that said authority does not have jurisdiction to conduct an investigation Under Rule 41, for the reason that petitioner herein, who is applicant before said authority is not a member of the society which is claiming right over the property in question. Thereafter, any objection which is required to be decided regarding creation of charge in respect of the property purchased by the petitioner from 3rd respondent cannot be decided since she is not a member of the society. It is further observed with reference to the business of Co-operative Society only a member of the said society will be eligible to raise any dispute or seek adjudication or investigation of dispute.
5. In the instant case, since the petitioner is not a member of 2nd respondent – society, her application seeking enquiry is dismissed by order impugned. The dismissal of said application under Rule 41 is sought to be challenged in this petition, relying upon the judgment rendered by a Division Bench of this Court in the matter of Jyotiba Yellappa Jadhav & ors., -vs- The Hubli Co-operative Cotton Sale Society Ltd., & Ors., reported in Mys.LJ 1970(2) 344.
6. Heard the learned counsel for petitioner as well as respondents, perused the material on record. To consider the challenge to the order impugned, reading of Rule 41 of the Rules is necessary, which reads as hereunder;
“41. Investigation of claims to property attached – (1) Where any claim is preferred to or any objection is made to the attachment of any property attached under these rules, on the ground that such property is not liable to such attachment, the Sale Officer shall investigate the claim or objection and make an order either rejecting or allowing the claim and to that extent raising the attachment made:
Provided that the Sale Officer may refuse to investigate the claim in he considers that the claim or objection is frivolous or made on or after the date fixed for sale.
2. Where the property to which the claim or objection relates has been advertised for sale, the Sale Officer may postpone the claim or objection.
3. Where a claim or an objection is preferred, the 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.”
7. The reading of aforesaid Rule 41 clearly discloses that in the event of there being an objection against the attachment to any property, investigation sought to be raised in that behalf, which need not be by a member of the society alone, but it could be by anybody, who is aggrieved of the said attachment as could be seen from the wordings used in the said Rule. In fact, under similar circumstance, the Division Bench of this Court in the matter of Jyotiba Yellappa Jadhava, referred to supra, has held as under:
“The Co-operative Societies Act makes a special provision for adjudication of disputes touching the constitution, management or the business of the Co- operative Societies registered under the Act and to the extent such provision is made it excludes the jurisdiction of ordinary Civil Courts to deal with such disputes. The basic section is S.70 according to which notwithstanding anything contained in any law for the time being in force, if any dispute touching the constitution, management or the business of a co- operative society arises among or between the parties enumerated in clauses (a), (b), (c) and (d) of sub-section (1) of that section, such dispute shall be referred to the Registrar for decision and no court shall have jurisdiction to entertain any suit or other proceeding in respect of such dispute. For our present purposes it is enough to refer to the enumeration in clauses (a) and (b) which is as follows. – “(a) among members, past members or persons claiming through members, past members and deceased members, or (b) between a member, past member or person claiming through a member, past member or deceased member and the society, its committee or any officer, agent or employee of the society, or ”
8. Therefore, in the present set of facts also, since the petitioner herein is claiming title to the property in question under 3rd respondent, who is a member of 2nd respondent from whom the petitioner has derived title to the property is entitled to challenge the same seeking investigation in to the objection raised for said attachment. In fact, Rule 41 of the Karnataka Co-operative Societies Rules, as well as the judgment referred to supra recognize that the petitioner has every right to seek adjudication of her objection with reference to the title of 3rd respondent to property in question and also with reference to alleged charge said to have created in favour of 2nd respondent. In fact, the same is required to be adjudicated in the light of judgment referred to supra.
9. In that view of the matter, this Court would allow this writ petition by setting aside the impugned order dated 11.6.2013 vide Annexure-D passed by 1st respondent in CEP.No.295/2005-2006. The matter is remanded to 1st respondent with a direction to hear the matter afresh on merits and pass appropriate orders with reference to the objection raised by petitioner challenging the alleged attachment of petition schedule property by 2nd respondent for recovery of the amount said to be due from 3rd respondent in respect of said property, presently the title of which is vested with petitioner.
Sd/- JUDGE nd/-