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Judgment
Antony Dominic, J.—Petitioner is a Primary Co-operative Bank registered under the provisions of the Kerala Co-operative Societies Act. The prayer sought for in this writ petition is to quash Ext.P18 order and further proceedings in complaint No. 203/09, pending before the first respondent.
The facts of the case are that the 4th respondent was a surety to two loans availed of by Smt. Seena Madhavan, her daughter in law and Sri. C.B.Anil Kumar, her son. The loans were for Rs. 10 lkahs and Rs. 5 lakhs respectively and were re-payable with 16.5.% interest. The loans were availed in 1997. Default was committed. Arbitration proceedings were initiated and award was rendered in favour of the bank. Thereafter, recovery proceedings were initiated and the mortgaged property belonging to the petitioner was brought for sale. Auction was conducted on 17.4.2007 and the Bank purchased the property for an amount of Rs. 40.20 lakhs.
Ext.P1 is the letter of the Sale officer to the loanees and the 4th respondent. Sale was confirmed and Ext.P3 is the sale certificate. According to the Bank, subsequently the petitioner and some other similarly situated persons approached the Bank offering to pay the dues and requesting to return the property. Thereupon, on humanitarian considerations, the Bank passed Ext.P5 resolution dated 25.10.2008 resolving to return the properties, subject to the conditions specified and also subject to confirmation by the Joint Registrar. It would appear that, in order to avail the benefit of Ext.P5 resolution, the 4th respondent filed Ext.P4 representation to the Bank requesting to restore the property on payment of the amounts due and other charges that are due to the Bank. However, the Joint Registrar declined to confirm the resolution as per Ext.P6 proceedings and thereupon, the Bank again passed Ext.P7 resolution on terms similar to Ext.P5. Ext.P7 resolution was confirmed by the Joint Registrar as per Ext.P8 proceedings, on condition that the payment of the entire dues is to be made on or before 31.3.2009. On that basis, the sale was also ordered to be set aside. It would appear that in the meantime on 8.1.2009, Ext.R4(a) circular was issued by the Government, introducing a one time settlement scheme, which was implemented by circular dated 27.1.2009. Subsequently, one of the principal debtors made Ext.P9 representation to the Government, requesting for extending the benefit of the one time settlement scheme and to allow him to settle the liability on that basis. That was forwarded to the Joint Registrar who in turn issued Ext.P10 directing the Bank to take steps for settlement of the liability in terms of Ext.R4(a) circular. The Bank now says that as Ext.P10 was capable of being understood as a positive direction requiring it to settle the liability extending the benefit of one time settlement scheme in respect of the petitioner''s dues, invoking the appellate remedy available u/s 86 of the Co-operative Societies Act, they filed an appeal before the first respondent, which has been numbered as Appeal No. 4766-D1/09 and that the said appeal is pending.
It is stated that, in the meanwhile the 4th respondent approached the 3rd respondent, the Upa Lok Ayukta, by filing Ext.P11, Complaint No. 203/09, and relief Nos. 1 and 2 sought therein, are extracted below for reference.
I. To extend the benefit of one time settlement for outstanding 2 loans aforesaid as set out in item 3 (ii) of the P.1 circular and may be directed to release the document, kept as security.
ii. The time for settlement of the loan with benefit under P1 circular may be extended to 31st March, as ordered by 2nd respondent.
Parties filed their pleadings and Ext.P17 is the statement filed by the Joint Registrar which inter alia states that by Ext.P10 Bank was only called upon to decide the claim of the petitioner. However, relying on Ext.P10, by Ext.P18, the Upa loka Ayukta ordered that the Bank should settle the liability of the petitioner accepting a total amount of Rs. 27,01,720/-. The operative portion of the order reads as under.
Complainant will pay an amount of Rs. 27,01,720/- to R1 tomorrow ie. on 27.3.2009. First respondent will receive the amount and hand over the property to complainant tomorrow along with the original documents in the custody of the bank. The question whether the complainant is entitled to further reliefs will be decided later in this complaint. For reporting compliance of the order 30.3.09.
It is challenging Ext.P18 the writ petition has been filed.
Contentions raised by the petitioner are that the Upa Loka Ayukta didi not have jurisdiction to entertain the complaint and that One Time Settlement Scheme was inapplicable to defaulters whose cases have resulted in confirmation of sale. It is also contended that the appeal filed by them against Exgt.P10 is pending, that because of the impugned order the appeal has been rendered infructuous, that the Bank having discharged the full amount that was due to the apex Bank, will incur huge loss, if Ext.P18 is implemented.
On the other hand the Sr. Counsel appearing for the 4th respondent refutes the contentions raised by the petitioner. According to the learned Counsel, the Joint Registrar having set aside the sale, the 4th respondent continued as a defaulter and consequently the 4th respondent was eligible for the benefit of the OTS announced by Ext.R4(a) and implemented by circular dated 27.1.2009. In so far as the plea of lack of jurisdiction is concerned, it was contended that the question of jurisdiction was not raised by the petitioner before the Upa Lok Ayukta and therefore it is not open to the petitioner to raise this plea at this stage for the first time. It was contended that at any rate the petitioner should not be permitted to raise that issue in the discretionary jurisdiction of this Court under Arl.226 of the Constitution of India. Yet another contention raised is that Ext.P10 contained a positive direction to the Bank to extend the benefit of the scheme and so long as this order is not set aside or reversed by a superior authority, the Bank is bound to give effect to the said order. The 4th respondent disputed the plea of the learned Counsel for the petitioner that the Bank will suffer huge loss if Ext.P18 is implemented.
Having considered the submissions made by both sides, I do not think necessary for this Court to enter into an adjudication on many of the the controversial issues raised by both sides at least at this stage. A reading of Ext.P18 order shows that reliance has been placed on Ext.P10. Admittedly the appeal filed by the Bank against Ext.P10, before the first respondent, numbered as No. 4766-D1-09, is pending. According to the Bank, the 4th respondent could not be extended the benefit of one time settlement scheme since sale has already been confirmed and since such cases are not covered by Ext.R4(a). On this basis petitioner would contend that the Joint Registrar could not have issued any positive directions. Since the Bank was aggrieved, the Bank has taken recourse to appellate remedy, which according to them, is available u/s 83 of the Act. Once the appellate remedy against Ext.P10 has been availed of and the appeal is pending, in my view, the Upa Lok Ayukta should have waited for the outcome of the appeal before passing an order in the nature of Ext.P18, which has, in effect, rendered the appeal infructuous and that ought not have been allowed to happen. For that reason, Ext.P18 in my view is premature. Similarly, a deeper probe on this issue will necessarily warrant pronouncement on the effect of Ext.P10, which if done, will also render the appeal infructuous. In that view of the matter, I am inclined to set aside Ext.P18 and direct that the proceedings in Complaint No. 203/2009, pending before the Upa Lok Ayukta be deferred and that the matter be reconsidered, once the appellate authority disposes of the appeal filed by the Bank against Ext.P10 order. Accordingly, I dispose of this writ petition with the following directions.
Ext.P18 order rendered by the 3rd respondent will stand set aside. The first respondent before whom appeal No. 4766-D1/09 filed by the petitioner against Ext.P10 order passed by the 2nd respondent is pending, shall dispose of the appeal within 2 months of production of a copy of the judgment with notice to the Bank and the 4th respondent. Thereafter, the 3rd respondent shall consider Ext.P11 complaint filed by the petitioner (numbered as complaint No. 203/09) and pass fresh orders with notice to the parities and adverting to the contentions raised.
It is clarified that all other contentions raised by both parties are left open.
It is noticed that in pursuance to the order dated 27.3.2009, the 4th respondent has deposited the amount ordered in Ext.P18 with the petitioner Bank. If so advised the 4th respondent may seek release of the said amount and if not, the amount deposited will be retained by the bank in suspense account and depending upon the outcome of the proceedings before the Upa Lok Ayukta, the same can be appropriated or released
Writ Petition is disposed of as above.