K V Srinivasa Reddy vs The Joint Registrar Of Co ...
2022 Latest Caselaw 2984 Kant

     IN THE HIGH COURT OF KARNATAKA AT BENGALURU

       DATED THIS THE 22ND DAY OF FEBRUARY, 2022

                         PRESENT

          THE HON'BLE MRS.JUSTICE S.SUJATHA

                           AND

        THE HON'BLE MR. JUSTICE RAVI V. HOSMANI

               W.A.No.1134/2021 (GM - CFA)

BETWEEN :
K.V.SRINIVASA REDDY
S/O K.VENKATARAMANAPPA
AGED ABOUT 55 YEARS
PROPRIETOR
M/s SRI GOKUL ROADWAYS
R/AT NO.A-19, D-DEVARAJ URS TRUCK
TERMINALS, YESHWANTHPURA,
BENGALURU-560022                             ...APPELLANT

           (BY SRI M.R.RAJAGOPAL, SENIOR ADV. FOR
                  SRI N.RAMACHANDRA, ADV.)

AND :
1.      THE JOINT REGISTRAR OF
        COOPERATIVE SOCIETIES
        BENGALURU REGION
        PAMPA MAHAKAVI ROAD
        CHAMRAJPET, BENGALURU-560018

        PRESSENT ADDRESS
        3RD FLOLOR, SAHAKARA SOUDHA
        8TH CROSS, MARGOSA ROAD
        MALLESHWARAM, BENGALURU-560003

2.      THE DEPUTY REGISTRAR OF
        COOPERATIVE SOCIETIES & CHITS
        BENGALURU NORTH ZONE
                            -2-



       (NOW CALLED DRCS-1)
       1ST FLOOR, SAHAKARA SOUDHA
       8TH CROSS, MARGOSA ROAD
       MALLESHWARAM, BENGALURU-560003

3.     THE ASSISTANT REGISTRAR OF
       COOPERATIVE SOCITIES
       BENGALURU NORTH ZONE
       (NOW CALLED ARCS -1)
       1ST FLOOR, SAHAKARA SOUDHA
       8TH CROSS, MARGOSA ROAD
       MALLESHWARAM, BENGALURU-560003

4.     MARGADARSHI CHITS
       (KARANTAKA) PVT. LTD.,
       NO.SS-801 & 802, 8TH FLOOR,
       SOUTH BLOCK, MANIPAL CENTRE
       NO.47, DICKSON ROAD
       BENGALURU-560042
       REP BY ITS FOREMAN

5.     Mr. K.VENKATARAMI REDDY
       S/O K.B.VENKI REDDY
       AGED ABOUT 50 YEARS
       MAHALAKSHMIPURAM
       BENGALURU-560086

6.     D.RAMANATH REDDY
       S/O DORAISWAMY REDDY
       SINCE DECEASED BY HIS LRs.

6(a)   R.VANANJA
       W/O LATE D.RAMANATH REDDY
       AGED ABOUT 63 YEARS

6(b)   BHASKAR
       S/O LATE D.RAMANATH REDDY
       AGED ABOUT 46 YEARS

6(c)   HEMA
       D/O LATE D.RAMANATH REDDY
       AGED ABOUT 43 YEARS
                               -3-



6(d)    UMA
        D/O LATE D.RAMANATH REDDY
        AGED ABOUT 41 YEARS

6(e)    MURALI
        S/O LATE D.RAMANATH REDDY
        AGED ABOUT 39 YEARS

        ALL ARE R/AT NO.1276
        6TH MAIN, A BLOCK
        II STAGE, RAJAJINAGAR
        BENGALURU-560010.

7.      K.B.KEMPEGOWDA
        S/O BETTAIAH
        AGED ABOUT 51 YEARS
        PROPRIETOR
        CHIRAG TRANSPORT
        R/AT D-23, DEVARAJ URS TRUCK
        TERMINAL, YESHWANTHPURA
        BENGALURU-560022                      ...RESPONDENTS

     (BY SRI T.P.SRINIVASA, PRL. GOVT. ADV. FOR R-1 TO R-3.)

THIS W.A. IS FILED UNDER SECTION 4 OF THE KARNATAKA
HIGH COURT ACT, PRAYING TO SET ASIDE THE ORDER DATED
26.08.2021 PASSED BY THE LEARNED SINGLE JUDGE IN
W.P.NO.419/2018 (GM-CFA) HAS NULL AND VOID AND
CONSEQUENTLY ALLOW THE WRIT PETITION BEARING
NO.419/2018 (GM-CFA) FILED BY APPELLANT AND SETTING
ASIDE THE ORDER DATED 20.05.2011 IN DISPUTE BEARING
NO.DRB/CFS/230/2010-11 PASSED BY THE 2ND RESPONDENT
VIDE ANNEXURE-D AND ALSO ORDER DATED 21.10.2016, IN
APPEAL NO.14/2012-13 BY THE R1 VIDE ANENXURE-F IN THE
WRIT BEARING NO.419/2018 (GM-CFA).

     THIS APPEAL COMING ON FOR PRELIMINARY HEARING,
THIS DAY, S. SUJATHA, J., DELIVERED THE FOLLOWING:
                               -4-



                     JUDGMENT

This intra Court appeal is directed against the

order dated 26.8.2021 passed by the learned Single

Judge in W.P.No.419/2018, whereby the writ petition

filed by the appellant herein has been dismissed.

2. Briefly stated the facts are that the

respondent No.4 herein - Chit Fund Company was

running a chit fund business, wherein the appellant

was a successful bidder for the chit amount and

received a sum of Rs.19,90,000/- as a prize money after

deducting the chit amount on 27.8.2009. Having

defaulted in payment of installments, respondent No.4

initiated recovery proceedings under the provisions of

the Chit Fund Act, 1982 ('Act' for short.

3. On the dispute filed by the respondent No.4

under Section 64(1) of the Act for recovery of a sum of

Rs.4,78,470/- along with interest at the rate of 24%

p.a., against the appellant and sureties, the respondent

No.2 - authority passed an award on 20.5.2011. The

appellant being aggrieved by the said award, presented

an appeal before the respondent No.1 assailing the

validity of the said award. The appellate authority has

dismissed the appeal by confirming the award dated

20.5.2011. Being aggrieved by the said order, the writ

petition i.e., W.P.No.419/2018 was filed by the

appellant before this Court, which came to be

dismissed. Hence, this writ appeal.

4. Learned Senior Counsel Sri.M.R.Rajagopal

representing the appellant submitted that the

prescribed procedure for service of summons was not

followed by the respondent No.2 resulting in passing of

an exparte award. Learned Senior Counsel inviting the

attention of the Court to the order sheet of the

proceedings in Dispute No.DRB-I/CFS/230-2010-11

argued that on 29.4.2011 no order was passed placing

the appellant ex parte. On the next date i.e., on

20.5.2011 ex parte award was passed. Referring to Rule

35(2) of the Chit Fund (Karnataka) Rules, 1983 (Rules

for short), learned Senior Counsel submitted that the

different modes of service of summons contemplated

therein was not followed. Service of summons not being

effected in terms of the said Rules, there is infraction of

law. Despite the said shortcomings were brought to the

notice of the appellate authority, the same has been

ignored, blindly upholding the exparte award. The

learned Single Judge has failed to appreciate these

aspects.

5. Nextly it was submitted that the rate of

interest at 24% p.a., awarded by the respondent No.2

and confirmed by the appellate authority and the writ

Court is wholly unsustainable.

6. We have carefully considered the

submissions made by the learned Senior Counsel for

the appellant and perused the material on record.

7. The service of summons effected in terms of

Rule 35(2) of the Rules cannot be faulted with. The

arguments advanced by the learned Senior Counsel

must fail for the reason that the order dated 29.4.2011

makes it very clear that the matter was called, the

disputant was present and the opponent was absent, as

no acknowledgment was received from respondent No.1

documents were placed for having effected service of

summons through paper publication, despite the said

sub-service of notice through paper publication there

was no representation on behalf of the respondents.

Therefore, having considered the same, treating the

respondent/opponent has no interest in the matter, the

case was listed for further hearing on 13.05.2011.

8. On 13.05.2011, a specific observation has

been made by the Assistant Registrar, that the

respondents being continuously absent it has been

decided to consider the matter ex parte after recording

the evidence of the disputant. Thereafter, the matter

was disposed of on 20.05.2011. On further appeal, the

Appellate Authority has examined the grounds urged by

the appellant in extenso while dismissing the appeal.

Similarly, the learned Single Judge has adjudicated

upon the points canvassed insofar as service of

summons not being in conformity with Rule 35(2) and

the rate of interest levied at 24% p.a., and rejected the

same on analysis of the matter.

9. The rate of interest at 24% pa., awarded by

the Tribunal being in terms of the contract, contractual

matters cannot be interfered with, in the writ

jurisdiction. Hence, even on this ground the writ appeal

must fail.

10. It is pertinent to note that the appellant

having admitted the liability has failed to repay the same

fully but only on some untenable technical grounds is

protracting the matter since 12 years as rightly observed

by the learned single judge. Denial of exercising the

discretionary power under Article 226 of the Constitution

of India by the writ court cannot be interfered with, in

the background of the case as narrated above.

11. This Court, having considered the

arguments advanced by the learned Senior Counsel,

finds no grounds to interfere with the well reasoned

order of the learned Single Judge.

Writ appeal is devoid of merits and accordingly

stands dismissed.

Sd/-

JUDGE

Sd/-

JUDGE nd