Diyyala Venkata Rangaiah vs The Sub-Collector, Nandyal and Others

Mr. Gagadhara Rao, J.—The petitioner, Diyyala Venkata Rangaiah is a money lender of Nandyal. According to the counter affidavit filed by the Sub-Collector, Nandyal, Venkata Rangaiah is a pawn-broker, but he has no licence under the Pawn-brokers Act, 1943. K. Subbarayudu, a harijan and 5 others of Pellavaram village who are agricultural labourers and artisans filed petitions before the Tahsildar under the Andhra Pradesh Agricultural Indebtedness Relief Act, 1977 (hereinafter referred to as the Act) stating that they had borrowed some moneys from the petitioner and pledged gold and silver jewels and cart wheels with him. During the course of the enquiry in those petitions, the Circle Inspector of Police, Nandyal on the direction of the Tribunal searched the house of the petitioner in order to recover the pledged articles. He did not recover any articles but be found 56 promissory notes. The Circle Inspector left the promissory notes with the petitioner obtaining an undertaking from him that he would produce them whenever called upon to do so by the tribunal. But the petitioner did not produce the promissory notes or pledged articles though sent for by the Tribunal. The Tribunal passed the judgment in M.P. No. 1 of 1977 dated 6-1-1978 discharging the debts of the petitioners therein and ordering the return of the pledged articles to them. Questioning that judgment, the petitioner filed an appeal before the Sub-Collector, Nandyal, the Appellate Tribunal, against three debtors only viz, Yadla Ramaiah, Vadla Subbaiah and Vadla Brahtnaiah. He did not file any appeal with regard to the remaining debtors. He did not also produce the pledged articles of the debtors viz. cart wheels. The Appellate Tribunal in the course of the enquiry directed the petitioner to produce all the 56 promissory notes and pledged articles but he failed to produce them. After due enquiry, the Appellate Tribunal dismissed the appeal with costs confirming the judgment of the Lower Tribunal.

While so, some more harijans from Gollavaram village viz., Datla Ramanna, Setti Bala Venkata and Datla Venkatanna filed the petitions before the Sub-Collector alleging that the petitioner was harassing them for repayment of the debt amounts. They deposed before the Sub-Collector that they had taken loans, pledged jewellery and also gave paddy and the petitioner instead of returning the pledged articles, got the promissory notes renewed and also obtained decrees from Civil Court. In addition, be was also forcing some of them to vacate their houses and lands. Therefore, they requested that relief might be given to them and they might be saved from the clutches of the petitioner,

In view of that information and since the petitioner did not file any statement of the pledged articles as required u/s 5 (11 of the Act nor produced the 56 promissory notes in his custody, the Sub-Collector thought that there was no other course left to him to enforce the production of the documents and pledged articles except to issue a search warrant u/s 94 Cr. PC. authorising the Circle Inspector of Police, Nandyal to seize all the 56 promissory notes, pledged and mortgaged property if any, in the residential house and shop of the petitioner. Pursuant to the search warrant, the Circle Inspector of Police, Nandyal submitted search list dated 17 6-1978 along with 45 promissory notes. Thereupon, the petitioner issued a telegram and a notice to the Sub-Collector u/s 80 C.P.C, stating that the search and seizure of the promissory notes was illegal and the promissory notes should be returned to him. The Sub-Collector has also stated that all the debtors under the promissory notes were issued notices to appear before him on 14-7-78 for enquiry to find out whether any of them are agricultural labourers, small farmers or village artisans. Out of the 45 debtors, 21 attracted the provisions of the Act and as such 21 promissory notes pertaining to those debtors were sent to the concerned Tribunals for enquiry and necessary action. The remaining 24 promissory notes were returned to the petitioner on 15-7-78 through the office attender as they were not required. But the petitioner refused to receive them stating that he wanted all the 45 promissory notes should be returned to him. The allegation of the petitioner that he had approached the Sub-Collector on 24-6-78 and requested him to return the promissory notes and he informed the petitioner that the promissory notes would be returned to the debtors is denied by the Sub-Collector. Thereafter, the petitioner has filed this writ petition for return of all the promissory notes, seized from him.

On behalf of the petitioner, it is submitted by Shri R. V. Subba Rao that the Sub-Collector, the Appellate Tribunal, has no power under the Act to search and seize the promissory notes. It is also submitted that he cannot issue a warrant to the Circle Inspector under the Code of Criminal Procedure to search the house of the petitioner and seize the promissory notes. There-fore, it is contended that the seizure of the promissory notes is illegal and consequently they should be returned to the petitioner.

I find merit in this contention. I will now refer to the relevant provisions of the Act. The Tribunal is defined by section 3 (w) of the Act as meaning a ''Tribunal'' constituted under sub-section (1) of section 8, Section 8(1) provides that the Government can constitute Tribunals and each Tribunal shall consist of a single member who shall be a Tahsildar. The Appellate Tribunal is defined by section 3 (e) of the Act as meaning the ''Appellate Tribunal'' constituted under sub-section (2) of section 8. Sub-Section (2) of section 8 provides that the Government may constitute Appellate Tribunals and each Appellate Tribunal shall consist of a single member who shall be an officer not below the rank of a Collector. It is conceded that Collector included Sub-Collector. In this case, it is not disputed by the Government Pleader that the Sub-Collector is not a Tribunal within the meaning of section 8(1) but is only an Appellate Tribunal within the meaning of section 8(2). Section 4(1) provides that notwithstanding anything in the Acts mentioned in that section, every debt including interest, if any, owing to any creditor by any agricultural labourer, a rural artisan or a small farmer shall be deemed to be wholly discharged. Under sub-section (3) of section 4, every movable property pledged by a debtor whose debt is deemed to be discharged under sub-section (1), shall stand released in favour of such debtor and the creditor shall be bound to deliver the same to the debtor forthwith. Section 5 provides that every creditor shall, within such period as may be prescribed furnish to the Tribunal a statement containing the names of all persons who have pledged movable property with him. the nature and description of such property, the amount advanced and due as on the commencement of this Act, the rate of interest and such other particulars as may be prescribed. A debtor also can make an application to the Tribunal for an order for the delivery of the movable property pledged by him. Where the creditor has furnished a statement, the Tribunal has to determine which of the persons who have pledged movable property with him are entitled to relief u/s 4 Where the application is made by the debtor, the Tribunal has to decide whether the debtor is entitled to relief u/s 4. Before doing so, the Tribunal has to make an enquiry in the manner prescribed by the rules. After coming to a decision, it can direct the creditor to produce on or before the dates specified in the order the movable property pledged by such person or debtor. If the creditor fails to produce the movable property as directed in the order under subsection (3), the Tribunal may enter any premises of the creditor and search and seize the said property. After such production or recovery or deposit of the movable property pledged, the Tribunal shall deliver the said property to the debtor. Sub-section (8) of section 5 provides that notwithstanding anything in the Andhra Pradesh (Telangana Area) Money Lenders Act, 1349 fasli (Act 5 of 1349 fasli), the Andhra Pradesh (Andhra Area) Pawn Brokers Act, 1943 (Act 23 of 1943), or the Andhra Pradesh (Scheduled Areas) Moneylenders Regulation. 1960 (Regulation 1 of 1960) or any other corresponding law for the time being in force, the Tribunal may enter any premises of the creditor and search and seize the movable properties pledged by debtors and arrange for their safe custody and shall proceed to determine which of the movable properties so seized are to be released to the debtor and pass orders accordingly: The provisions of section 100 and 165 of the Code of Criminal Procedure, 1973 (Central Act 2 of 1974).relating to search and seizure shall, so far as may be, apply to searches and seizures under sub-sections (5) and (8). Section 7 provides that any person aggrieved by any order or decision made by the Tribunal u/s 5 or section 6 may appeal to the Appellate Tribunal, section 8 deals with the constitution of Appellate Tribunals. Section 9 says that the Tribunal and the Appellate Tribunal shall have the same powers as are vested in a Civil Court under the Code of Civil procedure, 1908 (Central Act 5 of 1908) for summoning and enforcing the attendance of any person and examining him on oath and for requiring production of any document. The procedure to be followed by Tribunal or Appellate Tribunal in any proceedings before it, shall, subject to the provisions of the Act be in accordance with such rules as may be prescribed. Section 10 provides that the order or decision of the Tribunal or the Appellate Tribunal made under the Act shall be executed by the Civil Court having jurisdiction as if it were a decree or order of that Court. Section 11 provides for penalties for failing to furnish the statement u/s 5 to comply with the order made or direction given under that section or section 6 or otherwise contravening the provisions of either of the said sections. Section 14 says that no Civil Court shall have jurisdiction in respect of any matter which the Tribunal or the Appellate Tribunal is empowered by or under the Act to determine.

Bearing these provisions in mind, I will now discuss the question whether the Appellate Tribunal viz, the Sub-Collector in the case has power to issue a search warrant to the Circle Inspector of Police, Nandyal under the provisions of Criminal Procedure Code to search the premises of the petitioner for recovery of pledged articles and promissory notes. Sub-Section (5) of Section 5 of the Act says that if the creditor fails to produce the movable property as directed in the order under sub-section (3), the Tribunal may enter the premises of the creditor or the transferee of the creditor and search and seize the said property. If we read that section as a whole, it is obvious that the movable property referred to therein is only the movable property pledged with the creditor. Therefore, the creditor fails to produce the movable property pledged [with him as directed in the order under sub-section (3), the Tribunal can search his premises and seize the movable property pledged. But it is only the Tribunal that has been given the power to search and seize the properly. Even that can be done by the Tribunal only after conducting the enquiry in the manner prescribed under sub-section (3). Similarly, under sub-section (8) the Tribunal can enter any premises of the creditor or of the transferee of the creditor and search and seize the movable properties pledged by the debtors and arrange for their safe custody and shall proceed to determine which of the movable properties go seized are to be released to the debtor and pass such orders, accordingly. Evidently, sub-section (8) had a different purpose to serve. While sub-section(5) empowers the Tribunals lo search and seize the property pledged when the creditor fails to produce the movable property as directed in the order under sub-section (3), Sub section (8) empowers the Tribunal to search and seize the movable properties pledged with him in other cases. But that can be done only by the Tribunal but not by the Appellate Tribunal. It was submitted by the learned Government Pleader that the Appellate Tribunal has all the powers of the Tribunal and therefore the Sub-Collector can enter the premises and search and seize the movable properties pledged by the debtors. I have my own doubts about it. No section says so. Even assuming it is so, only the Sub-Collector can search and seize the movable property that is pledged with the creditor. While doing so, he has to follow the procedure prescribed under sections 100 and 165 of the Code of the Criminal Procedure, 1973. But there is no provision in the Act which empowers the Tribunal or the Appellate Tribunal to give a warrant to the Circle Inspector under he provisions of the Criminal Procedure Code to go and search the premises of the creditor. A reading of section 91, 92 and 93 Cr. P. C. shows that the Court can issue a search for the purpose of any enquiry or trial or any other proceeding under the Criminal Procedure Code. Admittedly, the Tribunal and the Appellate Tribunal while holding the enquiry under the Act are not holding an enquiry under the Criminal Procedure Code. In fact, sections 9 and 14 shows that the proceedings before the Tribunals under the Act are civil proceedings. It is only when a criminal case is filed u/s 11, it becomes a criminal proceeding which bad to be tried by Criminal Court but not by the Tribunals. Therefore, on a plain reading of the relevant provisions of the Act, lam of the proinion, that it is only the Tribunal that can search and seize the movable properties pledged under sub-sections (4) and (8) of section 5. Even assuming for a moment that the Appellate Tribunal has all the powers of a Tribunal, even then it is only the Appellate Tribunal that can search and seize the movable properties pledged by the debtors. In no event, either the Tribunal or the Appellate Tribunal can issued a warrant to the Circle Inspector of Police under the provisions of Criminal Procedure Code to search and seize the properties pledged by debtors from the house of the creditor. The position may be different if a criminal case is filed u/s 11 or 12 of the Act. Consequently, I hold that the action of the Sub-Collector, Naddyal in giving a search warrant to the Circle Inspector of Police, Nandyal to go search the premises of the petitioner and seize the movable properties pledged is not valid.

It was also submitted by the learned counsel for the petitioner that the sub-Collector has no jurisdiction to issue a search warrent to search and seize the promissory notes. It is true that the Tribunal can search the premises of a creditor only to recover and seize the movable property pledged by the debtors. That is evident from a plain reading of section 5. But the fact ultimately the Tribunal does not find the goods pledged but finds only promissory notes does not make the search invalid. Only be cannot seize the promissory notes, for it cannot be said that a promissory note is a movable property pledged by the debtor with the creditor. But the Government pleader submitted that if the Tribunal cannot seize the promissory notes, the entire enquiry becomes infructuous. I do not agree. u/s 9, the Tribunal has the powers of a Civil Court for summoning and enforcing the attendance of any person and examining him on oath and for requiring production of any document. Therefore, the creditor refuses to produce the promissory notes and if it becomes necessary, the Tribunal can take appropriate steps under the provisions of the CPC for the production of the promissory notes. A reading of section 5 shows that the Legislature warned lo give relief to the debtors with regard to the movable properties pledged by them.

It was also submitted by the learned Government pleader that since 21 promissory notes had been transmitted to the Tribunal which have juris; diction to enquire into the matters it would not be proper to direct the return of these promissory notes to the petitioner. But this argument was countered by Shri Subba Rao, the learned counsel for the petitioners by stating that in the counter affidavit filed by the Sub-Collector only three harijans by name Datta Ramanna, Setu Bala Venkana and Datla Venkattanna bad filed petitions before him and therefore all the 21 promissory notes could not have been sent to the Tribunals; at the most is submitted that the promissory notes concerned with those three persons alone should have been sent to the Tribunals. It is also contended by Shri Subba Rao that the Sub-Collector has no jurisdiction to send the promissory notes to the Tribunal and also that the Tribunal has no jurisdiction to enquire into promissory note debts. It is unnecessary for me to decide these questions, for the petitions are still pending with the Tribunals, the enquiry is not yet over and the subject matter of this writ petition is different. I hold that the Sub-Collector has no jurisdiction to issue a search warrant to the Circle Inspector of Police, Nandyal to search the house of the petitioner or seize only the promissory notes. If the Tribunals want the production of the promissory notes, they can take appropriate steps for their production under sub-section (1) of section 9 of the Act. I, therefore, direct, the return of the 45 promissory notes which were seized by the Circle Inspector of Police, Nandyal to the petitioner.

Before I close'' I have to state that in paragraph 3 of his affidavit, the petitioner has stated mat the action taken by the Sub-Collector was most vindictive and mala fide. On the material placed before me, I am not prepared to hold mat the Sub-Collector had acted in a vindictive manner or with mala fide motives. He might have misunderstood his powers under the Act, but that is different from saying that he is vindictive or mala fide I have therefore, no hesitation in rejecting this allegation. The promissory notes have been sent by the Sub-Collector to the Government Pleader in the High Court. The Government pleader should see that all the promissory notes are dispatched immediately to the Sub-Collector, Nandyal and the Sub-Collector, Nandyal should see that the promissory notes are returned to the petitioner within one week from the date of the receipt of the promissory notes by his office.

In the result, the writ petition is allowed but in the circumstances of the case, I direct each patty to bear his costs.